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Tread lightly to avoid step in the proceeding


L Capital Jones Ltd and another v Maniach Pte Ltd [2017] FICR 11

Merits strike-out usually a step.

The Singapore Court of Appeal has held that an application to strike out proceedings on the merits will almost always be a step in the proceedings to preclude the granting of a stay of litigation in favour of arbitration under s6(1) of the International Arbitration Act.

One of two defendants applied to strike out litigation on the merits and sought a stay under the Act in the alternative. It filed affidavits and submissions on the strike-out application but did not proceed at the hearing and instead pressed only the stay application. The trial judge held it was not a step in the proceeding sufficient to disentitle the defendant to a stay under s6(1).

The Court of Appeal disagreed and held that an application to strike out proceedings on the merits would ordinarily be a step in the proceedings sufficient to preclude the applicant from applying for a stay under s 6(1). Speaking for the court, the Chief Justice said a pragmatic approach should be taken to assessing whether a step in the proceedings has been taken, and the court should not place “an undue premium on procedural subtleties rather than on the substance of the issue at hand”.

His Honour said whether a party has taken a step in the proceedings is a fact-sensitive inquiry that should not be approached with undue technicality or formalism; rather, the court must look at the substance of the events that transpired to determine whether the party in question had taken a step in the proceedings.

Read the full head note here: [2017] FICR 11

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