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2020 MarsdenLR 1413

HIGH COURT MALAYA KUALA LUMPUR
TOKIO MARINE INSURANS (M) BERHAD – Appellant
Versus
HI-POLY INDUSTRIES SDN BHD – Respondent
[Originating Summons No: WA-24NCC(ARB)-39-09/2019]



Petitioner Advocates:T Sudhar,Dawn Wong ,Respondent Advocate: Robert Low,Ahmad Sharizat,Tan Chong Li,Elaine Koh

The court ruled that the plaintiff could not invoke the repealed section 42 of the Arbitration Act for an interim award, affirming that such applications only pertain to acknowledged awards.

Headnote:(A) Arbitration Act 2005 – Sections 37(1)(a)(v), 37(1)(b)(ii), and repealed section 42 – Plaintiff sought to invoke s 42, repealed by Act 2018, regarding the interim award on liability – Court ruled that s 42 was not applicable post-repeal, hence the application was dismissed. (Paras 22, 70, 92)

(B)

Legal principle – Ruling was procedural in nature and did not constitute an award under the AA; cannot invoke provisions regarding setting aside based on non-award. (Paras 81, 85)

(C)

Repeal of statutory provisions – The repeal of s 42 of the AA had no retrospective effect; thus, the right to invoke it was not preserved for awards made post-repeal. (Paras 43, 54)

Facts of the case:

The Plaintiff sought to appeal an interim ruling made during arbitration related to an insurance claim after the relevant section had been repealed.

Findings of Court:

The court clarified that the repealed section was not available for use and affirmed the procedural nature of the ruling made during arbitration.

Issues

: Whether s 42 could still be invoked post-repeal and whether the ruling constituted an enforceable award.

Ratio Decidendi:

The court held that the right of appeal under s 42 vested at the action's initiation, not the ruling's issuance; the ruling was not an award under the AA.

Result:

Plaintiff's application dismissed with costs.

JUDGMENT

Darryl Goon Siew Chye J:

[1] This case concerned an application that had invoked the repealed s 42 of the Arbitration Act 2005 (" AA ") to refer several questions of law to the Court and to set aside a ruling made by an arbitrator pursuant to ss 37(1)(a)(v) and 37(1)(b)(ii) of the .

Background To The Application

[2] The parties were locked in an arbitration.

[3] The Defendant had taken out an insurance policy with the Plaintiff in respect of what was a variety of equipment.

[4] According to the Defendant, during the cover of the insurance policy, there was heavy rainfall on 17th July 2005. This resulted in a flood which in turn damaged the insured properties of the Defendant.

[5] However, a dispute arose between the parties and, in accordance with the insurance policy taken out, the Defendant referred the dispute for the decision of an arbitrator.

[6] The Notice of Arbitration was issued on 1st June 2006. By then the AA had come into force. It came into force on 15th March 2006 and in accordance with s 23 thereof, the arbitration would be regarded as having commenced on 1st June 2006. There was no evidence that the parties had agreed otherwise or any contention to the contrary. Presumably, the notice of arbitration was also received by the Plaintiff on 1st June 2006.

[7] The Defendant's claim in the ensuring arbitration was to be indemnified by the Plaintiff for the loss and damage caused to its insured properties by the flood.

[8] On 1st November 2011, the learned Arbitrator delivered an Interim Award on Liability, with a finding in favour of the Defendant. Being only and interim award on the issue of liability, the loss and damage suffered by the Defendant was to be assessed. Costs was also awarded to the Defendant, but the amount was not determined and therefore it also had to be taxed or settled.

[9] Following upon the foregoing, the Defendant applied to the learned Arbitrator to convene proceedings for the assessment of the amount of loss and damage it had suffered and a determination of the amount of the costs that the Plaintiff had to bear.

[10] Communications between the parties then ensued and went on for what was a rather inordinate period of time, even though during this period there were indications of some possibility that the issue of the costs payable might be resolved between the parties.

[11] On 23rd October 2017, the Defendant's solicitors wrote to the learned Arbitrator in an application pursuant to s 44(1)(a)(ii) of the AA , 'to tax or settle the amount of such costs and expenses under the said Interim Award."

[12] On 16th January 2019, the Plaintiff's solicitors wrote to the learned Arbitrator with specific reference to the Defendant's 'applications to (i) tax or settle costs and expenses; and (ii) convene proceedings for assessment of damages'.

[13] In this letter the Plaintiff set out the background stating that more than six years had lapsed since the Interim Award and consequently, it maintained that the Defendant, '...is now time-barred from registering the Interim Award as a judgment of the High Court pursuant to s 38 of the Arbitration Act 2005 .'

[14] Following from this contention, the Plaintiff then raised a preliminary issue for the learned Arbitrator to determine, '... whether it would accordingly be futile for the Tribunal to accede to the Claimant's aforesaid applications arising from the Interim Award which has been rendered unregistrable and unenforceable.'

[15] After setting out its contentions, the Plaintiff ended with the following paragraphs:

'9. In light of the fact that the Interim Award has become unregistrable and unenforceable, the Respondent respectfully submits that any proceedings in connection with the Interim Award, including proceeding relating to the taxation or settlement of costs and expenses as well as any assessment of damages proceedings, will essentially be an exercise in futility.

10. Therefore, the Respondent respectfully contends that the preliminary issue ought


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