The plaintiffs, a Singapore company, had entered into a written agreement dated July 1, 1978 with the defendants, a Malaysian company, in respect of the marketing, selling and distribution in Malaysia of certain petroleum products to be supplied by the Singapore company. Pursuant to the agreement petroleum products were supplied by the plaintiffs to the defendants from time to time and the claim of the plaintiffs is a liquidated demand for the balances outstanding (together with interest thereon) being the price of the said products sold and delivered to the defendants. The plaintiffs also seek an order restraining the defendants from using the word ELF in their trading name.

With their letter of March 21, 1983 the plaintiffs submitted to the defendants the statement of accounts for the month ended February 28, 1983 in respect of the account between the parties; the balances outstanding as shown in the statement were: (1) Singapore Dollar AccountS$2,427,961.98(2) Malaysian Ringgit AccountM$1,546,933.42

The said covering letter, a copy of which was exhibit PS2 to the affidavit of Philippe Steff affirmed on September 6, 1983, enclosure (2), states: "If we do not hear from you within seven (7) days from the date of this letter, we shall assume that the outstanding figures are in order and correct."

By their letter of March 31, 1983 to the defendants, the plaintiffs purported to terminate the said agreement of July 1, 1978 and reiterated in the letter of termination that the aforesaid amounts on the two accounts were still due and owing. They required the defendants to "kindly let us know how and when do you propose to settle the amounts due to us." The defendants replied to that letter of March 31, 1983 by their letter of May 5, 1983 in which reply they stated that "the two most outstanding issues" between the parties were the current debts of the defendants to the plaintiffs and the prices of petroleum products to be supplied in the future by the plaintiffs to the defendants. This reply is exhibited as exhibit PS4 to Philippe Steff's affidavit. I understood the contents of that letter to amount to proposals to renew and restart relations between the parties which called for the settlement of the aforesaid two issues in respect of which the defendants submitted a proposed new price list in respect of petroleum products to be supplied in the future. The defendants' proposal for settlement of the debts was that they would initiate plans to completely clear the overdue accounts within five years. They proposed that future supply of products would be on a cash basis. To my mind the clear conclusion to be arrived at on the reading of the aforesaid three letters is that the defendants accept that the amounts owing by them to the plaintiffs were as stated by the plaintiffs in their two letters of March 21 and 31 respectively. What they wanted was time to settle the debt.

It would appear that the proposal to settle the outstanding amounts in five years was not acceptable to the plaintiffs in that on September 7, 1983 they caused the writ herein to issue against the defendants.

The application before me enclosure (7) is the application on the part of the defendants for an order that the writ of summons be struck off and for costs on the grounds that (1) because of clause XIII of the agreement the Malaysian Courts have no jurisdiction to entertain the action and (2) because of clause XIV which is an arbitration clause. The clauses are as follows: "XIII.Law of PerformanceThis agreement shall be read and construed in accordance with the Laws of Singapore.XIV.ArbitrationAny claim or controversy arising out of this Contract shall be settled by arbitration. The arbitration shall be held in Singapore and conducted in accordance with the Rules of the International Chamber of Commerce of Singapore. The arbitrator court shall consist of two arbitrators (one to be appointed by each party) and, in the event of the arbitrators differing, by a