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2011 MarsdenLR 1036
HIGH COURT MALAYA KUALA LUMPUR
FOOD INGREDIENTS LLC – Appellant
Versus
PACIFIC INTER-LINK SDN BHD & ANOTHER APPLICATION – Respondent
[Originating Summons Nos: 24NCC(ARB)-25-2011 and 244NCC(ARB)-37-2010/2011]
A valid arbitration agreement is required for an arbitral tribunal's jurisdiction; absence thereof invalidates awards and leads to dismissal of enforcement applications.
Headnote:(A) Arbitration Act 2005 [Act 646] - Section 38 and Section 39 - Applications for recognition and enforcement of two arbitral awards involving contractual disputes - The court discussed the validity of the arbitration agreement and the jurisdiction of the tribunal, determining the lack of jurisdiction based on the absence of a valid arbitration agreement between the parties - Key focus on section 39 regarding grounds for refusing enforcement, which includes lack of a valid arbitration agreement. (Paras 12, 30, 33, 39)
(B) Jurisdiction - The court established that jurisdiction can be contested at enforcement stage; a failure to invoke jurisdiction objections during arbitration does not bar later challenges in court. (Paras 61, 84)
(C) Enforcement of Arbitral Awards - The enforcement of an award can be refused if the tribunal lacked jurisdiction, with emphasis that both parties must have clearly expressed intent to arbitrate found in a formal written agreement. (Paras 26, 103)
Facts of the case:
The plaintiffs, two companies based in the UK, sought enforcement of arbitration awards against a Malaysian company regarding contracts for oil sales and alleged freight rebates. Dispute centered on whether a valid arbitration agreement existed to authorize arbitration over a freight rebate claim. (Paras 4-6, 10)
Findings of Court:
The court agreed with the defendant's objections that there was no valid arbitration agreement and therefore dismissed the plaintiffs' applications for enforcement of the awards. (Paras 87-101)
Issues: The court considered whether jurisdiction objections could be raised at the enforcement stage, and whether a valid arbitration agreement existed to allow the tribunal to issue binding awards.
Ratio Decidendi: The court ruled that a valid arbitration agreement is requisite for tribunal jurisdiction; absence thereof invalidated the awards and left no enforceable judgment. The plaintiffs did not sufficiently prove the existence of such an agreement. (Paras 30, 102)
Result: Applications for enforcement of the arbitral awards dismissed with costs awarded to the defendant.
| Table of Content |
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| 1. overview of case background and contracts (Para 1 , 2) |
Introduction[1] The two applications before the court are for the recognition and enforcement of two separate arbitral awards dated 12 January 2011 issued by the same tribunal involving the same group of companies and arising from the same factual background - D24NCC(ARB)-25-2011 and D24NCC(ARB)-37-10/2011.
[2] The plaintiffs in both applications are companies incorporated in the United Kingdom. They were the claimants in the arbitrations leading to the two awards. I shall refer to the plaintiff in 24NCC(ARB)-25-2011 as "Food Ingredients LLC and the plaintiff in 24NCC(ARB)-37-10/2011 as "Agrovenus LLP". The defendant is a company registered in Malaysia. It is the same respondent in both arbitral proceedings. The plaintiffs' applications are supported by the affidavits deposed by Eugene Blinov, the lawyer who was the plaintiffs' counsel in the arbitral proceedings and as such claimed to have personal knowledge of the matters concerned. He affirmed the supporting affidavit further on the strength of a Power of Attorney granted by the respective plaintiffs to him and two others from his firm of lawyers known as "Astapov Lawyers International Law Group" on 12 April 2010. The application is opposed by the defendant and the reasons appear in the affidavit-in-reply of Nakul Rastogi, the Commodities Trading Manager of the defendant. The deponents' affidavits in both applications are substantially the same differing only in the obvious particulars.
