The appellant entered into a licensing agreement with Alstom Technology Ltd (the respondent). This agreement, among other things, provided for arbitration in the event of a dispute between the parties. The arbitration clause stated:

An arbitration was duly commenced when a dispute arose between the parties. The proceedings were initially commenced at the International Chamber of Commerce (ICC) by the respondent. However, the appellant objected to the commencement of the arbitration at the ICC on the basis that the arbitration clause provided that the dispute be resolved by arbitration before the Singapore International Arbitration Centre (SIAC) not the ICC.

At that stage, the appellant suggested that the SIAC could administer the arbitration under the rules of the ICC (ICC Rules). The respondent therefore enquired with the SIAC whether it would be able to administer such an arbitration. The SIAC replied in the affirmative: it agreed to administer the arbitration pursuant to the ICC Rules, and confirmed that it had departments/officers that could fill roles equivalent to those provided by the ICC and stipulated in the ICC Rules. The ICC proceedings were therefore withdrawn and proceedings were recommenced under the administration of the SIAC, which proceeded to appoint arbitrators to constitute an arbitration tribunal.

After the arbitration tribunal was constituted, the appellant challenged the validity of the arbitration clause, contending that it was void for uncertainty. It also challenged the tribunal's jurisdiction to hear the dispute on the basis that the ICC Rules required the tribunal to be constituted by the ICC and not the SIAC.

These preliminary challenges were considered by the tribunal and rejected. The appellant then appealed to the Singapore High Court and raised the same issues. The High Court too dismissed the appeal. The appellant then commenced a further appeal to the Court of Appeal where the same issues were raised.

The arbitration clause was held to be valid. It was construed as providing for an arbitration to be administered by the SIAC applying the ICC Rules. The approach adopted by the court in considering the arbitration clause is instructive as it clearly upholds party autonomy and their freedom to contract. The court also agreed with the High Court that there was nothing to prevent parties from agreeing that one institution should conduct the arbitration in accordance with another institution's rules.

The court made the following useful observations in its judgment on the approach to be taken in relation to such arbitration clauses:

The court held that the arbitration clause was not void for uncertainty. While the ICC rules are drafted to provide for certain specific officers/departments in the ICC to carry out certain specific functions, the court noted that the roles carried out by these officers/departments could, within the context of the arbitration, be carried out by equivalent officers/departments in the SIAC. Furthermore, this had in fact been confirmed by the SIAC to the parties prior to commencement of proceedings. As noted by the High Court, the arbitration clause would only be unworkable if such equivalent officers/departments had not been available. This, however, was not the case here.

This decision reaffirms the pro-arbitration approach of the Singapore courts and provides assurance that they will, in construing arbitration agreements, seek to uphold the intention of the parties to arbitrate. The case does, however, highlight the need to be cautious when agreeing to such a "hybrid" arbitration clause.

In this case, the appellant's apparent lack of good faith in objecting to an interpretation of the clause which it had, prior to that, adopted; and the fact that the SIAC had been willing to administer the arbitration under the ICC rules with its own departments/officers acting in roles equivalent to those stipulated in the ICC rules, possibly militated against the court finding the clause void for uncertainty. Further, both the Court of Appeal and the High Court had made clear their view that the clause would have been unworkable if the SIAC had been unable to provide similarly equipped substitute bodies.