CZD v CZE [2023] SGHC 86

In this case, the Court directed that practitioners should take note of O 12 r 2(1) of the Rules of Court 2021 (ROC) on filing of expert evidence for applications relating to arbitration awards involving questions of foreign law.

Background

In September 2017, the claimant, the defendant, and a People’s Republic of China (PRC) company entered into a loan agreement. Subsequently, they entered into another agreement, the “Cooperation Agreement”.

In 2020, the claimant commenced proceedings in the Beijing Arbitration Commission against the defendant pursuant to an arbitration clause in the Loan Agreement. In 2021, the arbitration tribunal issued an award in favour of the claimant.

In 2021, a PRC court issued a Notice of Enforcement Assistance to the China Securities Depository and Clearing Co. Ltd, Shenzhen Branch to freeze the defendant’s bank accounts and his shares in a publicly listed company on the Shenzhen Stock Exchange from June 2021 to June 2024.

The defendant brought several legal challenges against the award in the PRC.

On 1 November 2022, the claimant filed an originating application without notice to enforce the award in Singapore. On 2 November 2022, the Assistant Registrar granted the Enforcement Order. On 14 December 2022, the defendant filed an application to set aside the Enforcement Order.

Expert evidence

The claimant filed two affidavits to contest the defendant’s application to set aside the Enforcement Order. One of the affidavits filed was by an expert lawyer who provided legal opinion on PRC law.

The defendant argued that the claimant’s expert’s opinion raised four new issues on PRC law and said that he should be permitted to file affidavits in reply on those issues “so as to present the Court [with] a full picture of the contents of PRC law”.

The defendant was required to adduce expert evidence on PRC law to make good the grounds that he relied on in application and the affidavit filed in support of that application. While the defendant had included an expert opinion from a PRC lawyer in his affidavit, he did not obtain an opinion from the expert on two of the issues he raised to have the Enforcement Order set aside.

The defendant further argued that the claimant’s expert had “impermissibly jump[e]d the gun” and that no expert evidence could be adduced without the court’s approval pursuant to O 12 r 2(1) ROC.

The Court found that the defendant had to accept the consequences of failing to obtain the expert’s opinion on two of the issues advanced as grounds to have the Enforcement Order set aside. [22] As to the other two grounds advanced by the defendant, the Court ruled that an expert opinion was plainly irrelevant.

In relation to the defendant’s argument that the claimant’s expert had jumped the gun, Chua Lee Ming J noted that the defendant had himself adduced expert evidence in his earlier affidavit without the court’s approval.[23]

The Court stated that practitioners should take note of O 12 r 2(1) ROC which provides that no expert evidence can be advanced without approval of the Court. However, approval was likely to be given in applications relating to arbitration awards involving questions of foreign law, and that in those cases approval may be obtained retrospectively if obtaining approval prior to filing expert evidence is not practicable. [23]

Key takeaways

• In applications brought in respect of arbitration awards, it may be necessary for parties to adduce expert evidence on foreign law.
• In such cases, it is likely that the Court will give approval for the use of expert evidence on the basis that it would contribute materially to the determination of issues in the case.
• While approval should be sought prospectively, in cases where it is not practicable to obtain approval prior to adducing such expert evidence, approval may be granted retrospectively.

 

Read the full decision here.