Singapore – An Insight Into Commercial Litigation.
21 July, 2015
The new Singapore International Commercial Court (SICC) officially opened its doors on 5 January 2015, and will sit as a division of the Singapore High Court. Many are calling the SICC a game changer, and further describing it as a significant milestone in the development of the country’s legal infrastructure. We spoke to the lawyers at Braddell Brothers, about commercial litigation in Singapore, the new SICC and the law of champerty, and this is what he had to say.
Conventus Law: How will the SICC distinguish Singapore from its neighbouring countries in positioning itself as a global dispute resolution centre?
Braddell Brothers: We can do no better than to quote the Honourable Chief Justice Sundaresh Menon at the opening of the legal year in Singapore on 5 January 2015, when the SICC was officially launched. His Honour stated that the aim of the SICC is to “build upon and complement the success of [Singapore's] vibrant arbitration sector and make [Singapore's] judicial institutions and legal profession available to serve the regional and the global community”. The SICC effectively allows Singapore to attract litigation business from its neighbours, and from around the world. It offers an attractive option to litigants from outside Singapore:
a) who do not want to engage in international arbitration, for their own reasons; or
b) who are left with no choice but to proceed in court, given that no arbitration agreement exists between them and their opponents, and their opponents do not / will not agree to proceed to arbitration on an ad-hoc basis; or
c) who are left with no choice but to proceed in court, given that the parties need to resolve not only a dispute between themselves, but also their disputes with third parties (with whom no arbitration agreement exists) at the same time; or
d) who might feel dissatisfied having their case heard in their own local courts (for their own reasons e.g. lack of expediency, lack of confidence in judicial independence etc).
Singapore’s neighbours do not at this time have an equivalent, or anything close to the SICC, in their court structures, and this gives Singapore a head-start in attracting lucrative high-value, complex, cross border commercial cases.
CL: What are some of the advantages of having a case heard by the SICC over the standard court?
BB: There are several key advantages that the SICC may offer a client:
(a) Flexibility in legal representation: Foreign lawyers may represent parties in certain circumstances e.g. ‘offshore cases’ (see question 1.d below) or where the case involves foreign law. Foreign lawyers admitted for ‘offshore cases’ are allowed to conduct the case for the client effectively as if they were Singapore lawyers e.g. they will be able to file documents in the SICC, appear in SICC hearings and make submissions to the SICC on their client’s behalf. In contrast, where foreign lawyers are admitted because the case involves foreign law, they may make submissions to the SICC on behalf of a party, but their submissions must be confined to submissions on the questions of foreign law.
(b) An excellent panel of judges: SICC cases will be heard by a single judge or a panel of three judges, presumably depending on the complexity of the case and the value of the claim. The SICC’s judges include judges from the Singapore judiciary as well as eminent foreign judges and jurists from both common law and civil law jurisdictions. SICC judges are appointed for a term of three years. The current foreign SICC judges are (in alphabetical order):
The Honourable Ms Carolyn Berger (United States of America)
The Honourable Justice Patricia Bergin (Australia)
The Honourable Mr Roger Giles (Australia)
The Honourable Dr Irmgard Griss (Austria)
The Honourable Justice Dominique T. Hascher (France)
The Honourable Mr Dyson Heydon AC QC (Australia)
The Honourable Sir Vivian Ramsey (United Kingdom)
Mr Anselmo Reyes (Hong Kong)
The Right Honourable Sir Bernard Rix (United Kingdom)
Professor Yasuhei Taniguchi (Japan)
Mr Simon Thorley QC (United Kingdom)
(c) Confidentiality: On the application of a party, the SICC may order a case before it to be closed to the public, order the parties not to disclose any information relating to the case, and/or order that the case file be sealed. In making such orders, the SICC will consider whether the parties had a prior agreement on keeping the dispute confidential, as well as whether the case is an ‘offshore case’. ‘Offshore cases’ are more likely to be kept confidential as they do not affect Singapore’s interests.
(d) Freedom from the law of evidence: The SICC is not bound to follow the Singapore law of evidence and may apply other rules of evidence whether they are found in a foreign law or otherwise, if the parties make an application for it. The Rules of Court make it clear that the reference to rules of evidence includes any rule relating to legal professional privilege and the taking of evidence.
(e) Determination of a foreign law issue as a question of law, as opposed to a question of fact: Ordinarily, when confronted with an issue involving foreign law, Singapore courts determine that issue as a question of fact by receiving evidence from foreign law experts. The SICC however, has the option of ruling on a point of foreign law, as a question of law, after hearing submissions from counsel. This avoids the need for foreign law experts to testify. It also allows a potential appeal on the foreign law issue as a question of law, which is more readily re-examined (and hence, possibly overturned) by an appellate court, in contrast with a question of fact.
CL: What are the jurisdictional requirements for a case to be heard before the SICC?
BB: The SICC may hear and try any action that the Singapore High Court may hear and try in its original civil jurisdiction if:
a) the claims between the plaintiffs and the defendants named in the originating process when it was first filed are of an ‘international and commercial’ nature;
b) each plaintiff and defendant named in the originating process when it was first filed has submitted to the Court’s jurisdiction under a written jurisdiction agreement; and
c) the parties do not seek any relief in the form of, or connected with, a prerogative order (including a mandatory order, a prohibiting order, a quashing order or an order for review of detention)
The SICC also has jurisdiction to hear and determine a case transferred to the Court under Order 110, Rule 12 of the Rules of Court
CL: If a dispute has no connection to Singapore, can parties still have their case heard before the SICC?
BB: Yes, they can. The case will be regarded as an ‘offshore case’. An ‘offshore case’ is an action which has no substantial connection to Singapore e.g. where (a) Singapore law is not the law applicable to the dispute and the subject-matter of the dispute is not regulated by or otherwise subject to Singapore law; or (b) the only connections between the dispute and Singapore are the parties’ choice of Singapore law as the law applicable to the dispute and the parties’ submission to the jurisdiction of the SICC.
CL: Do the same discovery and procedural rules apply to cases in the SICC as they do in regular court proceedings?
BB: Special procedural rules apply to SICC cases. These are found in Order 110 of the Rules of Court and the SICC Practice Directions. They are available online at http://www.sicc.gov.sg/LegRulesPD.aspx?id=42. The discovery (disclosure) process applicable to cases commenced in the Singapore High Court will not apply to SICC Cases. Each party in an SICC case must provide to the Court and to all other parties all documents available to it on which it relies, within the time and in the manner ordered by the SICC. If one party wishes further documents to be produced by the other, and the latter objects, it may apply to the SICC for an order to produce those documents, at which time the SICC will consider inter alia whether the documents have sufficient relevance to the case or materiality to the outcome of case. This process is to be contrasted with normal ‘discovery’ where a party is also obliged to produce documents potentially adverse to its own case, and where it does not, may be ordered by the Court to produce such documents; no such obligation exists in SICC procedure.
CL: With this being new, do you anticipate any issues with the enforceability of SICC judgments in relevant foreign jurisdictions?
BB: SICC judgments are effectively judgments of the Singapore High Court which enjoy reciprocal enforcement in various British Commonwealth jurisdictions and in Hong Kong. Outside those jurisdictions, SICC judgments are not readily enforceable. Successful parties still have the option of suing on SICC judgments in the country of enforcement, unless local laws do not permit that practice e.g. Indonesian law which prohibits judgments of foreign courts (such as the SICC) from being enforced in Indonesia.
CL: Contingency fee agreements are lawful in places such as the US, Great Britain and Canada. However, the law of champerty bars such in Singapore. With ever increasing litigation costs, do you see there being any leeway for the allowance of contingency fee agreements any time in the near future?
BB: The rule against contingency fees has been described as one of the Singapore Bar’s ‘sacred cows’. Singapore lawyers have traditionally shunned such fee arrangements which by definition are dependant upon on the outcome of the case. Recent views from various leaders at the Singapore Bar however, have revealed that ‘conditional fee’ agreements may be more palatable – a typical ‘conditional fee’ arrangement comprises a base fixed fee, with a percentage ‘uplift’ on the fixed fee if the claim (or possibly defence) is successful. The fee is not directly linked to the damages recovered. It is possible that such fee arrangements may be legalised in the near future.
CL: What changes can we expect to see in the next 12 months that will have an impact on your commercial litigation practice?
BB: The biggest change will probably be clients’ increasing willingness to have their cases heard in the SICC. The commencement of the SICC in January 2015 has already generated a dramatic increase in interest from clients around the region, in using Singapore as their standard dispute resolution venue. Today, we find ourselves frequently advising clients on the merits of commencing a case in the SICC instead of in their own local courts, or sometimes, in the normal Singapore courts. We have also heard of around 20 cases, which had earlier been commenced in the Singapore High Court, being transferred into the SICC. The SICC ‘pie’ is therefore growing, and presents the latest opportunity for Singapore law practices to expand their horizons, increase their client pool and grow their practices.
Given that the SICC also allows foreign lawyers to appear before it, Singapore law practices will certainly need to answer the challenge of stiff competition from foreign firms in order to keep their market share. The competitive process that Singapore law practices will need to engage in, in order to meet such challenges, will no doubt prove to be beneficial to them in the long run.
For further information, please contact:
Kevin Ho, Partner, Braddell Brothers
Huixan Lye, Partner, Braddell Brothers
Jacqueline Tang, Braddell Brothers