THE AUTHOR:
Aaron Tan, Associate at Holman Fenwick Willan (“HFW”)
Justinian Tan, Undergraduate at Singapore Management University (“SMU”)
The decision of the Singapore High Court (the “Court”) in DJK and others v DJN [2024] SGHC 309 (“DJK”) saw the Court reaffirm the principles governing apparent bias in arbitration. The Court restated the established “reasonable suspicion of bias” test, emphasising the high threshold required to show apparent bias. In doing so, DJK provides further guidance to parties on the pitfalls to avoid when seeking to make arguments on apparent bias.
Facts
The arbitration between DJK, DJL, and DJM (the “Claimants”) and DJN (the “Defendant”) was administered by the SIAC (Singapore International Arbitration Centre) before a sole arbitrator (the “Arbitrator”) (the “Arbitration”). In 2022, the Defendant submitted a notice of arbitration seeking repayment of a loan given to DJK with interest. The Claimants’ defence was that the Defendant had agreed to accept shares given as collateral in lieu of cash payment.
On 5 March 2023, the Defendant applied for early dismissal of the Claimants’ defence or for security for claim and cost. The Arbitrator rejected the dismissal but ordered the Claimants to furnish security for claim and cost on 29 May 2023 (the “Security Orders”). However, the Claimants sought to set aside the Security Orders on grounds that it was made in breach of natural justice and/or there had been a violation of due process. This subsequently was rejected by the Arbitrator.
Thereafter, the Claimants requested that the Arbitrator withdraw from the Arbitration, arguing that the Arbitrator’s refusal to set aside the Security Orders raised a real likelihood of partiality in determining the issues in the Arbitration (the “Withdrawal Request”). The Withdrawal Request was declined by the Arbitrator. This prompted the Claimants to file a notice of challenge to the SIAC court on 21 June 2023 (the “Notice of Challenge”) where they sought the Arbitrator’s removal due to doubts about his impartiality and independence. Additionally, the Claimants requested the merits hearing be fixed after the Notice of Challenge was resolved and sought clarification on the Arbitrator’s power to continue with the Arbitration. The Arbitrator rejected the request and clarified that he had the power to continue with the Arbitration.
On 17 August 2023, the hearing was adjourned as the Claimants had refused to participate. Subsequently, the Claimants reiterated their refusal to participate in the Arbitration despite the SIAC Court rejecting the Notice of Challenge before the proceeding. The Claimants indicated that they intended to challenge the Notice of Challenge before the Singapore High Court (the “SGHC”), and would not participate in proceedings until the matter was determined. But no such application was made.
The Claimants did not attend the subsequent hearing on 31 August 2023, but the Arbitrator nonetheless gave the Claimants an opportunity to request oral arguments. However, the Claimants indicated their refusal to participate in the Arbitration any further. On 22 December 2023, the Arbitrator issued the final award in the Defendant’s favour. It was only on 20 March 2024 that the Claimants filed an application to set aside the final award.
Final Award Upheld by the Court
The Claimants’ application to set aside on natural justice grounds rested on the Arbitrator’s apparent bias. Accordingly, the Claimants argued two circumstances to support their apparent bias claim (para 35). Both were rejected by the Court, and apparent bias was ultimately not made out.
The first circumstance raised was the Arbitrator’s conduct in issuing the Security Orders and rejecting the request to set them aside. In doing so, the Claimants argued breaches of the fair hearing rule and excess of jurisdiction (paras 38-39). The Court held that the Claimant’s arguments were not made out (para 69). Even if they were, it would not have led to an inference of apparent bias (para 69). Ultimately, the first circumstance failed to support the Claimants’ apparent bias claim.
The second circumstance raised was the Arbitrator’s alleged prejudgment. In this regard, the Claimants argued that the Arbitrator had prejudged the merits of the Defendant’s claim when the Arbitrator ordered the Claimants to provide security for cost; dismissed the Claimants’ defences as weak; and ordered the production of bank documents that they believed were irrelevant to the Arbitration (para 72). Similarly, prejudgment was not made out (para 88). The Court held that the Arbitrator had taken great care to not prejudge and acted as a reasonable tribunal would in the Arbitration (paras 78, 82 and 87). Additionally, the problems that the Claimants complained of were caused by their refusal to participate in the Arbitration (para 82). Thus, the second circumstance also failed to support the Claimants’ apparent bias claim.
Commentary
DJK is one of the latest cases in Singapore where a party sought to set aside an arbitral award by alleging a breach of natural justice on grounds of apparent bias. The decision is an important and helpful reminder of the Singapore courts’ continued commitment to ensuring consistency in setting aside applications on the grounds of a breach of natural justice. This promotes legal stability and certainty in litigation whilst reinforcing Singapore’s position as an international dispute resolution hub.
As evidenced in DJK, the Court reaffirmed the high threshold for apparent bias and the “reasonable suspicion of bias” test in Singapore as introduced by the Singapore Court of Appeal (the “SGCA”) in BOI v BOJ [2018] SGCA 61 (“BOI”) (para 36). The Court held that establishing a breach of the fair hearing rule and excess of jurisdiction, without more, would not necessarily show apparent bias (para 40). As these arguments are already difficult to establish, the Court’s holding underscores the high threshold for finding apparent bias. Additionally, the Court reemphasised that prejudgment is a form of apparent bias (para 37). This meant a similarly high threshold applies to prejudgment, with the Court holding that prejudgment must be capable of articulation by reference to the evidence presented (para 71).
This high threshold has consistently been highlighted, such as in the recent decision of DLS v DLT and another matter [2025] SGHC 61, in which the SGHC alluded to a similarly high threshold for establishing apparent bias when it held that non-disclosure (even if deliberate in some cases) alone would not lead to an inference of apparent bias. This reaffirms a consistent approach undertaken by the Singapore courts in relation to apparent bias claims.
Accordingly, DJK also offers substantial guidance for parties relying on apparent bias to set aside an arbitral award. First, parties should focus directly on explaining how the circumstances of the case would give rise to a reasonable suspicion or apprehension of bias. The Claimants argued breaches of the fair hearing rule and an excess of jurisdiction, rather than focusing on the circumstances to infer apparent bias. In doing so, the Court appeared to suggest that the Claimants had missed the forest for the trees. This emphasis on circumstances is also seen in the United Kingdom Supreme Court decision of Halliburton Company v Chubb Bermuda Insurance Ltd [2020] UKSC 48. There, the claimant’s argument for apparent bias rests on the presiding arbitrator’s non-disclosure of his appointments in related arbitrations. Despite the presiding arbitrator being in breach of his duty to disclose, the claimant failed to establish apparent bias as the court held that there was no real possibility of bias due to numerous counteracting reasons. Nonetheless, the main takeaway was that the claimant focused its argument on the presiding arbitrator’s conduct and the circumstances. This was something the Claimants failed to do when they argued breaches of the fair hearing rule and excess of jurisdiction, requiring the Court to clarify that they were directed at establishing apparent bias (para 39). Although it may still be useful to establish certain breaches in furtherance of an apparent bias case, parties should not mistakenly place undue focus on it. Instead, parties should prioritise showing how a decision-maker’s conduct would lead to an inference of apparent bias.
Furthermore, parties should exercise caution when making arguments to establish prejudgment. As a form of apparent bias, the threshold for proving prejudgment is high. This is similarly the position in the United Kingdom as seen in the Privy Council decision of Stubbs v The Queen; Davis v The Queen and another case [2018] 3 WLR 1638. Given the high threshold, parties may be tempted to make serious allegations to meet the required standard. However, by pitching their arguments too high, parties may end up making it harder for themselves. In DJK, the Claimants argued that the Arbitrator had interpreted a SIAC rule unreasonably in favour of the Defendant (para 75). But this carried an implicit accusation that the Arbitrator abused his power (para 76). In the Court’s view, this was a serious allegation that required strong evidence to prove (para 77), which the Claimants ultimately failed to do. This suggests that, without caution, an argument may be pitched too high, thereby making an already difficult task even more challenging. Thus, parties should actively exercise caution when making submissions in relation to prejudgment to avoid the risk of pitching their arguments too high.
ABOUT THE AUTHOR
Aaron Tan is an associate at Holman Fenwick Willan (“HFW”) Singapore, specializing in arbitration, general disputes, commodities, and technology law. He has experience in arbitration cases under SIAC, ICC, and LCIA rules, achieving successful outcomes in complex matters, including expedited procedures and disputes in shipping, commodities, and carbon markets. Aaron has also assisted and advised on AI regulation and technology bylaws. Passionate about the intersection of law and technology, he is a frequent speaker at technology and AI-related events, sharing insights on the future of legal technology and its impact on the industry. In addition to his practice, Aaron serves as an Assistant Editor with Daily Jus, Jus Mundi’s thought leadership arbitration blog, focusing on the Asia-Pacific region. He can be reached at [email protected].
Justinian Tan is an undergraduate at Singapore Management University Yong Pung How School of Law. He has a strong interest in dispute resolution and has gained exposure by participating in the FDI Investment Arbitration Moot and undertaking internships with dispute resolution teams such as HFW and Dentons Rodyk. Justinian also has a sustained interest in private international law.
*The views and opinions expressed by authors are theirs and do not necessarily reflect those of their organizations, employers, or Daily Jus, Jus Mundi, or Jus Connect.
