Sino Dragon Trading Ltd v Noble Resources International Pte Ltd (No 2) [2015] FCA 1046

Sino Dragon Trading Ltd v Noble Resources International Pte Ltd (No 2) [2015] FCA 1046

Indemnity costs were refused because the Court rejected any special rule requiring indemnity costs for arbitration-related breaches, rejected any applicable policy analogy with resistance to enforcement of arbitral awards, and found that the usual principles did not justify indemnity costs. The decisive point on the substantive application was raised late, the failure of the application was not easily identifiable without hindsight, no warning correspondence threatened indemnity costs, both parties acted with expedition and co-operation, and it was unnecessary to determine discretionary criticisms of Sino Dragon's bias challenge.

Jurisdiction
Australia
Judgment Date
23 September 2015
Procedural Posture
Application for Indemnity Costs in an Arbitration Related Proceeding / Heard on the Papers After Dismissal of the Substantive Application
Outcome
Application for indemnity costs dismissed; ordinary costs ordered in favour of the First Respondent.
Legal Topics
['indemnity Costs' 'arbitration Agreement' 'challenge to Arbitrators' 'uncitral Model Law' 'federal Court Costs Discretion']
['arbitration' 'civil Procedure' 'costs'] ['indemnity Costs' 'arbitration Agreement' 'challenge to Arbitrators' 'uncitral Model Law' 'federal Court Costs Discretion']

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Procedural Posture

Application for Indemnity Costs in an Arbitration Related Proceeding / Heard on the Papers After Dismissal of the Substantive Application

Legal Issues

  1. 1 ['Whether a rule should be applied requiring indemnity costs to be ordered, save in exceptional circumstances, where an unsuccessful application is brought in breach of an arbitration clause.' 'Whether there is any policy which would require the award of indemnity costs by analogy with cases which have unsuccessfully attempted to resist enforcement of an award.' 'Whether the Court should, in its general discretion, award indemnity costs.']

Ratio Decidendi

Indemnity costs were refused because the Court rejected any special rule requiring indemnity costs for arbitration-related breaches, rejected any applicable policy analogy with resistance to enforcement of arbitral awards, and found that the usual principles did not justify indemnity costs. The decisive point on the substantive application was raised late, the failure of the application was not easily identifiable without hindsight, no warning correspondence threatened indemnity costs, both parties acted with expedition and co-operation, and it was unnecessary to determine discretionary criticisms of Sino Dragon's bias challenge.

Court Disposition

Application for indemnity costs dismissed; ordinary costs ordered in favour of the First Respondent.

Orders

  • ["The Applicant pay the First Respondent's costs of the application to be taxed if not agreed."]