MALAYSIA MARINE AND HEAVY ENGINEERING SDN BHD KEBABANGAN PETROLEUM OPERATING COMPANY SDN BHD

MALAYSIA MARINE AND HEAVY ENGINEERING SDN BHD KEBABANGAN PETROLEUM OPERATING COMPANY SDN BHD

The Setting Aside Application was allowed and the Award set aside in full because the tribunal committed serious breaches of natural justice and procedure by failing to consider and make findings on material issues (the detailed quantification of Claim 1 in the face of divergent expert evidence, the burden questions including waiver/acquiescence/estoppel, and mitigation) and by failing to give a reasoned award on Claim 1 as required by the parties' agreed procedure; those omissions materially impacted the outcome and thus rendered the Award in conflict with Malaysian public policy and inconsistent with the agreed arbitral procedure, justifying setting aside and dismissal of the...

Citation
WA-24C(ARB)-52-09/2021 (Mahkamah Tinggi)
Parties
Plaintiff (enforcement); Defendant (setting Aside): Kebabangan Petroleum Operating Company Sdn Bhd; Plaintiff (setting Aside); Defendant (enforcement): Malaysia Marine And Heavy Engineering Sdn Bhd
Court
ARB
Jurisdiction
Malaysia
Judgment Date
30 August 2022
Case Number
WA-24C(ARB)-52-09/2021 (Mahkamah Tinggi)
Procedural Posture
Originating Summons (arbitration Enforcement and Setting Aside) / Judgment Grounds of Judgment (decision on Applications)
Outcome
Setting Aside Application allowed; Award set aside in full. Enforcement Application dismissed.
Legal Topics
Setting Aside Arbitration Award Under S37 AA 2005, Enforcement of Arbitral Award Under S38 AA 2005, Breach of Natural Justice, Duty to Give Reasons/reasoned Award, Quantification of Damages, Mitigation of Loss, Burden of Proof; Waiver; Acquiescence; Estoppel
Source Language
Malay/English
Arbitration Contract Civil Procedure Enforcement of Foreign and Domestic Awards Public Policy and Natural Justice Setting Aside Arbitration Award Under S37 AA 2005 Enforcement of Arbitral Award Under S38 AA 2005 Breach of Natural Justice +4 more

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Parties

Kebabangan Petroleum Operating Company Sdn Bhd

Plaintiff (enforcement); Defendant (setting Aside)

Malaysia Marine And Heavy Engineering Sdn Bhd

Plaintiff (setting Aside); Defendant (enforcement)

Procedural Posture

Originating Summons (arbitration Enforcement and Setting Aside) / Judgment Grounds of Judgment (decision on Applications)

Legal Issues

  1. 1 Whether the arbitral award should be set aside under s37 AA 2005 for breach of natural justice/public policy
  2. 2 Whether the arbitral tribunal failed to give a reasoned award in breach of agreed procedure (Article 34(3) UNCITRAL / s33(3) AA 2005)
  3. 3 Whether the tribunal failed to consider/decide on quantification of Claim 1 and expert evidence

Ratio Decidendi

The Setting Aside Application was allowed and the Award set aside in full because the tribunal committed serious breaches of natural justice and procedure by failing to consider and make findings on material issues (the detailed quantification of Claim 1 in the face of divergent expert evidence, the burden questions including waiver/acquiescence/estoppel, and mitigation) and by failing to give a reasoned award on Claim 1 as required by the parties' agreed procedure; those omissions materially impacted the outcome and thus rendered the Award in conflict with Malaysian public policy and inconsistent with the agreed arbitral procedure, justifying setting aside and dismissal of the...

Court Disposition

Setting Aside Application allowed; Award set aside in full. Enforcement Application dismissed.

Orders

  • Award set aside in full.
  • Setting Aside Application allowed.