When the parties settle their disputes through arbitration, it is customary to ask the arbitrator to terminate the proceedings and to make an affirmative award that embodies the settlement. In Dawes v. Treasure and Son Ltd  EWHC 3218 (TCC), the parties did not seek consent or closure of the proceedings and disputes arose regarding the scope of the settlement. Was the arbitrator responsible for resolving these disputes? In particular, the Court of Appeal had to decide whether or not to stay the legal proceedings for reasons of “case management” – a reason first recognised and developed in Singapore by Tomolugen Holdings Ltd and the authority against Silica Investors Ltd and/or appeals  1 SLR 373 (the “Tomolugen”). Essentially, a “stay of case management” has been developed in accordance with case law, while a “mandatory stay” is based on the law set out in subsection 6(1) of the International Arbitration Act. A “mandatory stay” is granted when arbitration is the appropriate forum to resolve the parties` dispute and not the tribunal (i.e., when the same issue raised in court proceedings is actually being arbitrated). On the other hand, a “stay of business” is applicable to the situation in which the issue to be resolved in the arbitration differs from the issue raised in the court proceedings. If the court considers that the decision on the arbitration would replace or affect the issues existing in the judicial proceedings, it may grant a stay of proceedings, although there is no overlap between the arbitration and the judicial proceedings. It is common for a contractual clause to provide for negotiation and/or mediation prior to arbitration. These clauses are the most cost-effective way to resolve a dispute, as they often lead to early resolution. However, if such clauses are not carefully worded, they can also have negative side effects, as they can be a vector of delays and can lead to necessary but empty negotiations where one or all of the parties do not intend to move towards an agreement. According to JAMS` experience, these disadvantages can be significantly minimized by setting strict deadlines that mark the early end of negotiation and mediation periods.
A “predominant party” clause such as the following tends to deter frivolous claims, counterclaims and defenses, as well as the discovery of scorched earth in arbitration: the decision in PUBG has implications that the parties must weigh carefully. Indeed, if two parties are involved in legal proceedings in Singapore but subsequently enter into a settlement agreement in the middle of the legal proceedings, one party may invoke the arbitration clause contained in the settlement agreement and request the suspension of the initial legal proceedings for reasons of handling the case. The same principle of contractual interpretation applies in the case of an arbitration agreement. The Court would implement a reasonable person who possesses all the knowledge that the parties were reasonably at the time of the contract, not only taking into account the individual words used, but the agreement as a whole. Moreover, in interpreting the arbitration agreement, the Court proceeded to the assumption that the parties, as rational businessmen, probably intended that any dispute arising out of the relationship into which they entered or their claims to enter would be decided by the same tribunal, unless it was clear from the wording that certain issues should be excluded from the jurisdiction of the tribunal. In the Court`s view, the language of the arbitration agreement (i.e. “any dispute, difference or claim arising out of or in connection with this Agreement”) was broad enough to cover all disputes, except for one that has nothing to do with the transaction covered by the Orders. “It is assumed that business people, in particular, have entered into agreements to achieve a rational business objective, and an understanding of that purpose will affect how their language is interpreted.” Males J. agreed with the arbitrators that it was clear that the parties intended the arbitration clause of the charterparty to continue to apply if the agreed amount was not paid.
In some cases, the parties may wish to include in their dispute settlement clauses language that is not as comprehensive as that proposed in Rules 16.1 and 16.2, but that facilitates the efficient conduct of arbitration proceedings under the Agreement. Examples of such efficiency improvement clauses are given below. JAMS has separate model clauses that require the submission of domestic and international disputes to arbitration. While these clauses do not provide details of the procedures to be followed in such arbitration, they do provide a simple way to ensure that future disputes are resolved. An additional advantage is that it is sometimes easier for the parties to agree on simple and straightforward clauses than on some of the more complex provisions set out in the following sections of this guide. The default JAMS clauses are listed below. The appellant first filed a lawsuit against the five respondents for copyright infringement. Subsequently, the legal proceedings were stayed on the basis of the appellant`s proposal for a settlement agreement. After delaying the execution of the settlement agreement for a considerable period of time, the respondents finally agreed to the terms of the settlement. However, the applicant protested that it could no longer accept the settlement agreement, arguing that the settlement agreement was no longer valid. The Settlement Agreement contained an arbitration clause that provided that “any dispute, controversy, claim or difference of any kind” arising out of the Settlement Agreement may be resolved by arbitration (the “Arbitration Clause”). The respondents commenced arbitration proceedings against the Appellant (the “Arbitration”) and alleged that the Appellant breached the terms of the Settlement Agreement by alleging that the Settlement Agreement was invalid.
The defendants also requested a stay of proceedings for reasons of handling the case until arbitration was decided. A full copy of Rules 16.1 and 16.2 can be found at: www.jamsadr.com/rules-comprehensive-arbitration/.If parties wish to make full use of Rules 16.1 and 16.2, they can do so by including the following wording in the dispute settlement clause of their contract: One area where the “one-stop-shop presumption” has been applied is when an agreement is reached for the purpose of dispute resolution, which arose as a result of a previous agreement between the same parties […].