SETIA AWAN MANAGEMENT SDN BHD v SPNB ASPIRASI SDN BHD
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Case Significance
SETIA AWAN MANAGEMENT SDN BHD v SPNB ASPIRASI SDN BHD is a Court of Appeal (Mahkamah Rayuan) decision dated February 27, 2025 (citation: a-02imc-1587-09-2024). <p>This appeal concerned whether an arbitration clause giving parties an option to either litigate or arbitrate constitutes a binding arbitration agreement under section 10 of the Arbitration Act 2005. The Court of Appeal reversed the High Court's dismissal of the stay application, holding that the word 'may' in the clause creates an enforceable right to elect arbitration once a party chooses to do so, and that the absence of express provisions on seat, number of arbitrators, or appointment proc The panel comprised Ahmad Fairuz bin Zainol Abidin, Choo Kah Sing and Lee Swee Seng, with Lee Swee Seng delivering the judgment.
Key issues: Arbitration - Agreement - Option clause - Whether clause offering choice between litigation and arbitration constitutes a binding arbitration agreement under s.10 Arbitration Act 2005..
Summary
This appeal concerned whether an arbitration clause giving parties an option to either litigate or arbitrate constitutes a binding arbitration agreement under section 10 of the Arbitration Act 2005. The Court of Appeal reversed the High Court's dismissal of the stay application, holding that the word 'may' in the clause creates an enforceable right to elect arbitration once a party chooses to do so, and that the absence of express provisions on seat, number of arbitrators, or appointment process does not render the agreement void. The stay of court proceedings was granted in favour of arbitration.
What was the outcome of SETIA AWAN MANAGEMENT SDN BHD v SPNB ASPIRASI SDN BHD?
<p>This appeal concerned whether an arbitration clause giving parties an option to either litigate or arbitrate constitutes a binding arbitration agre...