Whether time limit under Art 34(3) of Model Law is absolute or extendable in exceptional circumstances? Whether the three-month time limit in Art 34(3) is incorporated into Section 24 IAA by the phrase “[n]otwithstanding Article 34(1)” for award induced by fraud or corruption?
Section 24(a) of the International Arbitration Act (Cap. 143A) (‘IAA’) inter alia provides additional ground of fraud or corruption to set aside the award. It states that ‘[n]otwithstanding Article 34(1) of the Model Law’, the High Court may, in addition to the grounds set out in Article 34(2) of the Model Law, set aside the award of the arbitral tribunal if the making of the award was induced or affected by fraud or corruption.
Article 34(3) of the Model Law states: (3) An application for setting aside may not be made after three months have elapsed from the date on which the party making that application had received the award or, if a request had been made under Article 33, from the date on which that request had been disposed of by the arbitral tribunal.
The question then arises as to whether Section 24(a) of the IAA is a separate regime with no express time limit for setting aside of arbitral awards on grounds of fraud or corruption? Or whether, as a matter of construction of Section 24, the three-month time limit in Art 34(3) provided under Model Law is applicable to applications to set aside arbitral awards based on Section 24 grounds? The interpretation of “[n]otwithstanding Article 34(1) of Model Law” was inter alia in question before the Singapore High Court (SHC) in Bloomberry Resorts and Hotels Inc and another v Global Gaming Philippines LLC and another  SGHC 1 decided on 3 January 2020 (‘Bloomberry Resorts’).
In this case, the award debtors argued that Section 24 of the IAA is a separate regime with no express statutory time limit, and that the only applicable time limit is prescribed by O 69A r 4 of the Rules of Court (Cap 322, R 5, 2014 Rev Ed) (‘ROC’). Furthermore, the procedural timelines set by the ROC are extendable at the discretion of the court. Per contra, the award creditors argued that there is only one regime and Art 34(3) of the Model Law applies to the two grounds in Section 24 of the IAA. Further in the absence of any legislative exclusion or extension, the time limit in Art 34(3) of the Model Law is applicable to applications to set aside arbitral awards on the ground that the award was induced or affected by fraud or corruption.
In Singapore, the words “may not” in Art 34(3) have been held by Courts to be mandatory in meaning by setting an absolute time limit of three months beginning from the date of receipt of the award, after which all recourse against the award is barred. Such an absolute time limit recognises the need for finality and legal certainty. [ABC Co v XYZ Co Ltd  3 SLR(R) 546 at , PT Pukuafu Indah and others v Newmont Indonesia Ltd and another  4 SLR 1157 at  and Astro Nusantara International BV and others v PT Ayunda Prima Mitra and others  1 SLR 636]
Art 34 is meant not only to limit the grounds for setting aside an arbitral award, but it also prescribes that any challenge made on Art 34 grounds must be brought promptly within the period specified [Astro Nusantara (HC) at , BXS v BXT  SGHC(I) 10 at – and BXY and others v BXX and others  SGHC(I) 11 at ]
In Singapore, it is also held in past that Art 34(3) is a written law relating to limitation within the meaning of paragraph 7 of the First Schedule of the Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed) and it is inappropriate to rely on the court’s power derived from procedural rules of court to extend time prescribed in a primary legislation (at  of BXS v BXT quoted in )). Thus, a power to extend time under a Rule cannot overcome a time limitation in primary legislation and the time limitation under Art 34(3) of the Model Law still supersedes the court’s general discretion under ROC. [Roger Giles IJ in BXY v BXX at ,]
However, Hong Kong court in Sun Tian Gang v Hong Kong & China Gas (Jilin)  HKCFI 1611 (‘Sun Tian Gang’) held that the Model Law does not preclude the court from regulating the procedure of applications to set aside awards, and therefore the court has the discretion to grant an extension of time under Art 34(3) (at ).
The SHC in BXS v BXT was alive to the decision of Sun Tian Gang but chose not to follow it. In Bloomberry Resorts as well, the SHC continued to depart from Sun Tian Gang. The Court was unpersuaded by the reasoning in Sun Tian Gang which starts with and draws support from the court’s permissive interpretation of the word “may” in Art 34(2) of the Model Law to give a similar permissive interpretation to the words “may not” in Art 34(3). In SHC’s view, such an interpretation cannot be correct as a different meaning is conveyed by the single word “may” in Art 34(2) as compared to the words “may not” in the context of Art 34(3).
In Bloomberry Resorts, placing reliance on Reyes IJ in BXS v BXT at , SHC noted that the discretion conferred by the word “may” in Article 34(2) merely refers to the court’s discretion not to set aside an award even where one or more of the conditions in Article 34(2)(a) (i) to (iv) or (b)(i) to (ii) have been established. The word “may” in Article 34(2) accordingly cannot have any logical bearing on one’s understanding of the expression “may not” in Article 34(3).
All Art 34(3) says is that [an] application [to set aside] may not be made after the lapse of three months from a specified date. Although the words used are ‘may not’ these must be interpreted as ‘cannot’ as it is clear that the intention is to limit the time during which an award may be challenged. This interpretation is supported by material relating to the discussions amongst the drafters of the Model Law. The court would not be able to entertain any application lodged after the expiry of the three-month period as Art 34 has been drafted as the all-encompassing, and only, basis for challenging an award in court. It does not provide for any extension of the time period and, as the court derives its jurisdiction to hear the application from the article alone, the absence of such a provision means the court has not been conferred with the power to extend time. [Judith Prakash J (as she then was) held in ABC v XYZ (at )]
Hence, starting with the decision of ABC v XYZ and, more recently, the decisions of the Singapore International Commercial Court, the legal position in Singapore is that the time limit in Art 34(3) of the Model Law is strict, favouring the policy of finality of arbitral awards (see BXS v BXT at ) and legal certainty.
However, BXS v BXT did not involve an award whose making was “induced or affected” by fraud. Therefore, the question arises as to whether the usual time limit of three months is extendable where fraud as a ground is raised to set aside an arbitral award?
To answer this issue, the SHC, in Bloomberry Resorts, relied on the Report of the UNCITRAL on the work of its Eighteenth Session (A/40/17, 3–21 June 1985) at paras 299–300 and observed that it is plain that the drafters chose to favour the finality of arbitral awards. Thus, the time limit in Art 34(3) is absolute in that all recourse against arbitral awards outside the three-month period (starting from the time of receipt of the award) are barred.
The Court noticed that albeit the national legislation may modify the time limit in Art 34(3), nevertheless, unlike Malaysia, New Zealand and Ireland (all are Model Law States), Singapore has not expressly allowed for an exception to or extension of the three-month time limit in Art 34(3). Further, there is no provision in the IAA that computes the time limit in Art 34(3) from the date of discovery of the fraud or withheld evidence or discovery of new facts or evidence post-award.
In Bloomberry Resorts case, the SHC followed award creditor’s interpretation of the term “[n]otwithstanding Art 34(1) of Model Law” appearing under Section 24 of IAA to mean that this phrase must be read with the key words expressed in Section 24 of the IAA, “in addition to the grounds set out in Art 34(2)”. This would mean that courts may apply Section 24 of the IAA in spite of the grounds set out in Art 34(2) of the Model Law, and not in spite of the time limitation set out in Art 34(3) of the Model Law. Hence, an application to set aside an arbitral award on a ground set out in Section 24 of the IAA is still subject to the three-month time limitation under Art 34(3). The SHC reasoned its findings as follows:
That the three-month time limit in Art 34(3) is strict, favouring the policy of finality of arbitral awards and legal certainty. The drafters of the Model Law decided that cases of fraud, bribery or corruption should be subject to the strict time limit in Art 34(3) of the Model Law.
That it is left to national laws to decide whether to adopt the time limit set out in Art 34(3) or to provide separate time limits for setting aside of fraudulently obtained arbitral awards and/or for the situation where there is subsequent discovery of new facts or evidence post award.
That cases of fraud, bribery or corruption fall within the ambit of public policy as a ground for setting aside under Art 34(2)(b)(ii) and there is no exception to the three-month time limit for this ground. Thus, there is a non-extendable three-month time limitation if recourse against an arbitral award is brought under Art 34(2)(a)(ii) and Art 34(2)(b)(ii). However, if the applicable time limit for an application to set aside an arbitral award under Section 24 of the IAA is governed by O 69A r 2(4) of the ROC which is extendable subject to the court’s general discretion under O 3 r 4(1) and O 92 r 4 of the ROC to prevent injustice, it will create internal inconsistency within the legislation qua applicable limitation period for setting aside the award under Art 34(2) & Section 24 IAA effectively on the same ground of fraud. The inconsistency as described will result if the opening words “[n]otwithstanding Article 34(1) of the Model Law” in Section 24 of the IAA are construed to have the effect of carving out the time limit in Article 34(3) for Section 24 grounds. Parliament could not have intended for such an incongruous and absurd result whereby parties restricted by the non-extendable three-month time limitation under Art 34(2) of the Model Law would be able to circumvent the time bar requirement by resorting to the grounds set out in Section 24 of the IAA.
That the Parliament must not have intended for special and narrow cases of fraud or corruption under Section 24(a) of IAA not to be subject to the three-month time limit in Art 34(3) of the Model Law especially where the Section 24(b) of the IAA ground for breach of rules of natural justice has such a broad scope and substantially overlaps with the “otherwise unable to present its case” ground in Art 34(2)(a)(ii) of the Model Law.
In view thereof, the SHC held that applications brought under Section 24 of the IAA are subject to the three-month time limit in Art 34(3) of the Model Law, which is an absolute one that favours finality of arbitral awards.