Jurisdiction - Singapore
Singapore – International Arbitration: Oei Hong Leong v Goldman Sachs International [2014] SGHC 128.

30 September, 2014


Legal News & Analysis – Asia Pacific – Singapore – Dispute Resolution


Where there are competing dispute resolution clauses (e.g., arbitration clauses and non-exclusive jurisdiction clauses) set out in more than one potentially applicable agreement, parties would be taken to have intended to apply the dispute resolution clause in the contract out of which the claim arose or that is closer in connection to the claim:
— Oei Hong Leong v Goldman Sachs International [2014] SGHC 128 (Singapore, High Court, 1 July 2014)


The plaintiff in this case had entered into two agreements with the defendant and its affiliates. One agreement contained arbitration clauses, while the other contained a non-exclusive jurisdiction clause in favour of the English courts. When the plaintiff brought a claim in the Singapore courts, to which both agreements were potentially applicable, the defendant applied to stay all further proceedings on the basis that the matter was governed by the arbitration clauses. The issue before the Singapore High Court was therefore which dispute resolution clause(s) to apply.

The Court held in favour of the defendant, finding that the dispute is more closely related to (and ought to be governed by) the agreement with the arbitration clauses, and accordingly the arbitration clauses applied. It therefore stayed the court proceedings in favour of arbitration. This article takes a look at the decision.


The plaintiff had entered into two agreements with the defendant and its affiliates. The first agreement was an International Swap Dealers Association Inc (“ISDA”) Master Agreement governing the operation of any derivative transactions entered into by the parties. Clause 13(b) of the ISDA Master Agreement was a non-exclusive jurisdiction clause in favour of the English courts.


The second agreement was the Goldman Sachs Private Wealth Management Client Agreement Pack (“Account Agreement Pack”), a comprehensive agreement which governed the plaintiff’s banking relationship with Goldman Sachs Asia (“GSA”) and its affiliates, including the defendant. The Account Agreement Pack contained arbitration clauses which referred any disputes arising out of or connected with the Account Agreement Pack to arbitration in England under the Rules of the London Court of International Arbitration.

The plaintiff had a non-discretionary trading account with GSA, and in May 2013 met with two GSA employees regarding investment in currency options involving the Brazilian Real (“BRL”) and the Japanese Yen (“JPY”). The plaintiff thereafter decided to enter into two BRL/JPY option trades. Pursuant to the plaintiff’s instructions, GSA arranged the BRL/JPY trades for the plaintiff, with the defendant as counterparty.

Unfortunately, the BRL/JPY rate fell significantly and the plaintiff subsequently instructed GSA to unwind the BRL/JPY option trades. This was done at a loss. Dissatisfied, the plaintiff first complained to GSA in Hong Kong, but later commenced action in the Singapore courts against the defendant to claim compensation for the losses sustained. He alleged that GSA employees had made certain misrepresentations to him concerning the BRL.

The defendant applied to stay the court proceedings on the basis that the plaintiff’s claims were properly the subject of the arbitration clauses contained in the Account Agreement Pack. The plaintiff resisted the application on the basis that the dispute fell within the non-exclusive jurisdiction clause in the ISDA Master Agreement. At first instance, the plaintiff’s claim was stayed by a registrar. The plaintiff appealed to a High Court judge.


The Singapore High Court agreed with the defendant and found that the plaintiff’s claims were governed by the arbitration clauses in the Account Agreement Pack.

The Court held that where there are competing dispute resolution clauses, the question to be asked is which clause the parties objectively intended to apply. In answering this question, parties would be taken to have intended to apply the dispute resolution clause in the contract out of which the claim arose or that is closer in connection to the claim.

The central task in determining which clause applies is one of ascertaining the parties’ objective intention based on a “careful and commercially-minded construction” of the two contracts. This would require the court to locate the “centre of gravity of the dispute” or search for “the agreements which are at the commercial centre of the transaction”. This exercise goes beyond a contemplation of the literal wording of the dispute resolution clauses. This is because, even if the dispute resolution clauses overlapped, there is a presumption that parties would act commercially and would not intend for similar claims to be subject to inconsistent clauses.

The Court then considered the two agreements in question and noted three salient points which favoured a finding that the arbitration clauses in the Account Agreement Pack ought to be applied:


  • First, the Court noted that the plaintiff’s claims against the defendant hinged upon GSA acting as the agent for the defendant (since the alleged misrepresentations were made by GSA employees), and the plaintiff relied on the Account Agreement Pack provisions to establish such agency.
  • Second, the Court noted that there was a possible defence against the plaintiff’s claims under the provisions of the Account Agreement Pack which made clear that any information made available by GSA and its affiliates to the plaintiff was not to be considered as “investment advice”, and the plaintiff was responsible for any investment decision he made.
  • Third, the Court noted that the plaintiff’s claim did not rely on or refer to any provision in the ISDA Master Agreement other than the non-exclusive jurisdiction clause.

The Court also held that it must consider the pith and substance of the dispute as it appeared from the circumstances in evidence (and not just the particular terms in which the claims had been formulated in court). In this respect, the Court found that the bank-customer relationship between GSA and the plaintiff formed the substance of the dispute, and that relationship was governed by the Account Agreement Pack. The ISDA Master Agreement governed the operation of the derivative transactions, which was not the crux of the plaintiff’s claims.

In light of the above, the Court found that that the dispute was more closely related to, and ought to be governed by, the Account Agreement Pack. Accordingly, the Court found that the arbitration clauses applied and dismissed the appeal.




For further information, please contact:


Alvin Yeo, WongPartnership
[email protected]

Andre Maniam, WongPartnership

[email protected]


WongPartnership Dispute Resolution Practice Profile in Singapore


Homegrown Dispute Resolution Law Firms in Singapore


International (with Local Law Capabilities) Dispute Resolution Law Firms in Singapore

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