Documents-only arbitrations: Lessons from Singapore

Depending on the circumstances, construction disputes can be decided based on documents alone without oral hearings. Whilst they can enable a quicker and cost-effective outcome, a recent Singapore case shows that documents-only arbitrations can also give rise to due process considerations which need to be carefully navigated.

In Wan Sern Metal Industries Pte Ltd v Hua Tian Engineering Pte Ltd [2025] SGCA 5, the Singapore Court of Appeal set aside part of an arbitration award which granted, what the arbitrator failed to appreciate was, an unpleaded remedy. Among other things, this decision highlights the additional level of scrutiny expected of arbitrators in documents-only procedures where the parties and tribunal have limited opportunities to clarify the exact nature of the parties' positions. The lessons learnt are also relevant to other forms of alternative dispute resolution commonly used in the construction sector.

Facts

Wan Sern Metal Industries Pte Ltd (Wan Sern) engaged Hua Tian Engineering Pte Ltd (Hua Tian) as a manpower subcontractor for installation works relating to the Defu Industrial City project in Singapore. Following disagreements during the works, Wan Sern terminated the subcontract and initiated a SIAC arbitration against Hua Tian. Hua Tian, in turn, claimed the termination was wrongful.

The parties agreed to resolve their dispute on a documents-only basis under the SIAC Expedited Procedure. All submissions were filed within 3 months. The key issue before the Court of Appeal was the manner in which part of Hua Tian's counterclaims was raised and determined:

• In its initial submissions, Hua Tian claimed for the unpaid value of work it had completed as at the date on which the subcontract was terminated. However, in its final submissions, Hua Tian argued that it was entitled to either (a) the value of completed work only (which was its originally pleaded position); or (b) the value of completed work plus its "expectation interest", being the value of incomplete (but expected) work under the subcontract.
• Wan Sern filed its final submissions four days later, in which it responded that Hua Tian was not entitled to claim for incomplete work as these had not been performed. Wan Sern did not specifically object to the claim for incomplete work on the basis that it was an unpleaded issue.
• The arbitrator found that Wan Sern wrongly terminated the subcontract. Noting that Wan Sern did not "object to or address [Hua Tian's] measure of its expectation interest", the arbitrator further awarded Hua Tian the value of all the work it expected to complete when it entered into the agreement, including the value of incomplete work.

Wan Sern applied to set aside the award. This was rejected by the Singapore High Court, but partly succeeded on appeal.

Court of Appeal Decision 

The Court of Appeal found that the arbitrator acted in breach of natural justice by failing to apply her mind to the parties' cases. It was insufficient that the arbitrator considered the contentions on Hua Tian's entitlement to damages for incomplete work. She failed to appreciate that this was an unpleaded counterclaim and incorrectly awarded damages on that basis.

Underpinning the Court's decision was its view that documents-only arbitrations raise procedural considerations that are absent in ordinary arbitrations.

• Due to their truncated nature, documents-only procedures limit opportunities for the tribunal and parties to understand fully the contours of the parties' cases, especially given the lack of an oral hearing which provides a key avenue for clarification. Thus, whilst pleadings are not necessarily determinative of the issues in an arbitration, pleadings in documents-only arbitrations provide a "crucial anchor in ensuring that the tribunal is fully cognisant of the parties' cases".

• In Wan Sern, the arbitrator should have, among others: (a) considered the scope of the parties’ submission to arbitration, including by referring to the agreed list of issues which did not include Hua Tian's "expectation interest" claim; and (b) consulted with the parties to clarify the scope of their positions, or ask whether Hua Tian wished to amend its pleadings to include a claim to recover damages in respect of the unpleaded work.
• Further, the arbitrator's failure to understand Wan Sern's position caused her to ascribe an incorrect position to it. Despite Wan Sern's brief submission that Hua Tian had no basis in law for claiming the value of incomplete work, the arbitrator incorrectly found that Wan Sern did not object to how the counterclaim was valued. Thus, the arbitrator failed to consider the true issue that had been raised, which amounted to a breach of natural justice.

Conclusion

Wan Sern provides important lessons in relation to documents-only arbitrations. Given their truncated nature and limited interaction between the parties and tribunal, the parties' pleadings play an even more important role compared to normal arbitration proceedings. Arbitrators and parties alike should therefore be clear about the precise scope, basis and contours of the parties' respective positions. 

These considerations are also relevant to other forms of alternative dispute resolution, such as statutory construction adjudication, expert determinations and dispute avoidance boards, which are often determined on a summary or documents-only basis. Although these types of proceedings are often said to administer "rough justice", decisions can still be challenged on procedural grounds such as where the decision maker has failed to afford a party a reasonable opportunity to respond on a substantive issue.

Finally, the Wan Sern decision is timely as the new SIAC Rules 2025 come into force (see our summary here), under which the new Streamlined Procedure (Rule 13; Schedule 2) and Expedited Procedure (Rule 14; Schedule 3) are, by default, documents-only procedures. These changes are in line with a number of other institutional rules which also provide for documents-only procedures, including those under the ICC, LCIA, HKIAC, and AIAC. The lessons learned in Wan Sern therefore provide timely guidance for arbitrators and parties involved in such proceedings.