Seat of arbitration being overseas not a bar for a jurisdictional
objection
C. Morais, Judge of the Commercial High Court of Colombo, dismissed
on May 6 an action filed by Peter Nell, an agent recruiting players for
the SLPL Cricket Tournament against Somerset Entertainment Ventures
(Singapore) pvt. Ltd, the organizers of SLPL, in view of the submissions
made by Faiszer Musthapha P.C. Peter Nell obtained at the first instance
a Sequestration Order restricting commercial rights of Somerset which
was also set aside.
President’s Counsel Member of Parliament Faiszer Musthapha with
Attorneys at Law Isuru Balapatabendi and Nayantha Wijesundara appeared
for the defendants, Somerset Entertainment whilst President’s Counsel
Ikram Mohammed Attorney at Law Mangala Niyarepola appeared for the
plaintiff, Peter Nell.
Raising a preliminary objection to the plaint according to section 5
of the Arbitration Act of 1995, Musthapha submitted to court that in the
present case the parties have agreed to refer all disputes to
arbitration in Singapore, and hence the High Court of Colombo does not
have any jurisdiction to adjudicate on the disputes arising out of the
agreement between parties when the defendants object.
Musthapha told court that section 16(1) of the Arbitration Act gives
parties to contract the freedom to select the seat of the arbitration
and that it is on this basis that the plaintiff and defendants have
selected Singapore as the place of arbitration. Therefore, once the
place of arbitration has been agreed to by the parties, Sri Lankan
courts have no jurisdiction to look into disputes arising out of the
agreement when an objection is raised under section 5.
Musthapha also submitted that the Sri Lankan Arbitration Act was
based on the New York Convention on Arbitration and the Act was enacted
mainly to allow for enforcement of foreign arbitration awards.
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