DTH & Anor v DTF & Ors

Facts

DTH and DTI were founders and shareholders in a joint venture company, the third respondent, with DTF and DTG. After the relationship broke down, they brought a Singapore-seated arbitration under the SIAC Rules (6th edition) for breach of the shareholder and investment agreements and for minority oppression. In a partial award, the tribunal found breaches and oppression, and the majority ordered DTF to buy out the applicants' shares for US$14,736,000. An application to set aside that partial award had been dismissed in DPT v DPV [2025] SGHC(I) 29, and an appeal was pending.

The applicants had funded the arbitration under a litigation funding agreement and claimed third-party funding costs of US$14,608,695.11 on top of legal costs. In the costs award the tribunal ordered DTF to pay legal costs of US$4,129,633.56, but the majority held that it had no power or authority to award the funding costs and dismissed that claim. One arbitrator dissented. Paying the funder would leave the applicants with almost nothing from the buyout. In SIC/OA 23/2025 they applied to the Singapore International Commercial Court to set aside or remit that part of the costs award.

Issues

1. Whether the majority's decision on funding costs conflicted with the public policy of Singapore under Article 34(2)(b)(ii) of the Model Law
2. Whether the majority failed to follow the agreed arbitral procedure under Article 34(2)(a)(iv) of the Model Law
3. Whether the application should fail anyway because the majority's decision rested on an independent ground

Holding

The court dismissed the application in its entirety, finding that neither ground for setting aside or remitting the costs award was made out. Directions were given for written submissions on costs if the parties could not agree within 21 days.

Reasoning

The court stressed that it was not deciding whether the majority was right that it lacked power to award funding costs; an error of Singapore law does not by itself make an award contrary to public policy. The proposed policy of access to justice for impecunious but deserving arbitrants was too narrow to be public policy and was really social policy. The applicants' grievance was really with how little they recovered net of funding, a risk any litigant runs, and they had sought a buyout of about US$65m. Even accepting access to justice as a head of public policy, refusing funding costs did not shock the conscience. The 2017 amendments to the Civil Law Act legalised third-party funding but did not say funding costs were recoverable, full cost recovery is not required for access to justice, the paying party's interests count too, and the SICC's own rules prohibit recovery of such costs. The court distinguished the Hong Kong case G v N [2023] HKCFI 3366 and AJU v AJT [2011] 4 SLR 739, which concerned the risk of enforcing awards founded on illegal contracts.

On arbitral procedure, Rule 37 of the SIAC Rules authorises the disposition of costs and is substantive, not procedural, so any error in applying it went to the merits. Even if it were procedural, following Lao Holdings NV v Government of the Lao People's Democratic Republic [2023] 1 SLR 55, the court would not revisit a construction that was open on the text, and the majority's reading had been fully debated.

Finally, the court saw force in the respondents' point that the majority had independently found the funding agreement fell outside s 5B of the Civil Law Act and so was caught by the rules against maintenance and champerty. That alone would have defeated the claim, so the applicants suffered no prejudice.

From the judgment