Of Principle, Practicality, and Precedents: The Presumption of The Arbitration Agreement's Governing Law

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Arbitration International, 2020, 00, 1–13
doi: 10.1093/arbint/aiaa043
Case Note
Of principle, practicality, and precedents: the

presumption of the arbitration agreement’s
governing law
Aaron Yoong*
A BS TR A C T
The issue of determining the appropriate law governing an arbitration agreement is
one that has long vexed the courts in many jurisdictions. Most recently, both the
English and Singapore Court of Appeals have waded into the fray, contributing con-
trary opinions in their respective decisions of Enka Insaat Ve Sanayi AS v OOO
“Insurance Company Chubb” and BNA v BNB. This article examines these decisions
and argues that there should be a presumption that the governing law of the arbitration
agreement follows the matrix contract within which it is situated.
1. I NTR OD U C TI ON
1. The law governing an agreement to arbitrate impacts the scope, interpretation,
and very validity of that agreement.1 Naturally, the importance of the choice of such
law cannot be overstated. Notwithstanding this, it is rare in practice that arbitration
agreement(s) (AA(s)) specify an applicable governing law,2 often needing an adjudi-
cating body to determine the matter. Such determination, however, is subjected to a
multiplicity of methods, causing this area of law to be ‘unfortunate[ly] uncertain’,3
* Aaron Yoong, Justices’ Law Clerk, Supreme Court of Singapore, Singapore. The paper is written in the
author’s personal capacity, and the opinions expressed in the paper are entirely the author’s own views.
The author is deeply grateful for the ideas and assistance of Gladys Ng in writing this article. All errors re-
main the author’s own.
1 BNA v BNB [2019] SGCA 84 (hereinafter ‘BNA v BNB’) [55]; Dicey, Morris and Collins on the Conflict of
Laws (Lord Collins of Mapesbury, Gen ed, 15th edn) 16-008; Gary B Born, International Commercial
Arbitration (Kluwer Law International BV, The Netherlands Joseph 2014) (2nd edn) ch 4, Introduction;
David Joseph, Jurisdiction and AAs and Their Enforcement (3rd edn, Sweet & Maxwell 2015) para 6.53.
2 BCY v BCZ [2016] SGHC 249; Gary B Born, ‘The Law Governing International AAs: An International
Perspective’ (2014) 26 SacLJ 814, para 34; Born, ibid 4.04, 19.03; Joseph, ibid, para 6.30; Kabir Singh and
others, ‘Two Roads Diverged in a Clause – The Law of a Free-standing AA vs. the Law of an AA That Sits
Within a Main Contract’ (Kluwer Arbitration Blog) (Two Roads Diverged in a Clause – The Law of a Free-
standing AA vs. the Law of an AA That Sits Within a Main Contract) (2017) (last accessed 9 October
2020).
3 Born, ibid, para 4.01.
C The Author(s) 2020. Published by Oxford University Press on behalf of the London Court of International Arbitration.
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2 Of principle, practicality, and precedents
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KE Y RE FE RE N CES
• BNA v BNB [2019] SGCA 84
• BCY v BCZ [2016] SGHC 249
• Enka Insaat Ve Sanayi AS v OOO “Insurance Company Chubb” [2020]
EWCA Civ 574
• Fiona Trust and Holding Corpn v Privalov [2008] 1 Lloyd’s Rep 254
• Angeliki Charis Compania Maritima SA v Pagnan SPA (The “Angelic
Grace”) [1995] 1 Lloyd’s Rep 87
• BCY v BCZ [2017] 3 SLR 357
• Sulamerica Cia Nacional de Seguros SA v Ensa Engelharia SA and others
[2013] 1 WLR 102
• Firstlink Investments Corp Ltd v GT Payment Pte Ltd and others [2014]
SGHCR 12
• Arsanovia Ltd v Cruz City 1 Mauritius Holdings [2013] 2 All ER (Comm) 1
• Habas Sinai Ve Tibi Gazlar Istihsal Endustrisi AS v VSC Steel Co Ltd
[2014] 1 Lloyd’s Rep 479
• Hamlyn v Talisker [1894] AC 20
• Cie D’Armement v Cie Tunisienne [1971] AC 572
• Shashoua v Sharma [2009] 2 All ER 477
• Kabab-Ji SAL (Lebanon) v Kout Food Group [2020] 1 Lloyd’s Rep 269
• XL Insurance v Owens Corning [2020] 1 Lloyd’s Rep 269
• C v D [2007] 2 All ER (Comm) 557
• C v D [2008] 1 Lloyd’s Rep 239
• Black-Clawson International Ltd v Papierwerke Waldhof-Aschaffenburg AG
[1981] 2 Lloyd’s Rep 446
• Channel Tunnel Group Ltd v Balfour Beatty Construction Ltd [1993] AC 334
• Dyna-Jet Pte Ltd v Wilson Taylor Asia Paciﬁc Pte Ltd [2017] 3 SLR 267
• BMO v BMP [2017] SGHC 127
and more ‘puzzling than [need be]’.4 This unsatisfactory state of affairs, and the addi-
tional costs consequentially generated, is seemingly at odds with the ideals and aspi-
rations of international arbitration, as observed by Gary Born.5
2. It was in direct response to such concerns that the recent English Court
of Appeal (the ECA)’s decision of Enka Insaat Ve Sanayi AS v OOO
“Insurance Company Chubb”6 sought to ‘impose some order and clarity on this
area of law’.7 Specifically, the ECA held that where parties have failed to ex-
pressly dictate the law governing an AA, it is presumed that the law of the
seat ought to apply (the ‘Enka presumption’). This is in sharp contradistinction
to the Singapore Court of Appeal’s (the ‘SGCA’) decision in BNA v BNB and
4 Adrian Briggs, Private International Law in English Courts (OUP 2014), para 14.35.
5 Born (n 1) para 4.01.
6 [2020] EWCA Civ 574 (hereinafter, ‘Enka v Chubb’).
7 ibid [89].
Of principle, practicality, and precedents 3
another that presumes that parties intended the law governing the main con-
tract to apply (the ‘BNA presumption’).8
3. This article examines the efficacy and implications of these diametrically op-
posed positions by first (Section 2) briefly setting out the relevant facts and holdings
of both decisions. It is then argued that the BNA presumption should be the pre-
ferred approach as it is backed by (Section 3) principle and considerations of practi-
cality, and also the (Section 4) precedents cited, before (Section 5) concluding the
discussion.
2. TH E M A I N F A C TS A N D H OL D IN GS
2.1 Enka v Chubb
4. The appellant, Enka Insaat Ve Sanayi AS (‘Enka’), was a Turkish construction and
engineering company with an international presence in Russia. Enka entered into a
subcontract with CJSC Energoproekt to provide works on the Berezovskaya power
plant (the ‘Subcontract’), which CJSC Energoproekt was constructing for PJSC
Unipro (‘Unipro’). Subsequently, CJSC Energoproekt assigned to Unipro all rights
under the Subcontract.
5. Crucially, the Subcontract contained an AA that all disputes were to be ‘finally
settled under the Rules of Arbitration of the International Chamber of Commerce
[ICC]’.9 The place of arbitration was also stated to be London, England.
6. Unfortunately, a fire occurred at the Berezovskaya power plant. Unipro was in-
sured by the respondent, Chubb Russia Investments Limited (‘Chubb Russia’).
Between November 2016 and May 2017, Chubb Russia paid 26.1 billion roubles (ap-
proximately US $400 million) to Unipro in damages caused by the fire. As a result,
Chubb Russia became subrogated to Unipro’s rights under the Subcontract. This
allowed Chubb Russia to commence proceedings against Enka, on 25 May 2019,
with the Moscow Arbitrazh Court. In response, Enka argued that the Russian court
proceedings were brought in breach of the AA in the Subcontract and should have
been stayed. Enka also applied to the English Commercial Court (ECC) for an anti-
suit injunction to restrain Chubb Russia from continuing the Russian court proceed-
ings, on the basis that English law governed the AA.10 In contrast, Chubb Russia ar-
gued that Russian law governed the AA and the injunction should not be granted ‘as
a matter of comity and discretion’.11
7. Interestingly, Andrew Baker J in the ECC embarked on his ‘own initiative’,12
declining to decide the proper law of the AA. Instead, Baker J dismissed Enka’s claim
on the bases of forum non conveniens and that ‘Enka’s delay, failure to pursue arbitra-
tion and participation in Russia [was a] sufficient[ly] strong reason’13 to deny the
8 BNA v BNB (n 1) [47].

9 Enka v Chubb (n 6) [4].
10 This was in accordance with the familiar principles in Fiona Trust and Holding Corpn v Privalov [2008] 1
Lloyd’s Rep 254; Angeliki Charis Compania Maritima SA v Pagnan SPA (The “Angelic Grace”) [1995] 1
Lloyd’s Rep 87.
12 ibid [29].
13 ibid [39], citing the decision of Baker J [113].
grant of the injunction. This decision was overturned on appeal. In doing so, the
ECA found that that English law governed the AA.
8. The ECA began its analysis on the proper law by laying out the following estab-
lished conflict of law rules14:
a. Questions governing the law of AAs are not covered under the Rome I
Regulation.15
b. The law of the AA is to be determined by a three-stage framework, each
separate and applied sequentially as per Sulamerica Cia Nacional de Seguros
SA v Ensa Engelharia SA and others,16 as follows17:
i. First, whether there was an express choice of law;
ii. secondly, whether there was an implied choice of law; and
iii. thirdly, which system of law has the closest and most real connection to
the AA.
9. The ECA embarked on a considerably extensive review of past authority, aris-

ing out of which it derived two principles of law. First, an express choice of the law
of an AA may be found from the express choice in the main contract or on a con-
struction of the contract as a whole.
10. Secondly, at the second stage of the Sulamerica framework, the Enka presump-
tion applied as a strong, general rule that may yield only to ‘powerful countervailing
factors’.18 In the ECA’s view, the Enka presumption was supported by three ‘princi-
pal considerations’,19 namely20: (i) the doctrine of separability; (ii) the overlap be-
tween the scope of the curial law and that of the law of the AA; and (iii) that this
was distinct from the stage of closest and most real connection.
11. Applying the Enka presumption, the law of the AA was held to be English law,
to coincide with the curial law. Further, instead of countervailing factors, the ECA
found the pre-arbitration procedures to be affirmative of English law being the gov-
erning law.21
2.2 BNA v BNB

12. The appellant corporation, BNA, had entered into a contract to buy quantities of
industrial gases (the ‘Takeout Agreement’) from the respondent companies, BNB
and BNC. The Takeout Agreement required BNA to pay the respondents on a
monthly basis for the industrial gases purchased and delivered.22
14 ibid, Enka [71].

15 Regulation (EC) No 593/2008 of the European Parliament and of the Council of 17 June 2008 on the
law applicable to contractual obligations (Rome I).
16 [2013] 1 WLR 102 (hereinafter, ‘Sulamerica’).
17 Although noted to be ‘established’, the law has undergone much to and fro before arriving at this
position.
18 Enka v Chubb (n 6) [106].
19 ibid [91]
20 ibid [92]–[104].
21 ibid [109] and [110]
22 BNA v BNB (n 1) [6]–[11].
13. The Takeout Agreement also contained a critical ‘disputes’ clause that pro-
vided that: (i) the Takeout Agreement was governed by the laws of the People’s
Republic of China (PRC); and (ii) all disputes shall be ‘submitted to the Singapore
International Arbitration Centre for arbitration in Shanghai, which shall be con-
ducted in accordance with its Arbitration Rules’.23
14. When BNA failed to make payments under the Takeout Agreement, the
respondents commenced arbitration. BNA responded by challenging the tribunal’s
jurisdiction before the tribunal itself, the Singapore High Court (‘SGHC’) and the
SGCA. In essence, BNA argued that PRC law governed the AA. As a corollary, the
tribunal did not have jurisdiction as PRC law did not allow foreign arbitral institu-
tions to administer PRC-seated arbitrations or purely domestic disputes.
15. The SGCA held that the express choice of PRC law for the Takeout
Agreement did not amount to an express choice for the first stage of the Sulamerica
framework.24 That choice, however, applied to the second stage by way of the BNA
presumption.25 Further, the phrase ‘arbitration in Shanghai’ indicated Shanghai as
the seat.26 This aligned with the BNA presumption and, with no contrary indicia,27
meant that PRC law governed the AA.28
3. OF P R IN C I P LE A N D P RA C TI C A LI TY
16. From the foregoing section, it would be evident that the Enka and BNA pre-
sumptions were arrived at after much juridical and jurisprudential tussling. Indeed,
this is reflective of the courts’ positions that have ‘vacillated’ constantly,29 to the ex-
tent that a leading commentator has forgone any attempt to reconcile the decisions
in the latest edition of his treatise.30 In this section, it is argued that (Section 3.1)
separability does not in fact offer any support to the Enka position. Instead, the BNA
presumption should be adopted as it maintains (Section 3.2) the substantive-
procedural distinction and is (Section 3.3) practical as a starting point.
3.1 Separability
17. An argument founded on the separability presumption is oft-employed by those
who in support of the law of the seat as the AA’s governing law. Indeed, this ‘point
of departure’31 is also heavily relied upon in Enka v Chubb, as previously men-
tioned.32 At the risk of oversimplifying, the argument runs as such: because an AA is
23 ibid [12].
24 ibid [56]–[61].
25 ibid [62].
26 ibid [64]–[69].
27 ibid [70]–[93].
28 ibid [94] and [95].
29 Steven Lim, ‘Time to Re-evaluate the Common Law Approach to the Proper Law of the AA’ (Kluwer
Arbitration Blog, 2020) (http://arbitrationblog.kluwerarbitration.com/2020/07/05/time-to-re-evaluate-
the-common-law-approach-to-the-proper-law-of-the-arbitration-agreement/) (2020) (last accessed 9
October 2020); see also Enka v Chubb (n 6) [68].
30 Joseph (n 1) para 6.30.
31 Nigel Blackaby and Constantine Partasides QC with Alan Redfern and Martin Hunter, Redfern and
Hunter on International Arbitration (OUP 2015) para 3.15.
32 See paragraph 10 of this article.
autonomous and can stand apart from the matrix contract, it should be taken as a dis-
tinct agreement with a distinct governing law.
18. It is respectfully submitted, however, that this is fundamentally flawed. At its
core, the severability presumption ensures the survival of the parties’ intended
method of dispute resolution (ie the AA) in the event of the demise of the main con-
tract. Resort to the separability presumption need only be had in the narrow instance
of a challenge to the validity of the AA itself.33
19. On the contrary, the ECA in Enka v Chubb opined that this narrow instance
of the application of separability was a ‘powerful indication that [the AA] is to be iso-
lated for the purpose of determining the AA law more generally’.34 That argument,
however, impermissibly stretches the permissive purpose of separability, which merely
gives legal effect to parties’ intention,35 to a prohibitive extent. The fact that the main
contract and the AA possibly may have different laws does not mean that they are or
should necessarily different.36
20. The ECA also rhetorically questioned why the main contract law should influ-
ence the AA law when it has ‘nothing to say’ about the law of the seat.37 The short
answer to this is that in these circumstances, parties have expressly elected the law of
the seat, which must be respected. Further, the ECA’s point disregards the very
quote from Sulamerica that it acknowledged prior, namely that separability does not
‘insulate the [AA] from the substantive contract for all purposes’.38 This point is suc-
cinctly put by Professor Briggs as follows39:
It would be perverse to deduce from the principle of severability a rule that the
law governing the agreement to arbitrate should be identified without refer-
ence to the substantive contract in which the parties included it as a term. The
autonomy of the arbitration agreement is one thing; its hermetic isolation
would be quite another. To put the point yet another way: the agreement to
arbitrate is severable, but that does not mean it is separate. (emphasis added in
underline; original emphasis in italics)
21. To rely on the separability presumption hence does not take one very far.
3.2 The substantive-procedural distinction

22. The BNA presumption is also the preferred solution as it maintains the doctrinal
divide between the curial law and the AA law. The curial law, as determined by
33 BCY v BCZ [2017] 3 SLR 357, [60]; Sulamerica (n 16) [26]; Choosing the Law Governing the Arbitration
Agreement, Glick and Venkatesan in Jurisdiction Admissibility and Choice of Law in International Arbitration
(2018), Kaplan and Moser [9/05]; Lim (n 29).
35 Sulamerica (n 16) [26]; BCY (n 33) [60].
36 Born (n 1) para 4.02.
38 Sulamerica (n 16) [26].
39 Briggs (n 4) para 14.37.
reference to the law of the seat, refers to the system that governs the relationship be-
tween the parties, arbitrators, and supervisory courts. The curial law thus governs
items such as the tribunal’s composition, jurisdiction, the requirements for an AA,
etc. It is, therefore, clear that the curial law is intrinsically geared towards the proce-
dural supervision of the arbitral process. This immediately distinguishes the curial
law from the AA law. Indeed, David Joseph QC helpfully illustrates the point by ref-
erence to the law on bilateral investment treaties40:
. . . the English courts have sensibly and, it is respectfully suggested, correctly

approached the questions of construction of the treaty protection and the
scope of the arbitration agreement under the same governing substantive
law . . . In the same context, questions of the scope of the rights of challenge,
however, have been examined by reference to the procedural law – the law of
the seat.
23. Given the differing purposes that the curial law and AA law are primarily
intended to serve, it would be conceptually unattractive to adopt a presumption that
coalesces the two.
24. In Enka v Chubb, however, the ECA raised the counter-argument that the
scope of the curial law is not just limited to the exercise of purely procedural pow-
ers.41 Illustrating the point using several provisions of the English Arbitration Act
(EEA) 1996, the ECA noted although it is ‘in one sense procedural’, the curial law
has the ability to impact the parties’ substantive rights. The ECA, therefore, reasoned
that the scope of the curial law overlapped with the AA law, which strongly suggested
that they should be the same.
25. There certainly is a commendable force in this argument raised by the ECA.
Two points are, however, made in response. First, specifically in relation to the EEA
1996, the procedural–substantive divide was already recognized by the drafters of the
Act. In the original draft of section 2 of the Act (Scope of Application), an attempt
had been made to clearly bifurcate provisions relating to the AAs from those con-
cerning the arbitral procedure. As set out in the 1997 Supplementary Report on the
Arbitration Act 199642:
This further refinement was necessary in order to avoid the danger that all pro-
visions of Part I of the Act would be imported if English law is found to govern one
particular aspect of an arbitration. For example, an arbitration may have a
French seat, with French law governing the procedure, but English law govern-
ing the arbitration agreement. In such a situation, only those provisions of the
Act which concern arbitration agreements would apply. It would be quite
wrong to apply provisions of the Act which concern arbitral procedure, as this
would be governed by French law. Indeed, if this were not the case, a choice of
40 David Joseph, Jurisdiction and Arbitration Agreements and their Enforcement (2nd edn, Thomson Reuters
2010) para 6.41.
41 Enka v Chubb (n 6) [96]–[98].
42 para 7.
English law to govern an arbitration agreement would entitle a party to invoke the
jurisdiction of the English Court wherever the seat of the arbitration might be,
thereby endowing the English court with unacceptable extra-territorial jurisdiction.
(emphasis added)
26. It was, however, also recognized that certain provisions shaded into both pro-
cedure and substance. In fact, the difficulty of categorizing each provision was one of
the reasons that led to the drafters recasting the whole provision in a simpler manner
that was eventually reflected in the final version.
27. Notwithstanding that, it cannot be gainsaid that the effort to bifurcate proce-
dure from substance was abandoned, for as the DAC specifically noted: ‘[t]he policy
behind the Section, however was not materially altered’ (emphasis added). It is re-
spectfully submitted that the entire thrust of the ECA’s argument in this regard cuts
against the spirit and intent of the drafters of the EEA 1996.
28. Secondly, and perhaps more fundamentally, the function of the curial law is to
‘support, supervis[e], and control’ the arbitration. That function necessarily only
kicks in when the arbitration is already underway.43 It, therefore, is contingent or con-
ditional upon the determination of the existence and validity of the AA—an anterior
and distinct inquiry, undertaken by reference to the governing law. There simply is
no reason to mandate that these separate stages or questions should be determined
by the same law, even if it is only a presumption.
3.3 Practicality
29. Moving beyond the principles, it is respectfully submitted that to legally splice off
the AA from the main contract, as the Enka presumption seeks to do, offends com-
mercial sensibilities from both the perspective of parties’ and the courts.
30. From parties’ perspective, the BNA presumption is preferable as it is
reflective of commercial reality.44 As traditionally argued, businessmen must be
taken to have intended a single system of law to apply to their entire relationship.
This is because such arbitration clauses are often ‘midnight clauses’, finalized, and in-
cluded ‘at the last minute’45 of ‘arbitration package’ discussions.46 It is, therefore,
highly unlikely that, at the doorstep of contractual signing, such businessmen had ap-
plied their minds to the intricacies of dual legal system, much less agreed to it. It is
also highly unlikely that from a commercial standpoint, having applied their minds to
it, such businessmen would, as their primary choice, elect a Janus-faced governing
law.
43 Briggs (n 4) para 14.42; Adrian Briggs, Civil Jurisdiction and Judgments (6th edn, Informa Law from
Routledge 2015) 777.
44 Sulamerica (n 16) [11].
45 BCY (n 33) [62]; Firstlink Investments Corp Ltd v GT Payment Pte Ltd and others [2014] SGHCR 12, [1]
(hereinafter ‘Firstlink’).
46 Maravela, ‘Another Step to Validation in Enka v Chubb Russia?’ (Kluwer Arbitration Blog) (http://arbitra-
tionblog.kluwerarbitration.com/2020/05/05/hold-on-to-your-seats-again-another-step-to-validation-in-
enka-v-chubb-russia/) (2020) (last accessed 9 October 2020).
31. This is also consistent with contractual interpretation. As a starting point, an
express choice of governing law for the ‘agreement’ must surely extend to all clauses,
unless otherwise stated. As observed by Steven Chong J (as he then was)47:
. . . Where the arbitration agreement is a clause forming part of a main con-

tract, it is reasonable to assume that the contracting parties intend their entire
relationship to be governed by the same system of law. If the intention is other-
wise, I do not think it is unreasonable to expect the parties to specifically provide for
a different system of law to govern the arbitration agreement. . . . (emphasis
added)
32. Such choice, therefore, ought to extend to the arbitral agreement that is con-
tained within the main contract.48 Such an interpretation simply ‘makes much
sense’49 and it would be both inconsistent with the plain and ordinary meaning,50
and ‘surprising’51 to hold otherwise.
33. From the perspective of the courts, it would be baffling to mandate the appli-
cation of two different legal systems, even if only as a presumption. This solution is
‘inherently unattractive’52, given that the inquiry under both legal systems concerns
the very same subject matters, eg the contract’s validity and existence. Further, while
it is accepted that courts in most jurisdictions today have the capacity to apply differ-
ing systems of law, this occurs by way of additional experts and/or submissions. A re-
quirement for courts to do so inevitably equates to increased costs, judicial
resources, and inexorable delays in certain jurisdictions.53
4 . O F P RE C ED E N TS C IT ED
34. In this section, it is further argued that on a close examination of the precedents
relied upon in both decisions, the force of authority points in favour of the BNA
presumption.
35. It is convenient to begin the discussion with Enka v Chubb. There, the ECA
directly reviewed ten relevant cases that were ‘helpful in illuminating the issue’.54
However, even this curated list of cases does not fully support the Enka presumption.
The first group of cases comprises those that are against the Enka presumption,
namely: (i) Sulamerica; (ii) Arsanovia Ltd v Cruz City 1 Mauritius Holdings55; and
(iii) Habas Sinai Ve Tibi Gazlar Istihsal Endustrisi AS v VSC Steel Co Ltd.56 The sec-
ond group of cases is those that can, at best, be taken to be neutral, namely: (i)
47 BCY (n 33) [59].

48 Joseph (n 40) 6.35.
49 Briggs (n 43) 777.
50 BCY (n 33) [59].
51 Briggs (n 4) para 14.39
52 Joseph (n 40) para 6.35.
53 Abhinav Bhushan, ‘The Ghost of the Governing Law Returns: Lex Arbitri v Curial Law in India’ (Kluwer
Arbitration Blog) (http://arbitrationblog.kluwerarbitration.com/2014/02/26/the-ghost-of-the-governing-
law-returns-lex-arbitri-v-curial-law-in-india/) (2014) (last accessed 9 October 2020).
55 [2013] 2 All ER (Comm) 1.
56 [2014] 1 Lloyd’s Rep 479.
Hamlyn v Talisker57; (ii) Cie D’Armement v Cie Tunisienne58; (iii) Shashoua v
Sharma59; and (iv) Kabab-Ji SAL (Lebanon) v Kout Food Group.60
36. The final tranche of cases included: (i) XL Insurance v Owens Corning61 and
(ii) C v D of both the English High Court (EHC)62 and ECA.63 These cases were
cited in support, and as having charted an approach that was ‘in line’ with the ECA’s
considerations for the Enka presumption.64
37. It is submitted, however, that a close examination of the cases brings into
question the purported support for the Enka presumption. First, the facts of XL
Insurance and C v D are highly unique and hence distinguishable. Both these cases in-
volved the Bermuda Form,65 which has the ‘striking feature’66 of requiring arbitration
in London under the EEA, but with New York law as the proper law of the main con-
tract. This express reference to the EAA was specifically considered in XL Insurance
and in C v D EHC as pointing in favour of the law of the seat.67 This was because
the parties had not opted out of the EAA’s provisions governing matters like the for-
mal validity and the tribunal’s jurisdiction.68 Such a provision was highly distinctive
and was not even present on the facts of Enka v Chubb. Therefore, it was, with re-
spect, ‘far-fetched’69 for the ECA to formulate a rule of general application on the ba-
sis of these cases.
38. Secondly, both XL and C v D relied heavily on a dictum by Mustill J (as he
then was) in Black-Clawson International Ltd v Papierwerke Waldhof-Aschaffenburg
AG,70 which reads as follows71:
. . . It is by no means uncommon for the proper law of the substantive contract

to be different from the lex fori; and it does happen, although much more
rarely, that the law governing the arbitration agreement is also different from
the lex fori. . . .
39. On its face, the quote above does appear to support the conclusion that it
would be rare for the AA law to be different from the curial law. This, however, must
be seen in light of the entire decision. Mustill J subsequently goes on to refer to two
57 [1894] AC 20.
58 [1971] AC 572
59 [2009] 2 All ER 477.
60 [2020] 1 Lloyd’s Rep 269.
61 [2001] 1 All ER (Comm) 530 (hereinafter ‘XL Insurance’).
62 [2007] 2 All ER (Comm) 557 (hereinafter ‘C v D EHC’).
63 [2008] 1 Lloyd’s Rep 239 (hereinafter ‘C v D ECA’)
65 The different versions in the cases contained no differences material to the cases: C v D EHC (n 62)
[48].
66 C v D ECA (n 63) [1].
67 XL Insurance (n 61) 924; C v D EHC (n 62) [48]–[50].
68 Dicey, Morris and Collins (n 1).
69 Mihaela Maravela, ‘Hold on to Your Seats, Again! Another Step to Validation in Enka v Chubb Russia?’
(Kluwer Arbitration Blog) (http://arbitrationblog.kluwerarbitration.com/2020/05/05/hold-on-to-your-
seats-again-another-step-to-validation-in-enka-v-chubb-russia/) (2020) (last accessed 9 October 2020).
70 [1981] 2 Lloyd’s Rep 446.
71 ibid 453.
distinct sets of obligations in the arbitral proceedings, what he termed the ‘continu-
ous agreement’ and the ‘individual contract to refer’, each with its own proper law.
He then goes on to state as follows:
. . . Where the laws diverge at all, one will find in most instances that the law
governing the continuous agreement is the same as the substantive law of the con-
tract in which it is embodied and that the law of the reference is the same as the
lex fori. (emphasis added)
40. The fact that this ‘continuous agreement’ in actuality referred to the AA law is
seen from Mustill J’s definition of it as a ‘contract to submit future disputes to arbi-
tration’, and also from his illustration quoted from Miller v Whitworth Street Estates
Ltd. This interpretation is further evidenced in Lord Mustill’s subsequent decision of
Channel Tunnel Group Ltd v Balfour Beatty Construction Ltd,72 where he stated73:
. . . Thus, there is the proper law which regulates the substantive rights and
duties of the parties to the contract from which the dispute has arisen.
Exceptionally, this may differ from the national law governing the interpreta-
tion of the agreement to submit the dispute to arbitration. Less exceptionally it
may also differ from the national law which the parties have expressly or by impli-
cation selected to govern the relationship between themselves and the arbitrator in
the conduct of the arbitration: the “curial law” of the arbitration, as it is often
called. . . . (emphasis added)
41. Thirdly, the authority of XL and C v D is arguably limited at best. At

varying points in the judgments, the courts had sought to rely on the doctrine
of separability and the overlap with the curial law to justify the decision. However, as
submitted above, neither of these should gain much traction. Further, in C v D
(ECA), leaving aside the fact that this point was purely obiter, the court had
appeared to treat it as an inquiry under the third stage of the closest and most real
connection.
42. Turning next to BNA v BNB. It is acknowledged at the outset that the SGCA
had not undertaken its own analysis of the law in question. It was accepted by all par-
ties that the Sulamerica framework74 applied in Singapore,75 following the SGHC de-
cision of BCY v BCZ.76 As to the second stage of the Sulamerica framework, the
parties further accepted that the ‘starting point’ was the ‘law of the substantive con-
tract’ (emphasis added).77
72 [1993] AC 334.
73 357A and 358A.
74 See paragraph 8(b) of this article.
75 BNA v BNB (n 1) [23], [33] and [44]–[48]. It was noted that the BCY framework ‘mirrors’ that in
Sulamerica: BNA v BNB (n 1) [45].
76 BCY (n 33).
77 BNA v BNB (n 1) [47].
43. Beyond BCY v BCZ, however, the SGCA had also referred to two other
SGHC decisions that had fallen squarely in favour of the BNA presumption. First in
Dyna-Jet Pte Ltd v Wilson Taylor Asia Pacific Pte Ltd,78 Coomaraswamy J had ob-
served that there was ‘no reason . . . to move beyond the starting assumption that
the parties intended their arbitration agreement to be governed by the proper law of
the broader contract in which it is found . . .’. Secondly, in BMO v BMP,79 Ang J had
considered the approach in BCY v BCZ as providing ‘useful guidance’ in determining
the proper law of the AA.
44. The combined weight of Dyna-Jet, BMO v BMP, and BCY v BCZ is in sharp
contradistinction to the decision of Firstlink.80 However, FirstLink was directly con-
sidered in BCY v BCZ, but with Chong J (as he then was) disagreeing with the
Assistant Registrar’s approach, citing the same trio of approving cases, namely
Sulamerica, Arsanovia, and Habas. It is further submitted that the approach in BCY v
BCZ is able to withstand scrutiny, in particular, for its accurate analysis of separability
and commercial reality.
45. Taking the decisions and precedents cited in the round, it is, therefore, argued
that the force of authority points in favour of the BNA presumption.
5. C ON C LU S IO N
46. Several final points must be made in relation to the foregoing analysis. First, it
bears emphasizing that at the end of the day, the debate as fleshed out above relates
to legal presumptions. Whilst important as a starting point, the legal presumption
can be displaced by the factual and surrounding circumstances in each case. This
much is made clear from the facts of Sulamerica itself. Secondly, specific legal princi-
ples may play a role in determining the AA law. These include the validation princi-
ple81 and even the need for neutrality.82 At the end of the day, however, these legal
principles again are only useful in displacing, and not determining, the presumptions.
Lastly, the presumptive nature of the discussion above leads to a practical point: that
if a party wishes to avoid such presumptions, it may very well do so through proper
drafting. While this may appear self-evident, as noted above, it is not frequent prac-
tice now and may be worth considering in light of the issues fleshed out above.
47. These diametrically opposed positions found in BNA v BNB and Enka v
Chubb are not merely fodder for an academic’s keyboard. Its practical implications
and importance in practice are evident from the fact that at the time of writing of
this article, the appeal on Enka v Chubb has been scheduled on an expedited basis be-
fore the UK Supreme Court ("UKSC"). It is hoped that in finally settling the issue,
the UKSC finds in favour of the BNA presumption, in accordance with principle,
practicality, and precedents.
78 [2017] 3 SLR 267, [31] (hereinafter ‘Dyna-Jet’).

79 [2017] SGHC 127, [39].
80 FirstLink (n 45); Interestingly, FirstLink was the only authority cited in the footnote of the text for David
Joseph QC’s work on Joseph (n 1) para 6.36. This point was also observed by Chong J (as he then was)
in BCY (n 33) [58].
81 Maravela (n 46).
82 FirstLink (n 45) [13]; BCY (n 33) [63].
Postscript: at the time of publication of this article, the UKSC has rendered its de-
cision in this case. The UKSC was split on the specific issue of the presumption dis-
cussed in this paper. The majority, however, held that where the parties have not
specified the law applicable to the arbitration agreement, but they have chosen the
law to govern the contract containing the arbitration agreement, this choice will gen-
erally apply to the arbitration agreement.

Of Principle, Practicality, and Precedents: The Presumption of The Arbitration Agreement's Governing Law

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Of principle, practicality, and precedents: the

8 BNA v BNB (n 1) [47].

9. The ECA embarked on a considerably extensive review of past authority, aris-

2.2 BNA v BNB

14 ibid, Enka [71].

3.2 The substantive-procedural distinction

. . . the English courts have sensibly and, it is respectfully suggested, correctly

. . . Where the arbitration agreement is a clause forming part of a main con-

47 BCY (n 33) [59].

. . . It is by no means uncommon for the proper law of the substantive contract

41. Thirdly, the authority of XL and C v D is arguably limited at best. At

78 [2017] 3 SLR 267, [31] (hereinafter ‘Dyna-Jet’).

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