In IFLR Article, Akin Gump Lawyers Analyze Singapore Court Ruling on Interplay Between Arbitration and Insolvency
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IFLR has published the article “The interplay between arbitration and insolvency,” written by Akin Gump litigation partner Daniel Cohen, financial restructuring partner Naomi Moore and litigation counsel Hannah Wright, all based in the firm’s Hong Kong office. The article looks at a recent decision by the Singapore Court of Appeal dealing with “an issue of paramount importance where a creditor seeks to recover a debt arising under a contract containing a clause which provided that disputes would be determined through arbitration.”
The authors write that the ruling “is highly significant” and “may prove to be persuasive as and when further judicial attention is given to this important issue in other jurisdictions.” As a result, they say, it is important for all parties “to pay attention to the fine print of an arbitration agreement and possibly to consider suitable carveouts for insolvency proceedings if a party wishes to preserve the ability to wind up a counterparty which cannot or refuses to pay.”
If problems emerge later, the authors add, “a creditor should think carefully about the wisdom of applying to wind up a counterparty rather than proceeding directly to arbitration, and a debtor should be cognizant of its ability to insist on arbitration when faced with a winding-up application.”
To read the article in its entirety, please click here.