SILVERLINK RESORTS LTD V MS FIRST CAPITAL INSURANCE LTD

[2020] SGHC 251, Singapore High Court, Justice Chua Lee Ming, 16 November 2020

Arbitration – Stay of proceedings – Arbitration clause applying to all disputes – Jurisdiction clause applying to interpretation disputes – Whether judicial proceedings on interpretation should be stayed

MS issued an Industrial All Risks Policy under which Silverlink, which operated the Amanpuri resort in Pansea Beach, Phuket, Thailand, was insured against material damage and business interruption losses. The policy provided that all disputes were to be referred to arbitration, but there was also a jurisdiction clause under which disputes as to interpretation could be referred to the courts. As a result of the COVID-19 pandemic, on 2 April 2020 the Governor of the Province of Phuket ordered the closure of all hotels in Phuket, and at the same time the Civil Aviation Authority of Thailand banned all international flights to Thailand. Silverlink’s claim for business interruption losses was rejected by MS on the basis that there was no material damage and therefore the business interruption coverage was not triggered. Silverlink commenced proceedings in the Singapore High Court seeking a declaration that there were triggers other than material damage in the policy. MS applied for a stay of the proceedings on the ground the claim fell within the arbitration clause.