## Facts

- Silica Investors Ltd. was a minority shareholder (about 4.2%) in Auzminerals Resource Group Ltd. (AMRG).
- Silica acquired its AMRG shares under a 2010 share sale agreement with Lionsgate Holdings Pte Ltd., which contained a SIAC arbitration clause for disputes “arising out of or in connection with” the agreement.
- Silica sued in the High Court under Companies Act s 216, alleging AMRG’s affairs were conducted in an oppressive or unfairly prejudicial manner.
- The pleaded oppression included allegations of value diversion or dilution through share issuances and other management decisions affecting minority shareholder interests.
- Lionsgate applied under International Arbitration Act (IAA) s 6 to stay the court action in favor of arbitration for matters covered by the arbitration clause.
- Other defendants who were not parties to the arbitration clause sought discretionary stays under the court’s inherent case management powers, contingent on Lionsgate obtaining a stay.
- The High Court dismissed the stay applications, holding s 216 minority oppression claims were non-arbitrable (and, in any event, a stay was not appropriate on the facts).
- Defendants appealed; the Court of Appeal heard conjoined appeals concerning the stay regime, arbitrability, and handling parallel proceedings involving signatories and non-signatories.

## Issues

1. What standard of review applies under IAA s 6 when the court decides whether to stay proceedings for “any matter” allegedly subject to an arbitration agreement (prima facie or full merits)?
2. Are minority oppression claims under Companies Act s 216 capable of settlement by arbitration, and if so, subject to what limits?
3. How should a court manage overlapping court and arbitral proceedings where only some parties are bound by the arbitration agreement, including whether to stay claims against non-signatories?

## Decision

- The Court of Appeal allowed the appeals in part.
- The court held that IAA s 6 stay applications are determined using a prima facie standard as to the existence and scope of the arbitration agreement and the statutory exceptions.
- The court held that s 216 minority oppression claims are, in principle, arbitrable, subject to public policy constraints assessed on the substance of the dispute and the relief sought.
- As between Silica and Lionsgate, the court ordered a mandatory stay under IAA s 6 for those parts of the pleaded dispute that constituted “matters” within the arbitration clause.
- For defendants who were non-signatories to the arbitration agreement, the court recognized the High Court’s inherent case management power to grant a discretionary stay where appropriate to reduce duplication and inconsistent findings, while noting they could not be compelled to arbitrate absent consent.

## Legal Principles

- Under IAA s 6, the court applies a prima facie standard when determining whether: (i) a valid arbitration agreement exists, (ii) the dispute falls within its scope, and (iii) the agreement is not null and void, inoperative, or incapable of being performed; if satisfied, the stay is mandatory.
- The prima facie standard supports the tribunal’s competence to rule on its own jurisdiction and avoids pre-judging jurisdictional issues at the stay stage.
- Arbitrability is assessed through a public policy inquiry that distinguishes: (i) whether the dispute type is generally capable of arbitration, and (ii) whether arbitration of the particular dispute and remedies sought would contravene public policy or statutory purposes.
- Minority oppression claims under Companies Act s 216 generally concern private rights among shareholders and corporate actors and are not categorically excluded from arbitration; limits may arise where remedies or effects impermissibly bind non-parties or require powers reserved to the court.
- Non-signatories cannot be forced into arbitration via IAA s 6, but the court may use inherent case management powers to stay related court proceedings to coordinate parallel processes and reduce inconsistent outcomes.

## Conclusion

The Court of Appeal confirmed a prima facie approach for mandatory stays under the IAA, held that s 216 minority oppression disputes are generally arbitrable subject to public policy and remedial limits, and endorsed case management stays to coordinate mixed signatory and non-signatory proceedings.


Tomolugen Holdings Ltd. v. Silica Inv. Ltd., [2015] SGCA 57 (Sing. Ct. App. 2015)