Lao Holdings & Sanum v. Laos & al., SIAC Case No. ARB 414/17/QW
SIAC · Investment (ICSID and treaty) · Singapore · 11 Aug 2021
Why it matters
This award is significant for its application of collateral estoppel and the Henderson rule in a multi-party SIAC arbitration, demonstrating how prior arbitral awards can preclude subsequent claims. It also illustrates the interplay between commercial arbitration and investment treaty disputes, as the same underlying investment gave rise to multiple proceedings. The Tribunal's cost allocation, awarding only 60% of costs despite full dismissal, shows nuanced consideration of procedural conduct.
Summary
The dispute arose from Sanum Investments Limited and Lao Holdings N.V.'s investments in a casino in Laos. After a prior SIAC arbitration (Case No. ARB/143/14/MV) between Laos and Sanum/Lao Holdings, the Claimants initiated this arbitration against San Marco Capital Partners, Kelly Gass, and Laos. The Claimants alleged conversion of assets, including bank accounts and slot machines, by the Respondents. The Respondents raised preliminary objections based on collateral estoppel (New York law) and the Henderson rule (Singapore law), arguing that the issues had already been decided in the prior arbitration. The Tribunal agreed, finding that the prior award had determined that the Claimants had no ownership or entitlement to the disputed assets. Consequently, the Tribunal dismissed all claims on the merits. The Tribunal also rejected the Claimants' conversion claims, finding no evidence that the Respondents had wrongfully converted any assets. The Tribunal ordered the Claimants to bear the entire arbitration costs and 60% of the Respondents' legal costs, noting that the Claimants had succeeded on some non-merits disputes but ultimately lost on the main claims.
The detail
Parties: Lao Holdings & Sanum v. Laos & al., SIAC Case No. ARB 414/17/QW
Case number: italaw/cases/9541
Outcome: The Tribunal dismissed all claims and ordered Claimants to pay 60% of Respondents' legal costs and the entire arbitration costs.
Quantum: USD 437,200 to Respondents 1 and 2; USD 513,655 to Respondent 3; plus USD 348,770 to Respondent 3 for arbitration costs
Applicable law: SIAC Arbitration Rules (6th Edition, 1 August 2016); Singapore law as lex arbitri; New York law for collateral estoppel; Deed of Settlement
Issues in play: Collateral estoppel under New York law and the Henderson rule under Singapore law were central, as Respondents argued that issues decided in a prior SIAC arbitration precluded relitigation. The Tribunal applied these doctrines to bar Claimants' conversion claims.
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