Pt Bayan Resources TBK v BCBC Singapore Pte Ltd & Ors

The High Court of Australia considered a dispute between Pt Bayan Resources TBK (the appellant) and BCBC Singapore Pte Ltd and others (the respondents) concerning the enforcement of an arbitral award. The appellant sought to resist the enforcement of an award made in Singapore, arguing that it was contrary to Australian public policy.

The central legal issue before the High Court was whether the enforcement of the arbitral award in Australia would be contrary to Australia's public policy, as contemplated by section 8(5)(b) of the International Arbitration Act 1974 (Cth). This involved determining the scope of the public policy exception in the context of international arbitration and whether the award, which concerned a dispute over the interpretation of a shareholders' agreement, offended fundamental notions of justice in Australia.

The High Court, in a joint judgment, held that the public policy exception should be construed narrowly and applied only in exceptional circumstances. Their Honours found that the mere fact that an award might be inconsistent with Australian law or that a different outcome might have been reached by an Australian court did not render it contrary to public policy. Instead, enforcement would be contrary to public policy only if it offended the fundamental principles of the Australian legal system, such as where the award was obtained by fraud or corruption, or where its enforcement would be manifestly unjust. Applying this standard, the Court concluded that the award did not offend Australian public policy and therefore the appellant's challenge to its enforcement failed.