Singapore International Commercial Court

(a) Chairman Park induced Asiana to enter into a "package deal" with gategroup as a consequence of which: (i) GGK became Asiana's exclusive airline catering service provider; (ii) Kumho Buslines received at least KWR 160 billion; and (iii) Asiana received inadequate consideration as a result;

(b) each of the contracts comprising the joint venture, i.e. the JVA, Catering Agreement, BWA and Management Services Agreement, constituted part of the "package deal"

(c) Chairman Park's action were a breach of trust against Asiana;

(d) GGS, Mr Schmitz and Mr Rossinyol actively participated in Chairman Park's breach of trust by entering into and/or concluding the JVA, for which they are jointly and severally liable pursuant to Arts 35, 756 and 760 of the Korean Civil Code.

42 An ASI is an order of the court compelling the party subject to the order to refrain from instituting or continuing with proceedings abroad (see the High Court decision of PT Sandipala Arthaputra v STMicroelectronics Asia Pacific Pte Ltd and others [2015] 5 SLR 873 (" PT Sandipala ") at [71]). The general principles governing the issuance of ASIs are well established in Singapore. First, the jurisdiction is to be exercised when the "ends of justice" require it; second, where the court decides to grant an injunction restraining proceedings in a foreign court, its order is directed not against the foreign court but against the parties so proceeding or threatening to proceed; third, an injunction will only be issued restraining a party who is amenable to the jurisdiction of the court; fourth, since such an order indirectly affects the foreign court, the jurisdiction is one which must be exercised with caution (see the decision of this court in Sun Travels & Tours Pvt Ltd v Hilton International Manage (Maldives) Pvt Ltd [2019] 1 SLR 732 (" Sun Travels ") at [65]).

43 This court has also identified five factors (as stated in Lakshmi ([18] supra ) at [50]) that have to be considered when deciding whether to grant an ASI (see the decisions of this court in VKC v VJZ and anothe r [2021] 2 SLR 753 (" VKC ") at [16]-[20]) and Sun Travels at [66]):

(a) whether the defendant is amenable to the jurisdiction of the Singapore court;

(b) whether Singapore is the natural forum for resolution of the dispute between the parties;

(c) whether the foreign proceedings would be vexatious or oppressive to the plaintiff if allowed to continue;

(d) whether the ASI would cause any injustice to the defendant by depriving the defendant of legitimate juridical advantages sought in the foreign proceedings; and

(e) whether the institution of foreign proceedings was or would be in breach of any agreement between the parties.

Although these factors are to be considered in the round, a breach of an agreement has been regarded as a separate basis on which an ASI may be granted; one that is distinct from vexatious or oppressive conduct (see Sun Travels at [67]).

54 The Court has the power to grant interim and permanent anti-suit injunctions pursuant to s 4(10) of the Civil Law Act 1909 78 and s 18(2) (read with paragraph 14 of the First Schedule) of the Supreme Court of Judicature Act 1969 respectively: Hilton International Manage (Maldives) Pvt Ltd v Sun Travels & Tours Pvt Ltd [2018] SGHC 56 (" Hilton ") at [42]-[43].

55 An anti-suit injunction is directed not against the foreign court but against the party so proceeding or threatening to proceed: Baker, Michael A (executor of the estate of Chantal Burnison, deceased) v BCS Business Consulting Services Pte Ltd [2022] 3 SLR 103 ("Baker') at [45(c)].

56 As noted by the Court of Appeal in Sun Travels & Tours Pvt Ltd v Hilton International Manage (Maldives) Pvt Ltd [2019] 1 SLR 732 ("Sun Travels") at [67] there are two grounds for the grant of an anti-suit injunction:

(a) where the institution of foreign proceedings is in breach of any agreement between the parties; and

(b) where the foreign proceedings would be vexatious or oppressive to the applicant if allowed to continue.

57 The former category includes cases involving the breach of an arbitration or an exclusive jurisdiction clause: Maldives Airports Co Ltd v GMR Male International Airport Pte Ltd [2013] 2 SLR 449 at [42].

67 Although the factors are to be considered in the round, a breach of an agreement has been regarded as a separate basis on which an anti-suit injunction may be granted; one that is distinct from vexatious or oppressive conduct: UBS AG v Telesto Investments Ltd [2011] 4 SLR 503 (" Telesto Investments ") at [111]; BC Andaman Co Ltd v Xie Ning Yun [2017] 4 SLR 1232 (" BC Andaman ") at [53]; Lakshmi Anil Salgaocar v Jhaveri Darsan Jitendra [2018] SGHC 90 at [15]; Fentiman at para 16.39. This was also the view that the Judge took at [58] of her Judgment ([41] supra ).

68 In cases involving an arbitration agreement or an exclusive jurisdiction clause, it would suffice to show that there was a breach of such an agreement, and anti-suit relief would ordinarily be granted unless there are strong reasons not to : Donohue v Armco Inc [2002] 1 All ER 749 (" Donohue "), per Lord Bingham at [24]; Morgan Stanley Asia (Singapore) Pte v Hong Leong Finance Ltd [2013] 3 SLR 409 (" Morgan Stanley ") at [29]. There will be no need to adduce additional evidence of unconscionable conduct in such cases. Crucially, however, this approach is subject to an important caveat: there is no requirement for the court to feel any diffidence in granting an anti-suit injunction, " provided that it is sought promptly and before the foreign proceedings are too far advanced " [emphasis added]: Aggeliki Charis Compania Maritima SA v Pagnan SpA (The "Angelic Grace") [1995] 1 Lloyd's Rep 87 (" The Angelic Grace ") at 96. In the same vein, Lord Bingham in Donohue at [24] had also held that "a party may lose his claim to equitable relief by dilatoriness or other unconscionable conduct". The issue of delay and how it relates to comity are key to the determination of this appeal and we turn now to.

[emphasis in italics in original; emphasis in underlining added]

81 In our judgment, comity considerations are relevant when there is delay in bringing an application for anti-suit relief, and this is true even if the proceedings involve an exclusive jurisdiction clause or an arbitration agreement (as was the case in Ecobank and Sea Powerful ). We set out two other propositions that are relevant to this appeal.

82 First, the longer the delay and the more advanced the foreign court proceedings become, the stronger the considerations of comity would be . It was observed in Ecobank that "the longer an action continues without any attempt to restrain it, the less likely a court is to grant an injunction and considerations of comity have greater force", as more time, effort and expense will be wasted by the abandonment of proceedings which compliance with an anti-suit injunction would bring about (at [133]). This court in Beckkett Pte Ltd v Deutsche Bank AG [2011] 2 SLR 96 at [24] had also observed that "considerations of comity grow in importance the longer the foreign suit in question has continued, and the more the parties and the foreign court have engaged in its conduct and management".

83 While the length of delay is relevant, what is of greater importance is the extent to which the delay has allowed foreign proceedings to have progressed : Niagara Maritime SA v Tianjin Iron & Steel Group Company Limited [2011] EWHC 3035 (Comm) at [22], citing Thomas Raphael, The Anti-Suit Injunction (Oxford University Press, 2008) (" Raphael ") at para 8.11. Where a foreign judgment has already been delivered as a result of delay, a host of different considerations come into play, and for reasons expounded on below (see [97] and [98]), we are of the view that exceptional circumstances must be shown in addition to the usual requirements for anti-suit relief.

84 The second proposition is that delay cannot be justified on the basis that jurisdictional objections are being raised in the foreign court . In The Angelic Grace ([68] supra ), it was contended that the proper approach would have been to defer any application for an injunction until "something ha[d] gone wrong", such as when the foreign court accepted jurisdiction (at 95). Leggatt LJ rejected this approach, and found that this could be patronising and would achieve the "reverse of comity": "I can think of nothing more patronising than for the English Court to adopt the attitude that if the Italian Court declines jurisdiction, that would meet with the approval of the English Court, whereas if the Italian Court assumed jurisdiction, the English Court would then consider whether at that stage to intervene by injunction. That would be not only invidious but the reverse of comity".

[emphasis added]

104 Since an anti-suit injunction is granted to meet the ends of justice, the interests of both parties must be considered. Even if the bringing of the foreign proceedings is prima facie vexatious or oppressive, an anti-suit injunction will not be granted if it would nevertheless be unjust to enjoin the respondent from pursuing the foreign proceedings. This involves balancing the injustice to the applicant of denying the anti-suit injunction against the injustice to the respondent of granting the anti-suit injunction. All relevant factors must be considered, including but not limited to the natural and proper forum for the dispute to be heard: Koh Kay Yew v Inno-Pacific Holdings Ltd [1997] 2 SLR(R) 148 at [19].

60.  There is a point of construction of the exclusive jurisdiction clause that it is convenient to deal with at this point. It is accepted that the clause is not restricted to contractual claims. A claim for damages for, for example, fraudulent misrepresentation inducing an agreement containing an exclusive jurisdiction clause in the same form as that with which this case is concerned would, as a matter of ordinary language, be a claim in tort that arose "out of or in connection with" the agreement. If the alleged fraudulent misrepresentation had been made by two individuals jointly, of whom one was and the other was not a party to the agreement, the claim would still be of the same character, although only the party to the agreement would be entitled to the benefit of the exclusive jurisdiction clause. The commencement of the claim against the two alleged tortfeasors elsewhere than in England would represent a breach of the clause. The defendant tortfeasor who was a party to the agreement would, absent strong reasons to the contrary, be entitled to an injunction restraining the continuance of the foreign proceedings. He would be entitled to an injunction restraining the continuance of the proceedings not only against himself but also against his co-defendant. The exclusive jurisdiction clause is expressed to cover " any dispute which may arise out of or in connection with" the agreement. It is not limited to "any claim against" the party to the agreement. To give the clause that limited construction would very substantially reduce the protection afforded by the clause to the party to the agreement. The non-party, if he remained alone as a defendant in the foreign proceedings, would be entitled to claim from his co-tortfeasor a contribution to any damages awarded. He could join the co-tortfeasor, the party entitled to the protection of the exclusive jurisdiction clause, in third party proceedings for that purpose. The position would be no different if the claim were to be commenced in the foreign court with only the tortfeasor who was not a party to the exclusive jurisdiction clause as a defendant. He would be able, and well advised, to commence third party proceedings against his co-tortfeasor, the party to the exclusive jurisdiction clause.

61. In my opinion, an exclusive jurisdiction clause in the wide terms of that with which this case is concerned is broken if any proceedings within the scope of the clause are commenced in a foreign jurisdiction, whether or not the person entitled to the protection of the clause is joined as defendant to the proceedings. An injunction restraining the continuance of the proceedings would not, of course, be granted unless the party seeking the injunction, being someone entitled to the benefit of the clause, had a sufficient interest in obtaining the injunction. It would, I think, be necessary for him to show that the claim being prosecuted in the foreign jurisdiction was one which, if it succeeded, would involve him in some consequential liability. It would certainly, in my opinion, suffice to show that if the claim succeeded he would incur a liability as a joint tortfeasor to contribute to the damages awarded by the foreign court.

62. This point is of direct relevance in the present case. In the New York proceedings, which I must analyse more fully in a moment, several claims are made but most of them are based upon the allegation that Mr Donohue, Mr Atkins, Mr Rossi and Mr Stinson conspired together fraudulently to extract in various ways substantial sums of money from the Armco group of companies. If the allegations can be made good, the liability of the conspirators would be a joint and several liability. There are substantial issues as to which of the claims fall within the language of the exclusive jurisdiction clause but I think it is clear that some of them do. Of the four alleged conspirators only Mr Donohue and Mr Atkins are contractually entitled to the benefit of the exclusive jurisdiction clause. Mr Atkins has settled with Armco, so it was Mr Donohue alone who commenced an action in this country for an injunction enforcing the clause. If Mr Donohue is entitled to an injunction enforcing the clause he is entitled, in my opinion, to an injunction that bars the continuance of the claims in question not only against himself but also against Mr Rossi and Mr Stinson with whom he is jointly and severally liable . If claims against Mr Donohue are within the clause, then so too are the corresponding claims against Mr Rossi and Mr Stinson. Mr Rossi and Mr Stinson are not contractually entitled to enforce the clause, but Mr Donohue is, in my opinion, entitled to ask the court to enforce it by restraining the prosecution in New York of all claims within its scope in respect of which Mr Donohue would be jointly and severally liable.

[emphasis added]

23. In principle, and consistently with what Lord Scott and Laurence Rabinowitz QC^[28]Cavendish Square Holding BV v Joseph Ghossoub [2017] EWHC 2401 (Comm)have said and with the other authorities listed in paragraph 20 above, I would express the correct approach to this question (of whether the contracting party (B) can enforce against the other contracting party (A) an exclusive jurisdiction clause, by an anti-suit injunction, so as to prevent tort proceedings by the other contracting party (A) against a third party (C)) in the following way:

(i) It is a matter for the interpretation of the jurisdiction clause whether the clause extends to cover the tort proceedings against the third party [...]

(ii) If, as a matter of interpretation, the jurisdiction clause does extend to cover the tort proceedings against the third party, the contractual basis for an anti-suit injunction applies so that, as regards an application by the contracting party (B), the injunction will be granted unless there are strong reasons not to do so .

(iii) Applying privity of contract, only the contracting party (B) and not the third party (C) can enforce the jurisdiction clause (against A) by an anti-suit injunction on the contractual basis (unless an exception to privity of contract applies). But the jurisdiction clause may be a relevant factor in granting the third party (C) an anti-suit injunction on the alternative basis that the foreign proceedings are vexatious or oppressive. (It is also presumably possible in certain circumstances that the jurisdiction clause, even though not contractually enforceable by the contracting party (B) in favour of the third party (C), may be a relevant factor in granting the contracting party (B) an anti-suit injunction against the other contracting party (A) on the basis that the foreign proceedings are vexatious or oppressive.)

[emphasis added]

24.  In expressing the correct approach in the way I have just done, I accept that Laurence Rabinowitz QC in the Ghossoub case was correct that, absent express words as to the jurisdiction clause extending to claims against non-parties, the starting point in interpreting a jurisdiction clause (covering, let us say, 'all disputes arising out of the contract') will be that only the parties to the contract are covered. But I also agree with Lord Scott in the Donohue case that, where one has an alleged joint tort committed in relation to a contract by a contracting party and a non-contracting party, the objective interpretation of the jurisdiction clause (covering all disputes 'arising out of the contract') will tend to include a tort claim against the non-party because this will help to prevent forum-fragmentation on essentially the same issues. Such fragmentation is contrary to what the parties are likely to have objectively intended. Ultimately there may be no real conflict between the speech of Lord Scott and the judgment of Laurence Rabinowitz QC because the resolution of the issue turns on the interpretation of the particular contract in the light of the particular facts.

[emphasis added]

The English Court in Clearlake Shipping ([64] supra ) pushed the envelope further by taking into consideration what the court viewed as deliberate and unacceptable forum fragmentation in bringing separate claims in contract and tort in different jurisdictions. I do not need to decide on this point but I will say that it echoes the bold approach of our Court of Appeal in Tomolugen ([30] supra) and can be well justified in some circumstances under the rubric as being required by the ends of justice.

Where substantially the same claims are pursued against related defendants, the ends of justice are, as a general rule, best served by a single composite trial within which all the claims can be determined: see, eg, Donohue v Armco Inc & Others [2002] 1 All ER 749; Halsbury's at para 75.135; Fentiman at para 16.46.

62 The three-stage test to determine the proper law of an arbitration agreement was laid down in BCY v BCZ [2017] 3 SLR 357 (" BCY ") and involves considering at:

(a) Stage 1: Whether parties expressly chose the proper law of the arbitration agreement.

(b) Stage 2: In the absence of an express choice, whether parties made an implied choice of the proper law to govern the arbitration agreement, with the starting point for determining the implied choice of law being the law of the contract.

(c) Stage 3: If neither an express choice nor an implied choice can be discerned, which is the system of law with which the arbitration agreement has its closest and most real connection.

46 The relationship between arbitrability and public policy was extensively considered by this court in Tomolugen Holdings Ltd and another v Silica Investors Ltd and other appeals [2016] 1 SLR 373 (" Tomolugen ") with emphasis on s 11 of the IAA. We can do no better than quote the following passages from Tomolugen :

The concept of arbitrability

71. We turn now to the question of arbitrability. The absence of arbitrability has come to be associated with that class of disputes which are thought to be incapable of settlement by arbitration. The concept of arbitrability has a reasonably solid core. It covers matters which 'so pervasively involve "public" rights and concerns, or interests of third parties, which are the subjects of uniquely governmental authority, that agreements to resolve... disputes [over such matters] by "private" arbitration should not be given effect': Gary Born ([33] supra ) at p 945. However, the outer limits of its sphere of application are less clear. Lord Mustill and Stewart Boyd QC, for instance, suggest that '[i]t would be wrong... to draw ... any general rule that criminal, admiralty, family or company matters cannot be referred to arbitration': Michael J Mustill & Stewart C Boyd, The Law and Practice of Commercial Arbitration in England (Butterworths, 2nd Ed, 1999) at pp 149-150.

...

75. The concept of arbitrability finds legislative expression in s 11 of the IAA, which reads as follows:

Public policy and arbitrability

11.-(1) Any dispute which the parties have agreed to submit to arbitration under an arbitration agreement may be determined by arbitration unless it is contrary to public policy to do so.

(2) The fact that any written law confers jurisdiction in respect of any matter on any court of law but does not refer to the determination of that matter by arbitration shall not, of itself, indicate that a dispute about that matter is not capable of determination by arbitration.

...

It is evident from this that the essential criterion of non-arbitrability is whether the subject matter of the dispute is of such a nature as to make it contrary to public policy for that dispute to be resolved by arbitration. Beyond this, the scope and extent of the concept of arbitrability has been left undefined, as a consequence of which, it falls to the courts to trace its proper contours (see the 1993 Report on Review of Arbitration Laws ([65] supra ) at paras 26-28; Larsen Oil v Petroprod at [24]).

76. In our judgment, the effect of s 11 of the IAA is that there will ordinarily be a presumption of arbitrability so long as a dispute falls within the scope of an arbitration clause. This presumption may be rebutted by showing that ( Larsen Oil v Petroprod at [44]):

(a) Parliament intended to preclude a particular type of dispute from being arbitrated (as evidenced by either the text or the legislative history of the statute in question); or

(b) it would be contrary to the public policy considerations involved in that type of dispute to permit it to be resolved by arbitration.

[emphasis added in underline]

"A juristic act which has for its object such matters as are contrary to good morals and other social order shall be null and void."

12. The purpose behind Article 103 of the Korean Civil Code is to prevent the legal order from becoming an accomplice to illegal acts by absolutely denying the validity of legal acts contrary to good morals and other social order. If the main contract, the CA, is absolutely null and void ab initio for violation of Article 103 of the Korean Civil Code, an exception to the doctrine of separability applies, and the arbitration clause in the CA should also be viewed as null and void ab initio .

26. Article 103 of the Korean Civil Code states that "a juristic act which has for its object such matters as are contrary to good morals and other social order shall be null and void." The term "good morals in Article 103 refers to the society's general and sound moral sense; and the term "social order" in Article 103 refers to the nation's or the society's public order or general interest. Article 103 of the Korean Civil Code is regarded as an overarching principle in the sphere of Korean civil law and order.

[footnotes omitted]

32. Arbitrators are not judges but private persons. Arbitral proceedings proceed in accordance with agreement between parties and arbitrators or among arbitrators. There is a great deal of difference between litigation and arbitration. In arbitral proceedings, there is no guarantee that an arbitral tribunal would reach the same conclusion about what constitutes Korea's good morals and other social order as a judge would in judicial court. For example, inconsistencies may arise if an arbitral tribunal upholds validity of a juristic act under Article 103 of the Korean Civil Code that would otherwise be, in an objective view, nullified by the same provision. The arbitral tribunal's inconsistent decision then causes a juristic act that is contrary to good morals and other social order to be valid and effective.

44. As explained above, an arbitrable "private-law dispute" should not simply be construed as an opposite concept of "public-law dispute." Rather, an arbitrable "private-law dispute" is "a dispute whose nature permits parties to agree to resolve it through arbitration under the principle of private autonomy." If a dispute over validity of a contract executed as a by-product of a serious crime like an act of breach of trust is referred to arbitration, an arbitral tribunal consisting of private persons would have to decide the preceding issue of whether there is in fact a crime. Thus, such dispute may not be considered as a typical private-law dispute where parties may freely agree to resolution by arbitration under the principle of private autonomy.

45. In light of the above, one may not reach a dispositive conclusion that the dispute in the Korean CA Proceedings is arbitrable under Korean law. At a minimum, given absence of clear case law on this issue, Asiana's right to trial in Korean courts can easily be discerned.

49. There exists a theory in Korean jurisprudence that when a main contract is null and void because it contravenes good morals and other social order under Article 103 of the Korean Civil Code, validity of an arbitration agreement within the main contract cannot be recognized. According to the theory, that holds true even if the arbitration agreement itself does not present grounds for nullification-a reason being that a valid legal obligation cannot be created from illegality. In my opinion, the theory is sound and persuasive because the purpose of Article 103 of the Korean Civil Code is to preclude the legal order from becoming complicit in illegality by flatly denying and countermanding validity of any juristic act that is contrary to good morals and other social order, and because according such tortious act even partial validity would abolish the entire purpose of Article 103 of the Korean Civil Code.

[footnote omitted]

D.  With respect to the reasons for which the validity of the main contract is contested

The separability of an arbitration agreement becomes an issue in a dispute over validity of the main contract containing an arbitration clause when there is a reason for invalidation or cancellation of the main contract, e.g., where it is asserted that a contract containing an arbitration clause was executed upon fraud or coercion, or where there is an issue of error or incapacity.

However, when the validity of a contract containing an arbitration clause is contested, determination of the validity of the arbitration agreement is subject to certain restrictions. If a contract that includes an arbitration clause constitutes a juristic act contrary to good morals or other social order or an unfair juristic act, the arbitration agreement should also be deemed invalid. In such cases, although there is no ground for invalidation of such arbitration agreement, the validity of the arbitration agreement cannot be accepted because arbitration cannot create a valid legal obligation based on an illegal juristic act. However, this issue is more likely to be discussed in the perspective of arbitrability or public policies rather than separability.

In the event that one party claims invalidity of a main contract and such claim is not contested by an opposing party, or in the event that one party claims that there are grounds for termination of a main contract and such claim is not contested by an opposing party, or in the event that both parties agree to terminate a main contract, these scenarios could realistically undermine the subject matter of an arbitral award. In that case, an arbitrator can simply acknowledge his or her lack of jurisdiction over the claim.

However, if there is a dispute between the parties regarding the validity of a main contract, an arbitrator's jurisdiction to rule on that of validity could be deemed as a jurisdictional issue. If parties had agreed at the time of entering into an arbitration agreement that an arbitrator would have the power to decide on this issue, then the arbitrator should have the power to decide on validity of the main contract on the basis of this agreement. In the absence of such agreement, the issue must be resolved by contract interpretation. Since the arbitration agreement by its nature has an independent purpose and content separate from the main contract, it is reasonable to assume that disputes over the validity of the main contract also fall within the subject matter of arbitration. To the extent the validity of the main contract is contested, it can be presumed that the arbitration agreement is still valid under the main contract.

[footnotes omitted; emphasis added]

52. In this case, Asiana claims that the CA was executed through Park Sam-Koo et al.'s act of breach of trust and active participation in the tortious act by the Gate Group, and thus that the CA is null and void under Article 103 of the Korean Civil Code. Against such backdrop, I find it difficult to construe that the arbitration clause in the CA was intended to be applicable even in these circumstances. Likewise, it is my view that the doctrine of separability would not cover the arbitration clause of the CA.

24. Asiana's claim and the dispute in the Korean CA Proceedings come within the scope of the arbitration agreement in the CA. Under Korean law which embraces the principle of separability of an arbitration agreement, the arbitration agreement contained in the CA is not affected by the alleged invalidity of the CA. Thus, Asiana's claim and the dispute in the Korean CA Proceedings which arose out of or in connection with the CA must be resolved by arbitration in accordance with the arbitration agreement in the CA unless the court finds the arbitration agreement itself null and void, inoperative or incapable of being performed. I am of the opinion that there exists no such ground to view the arbitration agreement in the CA null and void, inoperative or incapable of being performed. Furthermore, the dispute between Asiana and GGK concerns the private law consequence of the CA, a commercial agreement, entered into by Asiana allegedly in breach of trust by its representatives with the alleged involvement of GGK. As such, the dispute squarely falls under the category of typical arbitrable disputes in private law under the Korean Arbitration Act and is capable of being resolved by arbitration in accordance with the arbitration agreement in the CA.

63. As discussed above, under the separability doctrine embedded in the KAA and accepted by Korean court precedents, the validity of an arbitration clause cannot be denied on the grounds of a challenge to the validity of the main contract. That is unless there are special circumstances to find that the arbitration clause is invalid in itself, the validity of the arbitration clause cannot be denied just because the validity of the main contract is being challenged. Asiana simply asserts that the CA is invalid under Article 103 of the Civil Code, and accordingly the arbitration agreement is also invalid. However, Asiana has not presented a rational argument how an agreement between the parties to resolve disputes by arbitration could be contrary to "good morals and other social order" under Article 103 of the Civil Code. As quoted in the paragraph 54 above, Article 103 of the Civil Code provides that legal acts " which has for its object such matters as are contrary to good morals and other social order shall be null and void ." Article 1 of the KAA provides that the purpose of this law is "to ensure the appropriate, fair and prompt settlement of disputes in private law by arbitration". Accordingly, an arbitration agreement whose objective is to resolve the disputes between the parties by arbitration is a means to fulfil such public policy of fair and prompt settlement of disputes in private law expressed in the KAA. Unless there is a special circumstance such as fraudulent inducement to agree to an arbitration or an arbitration clause that is extremely unfair to one party, it is improbable that an arbitration agreement itself would be determined invalid on the ground of Article 103 of Civil Code. I do not find any such circumstance making the arbitration agreement in the CA invalid. Designating Singapore as the place of arbitration is not extremely unfair to Asiana to be viewed as " contrary to good morals and other social order " of Korea. Korean parties commonly agree to arbitrate their disputes in Singapore under the rules of the ICC or SIAC.

[emphasis in original]

The flaw in the reasoning of Su Mi Kang is the statement that " it cannot create a valid legal obligation through arbitration from an unlawful act ". The principle of separability establishes the obligation to arbitrate is not created from the main contract but exists independently. As stated earlier, the principle of separability recognizes that an arbitration agreement, by its nature and function, exists on the premise that disputes may arise over the validity of the main contract containing an arbitration clause. Accepting the opposite argument would invalidate the arbitration agreement whenever the main contract is alleged to be invalid (not just on the grounds of illegality or public policy). Su Mi Kang's opinion is also against the explicit text of Article 17(1) of the KAA, which provides that " an arbitration clause which forms part of a contract shall be treated as an agreement independent of the other clauses of the contract ". This provision does not distinguish according to the basis for alleged invalidity. The conclusion is that the principle of separability applies regardless of the basis for pleading invalidity: only if the basis goes to the arbitration agreement specifically will the arbitration agreement be determined invalid.

[emphasis in original]

A court before which an action is brought in a matter which is the subject of an arbitration agreement shall dismiss the action when the defendant raises as a defense the existence of an arbitration agreement: provided that this shall not apply in cases where it finds that such arbitration agreement is null and void, inoperative or incapable of being performed.

Where an action referred to in paragraph (1) has been brought, arbitral proceedings may nevertheless be commenced or continued, and an award may be made while the issue is pending before the court.

54 Collectively, the above provisions of the KAA imply that when one contracting party files an action claiming nullity of an arbitration agreement and the other contracting party raises a defense of the existence of an arbitration agreement, Korean courts would first deliberate whether the arbitration agreement is null and void, rather than dismissing the action immediately. Case law from the Korean Supreme Court also holds to the same effect: that even in the midst of the arbitral proceedings, a contracting party that claims non-existence or nullity of the arbitration agreement can file an action in court regarding an arbitrable dispute.

55.  In other words, the fact that the arbitrability of a dispute is recognized under Korean law does not necessarily exclude the possibility of resolving the dispute by litigation. According to Korean arbitration law, where there is a dispute regarding the nullity or nonexistence of an arbitration agreement, the party claiming the nullity or non-existence of an arbitration agreement may file a separate lawsuit regardless of the arbitration proceeding even if a party initiates arbitration and the arbitration proceeding is ongoing. The Korean law specifically provides for the court to render judgement on the validity of such arbitration agreement.

56. In sum, as long as Asiana claims nullity of not only the CA but also the arbitration agreement in the CA, Korean courts would need to deliberate and render a final decision on the merits, regarding the issue of whether the arbitration clause of the CA is null and void, rather than dismissing the Korean CA Proceedings.

[emphasis in original; footnotes omitted]

But my point is this. This is something the Korean Courts deal with and allow parties to do. And if I'm doing something which a Korean Court---or if my clients are doing something the Korean Court allows us to do under the law, it cannot be a breach of an arbitration agreement, or at the very least, that would be a strong reason to deny an anti-suit injunction, because we're just exercising rights and expectations that we have under Korean law in the exact manner that Korean law expects these issues to be decided.