According to the statement of facts contained in the judgment, the claimant first initiated an arbitration against the respondent seeking:

The arbitral tribunal issued a final award dismissing the claim and acquitting the respondent.

However, the claimant initiated new arbitration proceedings against the respondent, this time seeking both direct damages and loss of profit. In response, the respondent raised a res iudicata defence, arguing that the subject matter of both arbitration proceedings was identical. According to the respondent, the first award was binding on the parties and the arbitral tribunal lacked jurisdiction to rule over the matter.

In a second award, the tribunal accepted the res iudicata defence in relation to the claim for direct damages, but not the loss of profit claim. The claimant's claim was therefore admissible.

The respondent filed an action to set aside the second award on the ground that the award breached public policy and that the arbitral tribunal had determined matters that were not capable of settlement by arbitration.

The Court of Appeal dismissed the respondent's action. It rejected the argument that the award breached public policy or ruled over matters that are not capable of settlement by arbitration purely because the arbitral tribunal dismissed the res iudicata defence.

The judgment established that the reasoning of an arbitral award cannot be revised in an action to set aside based on public policy grounds unless it is clearly arbitrary. In the case at hand, the Court found that the second award contained extensive reasoning in support of its decision to dismiss the res iudicata defence raised by the respondent, which prevented any arbitrariness.

The Court also rejected the argument that the matters were not capable of settlement by arbitration: the claimant's claim for damages was a claim that could be settled by arbitration.

Therefore, the Court concluded that the award was not in breach of public policy, nor did it rule over matters that are not capable of settlement by arbitration. It just contained a decision based on reasoning that the respondent did not share.