Ministry of Law Committee of Supply 2019 – Cuts by WP MPs and NCMPs

(Delivered on 1 Mar 2019)

Legal Aid – Chen Show Mao

Sir, I understand we do not currently provide legal aid for arbitration, as it is customarily a private, consensual dispute resolution process; and typically, arbitration is used for high value commercial dispute resolution, and involves much higher costs compared to court litigation.

But Sir, it is increasingly not the case.

Increasingly, in some standard form mass market consumer contracts that ordinary Singaporeans enter into without much room for negotiation, such as some insurance policies, there are contractual requirements that the parties go to arbitration in the event of a dispute. They must go to arbitration. No legal proceedings. Even for needy Singaporeans with good claims under their insurance contracts who have met the Legal Aid Bureau’s Means test and Merits test for aid. To belabour the point, these are needy Singaporeans who are poor enough, who have good enough claims, and who could otherwise have pressed their claims in court with the help of legal aid if not for the arbitration clause in their standardised contracts.

There are many good reasons why an insurance company that drafts the policy would want such an arbitration clause.  But one effect of such a clause is that it may keep a needy Singaporean from pressing a meritorious claim in the event of a dispute, since legal aid currently does not cover the costs of arbitration proceedings.

Sir, even one case that falls through this particular crack feels unnecessary. I’d like to ask that the Minister look into extending aid to eligible recipients, namely Singaporeans who have met the Means test and Merits test for legal aid, to help them cover the costs of arbitration proceedings to which they have been mandatorily directed by arbitration clauses in standardised contracts used in large volume.