Read the full judgment text of HCCT 9/2018 on BabelCite. This 高等法院原訟法庭 judgment was delivered on 18 February 2019 before Hon Mimmie Chan J.
Limitation Ordinance Cap 347 section 4(1)(c) prescribes a six-year limitation period for actions to enforce an arbitral award. The enforcement of an arbitral award is an independent cause of action based on an implied agreement to perform the award, which accrues upon failure to perform within a reasonable time. The court held that the limitation period commences when payment under the award is overdue after a reasonable period, not upon a clear refusal to pay by the debtor. In this case, the award dated 17 February 2011 ordered payment 'forthwith', and demand was made on 18 March 2011; the court fixed the accrual date at 8 April 2011, 21 days after demand. The applicant’s attempt to suspend limitation while enforcement proceedings were pursued in Mainland courts did not apply, as no statutory provision suspends time during these proceedings. The proceeding to enforce in Hong Kong in 2018 was therefore time-barred. The court ordered costs against the applicant with a certificate for counsel. This judgment clarifies the accrual of cause of action and limitation in enforcement of awards under Hong Kong law, rejecting any indefinite postponement of limitation arising from equivocal positions taken by debtors during enforcement disputes.
Legal issues: Limitation period for enforcement of arbitral award
Outcome: The court determined enforcement of the Award was time-barred under section 4(1)(c) of the Limitation Ordinance and made an order nisi for costs to be paid by CL to SCG with a certificate for counsel.