Read the full judgment text of HCCT 60/2019 on BabelCite. This 高等法院原訟法庭 judgment was delivered on 7 May 2020 before Hon Mimmie Chan J.
Arbitration — Anti-suit injunction — Jurisdiction under section 21L High Court Ordinance and Order 11 rule 1 RHC — Enforcement of arbitration agreement in Hong Kong — Concurrent jurisdiction of Mainland courts — Scope of arbitration agreement extending to affiliates — Interim relief pending arbitration — Ancillary jurisdiction rejected — Defendants' Mainland court proceedings in breach of arbitration agreements — Court’s power to grant injunctions under section 21L not limited to ongoing arbitration proceedings. X and Y (Plaintiffs) sought permanent injunctions to restrain defendants ZPRC and ZHK from pursuing parallel Mainland court actions PRC1 and PRC2 relating to derivative trading transactions and guarantee governed by English law and Hong Kong arbitration. Defendants challenged the validity and existence of arbitration agreements and claimed Mainland courts had jurisdiction. Court held: (1) Plaintiffs established a good arguable case under Rule 1(1)(c) and (d)(iii) for jurisdiction to join ZHK and bring claims; (2) the power to grant anti-suit injunctions is derived from section 21L HC Ordinance and is not confined to auxiliary tribunal powers, rejecting Defendants’ arguments that tribunal exclusivity and interim relief limit Court jurisdiction; (3) permanent injunctions refused as disputed issues of fact and contractual validity are better decided by tribunal, though interim injunctions continued; (4) arbitration agreements construed to include affiliated company Y; (5) Defendants’ Mainland proceedings constituted breach of arbitration agreements and were vexatious attempts to evade arbitration; (6) balance of convenience favors injunctions pending arbitration. The Court continued the interim injunction against PRC1 and granted interim injunctions against PRC2 until tribunal determination, ordering Defendants to pay costs to Plaintiffs.
Legal issues: Jurisdiction under section 21L of HC Ordinance and Order 11 rule 1 RHC · Whether Court’s jurisdiction under s 21L is ancillary to tribunal’s jurisdiction · Whether just and convenient to grant permanent injunction · Scope of arbitration agreement and whether it extends to 2nd Plaintiff Y · Whether Defendants’ Mainland court proceedings constitute breach of arbitration agreement · Balance of convenience in granting anti-suit injunction
Outcome: Court continues the interim injunction against ZPRC restraining PRC1 and grants an interim anti-suit injunction against both ZPRC and ZHK restraining PRC2 pending the arbitral tribunal's determination; refuses permanent injunctions at this stage; costs to be paid by Defendants.
Cited by 2 cases · Cites 1 case