Man Sing General Contractors Ltd v. The Incorporated Owners of on Tai Mansion, Winslow Street
Read the full judgment text of HCCT 67/2019 on BabelCite. This 高等法院原訟法庭 judgment was delivered on 11 November 2020 before Hon Mimmie Chan J.
Construction and Arbitration Proceedings — Arbitration Award — Failure to give reasons on interest and costs — Remission of Award to Arbitrator under sections 4, 5 and 6 of Schedule 2 of the Arbitration Ordinance (Cap 609) — Applicant’s application for leave to appeal and variation of costs order — Threshold for leave to appeal — Court’s power under section 5(7) Schedule 2 — Reasonableness of parties’ conduct in consenting to remission and procedural economy — Costs order. The Applicant applied for leave to appeal and variation of an Award relating to interest and costs dated 15 November 2019. The Arbitrator failed to give reasons on interest and costs, leading the Court to direct remediation of the Award with parties’ consent. The Court examined the high threshold for leave to appeal under section 5(7) of Schedule 2 to the Arbitration Ordinance and found the Applicant’s insistence on varying the costs order unreasonable and unjustified. The Court rejected the assumption that remission equated to the Applicant’s success. It also criticized both parties for failing to act reasonably and promptly to minimize delay and costs. The ultimate decision was that each party should bear its own costs of the Originating Summons.
Legal issues: Threshold for granting leave to appeal arbitral award · Whether remission of the Award reflects fault or success of the Applicant · Reasonableness of parties’ conduct regarding remission and costs
Outcome: Each party to bear its own costs of the Originating Summons; no leave to appeal granted; Award remitted to Arbitrator.
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HCCT 67/2019 [2020] HKCFI 2864 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE CONSTRUCTION AND ARBITRATION PROCEEDINGS NO 67 OF 2019 ____________________
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____________________ Before: Hon Mimmie Chan J in Chambers Dates of Written Submissions: 17 and 18 March 2020 Date of Decision: 11 November 2020 _____________ D E C I S I O N _____________ 1.Having reviewed the submissions in writing filed on behalf of the Applicant and the Respondent respectively, the order of the Court is that each of the parties should bear its own costs of the Originating Summons issued by the Applicant on 13 December 2019 (“OS”). 2.The need to remit the Award to the Arbitrator was not due to any fault of the Respondent, and I accept its submissions that an order for remission cannot be equated with the Applicant being the successful party. 3.Although it was clear from the OS and the Award that the Arbitrator had failed to give any reason for the decision on interest and on costs, and the Award was for that reason remitted to the Arbitrator following directions of the Court on 10 January 2020 and upon the consent of the parties finalized on 7 February 2020, the Applicant had by the OS also sought leave to appeal against the Award. 4.Even in the submissions served by the Applicant for the hearing before the Court on 10 January 2020, the Applicant had maintained that leave to appeal should be granted and further, that the appeal should be allowed and the Award on costs should be varied upon allowing the appeal. 5.The threshold for granting leave to appeal against an arbitral award (and in particular an order on costs) is high. Further, section 5 (7) of Schedule 2 to the Arbitration Ordinance states that the Court must not exercise its power to set aside an award on hearing an appeal, unless it is satisfied that it would be inappropriate to remit the matters in question to the tribunal for reconsideration. 6.The Applicant’s insistence on the variation of the costs order to be made for the hearing of the OS on 10 January 2020 was unreasonable, if not unjustified. 7.On the other hand, the Respondent should have consented to the remission of the Award, since it was indisputable that the Arbitrator had not given any reasons for his decision on interest and on costs. 8.It was not until the Court raised the above matters at the hearing on 10 January 2020 that the parties proceeded to confer on the remission (as directed by the Court), and it was not until 7 February 2020 that the parties could confirm consent to the referral. 9.In my view, both parties had failed to act reasonably and promptly to save costs, avoid delay and achieve the objectives of procedural economy. 10.The only order for costs which this Court is prepared to make is that each party is to bear its own costs of the OS.
Mr Wong Hok Yan, instructed by Francis Kong & Co, for the applicant Mr Wong Cho Lik, instructed by Cheung & Co, for the respondent |