Read the full judgment text of HCCT 20/2023 on BabelCite. This 高等法院原訟法庭 judgment was delivered on 4 June 2024 before Deputy High Court Judge Jonathan Wong.
Arbitration — Enforcement of foreign arbitral awards — Application to set aside enforcement order under Arbitration Ordinance (Cap 609) s.95 — 7-year delay in rendering 1st Award in Shenzhen Court of International Arbitration proceeding — Alleged procedural defects including ex parte approval to extend award deadline and partial non-payment of arbitration fees — Whether such procedure constitutes a serious defect undermining due process and structural integrity of arbitration — Whether Respondent was denied opportunity to present case on delay and fee payment issues — Whether enforcement contrary to public policy — Whether failure of 2nd Award to address complaint about malicious delay amounted to substantial injustice — Role of waiver and good faith — Allegation of concealment of related Share Transfer Agreement — Principles of natural justice and party equality in enforcement context. The Applicant obtained enforcement order in Hong Kong against Respondents for two SCIA Awards dated 2019 and 2021. Respondent 2 challenged enforcement on grounds including procedural defects in obtaining ex parte approval for over 7-year extension of time to render 1st Award due to Applicant’s failure to fully pay arbitration fees, lack of Respondent participation and notification on such deferral, and alleged denial of natural justice. The court held there was no provision for ex parte approval in SCIA Rules and Respondent’s rights to be heard were seriously undermined. The substantial delay and manner of extension violated agreed procedure and natural justice, affecting the integrity of the arbitral process. The 2nd Award's failure to deal with Respondent’s claims about Applicant's malicious delay also constituted failure to address an issue causing injustice. No waiver or breach of good faith found on Respondent’s part. Alleged concealment of share transfer agreement not established as denial of due process. Accordingly, enforcement of both Awards was refused and the Enforcement Order set aside. Costs were ordered against the parties respective to their applications. The court retrospectively extended the time to set aside enforcement order to allow fair adjudication and no prejudice was shown to Applicant. This case highlights the strict adherence to procedural fairness in arbitration enforcement and careful scrutiny of ex parte procedural extensions affecting jurisdiction and due process.
Legal issues: Defective Procedure Ground under section 95(2)(e)(i) · Due Process Ground under section 95(2)(c)(ii) · Public Policy Ground under section 95(3)(b) · Failure of 2nd Award to address R2’s complaint · Concealment of the Share Transfer Agreement
Outcome: The Enforcement Order is set aside and enforcement of the 1st and 2nd Awards is refused.
Cites 3 cases