O v. S

On 31 August 2026, Deputy High Court Judge Gary CC Lam handed down judgment in O v. S (HCCT 82/2026; [2026] HKCFI 4910), dismissing the Plaintiff's originating summons and refusing to set aside a partial award issued by an HKIAC tribunal. Mr Ambrose Ho SC (leading Mr Benny Lo and Mr Jiang Zixin), instructed by Han Kun Law Offices LLP, acted for the successful Defendant.

The underlying dispute concerned an investment management agreement under which the Plaintiff managed US$117 million for the Defendant, much of which was invested in an LRC bond and later replaced by promissory notes and a perpetual fund note. The Defendant commenced arbitration seeking the return of the managed assets. The arbitration was bifurcated by agreement into Phase 1 (liability and quantified claims) and Phase 2 (other damages quantification). After the Phase 1 partial award went against the Plaintiff, the Plaintiff sought to set it aside on two grounds.

The Court held that:

(1) No real possibility of bias arose from the presiding arbitrator's prior involvement in an earlier arbitration where the Plaintiff's key witness (Witness Z) had given evidence. Applying the fair-minded and informed observer test from CNG v G (No 2) [2025] 4 HKLRD 781, the judge found that the Partial Award itself contained no adverse credibility findings against Witness Z. The Tribunal relied on documentary evidence and inherent probabilities, not on Witness Z's testimony (§§70, 75). Even if apparent bias were established, the Plaintiff failed to show the outcome would have differed, applying the prejudice requirement from Grand Pacific Holdings Ltd v Pacific China Holdings Ltd (No 1) [2012] 4 HKLRD 1 (§§65-67, 75).

(2) The Tribunal did not breach the bifurcation agreement by deferring the question of liability for additional damages to Phase 2. Because the parties had not put recoverability of additional losses in issue for either phase, the Tribunal was entitled to raise the question of law on its own motion and to deal with it alongside Phase 2 quantification (§§81-85).

The Originating Summons was dismissed with costs to the Defendant, summarily assessed on paper with certificate for two counsel.

For practitioners:

apparent bias challenges based on an arbitrator's prior exposure to a witness face an uphill battle where the award itself shows no adverse credibility finding against that witness. The prejudice requirement remains a real obstacle to setting aside, even where disclosure failures are arguable. On bifurcation, tribunals retain the power to raise pure questions of law on their own motion, even where the parties' procedural agreement did not contemplate them.