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Firm “H" V.“w”

Judgment Cited authorities 6 Cited in Precedent Map Related
Vincent
Judgment Date08 January 2021
Neutral Citation[2021] HKCFI 68
Judgement NumberHCMP298/2020
Subject MatterMiscellaneous Proceedings
CourtCourt of First Instance (Hong Kong)
HCMP298/2020 FIRM “H" v.“W”

HCMP 298/2020

[2021] HKCFI 68

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 298 OF 2020

____________________

BETWEEN

FIRM “H” Applicant

and
“W” Respondent

____________________

Before: Hon G Lam J in Chambers (Not Open to Public)

Dates of written submissions: 2, 4 and 8 December 2020

Date of Decision: 8 January 2021

_______________

D E C I S I O N

_______________


1. The applicant, a solicitors firm in Hong Kong (“Firm”), obtained an arbitral award dated 14 February 2020 (“Award”) against the respondent (“W”), for unpaid legal fees in relation to litigation services, and obtained leave in HCMP 298/2020 to enforce the Award as a judgment of the court. W then took out proceedings in HCCT 23/2020 seeking an order to set aside the Award, as well as a summons in HCMP 298/2020 for an order to set aside leave to enforce the Award. These applications have been fixed to be heard together on 15 March 2021.

2. Meanwhile, the Firm has applied by summons dated 15 June 2020 for an order that W give security for the Award and security for the Firm’s costs in both sets of proceedings. No one has suggested there should be an additional separate summons for security taken out in HCCT 23/2020. The parties have agreed for this application to be dealt with on the papers without an oral hearing. This is my decision on the Firm’s application for security.

Security for the Award

3. The order dated 22 April 2020 granting the Firm leave to enforce the Award covered the principal sum of the Award in the amount of $681,138.20; interest thereon up to the date of the Award in the amount of $208,105.07; $716,820 and $61,115 for costs and expenses incurred by the Firm, including the fees and expenses of the arbitral tribunal and the HKIAC’s fees; and interest of $559.84 per day on the principal sum from the date of the Award until payment.

4. There is no dispute between the parties that in these circumstances, there is a discretion for the court under RHC Order 73 rule 10A to require security to be given by W pending his application to oppose enforcement of the Award. Two main factors to be considered are: first, the strength of the argument that the award is invalid as perceived by the court on a brief consideration of the arguments; secondly, the ease or difficulty of enforcement of the award including whether it will be rendered more difficult if enforcement is delayed: Soleh Boneh International Ltd v Government of the Republic of Uganda [1993] 2 Lloyd’s Rep 208, 212; applied in Guo Shun Kai v Wing Shing Chemical Co Ltd [2013] 3 HKLRD 484; Dana Shipping and Trading SA v Sino Channel Asia Ltd [2017] 1 HKC 281; Weili Su v Shengkang Fei [2019] 2 HKLRD 1214; and X v Jemmy Chien [2019] HKCFI 2172.

5. Regarding first point, the ground for W’s opposition to enforcement of the Award is that due to his health condition at the time of the arbitration, he was “unable to present [his] case”, within the meaning of section 86(1)(c)(ii) of the Arbitration Ordinance (Cap 609). His application to set aside the Award is based upon the similar ground in art. 34(2)(a)(ii) of UNCITRAL Model Law as set out in section 81 of the Ordinance. The principles relating to a challenge against an award on this ground are, again, not in dispute. The court is not concerned with the substantive merits of the dispute or the correctness or otherwise of the award, but with the structural integrity of the arbitral process. The relevant party has to show that he has been denied due process. The conduct complained of must be serious, even egregious. Even if the ground is made out, the court has a discretion not to set aside an award, which may be exercised where the court is satisfied that the outcome could not have been any different: Grand Pacific Holdings Ltd v Pacific China Holdings Ltd (in liq) (No 1) [2012] 4 HKLRD 1; China Property Development (Holdings) Ltd v Mandecly Ltd & others (CACV 92 & 93/2015; 24 May 2016).

6. While the court has to form some view on the strength of the underlying application, this is meant to be an exercise based on a “brief” consideration, not a very detailed inquiry pursuant to the substantive arguments. Detailed chronologies have been set out in the Award,[1] in the first affidavit of W’s wife filed herein, and in the Firm’s skeleton submissions for the present application, which I shall not repeat here. Suffice it to say that while I would not at this stage characterise W’s contentions to be patently unarguable, the following hurdles to his argument are of note:

(1) The only medical evidence supplied to the arbitrator was Dr Berger’s letter dated 24 July 2019 stating that W “had eye surgery on July 23, 2019 and was instructed to be off work and travel for the next three months” and Dr Berger’s letter dated 4 September 2019 stating W “had eye surgery on September 3, 2019 and was instructed to be off work until further notice”. As noted by the arbitrator in his Procedural...

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