In Buda Pipe Rehabilitation Engineering Co. Limited v CPC Construction Hong Kong Ltd  HKCFI 503, the Hong Kong Court of First Instance dismissed Buda Pipe Rehabilitation Engineering Co. Limited (BPR)’s application for leave to appeal a 2018 arbitral award, clarifying the proper application of Schedule 2 of the Arbitration Ordinance (Cap. 609) (Schedule 2).
This post was originally published on the Kluwer Arbitration Blog, 7 March 2019.
ICCâ€™s updated guidance to parties
On 20 December 2018 the International Court of Arbitration of the International Chamber of Commerce (ICC) published an updated Note to Parties and Arbitral Tribunals on the Conduct of the Arbitration under the ICC Rules of Arbitration (Note). The Note, which came into effect from 1 January 2019, introduces a number of significant updates to the ICCâ€™s practical guidance on its Rules of Arbitration.)
In CL v SCG  HKCFI 398, the Hong Kong Court of First Instance found that enforcement of a 2011 arbitral award by CL was time barred, clarifying when a cause of action for failure to honour an award accrues and the effect of the Arrangement Concerning Mutual Enforcement of Arbitral Awards between the Mainland and the Hong Kong Special Administrative Region (the “Mainland and Hong Kong Arrangement“) on time limits under the Hong Kong Limitation Ordinance.
US District Court in New York reviews AAA Appellate arbitral panel decision with the same deference as arbitral awards under the FAA
On February 14, 2019, in considering cross applications to vacate and confirm an arbitration award, the United States District Court, S.D. New York decided to grant the same deference to a decision made by an appellate arbitration panel as is given to an arbitral award under the Federal Arbitration Act (“FAA”) (Hamilton v. Navient Solutions, LLC., No. 18 Civ. 5432 (PAC) (S.D.N.Y. February 14, 2019).
Israel Sorin Shohat, the Third Defendant in proceedings commenced by Mr Balram Chainrai, sought to challenge the jurisdiction of Hong Kong courts to hear a matter related to an Israeli arbitral award issued in 2013. The court held that, while the deadline for challenging jurisdiction had not passed, Shohat had ultimately taken steps which indicated that he had submitted to the jurisdiction of the Hong Kong courts and therefore waived his right to challenge.
In the highly complex and contentious case of Filatona Trading Ltd and another v Navigator Equities Ltd and others  EWHC 173 (Comm), the English High Court dismissed an attempted challenge to an LCIA award brought on the grounds of jurisdiction (s.67 Arbitration Act 1996) and serious irregularity (s.68 Arbitration ActÂ 1996).
In particular, the Court held that an LCIA arbitral tribunal did not exceed the scope of its powers in ordering relief that was not available to an English court.
In Dickson Valora Group (Holdings) Co Ltd v Fan Ji Qian  HKCFI 482, the Hong Kong Court of First Instance has granted an anti-suit injunction restraining mainland Chinese court proceedings commenced by Fan Ji Qian on the ground that the dispute should be referred to arbitration. Although Fan was not a signatory to the contract containing the arbitration clause, he had nevertheless sought to enforce a contractual right under that agreement, such that he was also bound by any conditions integral to the exercise of this right (including the agreement to arbitrate).
This decision shows that an arbitration agreement can, in certain circumstances, bind third parties. This is something which should be considered when drafting agreements which purport to confer a benefit on non-signatories, particularly if it is intended that third parties exercising rights under the contract should also be bound by the arbitration provisions.
In Koshigi Ltd and another company v Donna Union Foundation and another  EWHC 122 (Comm) the English High Court considered an application for costs arising from discontinued proceedings under s.68 Arbitration Act 1996 to challenge two arbitral awards. The claimant in the underlying arbitration had successfully obtained two awards in its favour from the tribunal, which the respondents then sought to challenge in the English courts through two related sets of proceedings for serious irregularity under s.68, alleging bias on the part of the chairman of the tribunal. The respondents then discontinued the s.68 proceedings before they reached a hearing, asserting that the awards which they were seeking to challenge had become unenforceable.
In considering the claimant’s application for costs in relation to the discontinued proceedings, the Court decided that the liability for the costs rested with the applicants (the respondents in the arbitration) and that the costs should be assessed on an indemnity basis rather than the usual – and typically lower Â – standard basis. The Court’s approach, which disincentivizes the pursuit of s.68 applications without a strong substantive basis, is consistent with other attempts by the English courts to block applicants who bring weak s.68 appeals.
The discontinuation of LIBOR and arbitration: issues of substance and procedure for parties and arbitrators
The global financial markets are currently preparing for the phasing out of the London Inter-bank Offered Rate (or LIBOR) and other Inter-bank Offered Rates (or IBORs). LIBOR is the most widely used benchmark interest rate globally, employed in an estimated US$350 trillion worth of financial contracts worldwide. LIBOR may also be used in commercial contracts â€“ for example, in price adjustment mechanisms in share purchase agreements, price escalation clauses or as a reference rate for contractual interest on late payments. LIBOR may also be specified in arbitration clauses as a benchmark rate for interest on the award.
Many financial instruments affected by the discontinuation of LIBOR will include arbitration clauses. As discussed below, whilst the substantive disputes arising from the end of LIBOR will be the same whether they are resolved in a court or by an arbitral tribunal, there are some additional considerations particular to the arbitration process which are relevant in the context of LIBOR discontinuation disputes. Further, even when determining a dispute which does not arise from the end of LIBOR, arbitral tribunals may have to grapple with how to award interest where an arbitration clause uses LIBOR as a reference point. Read more in the E-bulletin here.
The International Council for Commercial Arbitration (ICCA) and the International Bar Association (IBA) have launched a Joint Task Force on Data Protection in International Arbitration Proceedings.