内地与香港特别行政区发布相互执行仲裁裁决的典型案例(3)
On 20 January 2012, Raffles applied to HKIAC for arbitration of the disputes relating to the Licence Agreement. On 29 January 2012, Raffles -Beijing applied to CIETAC Shanghai for arbitration of disputes relating to the Hotel Management Agreement. Thereafter, the HKIAC made an award (Case No.: HKIAC/A12016) ordering that Haihang pay Raffles the corresponding sum with interest. Raffles applied to The First Intermediate People’s Court of Tianjin for enforcement of the award. Haihang, the Respondent, resisted the enforcement on the grounds, inter alia, that the award dealt with a dispute not falling within the ambit of the arbitration clause, in breach of Article 7 of the Supreme People’s Court’s Arrangement Concerning Mutual Enforcement of Arbitral Awards Between the Mainland and the Hong Kong Special Administrative Region (hereinafter “Arrangement”).
II.Rulings
Having reported to the Higher People’s Court of Tianjin and the Supreme People’s Court, The First Intermediate People’s Court of Tianjin held that: first, the fact that HKIAC award involved the Hotel Management Agreement did not constitute decisions on matters beyond the scope of the submission to arbitration, and therefore did not fall within the circumstances prescribed by Article 7(1)(3) of the Arrangement; second, the tribunal’s handling of the issue of jurisdiction did not breach parties’ agreement and the laws of the Hong Kong Special Administrative Region, and therefore did not fall within the circumstances prescribed by Article 7(1)(4) of the Arrangement; third, the challenge raised by Haihangwas not in relation to the impartiality or the independence of the arbitrators, but the jurisdiction of the tribunal and, as such the tribunal had the power to decide the issue without the need to resort to the Council of the Arbitration Centre for a determination. Therefore, the subject matter of the challenge raised did not fall within the circumstances prescribed by Article 7(1)(4) of the Arrangement. To sum up, The First Intermediate People’s Court of Tianjin held that the partial award and final award (Case No.:HKIAC/A12016) made by the HKIAC on 19 November 2014 and 19 March 2015 respectively could be enforced in accordance with Article 1, 6 and 7 of the Arrangement.
III.Significance
In respect of whether an award contains decisions on matters beyond the scope of submission to arbitration prescribed by Article 7(1)(3) of the Arrangement, the following rules are clarified: Where the tribunal’s adjudication is confined to the fact-finding and reasoning sections of the award in respect of disputes beyond the scope of the tribunal’s jurisdiction, and the dispositive section of the award does not concern other agreement-related disputes, the award did not contain matters beyond the scope of submission to arbitration. In the present case, the matters Raffles submitted to arbitration before HKIAC were matters relating to the performance of the Licence Agreement. As the Licence Agreement and the Hotel Management Agreement are closely connected, the award touched on the Hotel Management Agreement in its section on fact-finding and reasoning. This analysis and determination could not be avoided in the course of dealing with a controversy arising from the Licence Agreement. The tribunal eventually merely made the award on issues arising from the Licence Agreement mentioned in the Request for Arbitration without making specific award decisions on issues arising from the Hotel Management Agreement. The relevant disputes fell within the scope of parties’ submission to arbitration pursuant to the arbitration clause. Therefore, the award in the present case did not give rise to the circumstances prescribed by Article 7(1)(3) of the Arrangement, where matters beyond the scope of the submission to arbitration were decided by the award.
CASE No.5： Application for enforcement of an arbitral award made by the Hong Kong International Arbitration Centre by Bensley Design Group International Consulting Co., Ltd.
(2019) Chuan 01 Ren Gang No. 1
I. Basic facts
On 13 November 2013, Bensley Design Group International Consulting Co., Ltd. (hereinafter referred to as “Bensley Co.”) signed a Service Agreement on Landscape Design for Mandarin Oriental, Chengdu, China (hereinafter referred to as “Service Agreement”) with Chengdu Mind River Land Co., Ltd. (hereinafter referred to as “Mind Co.”) and Chengdu Chenchuan Industrial Co., Ltd. (hereinafter referred to as “Chenchuan Co.”). Under the Service Agreement, any disputes, controversies or claims arising from or related to this contract or the breach, termination or invalidity of this contract shall be, in accordance with the then effective Arbitration Rules of the United Nations Commission on International Trade Law (hereinafter referred to as “Arbitration Rules”), resolved by arbitration in Hong Kong SAR. Due to a dispute arising in the course of the performance of the contract, Bensley Co. applied to the Hong Kong International Arbitration Centre (hereinafter referred to as “HKIAC”) for arbitration on 5 March 2018. On 5 May 2019, the arbitral tribunal made the Final Award, which was in support of all arbitration requests of Bensley Co. On 4 June 2019, the arbitral tribunal issued the Correction of the Final Award, where corrections and updates were made to the Final Award. Subsequently, Bensley Co. applied to the Chengdu Intermediate People’s Court in Sichuan Province for enforcement of the above arbitral award.
In their joint defence, Mind Co. and Chenchuan Co. stated that firstly, the selection of arbitrator by direct appointment of a sole arbitrator contravened Article 8 of the Arbitration Rules which required that the views of all parties shall be sought before using the list-procedure, thus falling within the situation stipulated in Article 7(4) of the Supreme People’s Court’s Arrangement Concerning Mutual Enforcement of Arbitral Awards between the Mainland and the Hong Kong Special Administrative Region (hereinafter referred to as “the Arrangement”). Secondly, the arbitrator failed to deliver relevant documents relating to the arbitration to the Respondents in accordance with the Measures for the Administration of China Appointed Attesting Officers (Hong Kong) (Order No. 69 of the Ministry of Justice)(hereinafter referred to as “the Measures”), which was a situation stipulated in Article 7(2) of the Arrangement. It has therefore requested that the application be rejected.
II. Rulings
Firstly, regarding the composition of the arbitral tribunal in the present case, the Chengdu Intermediate People’s Court in Sichuan Province held, upon examination, that the HKIAC’s exercise of discretion to appoint a sole arbitrator during the arbitral proceedings in question was in compliance with the Arbitration Rules, to which both parties to the Service Agreement had agreed to adopt. Secondly, regarding whether the arbitral tribunal had delivered notice to the Respondents in an appropriate manner, since in the course of the arbitral proceedings the arbitrator had arranged for delivery of relevant documents to the addresses designated by both parties in the Service Agreement and the Respondents had also expressly acknowledged receipt of the same, it was held that the delivery requirements set out in Article 2 of the Arbitration Rules had been complied with and that there was no question of the arbitrator failing to deliver notice to the Respondents in an appropriate manner. The Respondents’ contention that documents relating to the arbitration should be delivered to the Respondents in accordance with the Measures was held incompatible with the Arbitration Rules and was not accepted.
III. significance
It is established in the present case that the arbitration rules applicable to the arbitral proceedings in question should be the basis on which to determine whether a notice has been successfully delivered. Given that “non-delivery of notice pursuant to the law” is a ground commonly used by respondents for refusing the enforcement of arbitral awards made in Hong Kong SAR, it is necessary to first establish the legal basis of the delivery procedure in order to determine whether a notice has been delivered successfully pursuant to the law. In the present case, both parties agreed in the contract that any disputes, controversies or claims arising from or related to this contract or the breach, termination or invalidity of this contract shall be resolved in accordance with the then effective Arbitration Rules. Due respect has therefore been given to the choice of the parties concerned in this case. Relevant documents have been delivered to the addresses designated by both parties in the Service Agreement pursuant to the relevant requirements of the Arbitration Rules and the Respondents have also expressly acknowledged receipt of the same. There is no question of the arbitrator failing to deliver notice to the Respondents in an appropriate manner. The Respondents’ contention that documents relating to the arbitration should be delivered to the Respondents in accordance with the Measures was held incompatible with the Arbitration Rules.
Cases of the courts of the Hong Kong Special Administrative Region
CASE No.1： CL v SCG
[2019] 2 HKLRD 144
HCCT 9/2018
I.Brief Facts
This was a hearing of an application by the Respondent on, as a preliminary issue, whether the enforcement of an arbitral award against the Respondent is time-barred under s. 4(1)(c) of the Limitation Ordinance (Cap. 347) (“Limitation Ordinance”).
The Applicant proceeded with arbitration administered by an arbitral centre in Hong Kong against the Respondent and obtained an award on 17 February 2011 in its favour, ordering the Respondent to forthwith pay the Applicant the sum of USD 2,173,000 with interests and costs of the arbitration.
In March 2011, the Applicant demanded payment from the Respondent of the sums due under the award and subsequently costs of the tribunal, yet to no avail. On 7 July 2011, the Applicant commenced proceedings to enforce the award in the People’s Court on the Mainland, which was rejected by that Court. Later, the Applicant appealed the decision to the Higher People’s Court and made an application for a retrial which, however, was rejected by the Higher People’s Court on 1 March 2016.
On 6 February 2018, the Applicant made an ex parte application and successfully obtained leave and an order to enforce the award under s. 2GG of the Arbitration Ordinance (Cap. 341) (repealed) (“Arbitration Ordinance”) in Hong Kong (“Order”). On 6 June 2018, the Respondent applied for an inter partes hearing to set aside the Order on various bases including that the application was time-barred by s. 4(1)(c) of the Limitation Ordinance. On 24 July 2018, the question of limitation was ordered to be tried as a preliminary issue.
II.Issues
1.When did the cause of action to enforce the award in this case begin to accrue? (“Issue 1”)
2.Whether the cause of action, and hence the effects of time limitation under s. 4(1)(c) of the Limitation Ordinance, was suspended from the time when the Applicant applied to the People’s Court in the Mainland for enforcement on 7 July 2011 to 1 March 2016, when its application was rejected by the Higher People’s Court, in view of Article 2 of the Arrangement Concerning Mutual Enforcement of Arbitral Awards between the Mainland and the Hong Kong Special Administrative Region (“Arrangement”)? (“Issue 2”)
III.Analysis
Issue 1
The Respondent submitted that the limitation period commenced from 17 May 2011, 3 months from the date of the award, which was argued to be a reasonable time for the Respondent to pay and honour the award, meaning that the limitation period would have expired on 18 May 2017. Alternatively, the Respondent argued that the latest time from which the cause of action would have accrued was 8 July 2011, i.e. when the Applicant applied to the People’s Court in the Mainland for enforcement of the award. This places the expiry of the limitation period on 9 July 2017.
On the other hand, the Applicant contended that the limitation period only commenced on the date on which the Respondent filed its submission in opposition to the Applicant’s application in the People’s Court in the Mainland, i.e. 11 March 2012. The Applicant argued that despite that no payment was made by the Respondent after the payment demands made by the Applicant in March 2011, no inferences can be drawn from the Respondent’s lack of response as to whether it was disputing the award. The Applicant stated that the Respondent only demonstrated its clear and unequivocal intention not to be bound by the award when it filed its submissions in opposition. Thus, the Applicant argued that only on 11 March 2012 did the cause of action for enforcement accrue.
The court did not accept that the cause of action only accrues when a clear and unequivocal intention not to be bound by the award is demonstrated, noting a similar argument was rejected by International Bulk Shipping and Services Ltd v Minerals and Metals Trading Corp of India [1996] 1 All ER 1017. The court explained that accepting the argument means allowing the award debtor to indefinitely defer and postpone the accrual of its creditor’s cause of action and delaying its right to enforce the debt due under the award. Following International Bulk Shipping and Services Ltd v Minerals and Metals Trading Corp of India [1996] 1 All ER 1017 and Agromet Motoimport Ltd v Moulden Engineering Ltd [1985] 1 WLR 762, the court held that the cause of action on the award accrued “from the breach occasioned by the defendants’ failure to honour the award when called upon to do so”. Hence, limitation begins on the date on which the implied promise to perform the award is broken.
The court further noted that the cause of action arose when the Respondent failed to make payment within a reasonable time of the publication of the award and demand being made. The court noted that what a reasonable time was depended on the terms of the award as well as the facts and circumstances of the case. In the present case, since the Respondent was ordered under the award to pay the Applicant “forthwith”, a reasonable time for payment was held to lapse at the latest by 8 April 2011, i.e. 21 days after the Applicant’s demand for payment, and therefore the limitation period expired on 8 April 2017.
Issue 2
The Applicant argued that its accrual of the cause of action was suspended from 7 July 2011 to 1 March 2016, meaning the date on which the Applicant applied to the People’s Court in the Mainland for enforcement to the date when the application was finally rejected by the Higher People’s Court. The Applicant referred to Article 2 of the Arrangement and s. 40C of the Arbitration Ordinance, which prohibits concurrent filing of applications for enforcement of an arbitral award in the Mainland and Hong Kong, and pointed out that the prohibition targets the mischief of double enforcement and double recovery(Shenzhen Kai Loong Investment and Development Co Ltd v CEC Electrical Manufacturing (International) Co. Ltd [2001-2003] HKCLRT 649) and, as such, the Applicant should not be barred from enforcing its award in Hong Kong by operation of s. 4(1)(c) of the Limitation Ordinance simply because it had attempted enforcement in the Mainland.
Nonetheless, the court held that however unfair the consequence of the “no concurrent enforcement rule” may be, absent an express provision in the Arbitration Ordinance or the Arrangement providing otherwise, time under s. 4(1)(c) of the Limitation Ordinance should not stop running, even during the course of the enforcement proceedings in the Mainland. Therefore, the Applicant’s contention that the accrual of cause of action was suspended during the time of enforcement proceedings in the Mainland was rejected.
For reasons set out above, the court held that enforcement of the award was barred by s.4(1)(c) of the Limitation Ordinance when proceedings for leave for enforcement in Hong Kong were instituted on 6 February 2018.
IV.Decisions
Respondent’s application for setting aside the Order granted.
V.Significance
(a)Time limitation begins on the date when the implied promise to perform the award is broken, which is when the award debtor fails to perform the award within a reasonable time of the publication of the award and demand being made. What is a reasonable time for performing the award depends on the terms of the award as well as the facts and circumstances of the case.
(b)This case shows that time under the Limitation Ordinance still runs despite the fact that an award creditor must have failed to recover the total amount due under an award in one place before seeking enforcement in respect of outstanding liabilities in another, as provided for under Article 2 of the Arrangement. The unfair consequences that this may give rise to, such as the hardship the Applicant in the present case faces, highlights the defects in the original Arrangement and the necessity of reform with respect to the prohibition against concurrent enforcement in both places under Article 2 of the Arrangement.
CASE No.2：Gao Haiyan & Anor v. Keeneye Holdings Ltd & Anor
[2012] 1 HKLRD 627
CACV 79/2011
I.Brief Facts
By way of a share transfer agreement and a supplemental share transfer agreement (“the Agreements”), the Applicants transferred the shares in a Hong Kong company to the Respondents, which held beneficial interest in a joint venture coal business in Mainland China. The Agreements were governed by PRC law and provided for arbitration of disputes at an arbitral body in the Mainland.
Pursuant to Article 37 of the Arbitration Rules of the arbitral body, mediation-arbitration is to be conducted either by the tribunal or presiding arbitrator, or provided that the parties agree, by any third party. The tribunal held two sittings. After the first sitting, the tribunal on its own initiative suggested to the parties that the Respondents pay the Applicants RMB 250 million to settle the case.
Before the second sitting, in the absence of the Respondents’ appointee and the Chief Arbitrator, the Applicants’ appointed arbitrator, and a person related to the Respondents upon the invitation of the Secretary General of the arbitral body, attended a purported mediation-arbitration in the form of a private meeting. The Secretary General of the arbitral body who was not appointed by the parties’ was alleged to be the host of the private meeting. It was alleged that the Secretary General of the arbitral body asked the person related to the Respondents to persuade the Respondents into accepting the suggestion put forward by the tribunal.
The parties could not settle. The tribunal found in favour of the Applicants and recommended (yet did not require) a compensation of RMB 50 million. At no point did the Respondents complain about the tribunal’s conduct, fearing that to do so might antagonise the tribunal. The Respondents appealed against the award of the tribunal to the Intermediate People’s Court where the arbitral body situates (“Xi’an Court”) contending that the Secretary General of the arbitral body had manipulated the outcome of the arbitration in contravention of the law and the arbitration rules. The appeal was dismissed.
Subsequently, pursuant to sections 2GG and 40B of the Arbitration Ordinance (Cap. 341) (repealed) (“Arbitration Ordinance”), the Applicants obtained leave to enforce the award. The Respondents, in applying to set aside the leave, contended that it would be contrary to public policy to enforce the award because it was tainted by bias or apparent bias. The Respondents argued that the private meeting over dinner among the Applicants’ appointed arbitrator, the Secretary General of the arbitral body and the person related to the Respondents, was an attempt to pressurise the Respondents to pay RMB 250 million to the Applicants in return for a decision in the Respondents’ favour. The first instance judge held that the award was tainted by apparent bias. He further held that the Respondents did not waive their entitlement to complain about bias in proceeding with a second sitting after the private meeting. The Applicants appealed.
II.Issues
1.Whether the public policy ground applicable to the enforcement of a Convention award are applicable to a Mainland award and how high is the relevant threshold? (“Issue 1”)
2.Whether the Respondents waived their rights to complain about the non-compliance with the Arbitration Rules of the arbitral body? (“Issue 2”)
3.Whether apparent bias (as opposed to actual bias) may be sufficient to constitute the public policy ground for refusing enforcement of the award? (“Issue 3”)
4.Whether, on facts, the alleged apparent bias constituted the public policy ground for refusing enforcement of the award? (“Issue 4”)
III.Analysis
Issue 1
It was held that the jurisprudence on refusal to enforce an award on the public policy ground applicable to a Convention award is also applicable to a Mainland award. The relevant threshold is a very high one, since comity, which was held to be “woven” into the concept of public policy, has to be given effect where a foreign (including a Mainland) award is concerned. On this point, the court cited Hebei Import & Export Corp v Polytek Engineering Co Ltd (1999) 2 HKCFAR 111, in which the court remarked that, to give effect to comity, enforcement of foreign awards would not be refused unless such enforcement would be contrary to the fundamental concepts of morality and justice of Hong Kong, of which conclusion would take a very strong case to reach.
Issue 2
The court held that a party to an arbitration relying on breach of arbitration rules should do so promptly; it should not wait and see how its claims turn out before pursuing his complaint; nor should it proceed with the arbitration as if there had been compliance. As such, the Respondents should not have only submitted to the tribunal a supplemental submission after the private meeting, or attended a second hearing before the tribunal without making a complaint. The court also held that the attack by the Respondents against the Applicants’ integrity was not a substitute for a complaint about bias of any sort or impropriety against the tribunal or the Secretary General of the arbitral body. For these reasons, the Respondents are deemed to have waived their rights to complain about bias.
The court pointed out that, had the complaint been raised, action might have been taken by the tribunal or the People’s Court where the arbitral body situates to remedy the situation, both of which would have been in a much better position to ascertain facts to decide on the issue of bias. The court ruled that although the refusal by the People’s Court where the arbitral body situates to set aside the award for bias was not binding on Hong Kong court, and despite no estoppel resulted from the aforementioned Court’s decision, Hong Kong court was entitled to give serious consideration to the aforementioned Court’s decision in deciding whether to enforce the award.
Issue 3
On a careful interpretation of the views expressed in Hebei Import & Export Corp v Polytek Engineering Co Ltd, the court was of the view that apparent bias alone may be sufficient to justify refusal to enforce an award, though a party seeking to resist enforcement on this ground has to reach a higher threshold than the one for doing so on actual bias, and the court should be slow to exercise such discretion.
Issue 4
The court assessed the relevant facts and found that there was no apprehension of apparent bias based on the “fair-minded observer”. The court held that although one might share the learned Judge’s unease about the way in which the mediation was conducted because mediation is normally conducted differently in Hong Kong, whether that would give rise to an apprehension of apparent bias, may depend also on an understanding of how mediation is normally conducted in the place where it was conducted. In this context, due weight must be given to the decision of the People’s Court where the arbitral body situates refusing to set aside the award.
The court reiterated that enforcement of an award should only be refused if to enforce it would be contrary to the fundamental conceptions of morality and justice of the forum, which is Hong Kong in the present case. Accordingly, the court should not refuse to enforce an award in Hong Kong solely because mediation-arbitration in the form of a private meeting might give rise to an appearance of apparent bias in Hong Kong.
IV.Decision
Appeal allowed.
V.Significance
The court held that a party to an arbitration relying on breach of the arbitration rules should do so promptly; it should not wait and see how its claims turns out before pursuing his complaint, or proceed with the arbitration as if there had been compliance.
Enforcement of an award would only be refused if enforcement would be “contrary to the fundamental conceptions of morality and justice” of the forum. The court respects the usual way of conducting mediation in the forum where the mediation takes place and would not invoke the public policy grounds lightly solely because it is conducted differently from the way it is conducted locally.
CASE No.3： Xiamen Xinjingdi Group Ltd v. Eton Properties Ltd & another
[2009] 4 HKLRD 353;
CACV 106/2008 & CACV 197/2008
I.Brief Facts
The 1st and 2nd Appellants, two Hong Kong companies, were the sole shareholders of Legend Properties (Hong Kong) Co Ltd (“Hong Kong Legend”), and part of the Eton Group. Hong Kong Legend wholly owned a Mainland company which owned land in Xiamen (the “Property”).
The Applicant, a Mainland company, agreed to pay RMB 120 million to the Appellants for the right to develop, operate and to receive profits from the Property; and the Appellants agreed to transfer to the Applicant their shares in Hong Kong Legend and to deliver the Property to the Applicant (the “Agreement”). The Agreement also contained an arbitration clause.
The Appellants did not deliver the Property to the Applicant and purported to terminate the Agreement on the basis that performance would be contrary to PRC law. Consequently, the Applicant commenced arbitration proceedings in Beijing (the “First Arbitration”) and an award (the “Award”) was made in its favour ordering the Appellants to, inter alia, “continue to perform the agreement”. The Applicant then obtained an ex parte enforcement order of the Award in Hong Kong (the “Order”).
The Appellants applied to set aside the Order, arguing that enforcement should be refused as being contrary to public policy under the Arbitration Ordinance (Cap.341) (“Arbitration Ordinance”) on the basis that performance was impossible because: (a) construction on the Property had commenced; and (b) a restructuring of the Eton Group, which was implemented during the course of the First Arbitration, had diluted and transferred their shares in Hong Kong Legend to their parent company. The judge refused to set aside the Order.
In the meantime, the Appellants sought from the arbitral body a determination (the “Second Arbitration”) on whether the parties had been discharged from the Agreement. The arbitral body ruled against the Appellants on this.
By the time of the present hearing to deal with the Appellants’ appeal against the judge’s refusal to set aside the Order, the development of the Property had been completed and 99% of the units had been sold to third parties. The Appellants submitted that as performance was impossible, the Applicant was really looking at “further stages” remedies such as damages in lieu of or an account of profits rather than any rights in the Property itself; and offered an undertaking that they would commence further arbitration before the arbitral body for a determination of such alternative remedies (the “Undertaking”). Alternatively, it was said that the court could remit the matter to the arbitral body so that directions could be obtained or adjourn the appeal pending such directions.
II.Issues
1.Whether it was impossible for the Appellants to perform the Agreement? (“Issue 1”)
2.Whether, in light of issue 1, refusal to enforce the Award on public policy grounds can be justified? (“Issue 2”)
3.Whether the court had jurisdiction to remit the matter to the arbitral body? (“Issue 3”)
III.Analysis
Issue 1
The court reckoned the Undertaking was simply meaningless, given that the Appellants had had ample opportunity to raise squarely before the arbitral body the issue of impossibility of performance. The court was of the view that there was no rational explanation for their failure to do so except the very obvious one that the omission was intentional. The court rejected the Appellants’ arguments that the construction on the Property having been commenced; that the dilution of shares as a result of the restructuring of the Eton Group and that most units of the Property having been transferred to third parties barred the Appellants from performing the Agreement. The court further found that they were calculated risks and self-inflicted, of which consequences the Appellants must bear. The court also remarked that the risk of imprisonment for contempt, which the Appellants raised, was entirely fanciful, since the Order did not specify any time for performance and a person who genuinely is unable to carry out the Order cannot be made liable for the contempt.
Issue 2
The court held that, in considering whether or not to refuse the enforcement of the Award on public policy grounds, the court does not look into the merits or at the underlying transaction. Its role is confined to determining whether such grounds existed for refusing to enforce the award because it would be contrary to public policy. The court’s role should be as mechanistic as possible. Accordingly, the court ruled that impossibility of performance was not relevant at the registration stage of the Award and was not a sufficient reason to justify a refusal of enforcement under public policy grounds.
Issue 3
It was held that the court could not remit the matter to the arbitral body. Under Arbitration Ordinance, the court may enforce the Award or refuse to enforce it but there is no jurisdiction to remit.
IV.Decision
Appeal dismissed.
V.Significance
In considering whether to refuse the enforcement of the Award, the court does not look into the merits or at the underlying transaction. The court’s role is confined to determining whether grounds for refusal of enforcement existed. On this basis, it was held that impossibility of performance is not a relevant factor at the registration/recognition stage of enforcement and, accordingly, it would not be a sufficient reason to justify refusal of enforcement on the grounds that enforcement would be contrary to public policy.
CASE No.4： Shandong Hongri Acron Chemical Joint Stock Company Limited v. PetroChina International (Hong Kong) Corporation Limited
[2011] 4 HKLRD 604
CACV 31/2011
I.Brief Facts
The Appellant as the buyer and the Respondent as the supplier contracted for the supply of a total of 3,937.448 tonnes of sulphur in exchange for purchase price of US$ 3,051,522.20.
The Appellant rejected 3,810,578 tonnes of the sulphur for incorrect specification of the same supplied. It claimed the return of the balance of the purchase price in the sum of US$ 2,953,198 in respect of the rejected sulphur.
Parties submitted their dispute before a tribunal of an arbitral body in the Mainland. The tribunal made a final award in favour of the Appellant, ordering that:
(a)The Appellant shall return 3,810.578 tonnes of sulphur to the Respondent;
(b)The Respondent shall return US$ 2,953,198 (being the transaction payment received) to the Appellant;
(c)The Respondent shall pay damages as well as miscellaneous fees and costs incurred by the Applicant, plus interest (for late payment, if applicable);
