Introduction

In the recent decision of Song Lihua v. Lee Chee Hon [2023] HKCFI 1954, the Court of First Instance declined the request by an applicant in set aside proceedings in Hong Kong to compel an arbitrator to provide evidence concerning the nature and extent of his participation in the underlying arbitration process. 

Background

The Court granted leave to the Claimant to enforce, in Hong Kong, an arbitral award of the Chengdu Arbitration Commission  dated 11 October 2021. Pursuant to the award, the Respondent was liable to pay to the Applicant a sum of RMB 337,222,219.90 together with interest and costs.  

On 26 January 2023, the Respondent applied to set aside the award (the Setting Aside Application) on various grounds, including the inability of the Respondent to present his case in the Mainland arbitration. The Respondent claimed that he had not been validly served with documents in the arbitration proceedings and had not been given an opportunity to nominate an arbitrator of his choice or to appoint a lawyer to attend the first hearing of the arbitration. 

On 1 February 2023, the Respondent made an application to the Mainland Court to obtain the video recording of the entire arbitral proceedings, the resumes of the three arbitrators, and information relating to and reasons for the physical absence of one of the arbitrators from the second hearing, which was dismissed by the Mainland Court. The Respondent claimed that the requested information was highly relevant to the Setting Aside Application, since according to his inspection of the arbitration files, the arbitrator in question was not physically present at the second hearing and had been seen moving from place to place throughout the proceedings. 

On 22 March 2023, the Respondent applied to the Court pursuant to the Arrangement on Mutual Taking of Evidence in Civil and Commercial Matters between the Courts of the Mainland and HKSAR (the Arrangement). The Respondent sought a letter of request to be issued to the Mainland judicial authority (the Request) to obtain testimonies from the arbitrator in question, and from the secretary to the tribunal as to the arbitrator’s location and movements at the time of the second hearing and the nature of his participation at the hearing.

Ruling

In her decision on 31 July 2023, Hon. Mimmie Chan J declined to issue the Request and in doing so held the following:  

1. The question of whether the arbitrator should be ordered by the Court to give evidence for the purposes of determining the Setting Aside Application was a matter of Hong Kong law so far as it related to procedure and admissibility of evidence. The Respondent had relied on PRC law and authorities on the power of Mainland courts to require an arbitral tribunal to provide statements or documents in court proceedings. However, the Court held that such provisions only governed proceedings before the Mainland Court and the Court was not bound to accept the views of the Respondent’s PRC law experts. Notably, the Hong Kong Court also refused to dismiss the application solely on the ground that the Mainland Court had declined the admission of the evidence sought by the Respondent for the proceedings.
2. The Respondent relied on the English cases of Duke of Buccleuch v. Metropolitan Board of Works (1872) LR 5HL 418, Ward v Shell-Mex and BP Ltd [1952] 1 KB 280, and Warren v. Warren [1997] QB 488, which suggested that an arbitrator may give evidence and be called as a witness on certain matters. However, Hon. Mimmie Chan J observed that since these decisions, arbitration had grown in popularity as a dispute resolution method and courts had generally adopted a pro-arbitration approach and policy when recognising and enforcing arbitral awards. Further, the Court noted that the Respondent had not cited any authority in support of the proposition that an arbitrator could be compelled to give evidence in Hong Kong proceedings to challenge their award. The competence of an arbitrator to give evidence did not mean that they could be compelled to give evidence.
3. The Court’s policy of encouraging and aiding arbitrations and upholding parties’ choice of arbitration as the matter of final resolution of their disputes was encapsulated in section 3 of the Arbitration Ordinance (Cap.609), which refers to the Court’s non-interference in arbitrations save as expressly provided for in the Ordinance.
4. The Court recognised that arbitrators perform and exercise a judicial or quasi-judicial function. As such, there is a need to protect the course of their independent judgment from threats of suit as well as from collateral attacks. In light of this policy background, arbitrators should be entitled to the same immunity available to judges in respect of their decision-making, absent fraud or bad faith. Such immunity would serve to protect the autonomy of the arbitral process, which would be compromised if an arbitrator could be compelled by the Court to give evidence as to his decision-making. Such immunity was essential for ensuring that arbitrators could focus on making their decisions without fear or distractions as to whether they could be made liable for claims of any party. 

As such, the Court ruled that, absent evidence of any fraud or bad faith, the arbitrator in question was entitled to immunity and could not be compelled to give evidence on the matters raised by the Respondent. As for the Request as against the secretary to the tribunal, there was a need for the Court to be satisfied as to the relevance, necessity and probative value of the evidence sought. This requirement was not met in the instant case. It was not clear what additional evidence the secretary would be able to provide in the proceedings that could not be answered by the Respondent himself, by those advising him, or by the Court at the Setting Aside Application.

Commentary

The Court’s decision is a strong statement concerning the scope of arbitral immunity and the importance that the Hong Kong Courts place on the independence and integrity of the arbitral process. This is another example and validation of the consistency of the Courts in Hong Kong and their overall pro-arbitration stance in the jurisdiction. Additionally, the case also highlights the robustness and willingness of the Hong Kong Courts in making an independent assessment of requests under the Arrangement, to the extent that these are governed by local law.

Julian Ng, a litigation team trainee, is one of the authors.