Overview
Singapore and Hong Kong remain as two of the most preferred seats for international arbitration in the Asia-Pacific region. According to 2015, 2018 and 2021 rounds of international arbitration surveys conducted by Queen Mary University of London, both jurisdictions are consistently highly rated by users of arbitration, rivalling the likes of London and Paris. This popularity is in no small part due to the pro-arbitration and pro-enforcement reputation of their courts, even in the face of dubious challenges against an award at the enforcement stage.
These include the notorious "due process violations," which often take the form of a party against whom the award is (or will be) invoked alleging a case management irregularity in the underlying arbitration. In this regard, the UNCITRAL Model Law on International Commercial Arbitration, which the Singapore International Arbitration Act 1994 (at s.3(1)) and the Hong Kong Arbitration Ordinance (2014) (at s.4) have largely adopted, does recognize that an award may indeed be set aside or refused enforcement if a party was (among other grounds) "otherwise unable to present his case" (Arts. 34(2)(a)(ii) 35(1)(a)(ii)). While true instances of due process violations undoubtedly occur, this ground of recourse is unfortunately not immune to abuse by disappointed and disgruntled parties.
Two recent cases, where the complaining party sought to construe a tribunal's case management decision as denying them the right to file expert evidence and a hearing, illustrate the Singapore and Hong Kong courts’ high bar against applications to challenge awards based on alleged due process violations.
In the recent case in Singapore, CYW v CYX [2023] SGHC(I) 10, CYW, the award debtor, applied to the Singapore High Court (subsequently transferred to the Singapore International Commercial Court) to set aside a Singapore-seated SIAC award on the ground that "it was not afforded a reasonable opportunity to present its case in respect of expert evidence." In particular, it alleged that the tribunal issued a "draconian" order whereby, as framed by CYW, its expert evidence "would not be accepted into the record" unless filed within a few days of the same order.
The supposed "draconian" order was, however, issued in the context of: (i) CYW's "consistent non-compliance with the [t]ribunal's directions"; (ii) the tribunal having already indulged multiple extensions; and (iii) CYW having had "some eight months" in total to prepare and file its expert evidence. Citing earlier Singaporean jurisprudence on "accord[ing] a margin of deference to the tribunal in its exercise of procedural discretion" (China Machine v Jaguar Energy Guatemala [2020] 1 SLR 695), the SICC concluded that CYW was not in a position to complain of either a denial of a reasonable opportunity to present its case, or a denial of natural justice.
In COG v ES [2023] HKCFI 294, ES, the award debtor, applied to the Hong Kong High Court to resist enforcement of an underlying CIETAC award on the ground that "it was deprived of a fair opportunity to present its case." In particular, it complained that there was "grossly insufficient" preparation time, as well as that, as framed by ES, the tribunal had unreasonably and without justification "refused to conduct a further oral hearing" in order to deal with new evidence and submissions adduced post-hearing.
The Hong Kong High Court dismissed ES's complaint, given that: (i) it had failed to avail itself of any extensions of time during the arbitration proceedings; and (ii) both parties had in fact expressly agreed for any post-hearing materials to be dealt with on the papers. On the latter issue, it further highlighted that in those circumstances, the tribunal's refusal of a further oral hearing was "a case management decision which it was entitled to make … which the court should lightly interfere with, in the absence of what the court can find to be a serious denial of natural justice."
The message above is clear. There are limits to a tribunal's indulgence of a party's requests for extensions, various requests to present further evidence, and ultimate non-compliance with existing procedural orders. However, there has been no formulation by the courts of a test to ascertain whether the limit has been reached. At this point, the best gauge appears to be the level of egregiousness of the non-compliance by the party violating the procedural order. In the future, it will be interesting to see what degree of procedural violation will lead the courts to set aside or to refuse enforcement of an award.
