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Case 58: MAL 1(3)(b)(ii)
Hong Kong: High Court of Hong Kong (Kaplan J.)
22 June and 12 July 1993; appeal pending
Ananda Non-Ferrous Metals Ltd. v. China Resources Metal and Minerals Co. Ltd.
Excerpts published in [1993] 2 Hong Kong Law Reports (HKLR), 348
(Abstract prepared by the Secretariat)
The plaintiff, a Hong Kong company, agreed to sell to the defendant, also a Hong Kong company, 40 metric tonnes of cadmium c.i.f. Rotterdam. Upon arrival in Rotterdam, the goods were inspected and the defendant contended that they did not comply with the description contained in the contract. The issue was submitted to arbitration and the arbitral tribunal in an interim award found in favour of the defendant. The plaintiff sought leave from the court to appeal against that interim award. The defendant argued that an international arbitration was involved, to which MAL applied, and that under MAL there was no right to appeal. It was agreed that the court should first deal with the issue whether it had jurisdiction depending on whether a domestic or international arbitration was involved. The plaintiff argued that the arbitration was domestic since both parties were Hong Kong companies and that, even if it were international, the defendant was estopped from raising that defence or had waived such a defence since the circumstances and the conduct of the parties indicated that a domestic arbitration was involved.
The court, applying article 1(3)(b)(ii) MAL and citing its ruling on Fung Sang Trading
Limited etc. (case 20), held that an international arbitration was involved since a
substantial part of the obligations of the commercial relationship was to be performed
outside Hong Kong. It was found that the documents submitted by the plaintiff and the
circumstances did not indicate that the parties had agreed to opt into the domestic
regime. It was also found that the defendant was not estopped from raising the defence
that an international arbitration was involved since there was no representation by the
defendant on which the plaintiff might have acted to its detriment; nor did the defendant
waive such defence since the fact that the arbitration was international was never an
issue in the arbitration proceedings and the defendant could not have waived a right of
which it was not aware. The court dismissed the application.
This case is cited in case 75.
Additional Information published in later CLOUT issue (on "9 February 2000"):
Abstract published in English: [1996] Model Arbitration Law Quarterly Reports, Vol. 2, issue 1, 39
Text of the court decision published in English: [1996] Model Arbitration Law Quarterly Reports, Vol. 2, issue 1, 43
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