2011 - Klockner V Advance - Reason
2011 - Klockner V Advance - Reason
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HCA 1526/2010
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ACTION NO. 1526 OF 2010 F
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BETWEEN
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KLÖCKNER PENTAPLAST GMBH & CO KG Plaintiff
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and
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ADVANCE TECHNOLOGY (H.K.)
COMPANY LIMITED Defendant
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__________________________________
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R EASONS F O R DECI SI ON
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由此
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2. I accept that the applicant for leave to appeal does not have to
F demonstrate that the appeal will probably succeed: see Apple Daily Ltd v F
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3. Two questions arose in the decision sought to be appealed,
J first what was the proper law of the arbitration agreement, and second J
whether the dispute fell within the scope of the arbitration agreement. A
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subsidiary question, whether as a result of Chinese law the arbitration
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agreement was incapable of performance arose only if the answer to the
first question was that Chinese law was the proper law of the arbitration M
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agreement.
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4. Mr Khaw correctly identified three factors as pointing O
overwhelmingly to German law being the proper law of the arbitration
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agreement. They were:
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(i) that the MoU expressly provided that: “all of the obligations
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contained herein shall be governed in its entirety by the laws
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由此
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B (ii) that the arbitration clause provided that the third arbitrator B
D (iii) that both the governing law clause and the arbitration clause D
5. Against this, the only factor upon which Mr Cheng can rely to
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argue that the proper law of the arbitration agreement should be Chinese
H law is the fact that the seat of the arbitration is stated in the MoU to be H
had to the statement in Dicey and Morris, §16-017, cited at §24 of the
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decision.
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People’s Court on 26 December 2005. The Article reads: O
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P “The lex causae agreed to by the parties to a contract for settling
disputes arising from the contract cannot be used for determining
Q the validity of foreign-related arbitration clauses. Where parties Q
to a contract have specified the lex causae for determining the
validity of arbitration clauses, the laws agreed shall apply;
R where parties to a contract have not specified the lex causae for R
determining the validity of arbitration clauses, the arbitration
place, the laws of the country or region of the arbitration place S
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shall apply.” (My emphasis).
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由此
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arbitration was in Shanghai he could not suggest any reason why that
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should be so.
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courts would find that the law governing the arbitration clause was K
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anything other than that agreed to by the parties.
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particular facts. O
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10. In Black Clawson International Ltd v Papierwerke Waldhof-
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Aschaffenberg AG [1981] 2 Lloyd’s Rep 446, the arbitration was to take Q
S law if the reference was by the purchasers but the law of the Federal S
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由此
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B XL Insurance Ltd v Owens Corning [2000] 2 Lloyd’s Rep 500, the contract B
the law of the arbitration agreement that law would normally be the law of
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the seat of the arbitration. C v D [2007] 2 Lloyd’s rep 239, is precisely the
F same category. F
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11. In none of the three cases relied upon were expressions such
H as those set out in §4(i) above used. H
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12. Next, Mr Cheng seeks to say that it is reasonably arguable
J that the Court of Appeal is likely to disagree with my finding a that the J
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13. Again, an argument can be mounted, but I am not satisfied
that it has any reasonable prospect of success. M
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14. The relevant expression in the MoU is:
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“any dispute, controversy, or claim between the parties hereto
arising out of or relating to this MoU.” (My emphasis). P
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Q Mr Khaw was right to draw my attention again to Fiona Trust & Holding Q
Corp v Privalov [2008] 1 Lloyd’s Rep 254 CA, and the following passage
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from the speech of Lord Hoffmann, at 257, with whom the other law lords
S agreed: S
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由此
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dealt with other than by arbitration. Such sales plainly relate to the MoU
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and consequently it is not reasonably arguable that a dispute arising from
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such sales should not go to arbitration as the parties have agreed.
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16. Mr Cheng relies upon the decision of the House of Lords in
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K Union of India v E. B. Aaby’s A/S (The Evje) [1975] AC 797, as an
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example of the case where Aaby’s, relying on a subsequent undertaking to L
pay general average, given independently of the contract containing the
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arbitration clause, was held not to be bound by the arbitration clause,
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which contained a limitation provision. That was so, because the court N
found that the undertaking constituted a fresh contract varying the contract
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containing the arbitration clause, and that fresh contract contained no
P limitation period. P
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17. But the situation in the present case is quite different. First,
R the particular expressions contained in the present MoU, to which I have R
already referred, were not contained in the charter party. Second, the case
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is simply demonstrates that the subsequent undertaking given to pay
T general average constituted a separate contract which contained no T
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由此
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arguable that the arbitration clause was not intended to cover the present
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dispute.
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gone before to the Court of Appeal is because in most cases the answer is
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clear, and in any other case, well-established principles are simply applied
H to facts. It is simply not necessary to give leave in order to obtain the H
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20. Klöckner must pay Advance Technology’s costs on the
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application for leave, to be taxed on a party and party basis.
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(John Saunders)
P Judge of the Court of First Instance P
High Court
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Mr Alfred C P Cheng, instructed by Messrs DLA Piper Hong Kong, for the
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Plaintiff
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Mr Richard Khaw and Ms Angel Mak, instructed by Messrs Patrick Mak
& Tse, for the Defendant
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