NOBLE RESOURCES PTE LTD v. CHINA SEA GRAINS AND OILS INDUSTRY CO LTD

HCCT23/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTRUCTION AND ARBITRATION PROCEEDINGS

NO.23 OF 2006

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REASONS  FOR  JUDGMENT

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1. These are my brief reasons for making the following declaration at the conclusion of the hearing on Tuesday, 28 March 2006, namely that :

(1)     Dr Wang Shengchang has withdrawn from his office in the Hong Kong arbitration between the Plaintiff and the Defendant relating to disputes arising under a written contract of sale dated 8 April 2004;

(2)     pursuant to section 34(C) of the Arbitration Ordinance (Cap. 341) and Article 14 and/or 15 of the UNCITRAL Model Law, Dr Wang Shengchang’s mandate as arbitrator has been terminated;

(3)     the costs of and incidental to this application be paid by the Defendant.

2. The motion became necessary because Dr Wang who was the chairman of a tribunal of three arbitrators in a part-heard arbitration was arrested recently in Beijing and is currently in custody in the mainland.  The arbitration is due to resume on Monday, 3 April in Hong Kong.

3. It is true that many uncertainties exist as to Dr Wang’s present circumstances.  In my judgment however, those uncertainties do not extend to the question, has Dr Wang resigned?

4. It is clear that he has been arrested, but not clear why.  It is clear that he is in custody, but not clear for how long that will remain.  It is clear that he will not be in Hong Kong on Monday, 3 April.

5. More importantly it is clear that he has spoken to his fellow arbitrators.  It seems to me that nothing has changed since 20 March 2006 when one of the arbitrators, Mr Philip Yang, wrote to all the solicitors concerned in these terms :

“This is to inform the parties that the Chairman of the Tribunal, Dr. Wang Shengchang, informed Mr. Moser and me this morning that he wants to resign due to his sudden personal problem.”

6. It is true that, other than the above, there has been no direct communication from Dr Wang but that is simply because he is incommunicado in mainland China.

7. In my judgment, the only purpose that would be served by “waiting a few weeks” (Ms Teresa Cheng SC’s proposal on behalf of the defendant) would be to find out more about the circumstances surrounding Dr Wang’s arrest.

8. However, the only important fact is that he has expressed his intention to resign.  It is safe and proper to accept the truth of that from Mr Yang’s letter.  It is therefore in the interest of the part-heard arbitration to treat that as his resignation and now take such steps as are necessary to resume the hearing in accordance with the proper procedure.

9. The combination of his known present circumstances and his known present intention make it safe and proper to declare that Dr Wang’s mandate has been terminated.  Whether or not Dr Wang might, at some future date, be theoretically able to resume as arbitrator is neither here nor there once it is established that he has resigned.  In all the circumstances, I am satisfied that there is a sufficiency of evidence that he has and it therefore sensible and desirable to so declare sooner rather than later.