W v. GH

HCCT 228/2025

[2026] HKCFI 2966

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTRUCTION AND ARBITRATION PROCEEDINGS

NO 228 OF 2025

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D E C I S I O N

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Background

1.  On 30 December 2025, this Court by its Enforcement Order granted leave to the Plaintiff (“W”) on its ex parte application to enforce an Interim Award on Emergency Measures dated 21 November 2025 (corrected on 16 December 2025) (“Emergency Award”), which was made by an emergency arbitrator (“EA”) in an HKIAC arbitration commenced in Hong Kong (“Arbitration”). The Emergency Award ordered the Defendant (“GH”) to comply with various provisions of a Framework Agreement (“GFA”), to refrain from: acting in breach of those provisions of the GFA, including contacting W’s customers for services or businesses that fall within the scope of the GFA (“Scope”); making offers to W’s customers for services or business that fall within the Scope; forwarding inquiries from W’s customers regarding services or business that GH had procured in breach of the GFA; and to inform any customers that GH and its affiliates had already solicited in breach of the GFA that GH and its affiliates will cease entering into business with them until further notice.

2.  On 21 January 2026, GH issued its summons to set aside the Enforcement Order (“Setting Aside Summons”), on the stated grounds that the arbitration agreement contained in the GFA is invalid on the basis of:

(1)  want of authority, self-dealing, improper purposes and/or an abuse of process, and that consequently the EA did not have jurisdiction over the matter;

(2)  GH had been deprived of a fair opportunity to present its case, and that the Emergency Award as corrected contains matters not falling within the scope of the submission to arbitration in that the EA purported to exercise her power to correct the Emergency Award; and

(3)  the Emergency Award is contrary to public policy, as it improperly affects the rights and obligations of those who are not parties to the arbitration agreement, and enforces an unreasonable restraint of trade clause.

3.  The Setting Aside Summons invokes section 22B(1), 81 and 89 of the Arbitration Ordinance (“Ordinance”), and Order 73 rule 10 RHC.

4.  Under section 22B(1) of the Ordinance, any emergency relief granted, whether in or outside Hong Kong, by an emergency arbitrator under the relevant arbitration rules is enforceable in the same manner as an order or direction of the Court that has the same effect, but only with the leave of the Court.

5.  The rest of section 22B states as follows:

“(2) The Court may not grant leave to enforce any emergency relief granted outside Hong Kong unless the party seeking to enforce it can demonstrate that it consists only of one or more temporary measures (including an injunction) by which the emergency arbitrator orders a party to do one or more of the following—

(a) maintain or restore the status quo pending the determination of the dispute concerned;

(b) take action that would prevent, or refrain from taking action that is likely to cause, current or imminent harm or prejudice to the arbitral process itself;

(c) provide a means of preserving assets out of which a subsequent award made by an arbitral tribunal may be satisfied;

(d) preserve evidence that may be relevant and material to resolving the dispute;

(e) give security in connection with anything to be done under paragraph (a), (b), (c) or (d);

(f) give security for the costs of the arbitration.

(3) If leave is granted under subsection (1), the Court may enter judgment in terms of the emergency relief.

(4) A decision of the Court to grant or refuse to grant leave under subsection (1) is not subject to appeal.”

6.  On 18 March 2026, just before the return date of the Setting Aside Summons, the Court issued directions to the parties for the filing of factual evidence. The substantive hearing of the Summons was adjourned to 19 May 2026.

7.  On 24 April 2026, GH issued a summons, seeking a stay of these proceedings (“Stay Application”) pending the final determination of an application which had by then been made by GH to the Tribunal empaneled in the Arbitration, for the termination or discharge of the Emergency Award (“Discharge Application”) in the Arbitration. The Discharge Application is to be heard by the Tribunal on 24 July 2026, and the Court was informed that the Tribunal’s decision on the Discharge Application will be delivered on 30 August 2026. It was contended that there will only be an interim of less than 4 months from the substantive hearing of the Stay Application. The Stay Application was fixed for hearing on the same day as the Setting Aside Summons.

8.  GH applied for the Stay Application to be heard first, before the Setting Aside Summons, and to have the Court’s determination on the Stay Application first, before the parties should deal with the Setting Aside Summons and the merits thereof. This was despite the fact that the date of the Setting Aside Summons had been fixed as early as 18 March 2026, and the usual practice of the Arbitration Court is not to permit any party to have the hearing of a later application set down for hearing on a date first fixed for another application. This is to avoid the first application being derailed by a subsequent application, to the prejudice of the party who had been preparing for the hearing of the first application.

9.  In the course of the hearing, this Court informed Counsel for GH that the Stay Application would not be decided first, without hearing the parties on the substance of the Setting Aside Summons. This is because if there are no merits at all in the Setting Aside Summons, and the Setting Aside Summons should be dismissed, then there is no reason or purpose to stay the proceedings at all. It must be borne in mind that it is contrary to the principles and objective of the Ordinance, as set out in section 3 thereof, to leave the status of an award or order made by a tribunal in limbo, with parties being left in uncertainty as to the status of either an award, or an order made by the tribunal, or as to the validity or enforceability of the arbitration agreement between them.

10.  The Setting Aside Summons seeks the discharge of the Emergency Award, on grounds set out in sections 81 and 89 of the Ordinance. Neither of these sections is applicable, since what GH seeks to set aside is the Enforcement Order, and not an arbitral award. Nor is section 86 of the Ordinance, for refusal of enforcement of arbitral awards made in Hong Kong, applicable to the Emergency Award. Section 86 and the grounds therein set out on which enforcement of an award may be refused only applies to “an award”, which is final and involves a final determination of a claim or a particular issue in the arbitration (see G v N [2024] 4 HKC 1). G v N deals with an interim order made under section 61 of the Ordinance, but the same analysis applies to an interim injunction made by an emergency arbitrator under section 22B of the Ordinance, as in this case.

11.  Any application to challenge or set aside an order granted to enforce emergency relief granted under section 22B can only be made within the scope and ambit of the provisions of section 22B, which is silent on the application of the grounds set out in section 81 or 86 (or the corresponding section 89 or 95, where applicable) of the Ordinance. Not being a final “award”, the grounds of inability to present case, or public policy, cannot apply.

12.  The reference to Order 73 rule 10(6) RHC cannot assist GH in this case. That applies to the liberty of the debtor to apply to set aside an order granting leave for enforcement, but makes no reference to the grounds set out in section 81 or 86 of the Ordinance. The application to set aside may be on the ground of any material non-disclosure in the ex parte application, or on the basis that section 22B(1) or (2) does not apply to the circumstances of the case.

13.  I agree that it may be possible for the Court to set aside the Enforcement Order, or to refuse to grant leave to enforce the emergency relief made under section 22B, where it is clear that there is not even a prima facie case of the existence of an arbitration agreement between the parties. That is the basic premise for the tribunal’s grant of any relief to the parties in the arbitration. However, that cannot be a high threshold, and unless the matter is clear, the Court should accept that prima facie, the tribunal has jurisdiction and can decide on its own competence to grant the emergency interim order sought. Analogy is drawn to the threshold applicable to an application to stay an action to arbitration under section 20 of the Ordinance (set out in the case of PCCW Global Limited v Interactive Communications Service Limited CACV [2007] 1 HKLRD 309).

14.  In the case of an arbitration governed by the HKIAC Arbitration Rules, rule 23.4 sets out the relevant factors to be taken into account by a tribunal deciding a party’s request for any interim measure, and these include whether “there is a reasonable possibility that the requesting party will succeed on the merits of the claim”. That is akin to an applicant establishing “a serious question to be tried” in an application made to the Court for the grant of an interim injunction.

15.  In this case, considering the substance of the Emergency Award, the issues decided and the nature of the application made, it is clear beyond peradventure that the orders made in the Emergency Award were not final orders or awards which finally determined any of the issues in the Arbitration, but were intended and expressed to be “interim” only. As the EA pointed out, the Emergency Award was to maintain the status quo during the pendency of the Arbitration. None of the grounds in section 89 of the Ordinance would apply in an application to set aside the Emergency Award.

16.  On the facts as set out in the Emergency Award, there is a clear prima facie case of an arbitration agreement contained in the GFA. At this stage, the Court will not go into the merits of the claims of alleged lack of authority, or breach of fiduciary duties of the person signing the GFA, to decide that there is no valid arbitration agreement.

17.  If the Setting Aside Summons has no prospect of success, there is no reason or purpose achieved to stay the setting aside application or these proceedings. Hence, without having made any concessions to the viability of the Setting Aside Summons, Counsel for GH confirmed in the course of the hearing on 19 May 2026 that GH would withdraw the Setting Aside Summons, and will only seek a stay of enforcement of the Emergency Award, for the Tribunal to decide the Discharge Application.

The Restricted Stay Application

18.  On behalf of W, it was contended that the remaining application to discharge the Emergency Award is one which is pending before and to be decided by the Tribunal. There is no residual matter for this Court to exercise any power to stay these proceedings, when the Enforcement Order is not being challenged anymore. Reliance is placed on section 3 of the Ordinance, sub-section (2)(b) of which states that the court should interfere in the arbitration of the dispute only as expressly provided for in the Ordinance.

19.  I have to accept the submissions made for GH, that although the Enforcement Order is not being challenged, the Emergency Award itself is being challenged before the Tribunal. GH is seeking to stay these enforcement proceedings in order to allow the Tribunal to decide the Discharge Application, instead of asking the Court to intervene in that decision. The Court must have inherent jurisdiction to control and manage the proceedings brought before it.

20.  These proceedings before the Court are for enforcement of the Emergency Award made by the EA in the Arbitration. The Emergency Award is being challenged and will be heard by the Tribunal. Just as the Court has the jurisdiction to amend the originating summons, summonses and orders made in proceedings commenced before it under the Ordinance, to grant extensions of time for the filing and service of documents, and to adjourn hearings before it, all in the exercise of its inherent jurisdiction and the powers conferred under the RHC, the Court has the jurisdiction and power to manage the proceedings before it, and in this case, such power extends to granting a stay of enforcement of the Enforcement Order if there are matters which render it just to do so (under section 16(3) of the High Court Ordinance).

21.  In the circumstances of this case, I accept that it would be fair and just to stay enforcement of the Enforcement Order pending the Tribunal’s determination of the Discharge Application which is to take place in July, with a decision to be handed down in August. The delay, albeit undesirable, is in all the circumstances fair as GH will suffer prejudice in the event that the Discharge Application is successful, the Emergency Award is set aside or otherwise not continued on its terms, but W is permitted in the interim to enforce the Emergency Award. On balancing the possible injustices to the parties and also to achieve procedural economy (avoiding the necessity of another application to either discharge or vary the terms of the Enforcement Order to reflect the outcome of the Discharge Application), I would accede to GH’s application for the stay. The stay will be until the Tribunal’s determination of the Discharge Application, or further orders of the Tribunal or of the Court, with liberty to the parties to apply.

22.  As to W’s concerns as to the duration of the stay pending the decision of the Tribunal, I would observe that what the Tribunal is asked to decide on the Discharge Application is whether the Emergency Award and the orders made therein were valid or proper. Though there may be a dispute as to the existence and validity of the Arbitration Agreement and the underlying GFA, the decision on whether the orders made in the Emergency Award should be discharged turns on whether there was a serious question to be tried/prima facie/arguable/reasonable possibility of the existence of an arbitration agreement. Whereas the validity of the GFA and Arbitration Agreement may be part of the final award to be made by the Tribunal, the duration of the stay should only be until the Tribunal’s decision on the propriety of the making of the Emergency Award.

Disposition

23.  I accordingly grant an order to stay the Enforcement Order in the terms set out at paragraph 21 above, with costs of and incidental to the application be paid to W by GH which seeks the indulgence, with certificate for Counsel.

24.  At the conclusion of the hearing, I already recorded the withdrawal of the Setting Aside Summons, that there was nothing outstanding thereon, and ordered that the costs of and incidental to the said summons be paid by GH to W, on indemnity basis, with Certificate for Counsel.