In W v Contractor [2024] HKCFI 1452, an employer in a construction contract sought to appeal a decision made in arbitration regarding a call on a bond. In that decision, the arbitrator had made an interim injunction preventing the employer from calling on a bond for payment. The appeal rested on whether an interim injunction could be considered an award before a point of law could be examined.
The employer appealed the arbitrator’s decision on the grounds that the arbitrator had erred in law. Under section 6(4) of Schedule 2 of the Arbitration Ordinance, an appeal on law can only succeed if it was obviously wrong or the question is of general importance and the decision is open to serious doubt.
The Court noted that the threshold necessary to meet the standard of obviously wrong or open to serious doubt was high. As the first stage of the appeal is an application for leave, the Court is to look primarily at the arbitrator’s award and will limit the submissions by the parties. The Court applied the findings of an earlier judgment:
What has to be demonstrated to the Court, quickly and easily, without meticulous legal argument, is that the decision of the tribunal simply cannot be right, or that there are serious doubts as to the correctness or reasoning of the Award.
However, before considering whether the applied law met this standard, the Court directed that the fundamental status of the decision be examined. This is because, under section 6 of the Schedule, the Court is only able to consider an appeal on an arbitrator’s decision if that decision was an award. The question is, does this include interim injunctions? The Court referred to G v N [2024] HKCFI 721 to demonstrate the position that it did not.
The employer noted that in G v N, the decision was labelled as an interim injunction. In this case, the decision was called “an award”. However, the Court reiterated that it was concerned with the substance of the decision.
After assessing the decision’s nature, substance and form, the Court held that despite its name, the arbitrator’s decision was not an award. The Court noted that the injunction granted in the decision was interim in nature and was pending the conclusion of the resolution of the substantive dispute in the arbitration. The Court, therefore, found in favour of the contractor.
