Whether the seat of an arbitration was where it was “to be held”
The parties entered into an agreement which provided for arbitration of their disputes and specified: “Arbitration to be held in Hong Kong. English law to be applied”. The issue in this case was whether that meant the curial law of the arbitration agreement (ie the law of the seat of the arbitration) was English or Hong Kong law (and hence whether or not the Arbitration Act 1996 applied).
There is prior caselaw to the effect that the place of the arbitration will usually be the seat of the arbitration (and hence the curial law of that place will apply to the arbitration). For example, in Shashoua v Sharma (see Weekly Update 17/09) the parties agreed that the venue of the arbitration would be London and hence London was held to be the seat of the arbitration and English law was the curial law. The defendant tried to distinguish the position in this case by arguing that the arbitration agreement here had not referred to a “venue” or “place”. Hamblen J rejected that argument: “An agreement that the arbitration is “to be held in Hong Kong” would ordinarily carry with it an implied choice of Hong Kong as the seat of the arbitration and of the application of Hong Kong law as the curial law. Clear words or “significant contrary indicia” are necessary to establish that some other seat or curial law has been agreed….. I do not consider that “English law to be applied” provides clear wording to that effect. Indeed, it is most naturally to be read as referring to the substantive law applicable”. The fact that it might be convenient to hold the arbitration in Hong Kong (and hence, it was argued, it was only chosen as a convenient geographical location for hearings), was not a determining factor or a reason to distinguish this case from Shashoua. Hong Kong may have been convenient, but it is also a well-known and respected arbitration forum.