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.