On 12 April, the Hong Kong Court of First Instance of the High Court refused, on public policy grounds, to enforce an arbitration award made by the Xi’an Arbitration Commission in which one of the arbitrators acted as both arbitrator and mediator.
In Gao Haiyan and another v Keeneye Holdings Ltd and another, the court held that events that transpired at a dinner at the Xi’an Shangri-La Hotel three months before the arbitration award was issued would cause a fair-minded observer to apprehend a real possibility of bias on the part of the arbitral tribunal. Following case precedent, the court therefore ruled that the award made by the Xi’an tribunal should not be enforced.
Gao Haiyan and her husband had signed a share transfer agreement agreeing to transfer shares to Keeneye Holdings. Gao subsequently claimed the agreement was void due to duress and misrepresentation. Keeneye commenced arbitration proceedings and two arbitration hearings took place, in December 2009 and May 2010. After the first hearing, the parties agreed to have members of the tribunal act as mediators as well as arbitrators, in a so-called arb-med process.
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