GAO HAIYAN AND ANOTHER v. KEENEYE HOLDINGS LTD AND ANOTHER

CACV 79/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 79 OF 2011

(ON APPEAL FROM HCCT NO. 41 OF 2010)

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IN THE MATTER of enforcement of an Arbitration Award by the Xian Arbitration Commission

and

IN THE MATTER of Sections 2GG and 40B of the Arbitration Ordinance (Cap. 341)

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BETWEEN

GAO HAIYAN 1st Applicant
XIE HEPING 2nd Applicant

and

KEENEYE HOLDINGS LIMITED 1st Respondent
NEW PURPLE GOLDEN RESOURCES DEVELOPMENT LIMITED 2nd Respondent

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Before: Hon Tang VP, Fok JA and Lam J in Court

Date of Hearing: 22 March 2012

Date of Judgment: 22 March 2012

Date of Reasons for Judgment: 29 March 2012

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REASONS FOR JUDGMENT

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Hon Tang VP (giving the reasons for judgment of the Court):

1. This is the Respondents’ application for leave to appeal to the Court of Final Appeal against our judgment which restored the orderof Saunders J, granting leave to enforce the arbitral award dated 3 June 2010, made after arbitration in the Mainland.

2. The application is put on three bases. First, it is said leave should be granted as of right. Secondly, leave should be grantedbecause questions of great general or public importance are involved. Thirdly, on the “or otherwise” basis.

3. It is clear that the Respondents are not entitled to leave as of right, because it does not satisfy the immediacy requirement. Thatrequirement has been explained by the Appeal Committee in Chinachem Charitable Foundation Ltd v Chan Chun Chuen and Anor FAMV 20/2011 (28 October 2011) in these words:

“31. … If the Applicant were to be granted leave, the order he seeks, namely, one pronouncing in favour of the 2006 Will’svalidity, must have the immediate effect of conferring on him a financial benefit in a clearly quantified sum in excess of the $1million threshold amount (with a corresponding quantified detriment to the Foundation). It is not enough to show that such a financialconsequence is a likely eventual result of the appeal. By way of elaboration, as previously indicated, the immediacy requirementmeans that the order sought in the proposed appeal, if granted, would have the effect of conferring the quantified financial benefitwithout need for any further adjudicatory process to determine any question of fact or law, including any process of assessment,quantification or apportionment.” Per Ribeiro PJ

4. Mr Patrick Fung, SC (appearing for the Respondents) submitted that this requirement is satisfied because as a result of our decision,the Respondents immediately suffered a detriment namely the enforceability of the arbitral award. But it is the normal event oflitigation that the winner gains a benefit and loser suffers a detriment by the result. But as the citation from the judgment ofRibeiro PJ shows, that is not sufficient.

5. As for questions of great general or public importance, the Respondents rely on the following:

“… Whether the doctrine of waiver requires a finding that (1) the non-complaining party [acted] freely and not under pressure; and(2) [the non-complaining party acted] in lack of good faith; …”

6. With respect, as our judgment shows, we have followed well-established authorities on the subject including Locabail (UK) Ltd v Bayfield Properties Ltd [2000] QB 451, as well as Hebei Import & Export Corp v Polytek Engineering Co Ltd (1999) 2 HKCFAR 111.

7. Moreover, as Mr Edward Chan, SC (for the Applicants) pointed out, we allowed the appeal, also on the basis that we disagreed withthe learned judge’s conclusion that there was apparent bias.

Or otherwise

8. Leave is rarely granted by this court on the “or otherwise” basis.

9. Mr Fung submitted that insofar as we have left the learned judge’s findings of fact undisturbed, but disagreed with him on his conclusion,that gives rise to a point of law, namely, whether we were entitled to do, for which leave to appeal should be granted. I have alsotaken note of Mr Fung’s submission about the potential value of the arbitral award. These are matters which the Court of Final Appealwill take into account if and when the Respondents apply for leave to appeal from them. But they are not such that it would be appropriatefor us to grant leave on the “or otherwise” basis.

10. For the above reasons, we have refused leave to appeal with costs.

(Robert Tang)
Vice-President
(Joseph Fok)
Justice of Appeal
(M.H. Lam)
Judge of the Court of First Instance

Mr. Patrick Fung, SC and Mr. Calvin Cheuk, instructed by Messrs Li & Partners, for the Respondents

Mr. Edward Chan, SC, Mr. Laurence Li & Mr. Eric Chow, instructed by Messrs C.L. Chow & Macksion Chan, for the Applicants