William Co. v. Chu Kong Agency Co. Ltd. and Another

William Co. v. Chu Kong Agency Co. Ltd. and Another

The court held the dispute resolution clause was not void for uncertainty and that Article 7(2) was satisfied by the Bill of Lading together with post‑dating correspondence and pleadings which recorded assent; accordingly the court had no discretion under Article 8(1) of the Model Law and was required to stay the Hong Kong proceedings in favour of arbitration in China despite potential disadvantage to the plaintiff under the Hague‑Visby Rules; choice of law issues are for the arbitrators to decide.

Citation
William Co. v. Chu Kong Agency Co. Ltd. and Another
Parties
Plaintiff: William Company; 1st Defendant: Chu Kong Agency Co., Ltd.; 2nd Defendant: Guangzhou Ocean Shipping Company
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
17 February 1993
Case Number
HCCL155/1991
Procedural Posture
Commercial (cargo Claim Under Bill of Lading) / Application to Stay Proceedings (interim Hearing)
Outcome
Stay granted in favour of arbitration in the People's Republic of China
Legal Topics
UNCITRAL Model Law Article 7, UNCITRAL Model Law Article 8, Hague Visby Rules Article III Rule 8, Exclusive Jurisdiction Clause, Forum Non Conveniens, Enforceability of Arbitration Agreements, Exchange of Correspondence as Writing
Source Language
EN
Arbitration Maritime Law Private International Law Contract Law UNCITRAL Model Law Article 7 UNCITRAL Model Law Article 8 Hague Visby Rules Article III Rule 8 Exclusive Jurisdiction Clause +3 more

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Parties

William Company

Plaintiff

Chu Kong Agency Co., Ltd.

1st Defendant

Guangzhou Ocean Shipping Company

2nd Defendant

Procedural Posture

Commercial (cargo Claim Under Bill of Lading) / Application to Stay Proceedings (interim Hearing)

Legal Issues

  1. 1 Whether the dispute resolution clause in the Bill of Lading is void for uncertainty
  2. 2 Whether the clause complies with Article 7(2) of the UNCITRAL Model Law (writing requirement)
  3. 3 Whether the court must stay proceedings under Article 8 of the Model Law despite the Hague-Visby Rules

Ratio Decidendi

The court held the dispute resolution clause was not void for uncertainty and that Article 7(2) was satisfied by the Bill of Lading together with post‑dating correspondence and pleadings which recorded assent; accordingly the court had no discretion under Article 8(1) of the Model Law and was required to stay the Hong Kong proceedings in favour of arbitration in China despite potential disadvantage to the plaintiff under the Hague‑Visby Rules; choice of law issues are for the arbitrators to decide.

Court Disposition

Stay granted in favour of arbitration in the People's Republic of China

Orders

  • Stay proceedings in favour of arbitration in the People's Republic of China under UNCITRAL Model Law Article 8
  • Costs order nisi in favour of the defendants