Hong Kong Standard Form of Building Contract - Arbitration Clause

01 Jun 2001

HomeNewsHong Kong Standard Form of Building Contract - Arbitration Clause
01 Jun 2001

HKIAC's Council has issued the following clarification in regard to appointments under this clause :-

  1. In a number of Hong Kong standard form of building contracts and some "one off" contracts modeled on those standard forms, the dispute resolution clause is as follows:-

"Provided always that in case any dispute or difference shall arise between the Employer or the Architect on his behalf and the Main Contractor, either during the progress or after the completion or abandonment of the Works, as to the construction of this Contract or as to any matter or thing of whatsoever nature arising thereunder or in connection therewith (including any matter or thing left by this Contract to the discretion of the Architect or the withholding by the Architect of any certificate to which the Main Contractor may claim to be entitled or the measurement and valuation mentioned in clause 30 (5) (a) of these Conditions or the rights and liabilities of the parties under clauses 25, 26, 32 or 33 of these Conditions), then such dispute or difference shall be and is hereby referred to the arbitration and final decision of a person to be agreed between the parties, or, failing agreement within fourteen days after either party has given to the other a written request to concur in the appointment of an Arbitrator, a person to be appointed on the request of either party by the President or Vice-President for the time being of The Hong Kong Institute of Architects co-jointly with the Chairman or Vice-Chairman for the time being of the Royal Institution of Chartered Surveyors (Hong Kong Branch)."

or contains wording to the same effect.
It should be noted that the Royal Institute of Chartered Surveyors (Hong Kong) Branch no longer exists.

  1. Assuming the arbitration is a domestic arbitration, Section 12(1) of the Arbitration Ordinance applies rather than Section 12(2) since the contractual appointment mechanism has broken down.
  2. Section 12(1)(a) provides that the party desiring HKIAC to make an appointment has to give the other party a 7 seven clear days notice to concur in appointing a single arbitrator. If the parties do not so concur, HKIAC can accept an application to appoint a single arbitrator.
  3. HKIAC is aware that the Hong Kong Court of First Instance has dealt with two cases where HKIAC's appointments under the above clause were queried. Although the appointments were not set aside, one of the decisions of the Court of First Instance is under appeal. It is not appropriate for further comment to be made until the appeal is disposed of.
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