Introduction to the HKIAC 'Small Claims' and 12 'Documents Only 1 procedures

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3 ONTENTS An Introduction 3 The Rule of Law in Hong Kong 6 International Arbitration in Hong Kong 8 Introduction to the Hong Kong 10 Maritime Arbitration Clause Hong Kong Maritime Arbitration Clause 11 Introduction to the HKIAC 'Small Claims' and 12 'Documents Only 1 procedures HKIAC 'Small Claims' Procedure 15 HKIAC 'Documents Only 1 Procedure 18 List of Members of the Hong Kong Maritime Arbitration Group Insert Hong Kong International Arbitration Centre with Hong Kong Maritime Arbitration Group (A division of the HKIAC)

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5 N INTRODUCTION Hong Kong is uniquely placed to provide dispute resolution services in maritime matters. Its empathy with the Asian traditions of mediation and its skill at blending the best of east and west have created the prime centre in Asia for the resolution of disputes. What is Arbitration? Arbitration is the referral of a dispute to one or more impartial persons for final and binding determination. It is private and informal, designed for quick, practical and inexpensive resolution of disputes. But arbitration is at the same time an orderly proceeding, whether supervised by an arbitral institution in accordance with their rules or formed as an 'ad hoc 1 arbitration, in which there is no supervising institution and the parties are free to initiate and agree their own governing procedures. In any case, the conduct of the arbitration will be governed by standards prescribed by law. There is a long tradition of using arbitration to resolve shipping disputes. It is well recognised that the informal and less litigious nature of arbitration has the result that contract partners are more likely to keep their business relationship during and after the dispute resolution process. For an arbitration to take place, the disputing parties must agree to take their dispute to arbitration, in practice, this agreement is often made before the dispute arises and is included as a clause in their commercial contract. But it may also be made after the contract is negotiated or after the dispute has arisen. In agreeing to an arbitration the parties are agreeing that their dispute will not be heard by a court but by a private individual or a panel or tribunal of several private individuals. If the parties have agreed to an arbitration, the courts will generally refuse to hear their case by staying the court case in order to force the reluctant party to honour their agreement to arbitrate. What are the advantages of Arbitration? Arbitration has a number of inherent advantages over litigation, namely Choice of arbitrator - parties are free to choose their own arbitrator Informality - less formal than litigation Finality - the award is final and legally binding Speed Secrecy Less costly than litigation - especially in 'documents only 1 arbitrations Enforceability - awards are easily enforceable in foreign courts through the provisions of the New York Convention Why arbitrate in Hong Kong? Facilities. Geographically convenient, superbly well served in communications, transport, financial services and accommodation, Hong Kong has for some time been the international financial, commercial and maritime capital of Asia.

6 Expertise. Hong Kong is a world centre of expertise in shipping with an enormous pool of experienced professionals available to support dispute resolution. In addition to lawyers qualified to advise on Hong Kong law, there are many experienced lawyers from most major international trading nations who are qualified to advise on the laws of their respective jurisdictions. When necessary to supplement its own arbitral experience, Hong Kong can draw on an international reservoir of specialist knowledge. Law. Hong Kong's arbitration law is based partly on English law and partly on the UNCITRAL Model Law on International Commercial Arbitration. Although the Model Law normally applies to international arbitrations conducted in Hong Kong, parties can elect to have their dispute determined under the domestic provisions if, for example, they wish to have a right of appeal on a point of law. The Arbitration Ordinance (Chapter 341 of the Laws of Hong Kong) governs arbitration in Hong Kong. Its provisions maximise the authority of arbitral tribunals and minimise opportunities for court intervention. Enforcement. The New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards lays down a detailed framework for the recognition and enforcement of arbitration awards. Over 100 countries are signatories to this Convention. Hong Kong adopted the Convention on 21st April 1977 by virtue of the United Kingdom's accession on Hong Kong's behalf. China is also a signatory to the Convention and applied it to Hong Kong with effect from 1st July Hong Kong courts recognise and enforce arbitration awards made in countries which are signatories to the Convention in accordance with the terms of that Convention. Similarly, Hong Kong awards can generally be enforced through the courts of other signatory countries. Awards made in the mainland of China and Hong Kong, as well as those made in Taiwan and Macau, are reciprocally enforceable on a similar basis to that set out in the New York Convention. Maritime Arbitration Group. In response to demand from the industry, in February 2000 the Maritime Arbitration Group (MAG) was formed as a division of the HKIAC. The Group maintains a list of members and their details, from which parties are able to select one or more arbitrators to hear their dispute. How do you select an Arbitrator? If you have agreed that the dispute will be heard under the rules of a particular arbitral institution, then application to that institution will start the arbitrator appointment procedure. For an 'ad hoc 1 arbitration, the terms of your arbitration agreement may specify the qualifications required to be held by the arbitrator and whether a tribunal of one, two or three arbitrators should be appointed. It is not necessary that you use a lawyer but it is common to do so. The law firm will normally recommend an appropriate arbitrator holding the required qualifications but, if you do not wish to use a law firm, then the HKIAC maintains a panel of maritime arbitrators of experience and distinction and is willing to recommend suitable arbitrators for your selection. In cases where the parties have not agreed on a mechanism for making appointments or the agreed mechanism has broken down, the Arbitration Ordinance gives the HKIAC the exclusive and statutory authority to appoint arbitrators. (See the following section on International Arbitration for a more extensive description of the process.) This power means that in Hong Kong the parties do not have to go through lengthy and expensive court proceedings to form their tribunal, unlike arbitrations in London where the parties may have to apply to the High Court to appoint arbitrators.

7 How does the Maritime Arbitration Procedure work? You may agree, either before or after the dispute has arisen, that the dispute will be heard under the rules of an arbitral institution, such as the rules of the London Maritime Arbitrators Association (LMAA) or the UNCITRAL Rules. Although the dispute resolution process will follow these rules, you may also agree that the dispute will be heard at and/or administered by the HK1AC. Most 'ad hoc' arbitrations, however, follow no rules and it is up to the parties or the tribunal to agree on the procedures to be followed. The only overriding requirement is that the arbitrator must always abide by the principle of 'natural justice 1, meaning that each party must be given the opportunity to argue its case, and to answer the case that is being argued against it. Arbitrations can be divided into two broad categories; the documents-only arbitration and the oral hearing arbitration. The documents-only arbitration is generally cheaper and faster and is usually, although not necessarily, suited to small claims or where there is a single issue at stake. Hong Kong International Arbitration Centre 38/F Two Exchange Square 8 Connaught Place Central, Hong Kong Tel : Fax : adr@hkiac.org The Hong Kong International Arbitration Centre (HKIAC) was established in 1985 to assist disputing parties to solve their disputes by arbitration and other means of dispute resolution. It was established by a group of leading business and professional people in Hong Kong to be the focus for Asian dispute resolution. It has been generously funded by the business community and by the Hong Kong Government but is totally independent of both and is financially self sufficient.

8 HE RULE OF LAW IN HONG KONG There are still widespread misunderstandings of the status of the Hong Kong Special Administrative Region since 1 st July These misunderstandings go so far as statements to the effect that Hong Kong government system has completely changed, that the rule of law has disappeared and that Hong Kong is now just another mainland Chinese city. These statements are very far from the truth, as the following article will explain. The status of Hong Kong as a Special Administrative Region with the PRC is governed by the Basic Law 1 which will remain in force until the year It is difficult to change the Basic Law for two reasons: it is the result of the 1984 Joint Declaration, which has the status of a bilateral treaty between the Governments of the PRC and the United Kingdom, and there are complex provisions in the Basic Law governing its amendment. The specific provisions of the Basic Law and Joint Declaration are given in some detail at the end of this article. Broadly speaking, the Joint Declaration and the Basic Law provide for Hong Kong to be governed by the people of Hong Kong with a high degree of autonomy, and for its system of Government and way of life to remain the same as that before reunification. The Basic Law contains some specific provisions dealing with shipping in Hong Kong. As a result of cooperation between the Governments of the PRC and the UK, the autonomous register was set up in 1990, just after the enactment of the Basic Law and well before reunification. Articles 124 to 127 of the Basic Law give authority for Hong Kong to maintain the shipping register, issue related certificates under its legislation and regulate conditions of seamen, and further guarantee access to the port for all merchant ships, and guarantee that private interests in shipping fields may continue to operate freely. Other aspects which are important to note are: a. The Legislature. In 1998 and this year, 2000, elections for the Legislative Council were held. The Basic Law provides for further elections thereafter every four years with the ultimate aim of full universal suffrage by a gradual and an orderly process. b. The Executive. On 1 st July 1997, only two persons in the Executive Branch of the Hong Kong Government changed. The Governor was replaced by the Chief Executive and the Attorney General was replaced by the Secretary for Justice. All other officials, including the Director of Marine, remained in place. c. The Judiciary. Appeals to the Privy Council in London have been replaced by appeals to the Court of Final Appeal, which was set up in Hong Kong to take the Privy Council's place. The Chief Justice and the Permanent Judges are all Hong Kong people. One overseas judge (selected from Common Law jurisdictions, including the United Kingdom) often sits on important Court of Final Appeal cases. The other Courts and the judges of those Courts have not changed. d. The Law. Article 8 of the Basic Law provides that the law in force prior to reunification remains in force. This means that the Common Law system is preserved and, in many shipping cases, English precedents are still much used.

9 Hong Kong is and still remains an exciting place to do business. The PRC Government is extremely reluctant to involve itself in Hong Kong affairs, leaving the governing of Hong Kong to the Hong Kong people. Hong Kong continues to have a free and outspoken press and the rule of law is upheld in the Courts. And Hong Kong continues to develop its infrastructure and institutions so that it can remain the prime service centre for Asia. (Adapted from a speech given by Robin Peard to the Seatrade Hong Kong Conference, December 1999) Specific Articles of the Basic Law referred to in the text. Article 5 The socialist system and policies shall not be practised in the Hong Kong Special Administrative Region, and the previous capitalist system and way of life shall remain unchanged for 50 years. Article 124 The Hong Kong Special Administrative Region shall maintain Hong Kong's previous systems of shipping management and shipping regulation, including the system for regulating conditions of seamen. The Government of the Hong Kong Special Administrative Region shall, on its own, define its specific functions and responsibilities in respect of shipping. Article 125 The Hong Kong Special Administrative Region shall be authorised by the Central People's Government to continue to maintain a shipping register and issue related certificates under its legislation, using the name "Hong Kong, China". Article 126 With the exception of foreign warships, access for which requires the special permission of the Central People's Government, ships shall enjoy access to the ports of the Hong Kong Special Administrative Region in accordance with the laws of the Region. Article 127 Private shipping businesses and shipping related businesses and private container terminals in the Hong Kong Special Administrative Region may continue to operate freely. 1 Enacted in 1990 by the National People's Congress under the PRC Constitution. 7

10 NTERNATIONAL ARBITRATION IN HONG KONG The main legislation in Hong Kong governing arbitration is the Hong Kong Arbitration Ordinance Since April 1990, two separate arbitration regimes have been in force in Hong Kong, one for domestic arbitration, the other for international arbitration. Hong Kong Arbitration law is based partly on English law and partly on the UNCITRAL Model Law on International Commercial Arbitration. The rules governing international arbitrations are based on the UNCITRAL Model Law and the rules governing domestic arbitrations are based on the arbitration law in England. Maritime Arbitrations in Hong Kong are generally international arbitrations, so the following comments deal primarily with international arbitration. The principal arbitration institution in Hong Kong is The Hong Kong International Arbitration Centre (HKIAC). It was established in 1985 to assist disputing parties to resolve their disputes by arbitration and by other means of dispute resolution e.g. mediation. It was established by a group of leading business and professional people in Hong Kong to be the focus for dispute resolution in Asia. The HKIAC is independent of the Hong Kong Government. 1. Appointment Procedures (a) Number of Arbitrators: Under the UNCITRAL Model Law, the parties are free to determine the number of arbitrators. Where the parties have failed to agree on the number of arbitrators who should be appointed to hear the dispute, the claimant should apply to the HKIAC for a decision as to whether one or three arbitrators should hear the dispute before appointing any arbitrator. When deciding the number of arbitrators appropriate for any particular dispute, the HKIAC should take into account various factors like the amount in dispute; the complexity of the claim; the urgency of the matter; etc. (b) Choice of Arbitrators Under the UNCITRAL Model Law, the parties are free to elect an arbitrator of their choice. The law does not impose general restrictions on who may be appointed an arbitrator. However, there is nothing to stop the parties from putting in the Arbitration Agreement a requirement that the member of the tribunal must have some special qualifications. (c) Procedure for appointment Under the UNCITRAL Model Law, the parties are free to agree on a procedure for appointing the arbitrator or arbitrators. Failing such agreement:- in an arbitration with three arbitrators, each party shall appoint one arbitrator and the two arbitrators thus appointed shall appoint the third arbitrator.

11 in an arbitration with a sole arbitrator if the parties are unable to agree on the arbitrator, he shall be appointed upon request of a party by the HKIAC. * if a party fails to appoint their arbitrator within 30 days of receipt of a request to do so from the other party, or if the two arbitrators fail to agree on the third arbitrator within 30 days of their appointment the appointment shall be made upon request of a party by the HKIAC. Appointment of arbitrators by the HKIAC will take about 3-4 weeks. Apart from the appointment fees charged by the arbitrator appointed (which is usually about HK$1,000), the HKIAC charges HK$4,000 for the appointment. 2. Right of Appeal to Court on Points of Law There are no provisions in the UNCITRAL Model Law that provide for appeal to the Court on a point of law, and the Court can only set aside an award on very limited grounds e.g. a party to the arbitration agreement was under some incapacity; a party was not given proper notice of the appointment of the arbitrator; the arbitrators have exceeded their jurisdiction. Author: Peter Shelford Secretary, Hong Kong Maritime Arbitration Group

12 untroduction TO THE HONG KONG MARITIME ARBITRATION CLAUSE The clause has been introduced with the purpose of encouraging and promoting arbitration in Hong Kong, in particular maritime and trading arbitrations. The wording of the clause has been drafted to be of a format similar to that of the standard clause adopted by the London Maritime Arbitrators Association (the LMAA). Arbitration in Hong Kong is generally governed by the Arbitration Ordinance, which has two regimes, one domestic and one international. Maritime arbitrations are normally governed by the international regime which is based on the UNCITRAL Model Law plus other provisions adapted from a number of sources including the English Arbitration Act The clause contains an option for the parties to choose either Hong Kong law or English law, although the law in Hong Kong is to a very large extent based upon English law in any event. 2. The clause provides specifically for the appointment of one arbitrator by each party with a third arbitrator appointed by the two so chosen. In the absence of this provision, and also absent agreement between the parties, it would normally be necessary to make an application to the Hong Kong International Arbitration Centre (the HKIAC) for a decision to be made firstly on the number of arbitrators and secondly, if a sole arbitrator is determined to be appropriate, for that sole arbitrator to be appointed. This can cause some delay and additional expense. The clause also specifically provides that if the Respondent does not appoint their arbitrator within 14 days, then the Claimants' arbitrator can be appointed as sole arbitrator. It is of course always open to the parties to agree on a sole arbitrator in any event. 3. There is an option to insert a sentence providing for the arbitrators to be ordinarily resident in Hong Kong. One purpose of this is to encourage the appointment of arbitrators who are familiar with the Hong Kong legal and procedural system. Perhaps more importantly, appointment of arbitrators resident outside Hong Kong is likely to lead to delay and additional expense. 4. The clause makes specific reference to the Small Claims Procedure, which is suitable where the claim and counterclaim is less than US$50,000. The parties can also adopt the Small Claims Procedure where (e.g.) the issues are simple and little or no oral evidence is required. 10

13 ONG KONG MARITIME ARBITRATION CLAUSE This Contract shall be governed by and construed in accordance with Hong Kong/English* law and any dispute arising out of or in connection with this Contract shall be referred to arbitration in Hong Kong in accordance with the Arbitration Ordinance (Cap.341) or any statutory modification or re-enactment thereof save to the extent necessary to give effect to the provisions of this Clause. The reference shall be to three arbitrators, [#], one to be appointed by each of the parties hereto and the third by the two so chosen, and their decision or that of any two of them shall be final and binding. A party wishing to refer a dispute to arbitration shall appoint its arbitrator and send notice of such appointment in writing to the other party requiring the other party to appoint its arbitrator within 14 calendar days of that notice and stating that it will appoint its arbitrator as sole arbitrator unless the other party appoints its own arbitrator and gives notice that it has done so within the 14 days specified. If the other party does not appoint its own arbitrator and give notice that it has done so within 14 days specified, the party referring a dispute to arbitration may, without the requirement of any further prior notice to the other party, appoint its arbitrator as sole arbitrator and shall advise the other party accordingly. The award of a sole arbitrator shall be binding on both parties as if that arbitrator had been appointed by agreement. Nothing herein shall prevent the parties agreeing in writing to vary these provisions to provide for the appointment of a sole arbitrator. In cases where neither the claim nor any counterclaim exceeds the sum of USD50,000 (or such other sum as the parties may agree) the arbitration shall be conducted in accordance with the Hong Kong International Arbitration Centre Small Claims Procedure current at the time when the arbitration proceedings are commenced. (*DeIete as appropriate. If no deletion is made, Hong Kong law shall apply). (#The words "who shall ordinarily be resident in Hong Kong" may be inserted here. The appointment of an arbitrator resident outside Hong Kong may substantially increase the costs and result in delay). INLB. The above clause can be incorporated into a contract using one of the following short form alternatives:- (a) Arbitration in Hong Kong in accordance with the "Hong Kong Maritime Arbitration Clause", Hong Kong law to apply. (b) Arbitration in Hong Kong in accordance with the "Hong Kong Maritime Arbitration Clause", English law to apply. 11

14 NTRODUCTION TO THE HKIAC "SIW\LL CLAIMS" AND "DOCUMENTS ONLY" PROCEDURES A complaint frequently made about arbitration in Hong Kong is that it does not provide a costeffective way of resolving disputes involving relatively small sums. The Hong Kong International Arbitration Centre ("HKIAC") has addressed this by introducing two new procedures, which should be of particular interest to the shipping and trading communities in Hong Kong and the region. A new "Small Claims" procedure is available in cases where the claim is no more than US$50,000, and a new "Documents Only" procedure can be used where it has been decided that there is no need for an oral hearing. Both procedures are based on virtually identical procedures established by the London Maritime Arbitrators Association. The HKIAC Small Claims Procedure The HKIAC Small Claims procedure has been designed primarily to deal with low value shipping disputes, for example, small claims for outstanding charterhire in cases where there are no complex issues, and witnesses are not expected to give oral evidence. The procedure is equally suitable for use in non-marine disputes such as small quality or quantity claims arising from commodities trading. One prominent Hong Kong arbitrator has indicated to the writer that he would be prepared to use the Small Claims procedure to deal with this kind of dispute. In bigger cases of either type, the procedure could be used where only a single issue is at stake. The procedure is obviously only available where the parties have agreed to it, but this can be achieved either by inserting a clause into the relevant contract referring small claims to arbitration under the new rules (it is understood that a standard clause is currently being prepared by the HKIAC's Maritime Arbitration Group), or by the parties simply agreeing to its use after the dispute has actually arisen. The Procedure The Small Claims procedure is simple and straightforward: Parties appoint a sole arbitrator. Within 14 days, claimant sends out a letter of claim comprising its entire case, i.e. statement of claim and relevant documents, such as witness statements, expert's report, legal submissions etc. If the parties cannot agree on a sole arbitrator, the HKIAC may be asked to consider the letter of claim and make an appointment. «Within 28 days, respondent delivers its letter of defence and counterclaim, again comprising its entire case. 12

15 Within 21 days, claimant delivers its letter of reply and defence to counterclaim. 9 Within 14 days, respondent delivers letter of reply to defence to counterclaim. Within one month from any hearing, or from receiving all relevant documents and submissions, arbitrator makes an award. This uncomplicated procedure is complemented by a number of equally straightforward principles: Limited power to extend time for service of pleadings. Pleadings served late are inadmissible. No discovery of documents, but if a party has not produced a relevant document, this can be ordered. Adverse inferences can be drawn if the document is still not produced. No hearing, other than in exceptional circumstances. In such exceptional circumstances, the hearing should not take more than one day. No right of appeal to the courts. Clause 9 of the procedure gives the arbitrator, again in "exceptional cases", the liberty to depart from or vary the procedure at his entire discretion. Experience in London suggests that, this power is rarely, if ever, expressly invoked, but instead is used to give the arbitrator a degree of flexibility. As one experienced arbitrator has said: "One is frequently dealing with commercial people who have to travel on business. Case handlers become ill. Their wives have babies. Shipowners and charterers running their business cannot always find the necessary time to drop everything else for an arbitration over an incident which occurred perhaps months earlier. You have to decide whether they are swinging the lead or are genuine. It is not always possible to follow the procedure to the letter." Costs of the Small Claims Procedure The Small Claims procedure radically limits the fees payable to the arbitrator, and the costs recoverable by a successful party: The claimant must pay the arbitrator a fixed "small claims fee" of HK$15,000. This covers the arbitrator's appointment fee, the costs of dealing with interlocutory exchanges, a hearing limited to one day, the preparation of the award, and the assessment of any costs. Expenses are charged extra. If there is a counterclaim, and it exceeds the amount of the claim/the respondent must pay an additional fee of HK$7,500. HKIAC charges HK$ 1,500 to appoint an arbitrator. The arbitrator has power to direct which party must bear ultimate responsibility for the small claims fee and the tribunal's expenses, and for the legal costs incurred by the successful party. The arbitrator may assess the recoverable costs. This is to be done on a "commercial basis", but the amount may not exceed HK$30,

16 Documents Only Procedure The HKIAC "Documents Only" procedure is available where the parties have agreed, or where an existing arbitration tribunal has directed, that no oral hearing is needed. The procedure is again intended to encourage speed and economy: Claimant to deliver Claims submissions and supporting documents within 28 days. Defence and Counterclaim submissions within 28 days afterwards. Claimant's Reply to Defence and Counterclaim within 28 days afterwards. Respondent's final submissions within 21 days afterwards. Award. Promoting Hong Kong These new procedures have been introduced as part of the HKJAC's campaign to promote Hong Kong as an international commercial and maritime arbitration centre. By simplifying arbitral procedures, and limiting the cost, the new rules encourage parties to go to arbitration to resolve their disputes. If they catch on, and there is no reason why they should not, they provide a quick, cheap and user-friendly alternative to litigation and other more traditional forms of arbitration. Author Charles Allen Secretary, HKMLA Arbitration and ADR Sub-committee u

17 HE HKIAC SMALL CLAIMS PROCEDURE 1. Introduction These provisions shall be known as the HKIAC Small Claims Procedure. The procedure is suitable for use in arbitrations where neither the claim nor any counterclaim exceeds the sum of US$ 50,000. It is not suitable for use where there are complex issues or where there is likely to be examination of witnesses, but may be suitable for handling larger claims where there is a single issue at stake. 2. Appointment of Arbitrator (a) If a dispute has arisen and the parties have agreed that it should be referred to arbitration under the Small Claims Procedure, then, unless a sole arbitrator has already been agreed on, either party may start the arbitration by giving notice to the other requiring him to join in appointing a sole arbitrator. If within fourteen days the parties have agreed on a sole arbitrator and the intended arbitrator has accepted the appointment, the Claimant shall within a further fourteen days send to the Respondent (with copies to the arbitrator) a letter of claim accompanied by copies of all relevant documents including experts' reports and shall further send to the arbitrator a remittance in his favour for the small claims fee as defined in paragraph 3(b). (b) If the parties have not within fourteen days agreed on a sole arbitrator, either party may apply in writing to the Hong Kong International Arbitration Centre (HKIAC), for the appointment of a sole arbitrator. Such application shall be copied to the other party and shall be accompanied by a copy of the letter of claim together with copies of all said relevant documents and a remittance for the said small claims fee plus HK$ 1,500 where applicable in favour of the HKIAC. The HKIAC, having considered the nature of the dispute shall appoint an appropriate arbitrator and shall give notice to the parties. The HKIAC shall send to the arbitrator the letter of claim and the documents together with the said small claims fee, and shall retain the balance in respect of administrative expenses. 3. The Arbitrator's fee (a) The fixed fee includes the appointment fee, interlocutories, a hearing not exceeding one day (if required by the arbitrator pursuant to-para 5(g), the writing of the Award and the assessment of costs (if any). It does not include expenses, such as the hire of an arbitration room, which shall in the first instance be paid by the Claimant on demand. (b) The Small Claims fee shall be HK$ 15,000 or such standard fee as shall be fixed from time to time by the Council of the HKIAC. 15

18 (c) In the event of the Respondents putting forward a counterclaim which exceeds the amount of the claim an additional fixed fee in the amount of HK$ 7,500 is payable by the Respondents. Such fee is to be paid within fourteen days of service of defence and counterclaim submissions failing which the arbitrator may, at his discretion, stay the counterclaim and proceed with the original claim. (d) If the case is settled amicably before an award has been written, the arbitrator may retain out of the small claims fee a sum sufficient to compensate him for services thus far rendered and any balance shall be repaid. 4. Right of Appeal Excluded The right of appeal to the Courts is excluded under this procedure. By adopting the Small Claims Procedure the parties shall be deemed to have agreed to waive all rights of appeal. 5. Procedure (a) A letter of defence and details of counterclaim (if any) accompanied in each case by copies of all relevant documents including any experts' reports shall be delivered to the Claimant within twenty-eight days from receipt of the letter of claim or from the date of appointment of the arbitrator, whichever shall be the later. (b) Letter of reply and defence to counterclaim (if any) within a further twenty-one days. (c) Where there is a counterclaim, letter of reply to defence to counterclaim within a further fourteen days. (d) Any extension to the above time limits must be applied for before expiry of the existing time limit. If a party fails to serve its pleading within the time limit set, the arbitrator, on the application of the other party or of his own motion, will notify the defaulting party that unless the outstanding communication is received within a fixed period (maximum 14 days) he will proceed to the award on the basis of the submissions and documents before him to the exclusion of all others. Any pleading submitted by the defaulting party subsequent to expiry of the time limit set by the arbitrator's notice shall not be admissible. The time allowed by the arbitrator's notice, added to any extension of time previously allowed in respect of the same pleading shall not in total exceed 28 days. (e) Following service of the letter of reply, or, where there is a counterclaim, following service of the letter of reply to defence to counterclaim, the arbitrator may declare to the parties that pleadings have closed. No further pleadings shall be considered by the arbitrator following such a declaration. (f) Copies of all the above letters and documents shall be sent to the arbitrator and to the other party, or if the other party is acting through a solicitor or representative, to that solicitor or representative. 16

19 (g) There shall be no hearing unless, in exceptional circumstances, the arbitrator requires this. (h) In the case of an oral hearing the arbitrator shall have the power to allocate the time available (which shall be limited to one working day) between the parties in such manner that each party has a reasonable opportunity in which to present his case. (i) All communications or notifications under this procedure may be by letter or telefax. 6. Disclosure of Documents (a) There shall be no Discovery, but, if in the opinion of the arbitrator a party has failed to produce any relevant document(s), he may order the production of such document(s) and may indicate to the party to whom the order is directed that, if without adequate explanation he fails to produce the document(s), the arbitrator may proceed on the assumption that the contents of the document(s) do not favour that party's case. (b) The expression 'relevant documents' includes all documents relevant to the dispute, whether or not favourable to the party holding them. It includes witness statements, experts' reports and the like on which he intends to rely, but does not include documents which are not legally disclosable. 7. The Award The arbitrator will make every effort to publish the award within one month, in a documents only case, from the date when the arbitrator has received all relevant documents and submissions, or, where there is an oral hearing, from the close of the hearing. 8. Costs The arbitrator may give directions with regard to the ultimate responsibility for his fee and expenses and with regard to legal costs and may assess such costs. Such assessment shall be on a commercial basis having regard to the nature of the reference. Unless the parties otherwise agree, the amount which one party may be ordered to pay to the other in respect of legal costs shall be assessed at a sum in the arbitrator's discretion up to HK$ 30,000, or such other maximum figure as shall be fixed from time to time by the Council of the HKIAC. 9. General The arbitrator may in exceptional cases depart from or vary the above provisions at his entire discretion. 17

20 HE HKIAC 'DOCUMENTS ONLY 1 PROCEDURE 1. Introduction These provisions shall be known as the HKIAC 'Documents Only' Procedure. 2. General (a) If it is determined by the tribunal or agreed by the parties that the dispute is to be decided without an oral hearing the procedure set out in paragraph 3 below is recommended for adoption by agreement. (b) When this procedure (or any modification) has been agreed, the tribunal should be so informed. The tribunal must be promptly advised if, at a later stage, the parties or either of them wish to apply for an oral hearing. (c) The exchange of submission, etc., will take place directly between the parties unless the case is being handled by others (e.g. by lawyers) on their behalf. (d) Copies of all submissions, comments and documents must be supplied simultaneously to the tribunal, and all communications with the tribunal must be copied to the other party. (e) All documents relied on must be legibly copied and translations supplied as necessary. 3. Procedure (a) Within 28 days of agreement by the parties to adopt the procedure or of the order of the tribunal, the claimants shall send to the respondents, with copies to the tribunal, their written claim submissions, together with copies of supporting documents. (b) Within 28 days of the service of the claim submissions, the respondents shall send to the claimants, with copies to the tribunal, their written submissions (including those relating to any counterclaim) together with copies of the documents relied on additional to those already provided by the claimants. (c) If there is no counterclaim, the claimants' final submissions (if any) on the claim shall be provided to the respondents and the tribunal within 21 days after receipt of the respondents' submissions and documents. Effective date: 1st January

21 (d) If there is a counterclaim: f 3 M AY 2003 }-* * ~.i 1 ' (i) The claimants shall furnish submissions and any additional documents relative to the counterclaim within 28 days after receipt of the respondents' submissions and documents. (ii) The respondents' final submissions (if any) on the counterclaim shall be provided within 21 days after receipt of the claimants' submissions and additional documents (if any). (e) The tribunal will then give notice to the parties of its intention to proceed to its award and will so proceed unless either party within seven days requests, and is thereafter granted, leave to serve further submissions and/or documents. 19

22 ilst OF MEMBERS HONG KONG MARITIME ARBITRATION GROUP This list is neither inclusive nor exclusive and does not replace the Panel maintained by the Hong Kong International Arbitration Centre. Persons are included at their own request and their inclusion on the list is no guarantee of their expertise or their qualifications. The appointment of one or more of the names is at the full risk and responsibility of the person making the appointment. Those wishing to make an appointment should carry out their own enquiries about the person they wish to appoint. Arthur BOWrmg 1A/ 42 Coastline Villa, Tel : BSc FCIArb FHKIArb FICS FNI Peninsula Village, Fax : MRINA FR1N Discovery Bay, Office Fax: Hong Kong Panel Arbitrator HKIAC. Supporting Member LMAA. Seagoing experience as Deck Officer. Experience also as Classification Society surveyor. Operations Superintendent, Owning and Chartering freight trader, Fleet Insurance Manager and Manager for shipping related claims for major international commodities trading house. Currently Director of the Hong Kong Shipowners Association. Part-time arbitrator since MlCnaei BrOOkS c/ 0 Sinclair Roche & Temperley Tel : LIB Solicitor FCIArb FHKIArb 42A Bank of China Tower, Fax : Garden Road, Central, Hong Kong Date of birth 23 April Solicitor (Hong Kong; England and Wales) Over 18 years in practise as a solicitor (10 years in Hong Kong) specialising in maritime and commercial disputes. Recent experience as advisor within an F,D&D Association. Visiting professor of law, Dalian Maritime University. Arbitrator since Chan, Ylll-kei c/ 0, MC Development Management Ltd Tel: BBA MA FICS FCIArb FSIArb 17th Floor, St. George's Building, Fax : FHKIArb 2 Ice House Street, Direct Tel : Central, Hong Kong Panel member HKIAC and S1AC. BIMCO Documentary Committee member Over 25 years working experience in various fields - chartering, operation, ship sale and purchase, newbuilding contracting, ship finance, corporate structuring and tax planning. Stewart Crowther 41/F Bank of china BUiidmg, iei: 2103 osos MA Oxon Solicitor 1 Garden Road, Fax: Central, Hong Kong 1974 to 1977, House lawyer to US tanker operators, Koch Shipping Inc. London to 1989, Manager P&! claims dept. World-Wide Shipping Agencies Ltd. Hong Kong to date, Partner Alsop, Wilkinson/Dibb Lupton AIsop, Hong Kong. Experience: charter party disputes, new building disputes, ship management disputes, crew claims, bill of lading disputes, insurance coverage disputes, director's liability, letter of credit disputes, sale of goods disputes. Last updated: 1st January 2001 See Disclaimer Page 1 of 4

23 Eric G. Edmondson Master Mariner FNl B6, 29th Floor, Causeway Centre, 28 Harbour Road, Wanchai, Hong Kong Tel : Fax : Home Tel : Home Fax : Born Sea-going Officer (14 years) and Captain (16 years). Resident in Hong Kong since Active Marine Consultant and Surveyor from Expert Witness at Tribunals and Commercial Courts Hong Kong, China, Korea, Vietnam and London. Negotiated claim settlements in most North and East Asia Countries. Extensive practical experience in all types of cargo before, during and after shipment, collisions, sinkings, groundings etc. Harry Gilbert MIMarE leng MCIArb c/o Wallem Group Ltd Tel : th Floor, Hopewell Centre Fax : Queens Road East Wanchai, Hong Kong Date of birth years experience as seagoing engineer in deepsea and offshore oil industry. Senior management positions exclusively in the shipping industry since Particular experience in ship management and associated contracts. Currently Chief Executive of the Wallem Group of companies in Hong Kong. A.K. Hazari Master Manner MICS MNl AClArb c/o Anglo-Eastern Ship Management Ltd 23rd Floor, CEF Life Tower, 248 Queen's Road East Wanchai, Hong Kong Tel : Fax: Chris Howse Solicitor FCIArb FHKlArb c/o Richards Butler 20th Floor, Alexandra House, Chater Road, Central, Hong Kong Tel : Fax : Mobile : Pane! Arbitrator HKIAC. Panel Arbitrator CMAC. Supporting member LMAA. Joined Richards Butler, London Qualified as a solicitor in England and Wales in 1978; Hong Kong 1981; Australia Partner Richards Butler 1982; resided in Hong Kong since Over twenty years experience in charterparty and bill of lading disputes and all other aspects of marine litigation and arbitration; sale of goods, commodity disputes and international trade. John D. Kerr LLB DipLp Barrister Pacific Chambers, 901 Dina House, 11 Duddell Street, Central, Hong Kong Tel : Fax: Lee, Fook Choon Masfer Manner LLM ACll FCIArb FSNI MNl FSIA FlnstPet c/o Topi is and Harding Ltd 14/F Shanghai Industrial Investment Building Hennessy Road Wanchai, Hong Kong Tel : Fax : Chartered Arbitrator. An insurance loss adjuster for the last 22 years and appointed as arbitrator since Areas of arbitration interest include disputes related to marine insurance claims (hull/cargo), charter party, bunkers, cargo shipments (oil, bulk, etc) and ship repairs. Panel arbitrator with CIArb, HKIAC, S1AC, CMAC and RAG. Last updated: Jst January 2001 See Disclaimer Page 2 of 4

24 Raymond Li c/o Ray Glory shjpping Ltd Tei MA(ArbDR) FCIArb F1CS MCIT ] 004 Tung Chee Commercial Centre Fax : Des Voeux Road, W Mobile : Hong Kong Panel Arbitrator HKIAC. Started in shipping business in The early 1 5 years were in container shipping and liner conferences. The latter years have been engaged in shipbroking, agency, chartering, operation and shipowning. Part time arbitrator since J.A. Lister c/0gard Services(HK) Ltd Tel /F Shun Ho Tower, Fax : Ice House Street, Hong Kong Residing in Hong Kong since Working in P&l industry for 25 years and Director of Gard Asia (HK) Ltd since Arbitrator since 1984, over 70 awards published. Subject matters - Shipping (including charter party, bills of lading, MOA, repair contract), Sale of Goods and Insurance disputes. Mo, Sin-chi FICS FHKIArb c/o Eastern Worldwide Co. Ltd. 2 1/F Western Centre Des Voeux Road West, Central, Hong Kong Tel: Fax : Office Fax : Started career in shipowning company in Currently practising: agency, shipbroking, stevedoring, forwarding and transport; operating barges, vehicles and distribution centres; dealing with insurers, lawyers and claimants. Andrew Moore 2703 Uni versa i Tracj e Cen tre Tei : Master Manner FNl MlnstPet 3 Arbuthnot Road Fax : Central, Hong Kong 32 years in the shipping industry, both at sea and ashore. Independent Marine Consultant and Surveyor since 1982 and Hong Kong resident since Expert witness reports for international maritime litigation or arbitration proceedings in Far East, Europe and USA. Practical and commercial experience of most forms of maritime disputes including technical, casualty and charterparty matters. Jimmy Ng r Jim-rni Department of Maritime Studies Tel: MCITMNI Master Mariner The Hong Kong Polytechnic University, Fax : Hung Horn, Kowloon, Hong Kong Date of Birth 19 Jan Panel Member HKIAC. After 13 years sea-going service and two years in chartering and ship operation with C.H. Tung Group, joined Jardine Insurance Brokers from 1992 to 1997 as Assistant Director in placing and claims handling for P&l, H&M, cargo and marine liabilities. Became senior lecturer in Hong Kong Polytechnic University in 1997, lecturing on areas of carriage of goods, marine insurance and shipping law. Part-time Arbitrator since tn Floor, Prince's Building, Tel : JP Chartered Arbitrator 1 0 Chater Road, Fax : FCLArb FHKIArb FSlArb Central, Hong Kong Panel member of Chartered Institute of Arbitrators, Hong Kong International Arbitration Centre, Singapore International Arbitration Centre and British Columbia International Commercial Arbitration Centre. Formerly Partner-in-charge Shipping Litigation Department/Johnson Stokes & Master 1974 to Maritime arbitrator since 1987 during which time published in excess of fifty awards in shipping cases. T. IVeyCS 16th Floor, I Pacific Place, Tel : Barrister FCIArb 88 Queensway, Hong Kong Fax: Last updated: 1st January 2001 See Disclaimer Page 3 of 4

25 Peter Shelford c/ociyde&co Tei: 2878 aero LLB Solicitor 18th Floor, CITIC Tower, Fax : Tim Mei Avenue, Central, Hong Kong Joined Clyde Co, London, in Qualified as a solicitor in England in Became a partner in Clyde Co in Transferred to Clyde Co's Hong Kong office in 1996 and qualified as a Hong Kong lawyer in the same year. Twenty-five years of experience in all aspects of shipping, marine insurance and international trade. Particular expertise in charter party disputes. Member of the HKIAC panel of arbitrators. Mary Thomson c/0 Koo and Partners Tel BA(Hons)Law Solicitor FClArb 5/F Wing On House Fax : FHKIArb MInstPet 71, Des Voeux Road Central Hong Kong Supporting member LMAA. Qualified Barrister Claims Insurance with ship managers, Zodiac Maritime, London. Claims Underwriting with Thomas Miller, London. Solicitor in London and, since 1992, Hong Kong. All aspects of maritime and commercial disputes including charterparty, bill of lading, international trade, construction, crude oil, ship management, insurance, ship building, ship S&P, ship finance, etc. AndreW WllliamS c/0 The china Navigation Co. Ltd. Tel : MClArb 9/F East Wing, Warwick House Fax : Taikoo Place Quarry Bay, Hong Kong worked for a Hong Kong correspondent to several major P l Clubs, involved in a wide variety of maritime claims including cargo claims and charter party disputes to present Insurance Manager to Swire Pacific Offshore and China Navigation Co. Ltd. handling all risk management functions from insurance purchasing to resolution of all marine insurance matters and disputes. Michael Winckless 21st Floo, Te, Chartered Arbitrator Barrister Hong Kong Diamond Exchange Building Fax : FClArb FHKIArb BSc (Econs) MBA 8-10 Duddell Street, Central, Hong Kong Born General Manager, The First National Bank of Chicago (including Shipping Dept. in London and Piraeus) Management Consultant, Mckinsey Co Inc Shipping, J. Lauritzen A/S, Shipowners Finance Director, Prompt Shipping Inc Management Consultant, 1ST Management Consultants Ltd to date Barrister-at-law. Member of the HKIAC Panel of Arbitrators. James D. Wort J>D. Wort& Co Ltd> Tei FClArb B6 29th Floor Causeway Centre, Fax : Harbour Road, Wanchai, Hong Kong Active Consulting Marine Engineer and Ship Surveyor. Sea-going experience up to Chief Engineer followed by 5 years as Superintendent Engineer. In private practice since 1978 in UK and Hong Kong. Prefer technical disputes arising from Charter Parties, Sale Purchase Agreements, Building Contracts, Repair Contracts and Management Agreements. Experience in ship ownership and management. Extended knowledge of ship and engine casualties, salvage, wreck removal, fire, etc. Philip Yang 18ACasey Building, Tel: FlCSACll FClArb FHKIArb FSIArb 38 Lok Ku Road, Fax : Sheung Wan, Hong Kong Full time Maritime and international Trade Arbitrator, mainly in Hong Kong but also London, Singapore and Beijing. Arbitrating since 1980, over 100 Awards issued in past 10 years. Past-Chairman ClArb Hong Kong Branch ( ), Council member HKIAC, Member of the Professional Committee CIArb, London. Visiting Professor Hong Kong City University and 10 other universities in Mainland China. Writer of many books and papers on international trade and shipping matters. Last updated: 1st January 2001 See Disclaimer Page 4 of 4