上海佳船机械设备进出口有限公司 v. 美克斯海洋工程设备股份有限公司

At a glance

Parties

上海佳船机械设备进出口有限公司 (Jiachuan; applicant) v. 美克斯海洋工程设备股份有限公司 (Meikesi; respondent, in bankruptcy and acting through its bankruptcy administrator)

Case no.

(2019)浙04协外认1号

Court

Jiaxing Intermediate People's Court, Zhejiang Province, China

Forum and rules

Application to recognise a foreign arbitral award under the New York Convention and Article 283 of the PRC Civil Procedure Law

Underlying award(s)

Award of 14 May 2018 by sole arbitrator Clive Aston in an ad hoc LMAA arbitration in London, on the 15 June 2015 shipbuilding contract for hull no. DJHC8008

Treaty

Contract clause: Article 12 of the DJHC8008 shipbuilding contract (English law, LMAA arbitration); New York Convention

Court

Presiding judge 张涛; judges 杨剑 and 王黎明

Sector

Shipbuilding; offshore engineering equipment

Outcome

The award was recognised as legally effective in the People's Republic of China (1 July 2020).

Amount

The award ordered payment of USD 8,425,205.08 plus interest. The contract price was USD 58 million. The respondent bears the application fee of RMB 500.

The dispute

On 15 June 2015, Jiachuan (as main contractor) and 江苏大津重工有限公司 (Jiangsu Dajin, as builder) contracted as joint sellers to build a self-elevating multi-purpose offshore platform, hull no. DJHC8008, for Meikesi at a price of USD 58 million. Article 12 of the contract chose English law and LMAA arbitration before three arbitrators. A dispute arose over performance of the contract. Meikesi did not appoint an arbitrator, so the sellers' appointee, Clive Aston, became sole arbitrator. Meikesi did not file a defence, and on 14 May 2018 the arbitrator ordered it to pay USD 8,425,205.08 plus interest. Jiachuan applied to the Jiaxing court for recognition. Meikesi, now in bankruptcy, made four objections. It said it was denied a chance to present its case because the arbitration was not stayed while it challenged the arbitration agreement before the Shanghai Maritime Court. It said a sole-arbitrator tribunal breached the three-arbitrator clause. It said the LMAA list-of-issues procedure was skipped. And it said Jiachuan hid the true contract price, which distorted the damages awarded.

Key holdings

1. No denial of the right to present a case (New York Convention Art. V(1)(b)). The arbitrator extended Meikesi's deadline for a defence several times and warned it of the consequences. Meikesi had enough time and opportunity but did not use them. Apart from its 27 April 2018 email asking for a stay, it filed no defence. p. 8
2. The tribunal was properly composed (Art. V(1)(d)). The clause did not say how the tribunal would be formed if a party failed to appoint. The LMAA 2017 Terms (Art. 10) and section 17 of the English Arbitration Act 1996 therefore applied. Jiachuan gave Meikesi the 7-day notice required by section 17, so its appointee could act as sole arbitrator. pp. 8–9
3. Leaving out the exchange of a list of issues did not breach the agreed rules. Under Article 14 of the LMAA 2017 Terms, the tribunal may adjust the procedure set out in the Second Schedule at any time. The exchange is not mandatory, and Meikesi had repeatedly failed to file a defence. p. 10
4. No breach of public policy (Art. V(2)(b)). Meikesi never raised a formal jurisdictional objection before the tribunal. The award itself found the arbitration clause valid under English law, and the Shanghai Maritime Court also held it valid ((2017)沪72民特181号之一). Continuing the arbitration therefore did not harm Chinese judicial jurisdiction. pp. 10–11
5. The claim that Jiachuan concealed evidence of its relationship with H&C and the true contract price is not a ground listed in Article V(1). It would affect only the amount of damages and does not reach the level of a public-policy violation. The award was recognised, and the respondent bears the RMB 500 fee. pp. 11–12

Procedural history

1. 15 June 2015Shipbuilding contract for hull DJHC8008 signed. Article 12 provides for LMAA arbitration under English law.
2. 23–24 November 2017The sellers appoint Clive Aston as their arbitrator and give Meikesi 30 days to appoint its own.
3. 21–28 December 2017Meikesi says it has sued in the Shanghai Maritime Court over the validity of the arbitration clause and asks for a stay. On 25 December the sellers give 7 days' notice under section 17(2) of the Arbitration Act 1996.
4. 4 January 2018Clive Aston confirms his appointment as sole arbitrator.
5. 7 May 2018The Shanghai Maritime Court rules that the arbitration clause is valid.
6. 14 May 2018Award: Meikesi to pay USD 8,425,205.08 plus interest.
7. 19 July 2019Recognition application docketed by the Jiaxing Intermediate People's Court. A hearing is held on 30 August 2019.
8. 1 July 2020Civil ruling recognising the award in the PRC.

Tribunal, counsel and experts

For the claimant

上海中派律师事务所 · In-house (company employee) · 海神律师事务所

For the respondent

浙江峻德律师事务所 · 六合律师事务所

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Keywords

• recognition of foreign arbitral award
• New York Convention Article V(1)(b)
• Article V(1)(d)
• public policy
• LMAA
• ad hoc arbitration
• sole arbitrator
• Arbitration Act 1996 section 17
• failure to appoint arbitrator
• right to present case
• list of issues
• shipbuilding contract
• offshore jack-up platform
• DJHC8008
• Shanghai Maritime Court
• judicial sovereignty
• bankruptcy administrator
• China

Summary generated with AI from the published documents — refer to the award for the authoritative text.