What happens if it seems that the arbitrator deciding your case had already made up his mind, or worse, had fallen asleep during the hearing ? The Hong Kong Court of First Instance recently addressed this bizarre situation in the case of CNG v G [2025] HKCFI 3598 and the decision clarifies the limits of challenging an arbitrator’s decisions for apparent bias and reinforces the importance of raising objections promptly.
The Dispute
The case arose from a bitter four-year arbitration between shareholders of a joint venture company. After multiple awards were made against CNG (which it unsuccessfully challenged in court), CNG sought to remove the presiding arbitrator on the ground of doubts as to his impartiality, alleging that he had fallen asleep during hearings and displayed overt hostility towards CNG and its legal representatives. CNG argued this conduct gave rise to “justifiable doubts as to his impartiality”.
The Sleeping Episode
CNG claimed that the presiding arbitrator was sleeping for 10 to 15 minutes during the 25 June 2024 hearing (despite not relying on this instance in the CNG’s Notice of Challenge (“NOC”) but claimed that the presiding arbitrator was asleep during the hearings on 7 March 2024, 30 April 2024 and 1 May 2024 respectively in the NOC). The Court held that even if the complaint concerning the alleged sleeping episode on 25 June 2024 were to be taken into consideration, and even if CNG’s allegation were accepted as true, this alone did not establish partiality.
Applying the “fair-minded and informed observer” test, the Court noted that the arbitrator allegedly sleeping during submissions on costs components was not a particularly critical part of the proceedings. Second, CNG’s own legal team raised no immediate objection at the hearing, suggesting that they did not regard the brief inattention as materially affecting the outcome. Third, the fair-minded and informed observer would recognise that the presiding arbitrator was an experienced professional whose training and reputation would enable him to decide the case fairly despite any momentary lapse. Finally, falling asleep does not by itself indicate the arbitrator had shut his mind to one party’s case.
The Hostility Allegation
CNG also complained that the arbitrator had made hostile remarks, describing CNG’s conduct as “utterly disgraceful” and characterising certain claims as “tit-for-tat”. The Court firmly rejected these complaints, emphasising the importance of understanding the “cut and thrust of the arbitral process”. Expressing preliminary views (even robust ones) are perfectly proper. The critical question is whether the arbitrator’s mind was closed to contrary arguments, not merely whether he had formed preliminary impressions. Moreover, many of the criticisms were justified given CNG’s demonstrated conduct, including its persistent failure to comply with earlier awards.
Waiver
Most significantly, the Court held that CNG had waived its right to complain about most matters by failing to raise them promptly. Under the applicable arbitration rules, challenges must be made within 15 days of becoming aware of the relevant circumstances. CNG only challenged the arbitrator on 10 July 2024, meaning it could only rely on matters occurring on or after 25 June 2024.
The Court emphasised an important principle : parties cannot keep alleged irregularities “up their sleeves” for later use. If you believe an arbitrator is behaving improperly, you must raise it promptly with the tribunal. Failing to do so amounts to tactical gamesmanship. This principle applies even to fundamental rights such as the right to an impartial tribunal.
Practical Lessons
This judgment serves as a reminder for anyone involve in arbitration :-
- The Bar for Proving Bias is High : Simply being unhappy with an arbitrator’s tough questions or preliminary comments is not enough. You must prove that a fair-minded and informed observer would conclude that there was a real possibility of bias.
- Act Immediately : If you believe there has been a serious procedural error or evidence of bias, you must raise it at the earliest opportunity. In other words, any perceived irregularities should be challenged as they arise, rather than after an unfavourable outcome. Delaying complaint will likely result in one losing the right to object later.
- Context Matters : The court will not look at incidents in a vacuum. It will consider the entire procedural history, the nature of the comments, and the conduct of all parties when assessing a claim of bias.
Ultimately, the court’s decision reinforces the finality of arbitration and protects the process from tactical challenges designed to delay or derail arbitral proceedings. While justice must always be seen to be done, this case shows that parties also have a duty to help ensure that the process is fair by speaking up in a timely manner.
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