Justice in a Hurry? Safeguarding natural justice in the use of Expedited Procedure in International Arbitrations

Two recent decisions respectively by the Singapore Court of Appeal and the Hong Kong Court of First Instance raised a key concern in balancing the procedural fairness of the arbitration process and efficiency with the use of expedited documents-only procedure.

The appeal in Wan Sern Metal Industries Pte Ltd v. Hua Tian Engineering Pte Ltd [2025] SGCA5 arose from a decision to dismiss an application to set aside an arbitral award issued by the SIAC. The Court of Appeal allowed the appeal and set aside the award in part relating to the “Balance Work Counterclaim” in which it held that the Arbitrator had acted in breach of natural justice arising from the “Expectation Damages Issue” which was unpleaded.

The arbitration proceeded on an expedited basis as a documents-only arbitration – within the span of three months, the parties had filed their pleadings, witness statements and written submissions including submission in reply. As there was no oral hearing, the Arbitrator issued the award two months later.

The Court of Appeal held that the Arbitrator had breached natural justice by failing to apply her mind to the parties’ case regarding the unpleaded issue. The Court of Appeal found that the Arbitrator did not fully appreciate the appellant’s objections to the measure of damages was not just limited to respondent’s entitlement to that measure of damages. With limited opportunities for clarification given the nature of such truncated proceedings, the Arbitrator ascribed an incorrect position to the appellant that led her to fail to consider the true issue raised. This is to be distinguished from an error of law or an award which is plainly wrong – which are not grounds for setting aside an award (see: Paragraphs 44 to 47).

It was reinforced by the Court of Appeal that:

1. Pleadings usually provide “a crucial anchor” in ensuring the tribunal is fully conscious of the parties case – especially where the arbitral process is expedited and to be determined based on documents alone (see: Paragraph 42).
2. The tribunal and the parties have “a shared responsibility” to ensure the effective functioning of the arbitral process especially in the context of a documents-only It is important for the parties to make their positions clear and draw attention to the tribunal salient circumstances including arguments being advanced on an unpleaded issue; and for the tribunal to seek clarification to ensure the parties are provided with a fair opportunity to be heard (see: Paragraph 43).

In Hong Kong, both the 2018 and 2024 HKIAC Administered Arbitration Rules (the “HKIAC Rules”) also provide for an Expedited Procedure (see: Article 42.1) upon an application being made to and granted by the HKIAC. Under such Expedited Procedure, an award is to be communicated to the parties within 6 months from the date when the HKIAC transmitted the case file to the tribunal (see: Article 42.2(f)).

In Pan Ocean Container Suppliers Co. Ltd v. Spinnaker Equipment Services Inc [2024] HKCFI 1753, the Hong Kong Court was faced with an application to set aside an award issued by the HKIAC under the Expedited Procedure conducted on the basis of documents only in which the applicant did not participate in the arbitration proceedings. The Court ruled against the applicant on the grounds of “no proper notice”, “contrary to public policy” and the “no due procedure” as well as “exceeding the scope of arbitration”, and therefore, dismissed the setting aside application.

Notably, the Hong Kong Court held that:-

1. There was no duty on the part of the respondent to make a request to disapply the Expedited Procedure notwithstanding some claims had increased in their quantum during the course of the arbitration. This per se would not have justified the scrutiny of a more robust procedure in which the applicant would be unlikely to participate (see: Paragraphs 4.3 to 4.16).
2. The Expedited Procedure under Article 42 of the HKIAC Rules does not oust Article 13.1, which enjoins the Tribunal to adopt suitable procedures for the conduct of the arbitration proceedings to ensure equal treatment of the parties and afford the parties a reasonable opportunity to present their case (see: Paragraph 5.10).
3. It was entirely appropriate for the Tribunal to ask the parties to address her on damages if she was disinclined to grant the “Declaratory Relief” sought by the respondent. In all circumstances, even within the “streamlined” Expedited Procedure, the Tribunal was careful in the process, even disallowing substantial parts of the respondent’s claim without any input by the applicant (see: Paragraphs 4.15 and 5.10).

Both decisions provided a useful opportunity to examine the need to preserve structural integrity of the arbitration process and natural justice in the context of an accelerated documents-only arbitration albeit with different results which are entirely fact-sensitive. The approach of both supervisory courts facing a setting-aside application is consistent.

The important take-aways can be summarised as follows:

1. The supervising court whilst adopting a “pro-arbitration” stance must be vigilant to ensure the structural integrity of the arbitration process is preserved and maintained. Where the right to be heard or present a case has been breached in a way that prejudices a party, the court should refuse enforcement of or set aside the arbitral awards.
2. The adoption of the Expedited Procedure whether as agreed by parties or granted by the arbitral institution does not obliviate the need to uphold natural justice and due process.
3. There is a shared responsibility on the part of both the tribunal and the parties to ensure such due process is preserved even in the context of an accelerated and documents-only The tribunal has a duty to ensure equal treatment of the parties and afford them a reasonable opportunity to present their case and to seek clarifications whether by way of inviting submissions or where the circumstances so necessitate, direct an oral hearing to be held. The parties should make their position clear and assist the tribunal by drawing its attention to any salient circumstances including arguments being advanced on an unpleaded issue or exceeding the scope of arbitration.

The full judgment for Wan Sern Metal Industries Pte Ltd v. Hua Tian Engineering Pte Ltd [2025] SGCA5 is available at: https://www.elitigation.sg/gd/s/2025_SGCA_5

The full judgment for Pan Ocean Container Suppliers Co. Ltd v. Spinnaker Equipment Services Inc [2024] HKCFI 1753 is available at: https://legalref.judiciary.hk/lrs/common/search/search_result_detail_frame.jsp?DIS=161444&QS=%28HCCT%7C9%2F2023%29%7C%28HCCT%2C9%2F2023%29&TP=JU

The article is authored by Ms Connie Lee.