Split Dispute Resolution Clauses: A Recent Example

Summary

In a recent judgment (Construction Company v Guarantor [2021] HKCFI 2558, judgment date: 17 August 2021), a Hong Kong court upheld a U.S. arbitral award made pursuant to a split dispute resolution clause. In dismissing the application to set aside the award, the court gave due weight to the decision by the supervisory court at the seat of the arbitration. The court also considered the limitative effects the clause has on the arbitrator's jurisdiction, and its interaction with issues of procedural fairness.

A split dispute resolution clause is a clause which provides different dispute resolution processes for different claims or species of dispute between the parties. It often takes the form of a carve-out clause, whereby the parties agree to carve out specific types of disputes from the main dispute resolution process and submit such disputes to a different dispute resolution process.