Hong Kong court considers nature and arbitrability of lawyer-client fee disputes

In a decision dated 10 January 2018, the Hong Kong Court of First Instance (Court) stayed its proceedings in favour of arbitration under an arbitration agreement between a firm of solicitors and its former clients. The Court held that there is nothing in Hong Kong law or public policy to indicate that a dispute between a solicitor’s firm and its client over fees is not arbitrable. Hong Kong law protects consumers from being forced into arbitration, but the law will consider the nature of the transaction to determine whether or not a claimant is truly acting as a consumer.

The decision relates to a dispute over fees between solicitors’ firm Henry Wai & Co (Firm) and its former clients, businessman Fung Hing Chiu Cyril (CF) and Grandom Asia Holding Limited (GA). When the dispute arose, CF was 78 years old and a highly experienced businessman, who was acting as director of GA. The Firm and GA had signed a retainer agreement (Retainer Agreement), which contained an arbitration clause (Arbitration Agreement). The Court was asked to decide whether the Arbitration Agreement was enforceable, and whether the Court’s proceedings should be stayed in favour of arbitration.

Grandom Asia Holding Ltd v. Henry Wai & Co (A Firm) [2018] HKCFI 31; HCMP 1700/2017 (10 January 2018)

Source: Lexology