Rights under an arbitral award are assignable

惠州市東方聯合實業有限公司 v Wong Wai Tsang HCCT 73/2010, 28 February 2012

The Court had granted惠州市東方聯合實業有限公司 ("the Applicant") leave, pursuant to sections 40B and 2GG of the old Arbitration Ordinance (Cap 341), to enforce an arbitration award ("the Award"). The original claimant in the arbitration, Shenzhen Development Bank Foshan Branch ("the Bank") had obtained the Award against a debtor ("the Debtor") on the basis of a written guarantee signed by the Debtor. The Bank then purported to assign the outstanding sums under the Award by deed of assignment to another party, who in turn purported to assign the same by deed of assignment to the Applicant.

The Debtor now applied to set aside the enforcement order, arguing that the Applicant, as an assignee and not one of the persons between whom the Award was made, did not have locus standi to enforce the Award.

The Court held that as long as a person has obtained the benefit of an award (say by assignment), the award can be enforced even though he was not the original party to the award or not a "beneficiary" of an award. The rights under an award, the Court said, are a chose in action and therefore assignable. The assignment of the benefits of the Award was effective, the Court held, and the Applicant was a successor to the rights of the Bank under the Award. The Debtor's application was therefore dismissed.

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