Hengshi International Investments Ltd V.Bayspring International Ltd and Another

HCMP 1916/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1916 OF 2015

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D E C I S I O N

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1.This is D2’s application for leave to appeal against the decision dated 17 March 2016 dismissing D2’s Production Summons (“the Decision”).

Legal principles

2.The principles for granting leave to appeal on an interlocutory application has been stated in a recent decision dated 21 March 2016, in the present case (at §§2-5).  I can do no more than recite the principles here:

(1)  To obtain leave to appeal, the Applicants have to satisfy the court either (1) that the proposed appeal has a reasonable prospect of success, or (2) that there is some other reason in the interest of justice why the appeal should be heard. Reasonable prospect of success involves the notion that the prospect of succeeding must be more than fanciful, without having to be probable.

(2)  Although the fact that there is, ex hypothesi, a reasonable prospect of success would heavily influence the court’s exercise of discretion, even if the court comes to that view, it still retains in an appropriate case, discretion not to grant leave.

(3)  For an appellate court to interfere with the judge’s exercise of discretion, it must be established that the judge has misunderstood the law or the evidence or that the exercise of his discretion was plainly wrong such that it was “outside the generous ambit within which reasonable disagreement is possible”.

(4)  The fact that the judge did not refer to each and every piece of evidence placed before the court, or each and every argument run before him, does not mean that he, as a professional judge, has forgotten any of them, or has failed to take them into account where appropriate.

(5)  Hence, in order to show that the Judge had failed to take into account of any relevant considerations, it must be “clear from his judgment” that “he must have clearly overlooked” such matter.

(6)  Ultimately, “the question of weight was a matter for the judge to decide in conducting his balancing exercise”.

3.More specifically, the Court of Appeal has observed the following for an application for leave to appeal made against orders under RHC O 24:

“Orders for discovery under Order 24, for particulars under Order 18 rule 12 and for costs are all in the discretion of the court. The authorities are clear that an appellate court would only interfere with a trial judge's exercise of discretion where the judge has erred in law or in principle, or if the judge has taken into account some matter which he or she should not have taken into account or has left out of account some matter which he or she should have taken into account, such that the judge was plainly wrong. The fact that the appellate court may exercise a discretion differently on the same facts is no ground to substitute its discretion for that of the trial judge.”

See: Sunny Tadjudin v Bank of America, National Association HCMP 337/2012 (unrep, 29 March 2012), §12, per Fok JA (as he then was); Happy Dynasty Holdings Limited v China State Construction Engineering (Hong Kong) Limited HCCT 21/2014 (unrep, 25 June 2015), §§1-2, Mimmie Chan J.

Application of the legal principles

4.The Production Summons involved 2 emails, one dated 24 June 2015 and the other dated 29 July 2015.  The July email was disclosed in the plaintiff’s affirmation in support of the ex parte injunction; the June email disclosed on 9 September 2015.  Objections to both emails were first raised in Greenspoon-3^rd of D2 on 10 September 2015.  Hearing of the injunction application proceeded on 16 September 2015 when D2 has had notice of the 2 emails.  The Production Summons was issued only after the injunction hearing.  It was said to be relevant to the credibility of the plaintiff’s case for the injunction (a kind of equitable relief) (§12 of the Decision).  It was heard at a time when there was no application to discharge that injunction; only a pending arbitration for which the arbitrator has been appointed.  This court has ruled that the 2 emails were of minimal relevance (§§23 and 24 of the Decision).

5.The draft notice of appeal sets out 6 intended grounds of appeal, which are principally re-run of the arguments before me. 

6.Ground 1 suggests that this court dismissed the Production Summons on “mere delay”, which was incorrect.  There were 4 other grounds that this court relied on. 

7.Mr Beresford submits that this court was guided by a yardstick taken from an unrelated case, ie Taihan Electric Wire Co Ltd & anor v Lee Chi Yuen Arctic & ors, HCA 454/2013 (unrep, 8 October 2013). With respect, delay is fact sensitive and there is no point comparing the facts of 2 cases.The subject delay was calculated with reference to the injunction application, which was over by the time the Production Summons was heard. D2 is not permitted to advance its opposition to the injunction on a piecemeal basis. The discovery sought could serve no useful purpose.  The question of prejudice to the plaintiff would not even arise. 

8.Grounds 2 and 3 are challenges to the court’s finding on necessity and that the application was a fishing expedition.  I repeat paragraph 4 above. This is an appeal against exercise of discretion and not error in principle.

9.Grounds 4 and 5 are challenges to this court’s view on relevance, materiality and that the proper venue to seek discovery is before the arbitrator.  Again I repeat paragraph 4 above.  Ground 4 is an appeal against exercise of discretion and not error in principle.

10.Ground 6 concerns the order on costs of the Production Summons.  The costs order was originally made on a nisi basis.  There was no application to vary it.  The intended appeal is a challenge to exercise of discretion.

11.In summary, none of the grounds put forth are arguable.  They attack the exercise of discretion by this court instead of the legal principles.  I dismiss the application for leave to appeal. 

12.There are no merits in this leave application. Costs should follow the event and be to the plaintiff on indemnity basis.  The application has no complexity and, without disrespect, does not justify engagement of 2 counsel or more than one fee earner.  I assess costs in the sum of $80,000.

13.I thank counsel for their assistance.

Mr Anson Wong SC, leading Mr Martin Kok, instructed by DLA Piper Hong Kong, for the plaintiff

Mr Roger Beresford, instructed by Reed Smith Richards Butler, for the 2^nd defendant