William Chen and Another v. Chen Lee Hong-man
Read the full judgment text of CACV 25/1981 on BabelCite. This Court of Appeal judgment.
1. This is an appeal against the grant of an interlocutory injunction. The circumstances are that the Plaintiff and the 1st Defendant are wife and husband whose marriage is at present under litigation in the Divorce Court. The 2nd Defendant is the mother of the 1st Defendant. When the parties were married the mother bought property in the name of the 1st Defendant. The plaintiff wife alleges that the property was a gift to both husband and wife and that there is, therefore, a trust created by th
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CACV000025/1981 Interlocutory injunction - property purchased in name of a husband by his mother - breakdown of marriage - wife alleging property was gift to her and her husband - husband reconveyed property to mother, who sold it - judge granted "Mareva" injunction to wife in respect of proceeds of sale - injunction set aside on grounds that wife had no good cause of action and that, even if she had, there was no evidence that mother was likely to remove proceeds of sale from the jurisdiction. Dates of hearing: 14th and 17th July, 1981 Swaine, Q.C. & G. Rodway (Victoria Y. Chan & Co.) for Appellants. Ching, Q.C. & Mrs. V. Bokhary (Helen A. Lo & Co.) for Respondent.
Coram: Sir Alan Huggins, V.-P., Zimmern and Power, JJ. Dates of hearing: 14th and 17th July, 1981 Date of Judgment: 17th July 1981 ----------------- JUDGMENT ----------------- Sir Alan Huggins, V.-P. : 1. This is an appeal against the grant of an interlocutory injunction. The circumstances are that the Plaintiff and the 1st Defendant are wife and husband whose marriage is at present under litigation in the Divorce Court. The 2nd Defendant is the mother of the 1st Defendant. When the parties were married the mother bought property in the name of the 1st Defendant. The plaintiff wife alleges that the property was a gift to both husband and wife and that there is, therefore, a trust created by the 2nd Defendant in her favour of half the value of the property. When the marriage broke up, the husband gave back the property to the mother and she sold it. The injunction sought related to the proceeds of sale. When the matter came before the Judge in Chambers he understood the position to be that the claim was for damages for conspiracy and he granted an injunction believing that he was granting a "Mareva" injunction. 2. The first question is whether or not there was any valid cause of action and the second whether there were grounds for a "Mareva" injunction. As I see it, there was no real basis for a claim although it is not necessary, in my view, to decide finally whether there was. I cannot myself, at the present time, see that there was any basis whatever for a trust, and I cannot, therefore, see that there was any conspiracy to breach the trust, but what I am quite clear about is that there was no basis for a "Mareva" injunction. It is, I think, only some words of Lord Denning, M.R. in Rahman v Abu Taha 1980 1 W.L.R. 1268, 1273A - "or otherwise dealt with so that there is a danger that the plaintiff, if he gets judgment, will not be able to get it satisfied" - which formed the basis of the learned judge's judgment. I am quite satisfied that the whole basis of a "Mareva" injunction is the danger that property within the jurisdiction will be taken out of the jurisdiction, and it is not a remedy which is to be given merely because property is somehow to be put beyond the reach of the plaintiff. It is true that a "Mareva" injunction will be so worded not merely that the property will not be removed from the jurisdiction by the defendant but that it will not be dealt with within the jurisdiction. The purpose of that is to prevent its being removed from the jurisdiction by somebody else. As I say, I do not think that this is a remedy which was ever understood to be available, in effect, in every case where there is a risk that the defendant will dispose of property. The Respondent did not very strenuously contend otherwise and the main basis of the Respondent's case has been that the injunction was justified on the basis that it was just and convenient to protect this property as trust property from being disposed of. 3. Once again, I am very doubtful indeed whether there can possibly be a trust. In fact, I am inclined to say definitely that there cannot. An express trust has to be in writing where the trust property is land. There was clearly no written trust in this case and I cannot accept that a constructive trust arises simply because there is no writing relating to an express trust of property. I can see here no basis for contending that there is a constructive trust, but even if that be wrong I am of the opinion that there is no sufficient ground for the grant of an injunction, and for these reasons I would allow this appeal and set aside the injunction which was granted. Zimmern, J. : 4. I agree with the learned Vice President that this appeal must be allowed and wish to add firstly that the application for an injunction to freeze an asset was, as is clear from the decision of the learned Commissioner, argued on the basis of a tortious conspiracy. It appears to me that the court below failed to remember that tort is properly a wrong at Common Law and does not include wrongs redressable in equity. It failed to apply its mind to whether there is such an action in tort as a conspiracy to dispose of a trust property in breach of trust. 5. A civil conspiracy is an agreement of two or more to do an unlawful act or to do a lawful act by unlawful means. I fail to see how a disposition of property by a trustee whether in breach of trust or otherwise can amount to an unlawful act. Furthermore, in civil conspiracy, an agreement by itself is insufficient. It must be followed by damages that is Common Law damages for the injury sustained. In breach of trust equity provides its own rules. 6. In my view, the application on the ground of conspiracy was misconceived. 7. Secondly, I fail to see how a trust was ever constituted. Para. 3 of the Statement of Claim as pleaded is contrary to the evidence shown in the affidavit. Para. 3 of the Statement of Claims reads:
The facts deposed to do not show this at all. What could be said was that, to take a neutral stand here, the parents of the 1st Defendant provided the money for the purchase of and the assignment of the property to the 1st Defendant for any trust to be properly constituted in favour of the Plaintiff. Ordinance requires the trust to be in writing. The conveyance was made before the marriage. I agree with the learned Vice-President. There was nothing in writing and I fail to see how a trust was ever constituted in favour of the Plaintiff or that she, as a volunteer, could become a beneficiary under a constructive trust. Even if I am wrong in all these matters, I further fail to see how a "Mareva" injunction could have been granted. Both the Plaintiff and the 1st Defendant, the husband were volunteers. The money was provided by the 1st Defendant's parents. If the money is back now in the hands of the parents and the Plaintiff has a claim, she can of course trace the property in equity but there is not the slightest evidence that the property for which she might eventually trace is in jeopardy and I agree again with all that the learned Vice President has said about the protection of the asset. Power, J. : 8. I find myself unable to agree with all that has fallen from the learned Vice-President. I concur with all that he had said with regard to the nature and the jurisdiction to grant a "Mareva" injunction and I am satisfied that there is no such remedy available to the Plaintiff on the facts of the present case. As to the alleged trust and the alleged conspiracy to defeat it I am satisfied, as the matter stands, that there is a serious question to be tried. Should therefore an injunction, not, of course, of the "Mareva" type, issue? I am satisfied that it should not. I am respectfully in agreement that the evidence which the Plaintiff has placed before this Court does not constitute sufficient ground to warrant, on the balance of convenience, the grant of an injunction. 17th July 1981. Representation: Swaine, Q.C. & G. Rodway (Victoria Y. Chan & Co.) for Appellants. Ching, Q.C. & Mrs. V. Bokhary (Helen A. Lo & Co.) for Respondent. |