Hyundai Merchant Marine (Hong Kong) Ltd v. Ma Chun Kit and Others

HCA 619/2016

[2018] HKCFI 2477

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 619 OF 2016

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D E C I S I O N

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1.There are 2 specific discovery applications before the court. One by the Plaintiff (Hyundai Marine) against the 1^st Defendant (Ma) and one by Ma against Hyundai Marine.

2.A brief background of this case can be found in a Judgment from this court dated 1 February 2018 ([2018] HKCFI 176) at paras 4 to 13. 

3.The merits of Hyundai Marine’s application are clear and I shall deal with it succinctly.  The application concerns 4 categories of documents, namely, documents in relation to Ma’s investments in bonds and securities in the Mainland (Class 1); documents in relation to Ma’s investments in South China (Class 2); bank documents in respect of offshore accounts in Ma’s name, whether solely or jointly held (Class 3); and bank documents in respect of specified bank accounts in the name of 4 companies controlled by Ma (Class 4).  The documents requested for all 4 Classes are to cover the period from 2009 to date.

4.Ma is in custody pending his trial in connection with the alleged theft from Hyundai Marine.  However, I am satisfied that he is aware of this hearing, and the relevant papers had been served on him on behalf of Hyundai Marine.  He is free to apply for a body order to enable himself to be present at this hearing (see Chin Kam Chiu v Bank of China (HK) Ltd, unrep, HCB 1043/06, 18 April 2008, per Poon J (as he then was) at §48 and the CA judgment, unrep, CACV 167/08, 9 October 2009, §8).  It appears that he has not done so at his own choice.  

5.The request in respect of Classes 1 and 2 arose from 2 meetings between Ma and Hyundai Marine’s representatives in February and March 2016.  During such meetings, Ma said that part of the funds he got from Hydundai Marine was applied towards the purchase of certain investments in the Mainland and South China in the names of his friends.  The meetings were recorded and the transcripts of same are before the court.

6.Classes 1 and 2 documents are plainly relevant going to, firstly, the heart of the issue whether the money Ma had taken from Hyundai Marine was the result of acts of misappropriation or, as he alleges, used to pay off Hyundai Marine’s creditors and to overcome exchange control in the course of doing so.  Secondly, the tracing of Hyundai Marine’s assets. 

7.Further, the existence of these documents springs from what Ma had said in the meetings.  Furthermore, there is no reason to doubt that the documents are within the possession, custody or power of Ma.

8.In support of the request for Class 3 documents, 6 offshore bank accounts of Ma have been identified by Hyundai Marine.  Given the huge sum of money allegedly misappropriated from Hyundai Marine by Ma and the comparatively tiny amount of assets disclosed by Ma, there is good reason for the former to endeavour to trace its assets.  There is some evidence indicating that Ma had used at least 1 of the identified offshore account to hide his assets.  Indeed, the inference from the evidence is that Ma has not come clean with where Hyundai Marine’s money has gone.  These documents will also show whether the money was used in the way alleged by Ma.

9.As regards the Class 4 documents, the existence of the documents was revealed by Ma.  It has been shown that some of Hyundai Marine’s money was transferred to 3 of the accounts.  Like the other Classes of documents, they are clearly relevant.

10.The evidence filed by Ma indicates his agreement to disclose the documents relating to the 6 identified offshore accounts, as well as the Class 4 documents.  I am satisfied that the legal requirements for the discovery of both the Class 3 and Class 4 documents have been satisfied.

11.I am unable to see any real ground for resisting this application.  Subject to the curtailment of the proposed scope of the order as discussed in this hearing, I allow this application with costs incurred to date to Hyundai Marine.  An appropriate draft order should be provided to the court for approval.

12.As regards Ma’s discovery application, he has failed to appear to prosecute the same.  It is dismissed with costs to Hyundai Marine.  Both costs orders are to be taxed and paid forthwith. 

Mr Jonathan Wong and Ms Jacquelyn Ng, instructed by Reed Smith Richards Butler, for the Plaintiff

The 1^st Defendant was not represented and did not appear