Shin-shirasuna Denki Kabushiki Kaisha v. Technica Electronics Ltd and Another

CACV000030/1981

Copyright - Anton Pillar Order - such order to be made only in exceptional circumstances - evidence of mere possibility of destruction of evidence as distinct from "a real possibility" not sufficient - need to show some likelihood.

Dates of hearing: 29th, 30th April, 1981 1st May, 1981

Mills-Owens, Q.C. & A. Liao (Johnson, Stokes & Master) for Appellants.

A. Li (Deacons) for Respondent.

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Coram: Sir Alan Huggins, V.-P., Leonard & Cons, JJ.A.

Date of Judgment: 1 May 1981

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JUDGMENT

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Sir Alan Huggins, V.-P.:

1. This is an appeal against the order of Mr. Justice Silke made upon an ex parte application for orders requiring the Defendants to allow the Plaintiff's solicitor to enter their premises and take away, for photographing, items which are alleged to infringe their copyright and also to allow them to enter and inspect documents and to remove those documents for the purpose of photocopying. The first order is the order for the preservation of infringing materials or alleged infringing materials and the second order is one to obtain evidence which would assist them in persuing their claim against the Defendants and also possibly against others with whom the Defendants may have been trading.

2. The allegation is that the Defendants have produced radio cassette recorders which are in breach of the copyright held by the Plaintiffs and are selling these to persons abroad. The Plaintiffs naturally seek to prevent this and to obtain evidence, they say, both against the Defendants and against other persons. This is the type of order which was granted in the Anton Pillar Case 1976 2 W.L.R. 162 and it is made ex parte because it is desired to ensure that the defendants are unable to destroy evidence - an opportunity which they might have if notice were given in the usual way of an application for the orders. The cases, as it seems to me, are quite clear that these are exceptional orders and there must be strong evidence justifying the making of them, and in my judgment the evidence in the present case was not sufficiently strong to justify such orders.

3. Counsel for the Plaintiffs has advanced six matters which, he suggests, do indicate a real possibility that the Defendants will destroy the evidence. These words "real possibility" obviously present difficulty. One can become embroiled in semantics, but it seems to me that clearly "a real possibility" is intended to convey something more than a mere possibility. There has, I think, to be some evidence which suggests that there is some likelihood and not just circumstances, which would arise in every case, that the Defendants might destroy evidence: there could not be a case where that mere possibility did not exist. Obviously something more is intended, and I think there has to be some likelihood shown. The evidence here is that the Defendants were manufacturing instruments which did not bear any trademark. The evidence was that they had received orders from overseas with express instructions not to impose any trademark, such mark to be imposed by the purchaser on delivery. That, of course, is a matter which at least gives opportunity for the imposition of a false trademark or an infringing mark.

4. Secondly, the evidence was that the external design of these instruments was identical to some which had been on sale in Colombia, South America, and were with minor exceptions identical to articles which were produced by the Plaintiffs.

5. Thirdly, the Defendants were putting their instruments - which they called a "Model No. 4L2", I think it was - into cartons which bore the Model No. RT430. RT430 was, in fact, the model number of the Plaintiff. There is nothing to show that the Defendants knew this. The coincidence, of course, may arouse suspicion, but there is nothing to indicate that the Defendants themselves were aware of this coincidence, and it seems to me possible - I put it no higher - that it was the purchaser who was being fraudulent and who was using the Defendants as innocent instruments of his fraud.

6. The fourth point was that the Defendants were shown to be exporting to South America, and it was suggested that, since that is such a distant market, there would be a great temptation on the Defendants to destroy evidence in Hong Kong, thus leaving the Plaintiffs to chase evidence in the distant market. Again, there is certainly a possibility of that's happening, but that alone, again, does not show any likelihood.

7. Fifthly, some point was made that the Defendants had shown a willingness to cooperate with the private investigators, even though they had previously been investigated by the Trade Industry & Customs Department, who were investigating a complaint of the misuse of marks. It seems to me, and I suggested this in the course of argument, that the fact that there had been two apparently independent investigations might give a defendant some fear that things were getting rather hot and that he would be wise to destroy evidence. Again, that in itself does not seem to me to be sufficient.

8. Sixthly, it was said that this particular instrument was not on display in the showroom of the Defendants and was only discovered by the private investigators on a second visit, when it was admitted by the Defendants that they were in fact manufacturing such a model. I indicated that I did not consider any one of these matters, in itself, was sufficient to show that there was a real likelihood of destruction of evidence. We, of course, have to consider them all together, but, even considering them all together, I confess that I do not think that there was sufficient evidence to justify this very extreme remedy, and for this reason I think the learned Judge was in error in making the order.

9. It is unnecessary in this case to decide the very difficult questions which arise on a claim of privilege on the ground of self-incrimination. That is a comparatively new defence to be raised to application of this kind and it is, no doubt, a branch of the law which is still developing. We have very few such cases in Hong Kong compared with the number that they have in the United Kingdom, and it may well be that before it becomes necessary to decide this matter in this court we shall have further guidance from the courts in England. I do not think that it would be wise for us to give any opinion which would not be binding in Hong Kong and which might, in the event, prove to be contrary to the trend which is adopted. However, for the reasons I have given I would allow this appeal.

Leonard, J.A.:

10. I agree that a distinction exists, as was pointed out by Mr. Li between the two orders made in this case namely the Entry Order and the Preservation Order.

11. I am satisfied on the authorities, however, that before a Preservation Order can be made, otherwise than inter partes similar if not precisely the same limitations must apply as those which apply to an Entry Order.

12. I consider that the six matters raised by Mr. Li as giving rise to possibility of destruction of evidence are not sufficient, either individually or cumulatively to justify either. I too would allow the appeal.

Cons, J.A.:

13. I too would allow the appeal and set aside the two orders in question. With every respect to the learned Judge below, in my view the circumstances do not approach the high level postulated by the cases which we have been referred to in the arguments, which, if I may say so have been carefully presented on both sides. It is not through any lack of clarity in those arguments that I have agreed not to deal with the most interesting point raised, but because in the circumstances I feel that it would be wiser to leave it until such time as a decision becomes necessary.

1st May, 1981.

Representation:

Mills-Owens, Q.C. & A. Liao (Johnson, Stokes & Master) for Appellants.

A. Li (Deacons) for Respondent.