Chow Kwan Yee v. Leung Mei Yin May and Another

HCA 1260/2017

[2020] HKCFI 657

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1260 OF 2017

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BETWEEN

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DECISION

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1.By a summons filed on 16 March 2020 (“the summons”), Ds apply for an order to stay the execution of my judgment handed down on 13 December 2019 (“the Judgment”) pending the determination of their appeal against the Judgment lodged on 14 January 2020. I have directed that the summons would be determined on paper without an oral hearing[1]. Parties have provided me written submissions, and I have considered those submissions.

2.In the Judgment, I dismissed D2’s counterclaim and ordered Ds to pay the following to P:

(1)  the Pre-Judgment Monthly Repayments (in the aggregate sum of HK$544,000[2]) [3];

(2)  a monthly repayment sum of HK$8,000 until the entire loan of HK$2 million is fully repaid[4];

(3)  interest[5]; and

(4)  the costs of these legal proceedings[6].

The principles

3.The principles concerning stay of execution pending appeal are well established.  Those principles have been set out in detail by Ma J (as he then was) in Star Play Development Ltd v Bess Fashion Management Co Ltd[7]. 

4.As said by Ma J (as he then was) in Star Play, the existence of an arguable appeal (ie one with reasonable prospects of success) is the minimum requirement before a court would even consider granting a stay.  In the words of the learned judge[8]:

“The existence of merely an arguable appeal cannot by itself amount to sufficient reason to justify a stay. It can be put this way: the existence of an arguable appeal (that is, one with reasonable prospects of success) is the minimum requirement before a court would even consider granting a stay. In other words, however exceptional the circumstances may be otherwise justifying a stay of execution, if the court is not convinced that there exist arguable grounds of appeal, no stay will be granted.”

5.The Star Play principles were recently mentioned by Lam VP in Bright Gold Ltd v Mega Well Development Ltd[9].  In my view, the principles highlighted by the Vice President in [13] of the Court of Appeal’s judgment are applicable in considering the application made by Ds in the summons:

“13.  The principles governing an application for stay pending appeal are well settled. The leading case in Hong Kong is Star Play Development Ltd v Bess Fashion Management Co Ltd [2007] 5 HKC 84. It is not necessary for us to recite that judgment at length. For present purpose, we would reiterate the following propositions:

(a)  The applicant must show an arguable ground of appeal (viz. one with reasonable prospect of success) before the discretion to grant stay is engaged, see Star Play para 9(6); Sy Chin Mong Stephen v Lo Shing Kin CACV 45/2013, 13 March 2013;

(b)  Even if arguable grounds exist, there must be other circumstances justifying the deprivation of the successful party the fruit of the judgment. Sometimes, the applicant may do so by showing the existence of strong ground of appeal. Sometimes, the applicant may do so by showing that the appeal would be rendered nugatory if no stay is granted. In either case, the court must also have regard to the prejudice that could be suffered by the successful party if a stay is granted. In all cases where the discretion is engaged, ultimately it is a balancing process with common sense;

(c)  In assessing the strength of the appeal for the purpose of a stay application, it is impracticable and undesirable to go deeply into the merits: see Star Play para 9(5).  A broad brush approach is called for.  Thus, counsel should not attempt to deploy full arguments on law and facts quoting in extenso all the relevant evidence and transcript as if the application for stay is a platform for a rehearsal of the appeal proper.  Generally, with the benefit of written skeleton submissions, the court is able to assess whether an appeal has a high prospect of success without lengthy oral submissions from counsel, MKKWH v RKSH CACV 197/2012, 27 February 2013 at para 3.  Application for stay of execution should not be a dry run of the appeal, see Ming Hsieh v Xu Zhe [2018] HKCA 390, at para 9.”

No arguable appeal

6.With respect, having considered the grounds of appeal as set out in the notice of appeal and Ds’ written submissions, I am of the view that Ds’ appeal does not have a reasonable prospect of success.

7.Ds are challenging the factual findings made by me in the Judgment.  Such factual findings are made after hearing the live evidence given by the witnesses in the trial.  In order to successfully challenge those factual findings, Ds have to overcome a very high threshold.  The Court of Appeal would not set aside the factual findings made by the trial judge unless the findings are plainly wrong.  In China Gold Finance Ltd v CIL Holdings Ltd. and Others[10], Lam VP said:-

“14.  …… In our judicial system, the appellate process is not designed to give a litigant (or his counsel) a platform for regurgitating his closing submissions on the evidence and factual aspects of the case again with the hope that the appellate judges may come to a different view to that of the primary judge. It is thus, as we said above, a misuse of the appellate process to place before this court submissions which, in substance, are (or should be) submissions advanced by way of closing submissions at the trial after the judge has heard all the evidence.

15.  In an appeal, the court of appeal should focus on the question whether the primary judge has fallen in palpable errors which could give rise to grounds for intervention by the appellate court. As explained in the cases, it is not germane that judges in this court may reach a different conclusion from that of the judge. There are many areas, particularly those in relation to findings of fact, where judges can reasonably reach different conclusions from each other. That would not be a ground for intervention.

16.  Thus, in an appeal, it is not helpful if counsel and litigant (acted in person) only repeat submissions already advanced and considered by the primary judge at the trial.  The starting point should be the judgment of the primary judge and the identification of palpable errors (which must be errors of such nature which warrants intervention from this court) in the judgment.  The mere assertion that the finding of the judge is against the weight of the evidence or that the judge should have reached another conclusion because of points advanced in the closing submissions below are not errors coming within that category.”

8.Ds have put forward lengthy grounds of appeal and lengthy written submissions.  It would not be necessary for me to make detailed comments on those grounds, as an application for stay of execution should not be a dry run of the appeal and this application should not be treated as the platform for a rehearsal of the appeal.  Suffice for me to say that having considered Ds’ grounds of appeal and Ds’ written submissions, I am of the view that nothing therein has shown that any factual finding made by me in the Judgment is arguably plainly wrong.

9.As to D2’s counterclaim for the Bangle, I have explained why I could not allow this claim in [53] to [57] of the Judgment.  In my view, Ds have not demonstrated an arguable case that I might have erred in the analysis as set out in these paragraphs.

10.In my view, Ds have not demonstrated an arguable appeal.  For this reason, Ds’ application for stay of execution pending appeal must be refused.

11.For the sake of completeness, I would say that even if I were wrong on the above and even if I had held that Ds have demonstrated an arguable appeal, I would not grant an unconditional stay to Ds.  I would only order a stay of execution upon the condition that there be a payment of HK$1,640,000 by Ds into court within 14 days.

(1)  I note that P is a Canadian citizen.  There is no evidence showing that P is ordinarily resident in Hong Kong or has any valuable asset in Hong Kong.  However, the fact that P is the successful party in the trial and is entitled to the fruits of the litigation has to be borne in mind. In view of all these, if I had held that Ds have demonstrated an arguable appeal, I would order a stay of execution upon the condition that Ds shall pay a sum into court within 14 days.

(2)  In assessing the sum, I would take into the account the amounts owed by Ds to P under the Judgment as set out in [2] above. I have been told by P’s legal representatives that 2/3 of the legal costs incurred by P in these proceedings are about HK$1 million.  It is unlikely that the appeal will be heard in 2020.  Probably the appeal will be heard in the first half of 2021.  With all these in mind, taking a broad-brush approach, in my view, the appropriate sum to be paid into court would be HK$1,640,000.

Disposition

12.For the reason that Ds have failed to demonstrate an arguable appeal (ie one with reasonable prospects of success), Ds’ summons must be dismissed.  Costs should follow the event.

13.I dismiss the summons.  P does not seek a certificate for 2 counsel.  I order that costs of the summons be paid by Ds to P forthwith, and those costs be summarily assessed at HK$60,000.

14.I thank counsel for the assistance provided to the court.

Written submissions by Mr Alan Kwong & Mr Joseph Wong, instructed by William K. W. Leung & Co, for the plaintiff

Written submissions by Mr Tony Ng, instructed by Lee & Wu, Solicitors, for the 1^st & 2^nd defendants