Great Silver Investment Ltd v. Sky Trend Global Ltd and Another

HCA 1275/2020

[2020] HKCFI 2091

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1275 OF 2020

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Before:  Deputy High Court Judge To in Chambers

Written Submissions of the Plaintiff:  5 and 11 August 2020

Written Submissions of the Defendants:  7, 10 and 11 August 2020

Date of Decision:  14 August 2020

Date of Reasons for Decision (No. 2):  17 August 2020

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REASONS FOR DECISION (NO.2)

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1.On 12 August 2020, I granted a Mareva injunction order against the Defendants and reserved my reasons for decision.

2.The Plaintiff’s application for injunction was order to be determined on an urgent basis on paper without a hearing, pursuant to the order of Au Yeung J.  The urgency was occasioned by the need to complete the sale and purchase of certain properties between a company owned by the 1^st Defendant and a third party, which was scheduled to take place between 10 am and 5 pm on 17 August 2020 at the office of the Defendant’s solicitors.  The Plaintiff’s solicitors and the Defendant’s solicitors lodged their last round of skeleton argument respectively at 4:38 pm and 6:00 pm on 11 August 2020.

3.At 11:17 on 12 August 2020, I granted the Mareva injunction with reasons of decision reserved.  Out of all good intentions to avoid unnecessary inconvenience and costs to the Defendants and most importantly infringement of their privacy, I withheld ordering a disclosure order in the hope that restraining the proceeds of sale net of such liabilities as are required to be discharged before completion would be sufficient[1].  Such disclosure orders would usually have been given and but for the above consideration would have been given in this case.

4.At 10:22 on 14 August 2020, I was informed by the Plaintiff’s solicitors that to their surprise the Defendant and the third party had completed the sale and purchase of the properties on 12 August 2020 without giving notice to the Plaintiff. 

5.Obviously, the Defendants have abused the good intention of this court.  In advancing completion of the sale and purchase without notice, the Defendants have actually dissipated the only available assets under their control.  They have confirmed by their conduct that the order of this court made on 12 August 2020 was appropriate.  Immediate disclosure becomes necessary.  Having regard to the Defendants’ conduct, I order disclosure in terms paragraph 2 of the draft amended injunction order attached to the Plaintiff’s summons dated 3 August 2020 with costs against the Defendants on indemnity basis.

6.The circumstances suggest that the advanced completion was calculated to frustrate the Plaintiff in its effort in obtaining the injunction order.  The Defendants’ solicitors are also acting for the vendor of the Property in the sale and purchase, which is under the control of the 1^st and 2^nd Defendants.  There is no reason that the Defendants’ solicitors did not know about the advance completion by the time they submitted their last skeleton argument at 4:38 pm on 11 August 2020.  The urgent determination was arranged for the parties’ mutual benefit.  Solicitors are officers of the court.  The Defendants’ solicitors had a duty to inform the court of the change in completion date which was the basis for which the urgent determination was arranged.  By their silence they are misleading the court and aiding and abetting their clients in anticipatory frustration of the legal process.  The Plaintiff’s solicitors are therefore instructed to refer the Defendants’ solicitors’ conduct to the Law Society of Hong Kong to consider if any disciplinary action should be taken against them.

Mr Kenny Lin, instructed by Messrs. Vincent T. K. Cheung, Yap & Co, for the Plaintiff

Mr Edward Chan, SC, instructed by Messrs. Lo, Wong & Tsui, for the 1^st and 2^nd Defendants