Manhattan Borneo Finance & Trust Corporation Ltd (in Liquidation) v. San Imperial Corporation Ltd

CACV000047/1977

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Coram: Huggins and Pickering, JJ. A. and McMullin, J.

Date of Judgment: 2nd September 1977

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JUDGMENT

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Huggins, J. A. :

1. The 2nd Defendant in the action appeals against the order of Yang, J. granting an interlocutory injunction.

2. The affidavits reveal a long and complicated story about the affairs of various connected companies in which the 1st Defendant has had an interest. As is notorious the 1st Defendant has absconded after being charged in Hong Kong with offences involving fraud. The action was originally brought against the 1st Defendant only. It was for money received by the Defendant to the use of the Plaintiff, for a declaration that the money was held on trust for the Plaintiff "alternatively as the Plaintiff's money" and for an injunction to restrain the Defendant his servants or agents or any of them howsoever from selling, dispensing, releasing, transferring or otherwise dealing with nine million shares in M.A.F. Credit Limited registered in the name of Asiatic Nominees Limited. An ex parte summons for an interlocutory injunction against the 1st Defendant was successful. At that stage the 2nd Defendant applied under 0.15 r.6 to be joined as a defendant. The 2nd Defendant is a company, incorporated in Brunei, which is in liquidation. The Official Receiver of the State of Brunei has been appointed Receiver. The basis of the application was that there was an issue arising between the Plaintiff and the 2nd Defendant which also arose out of the relief or remedy claimed by the Plaintiff against the 1st Defendant and which it was just and convenient should be determined at the same time. That issue was presumably said to be whether the 2nd Defendant was the agent of the 1st Defendant and therefore affected by the exparte injunction. An order of joinder was made and we are not concerned on this appeal with the correctness of that order.

3. Although the writ was amended consequently upon the order for joinder, it still contained no claim of any kind by the Plaintiff against the 2nd Defendant. Nevertheless the Plaintiff took out an inter pastes summons against both the 1st and the 2nd Defendants for the extension of the interlocutory injunction and it was this application which was granted by Yang, J. The basis of his judgment appears to have been that the balance of convenience was in favour of the Plaintiff, and if that were the deciding factor I would, for my part, not be disposed to disagree with him. However, the 2nd Defendant contends that there was no ground for the granting of an injunction against it at all and that the issue of the balance of convenience did not arise.

4. It is true that the 2nd Defendant itself applied to be joined as a defendant in the action, but that was only a method of bringing before the court the issue of the 2nd Defendant's agency and did not imply that the Plaintiff had a cause of action against the 2nd Defendant. We are told that in the event judgment in default has been entered against the 1st Defendant upon the money claim, the claim against him for an injunction having been waived.

5. There is no doubt but that the provisions of s.19(1) of the Supreme Court Ordinance are now to be interpreted more widely than was previously understood, but in none of the cases cited to us was an injunction granted against a person against whom the plaintiff had alleged no cause of action. The Sis Kina 1977 1 LI.R. 404 is, indeed, authority against extending the power of freezing assets which are within the jurisdiction, but which belong to a foreign defendant, to cases where the courts have no other basis of jurisdiction against the defendant.

6. In my view there was no ground for the granting of an injunction against the 2nd Defendant and this appeal ought to be allowed.

2nd September 1977.

Representation: