Beijing Songxianghu Architectural Decoration Engineering Co., Ltd v. Kitty Kam also known as Wang Yuzhi

HCA 1289/2022

[2024] HKCFI 2194

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1289 OF 2022

______________

______________

_______________________________

REASONS FOR DECISION

_______________________________

1.For ease of reference and consistency, I will continue to adopt in these Reasons for Decision the abbreviations used in this Court’s Reasons for Decision handed down herein on 19 June 2024 [2024] HKCFI 1658 refusing Kam’s application to strike out the Plaintiff’s claim against her and to discharge the Mareva Injunction granted on 13 January 2023 (“the Striking Out Reasons”).

2.On this occasion and for determination was the Plaintiff’s application by summons dated 8 February 2024 for an order:

(a)  Save for the compliance with paragraph (b) below, restraining Kam from disposing of or dealing with Sum A and Sum B or any traceable proceeds thereof, including the sums of HK$170,962,682 and US$6,300,000 held in Kam’s bank account number 652756XXXX[1] with Standard Chartered Bank Singapore Limited (respectively “D’s Account” and “Standard Chartered Singapore”) as of 22 February 2023 (“the Proprietary Injunction”);

(b)  Ordering Kam to pay into Court within 7 days Sum A and Sum B, including the said sums of HK$170,962,682 and US$6,300,000 or such sums deemed just and sufficient by the Court; (“the Repatriation Order”); and

(c)  That Kam do comply with paragraph 4 of the Mareva Injunction within 7 days by serving on the Plaintiff an affirmation stating, in relation to HK$49,586,000, being part of Sum A, the present location and the recipient(s) of that sum and the location, nature and value of assets which represent in whole or in part or are derived from the proceeds of that sum before the sum was purportedly transferred to D’s Account as US$6,300,000, regardless of whether or not such proceeds are in the Defendant’s own name and whether they are solely or jointly owned (“the Disclosure Order”).

3.Mr Douglas Lam SC, leading Ms Sat and Mr Poon appeared for the Plaintiff and Mr Mike Lui SC leading Mr Lee appeared for Kam.

4.At the conclusion of the hearing, I granted:

(a)  the Proprietary Injunction, but only in respect of the sum of HK$170,962,682;

(b)  the Repatriation Order, but also only in respect of the sum of HK$170,962,682, which is to be complied with within 14 days;

(c)  the Disclosure Order but in terms of its amended form, and to be complied with by Kam within 28 days; and

(d)  the costs order that Kam do pay 90% of the Plaintiff’s costs of its summons to be summarily assessed, with certificate for 2 counsel

with the provision that (a) my refusal to grant the Proprietary Injunction and the Repatriation Order to cover the sum of HK$49,586,000 and/or the sum of US$6,300,000 was without prejudice to the Plaintiff later applying for similar orders concerning those 2 sums (or any part thereof), if advised after disclosure is made by Kam in relation to the sum of HK$49,586,000, and (b) for the avoidance of doubt, the sum actually paid into Court by Kam pursuant to the revised Repatriation Order would correspondingly and automatically reduce the amount so prohibited in the Mareva Injunction pursuant to paragraph 9 therein.

5.I said written reasons would be provided, and here are my reasons.

Kam’s contentions against this application

6.As Kam’s contentions against this application would make the related recent developments in this action, in HCCT ███████ and in the Arbitration relevant, and therefore for the same to be set out in a clear and chronological manner, as I intend to do in the next section, I will first give a summary of Kam’s such contentions.

7.In her written submissions, Kam referred to certain failed application by the Plaintiff in HCCT ███████ and ███████████████████ █████████████████████ in the Arbitration, and contended that (a) the Mareva Injunction and the HCCT Proprietary Injunction (defined below), which the Plaintiff have obtained, are already sufficient and effective injunctive relief, but (b) the Plaintiff has been abusing the process by this application, (b) the Plaintiff has been engaging in vexatious, oppressive and overly aggressive conducts and “trial and error” litigation strategies, (c) the Plaintiff has seriously delayed in making this present application, and (d) all these caused great prejudice to Kam.

The factual background and relevant procedural history herein, in HCCT █████ and the Arbitration

8.The factual background, the parties’ respective case and the relevant procedural history in this action up to late May 2024 have been set out in §23 to §29 and §36 to §39 of the Striking Out Reasons, I would not repeat them here.

9.It will be recalled that in this action, the Plaintiff claims that it has been defrauded by Kam over very substantial amounts, which have been conveniently referred to as “Sum A” and “Sum B”.

10.According to the Plaintiff, not disputed by Kam, that on 1 November 2019, the Plaintiff, by 2 transfers made by Kong Fung on its behalf, transferred Sum A (ie. the total sum of HK$220,548,682) to the Chiyu Account held by SSGI. 

11.According to the Plaintiff, on 20 February 2020, a further total sum of HK$32,500,000 (ie Sum B) was transferred by Kong Fung on the Plaintiff’s behalf to Redstone Capital and Wise Bravo pursuant to certain promises and instructions given by Kam.  The receipt of Sum B by SSGI (and related allegations) was disputed by Kam.

12.Since February 2022, there were a number of written requests made by the Plaintiff for information relating to Sum A and Sum B, but all to no avail.  They included Wang’s repeated requests to Kam Between February and March 2022 for, among others, information relating to the projects and value of SSI’s investments, which were not responded to, and the Plaintiff’s solicitors’ letter of 20 April 2022 which was replied to by letters of the solicitors of SSGI dated 30 May 2022 and 13 June 2022 to the effect that the Plaintiff had no proper basis to seek disclosure and that “Your client’s investment is secure”.  No particulars whatsoever were given about the investment.

13.In the meantime, on 13 May 2022, the Plaintiff obtained a Norwich Pharmacal order against Chiyu Bank. From the documents disclosed by Chiyu Bank, there were a number of substantial transfers in and out of the Chiyu Account authorized by Kam. The upshot was that by 4 January 2022, there was no money left in the Chiyu Account.

14.On 9 September 2022, the Plaintiff obtained disclosure of the corporate records of SSI from Maples pursuant to a Court Order of the Cayman Islands.

15.On 13 January 2023,

(a)  the Mareva Injunction was granted herein against Kam up to the value of HK$253,048,682 (being the aggregate of Sum A and Sum B); and

(b)  a proprietary injunction in respect of Sum A was also granted in HCCT ██████ against ████ in aid of the Arbitration (“the HCCT Proprietary Injunction”).

16.There was no appeal by Kam or ████ against the granting of the Mareva Injunction and the HCCT Proprietary Injunction.

17.The terms of the Mareva Injunction and the disclosure order provided in paragraph 4 thereof (“the January 2023 Disclosure Order”) and the terms of the HCCT Proprietary Injunction are pertinent :

The Mareva Injunction :

“1. The Defendant must not –

(1) Remove from Hong Kong any of his assets which are within Hong Kong whether in his own name or not, and whether solely or jointly owned, up to the value of HK$253,048,682 (the “Claimed Amount”), or

(2) In any way dispose of or deal with or diminish the value of any of his assets, which are within Hong Kong, whether in her own name or not, and whether solely or jointly owned up to the value of the Claimed Amount. This prohibition includes the following assets in particular:

a. The property known as Flat B (including …) on the 16th Floor of Tower 2, Larvotto, No. 8 Ap Lei Chau Praya Road, Hong Kong, or the net sale money after payment of any mortgages if it has been sold;

b. any money in the account number 608-173XXX-XXX at the Hongkong and Shanghai Banking Corporation.

…

4. The Defendant must inform the Plaintiff in writing within 48 hours from the service of this Order of the location and recipient(s) of the sums of HK$100,000,000 and HK$120,548,682 (in aggregate of HK$220,548,682 (the“Sum”)) transferred on 1November 2019 by Kong Fung Trade Ltd (“Kong Fung”) on behalf of the Plaintiff to Sunshine Success Global Inc's bank account maintained with Chiyu Banking Corp Ltd., (Account Number 7302002XXXX) and the further sums of HK$12,500,000 and HK$20,000,000 (in aggregate of HK$32,500,000 (“the “Further Sum”)) transferred on 20 February 2020 by Kong Fung on behalf of the Plaintiff to the bank account of Redstone Capital Holding Corp. maintained with United Overseas Bank Ltd Hong Kong (Account Number: 081313XXXX) and the bank account of Wise Bravo Limited maintained with DBS Bank (Hong Kong) Ltd (Account number 00051XXXX) and the location, nature and value of all assets which represent in whole or in part or are derived from the proceeds of the Sum and the Further Sum, regardless of whether or not such proceeds are in the Defendant’s own name and whether they are solely or jointly owned.”

The HCCT Proprietary Injunction :

“1. PROPRIETARY INJUNCTION

████████████████████████████████████████████████████████████████████████████████████████
████████████████████████████████████████████████████████████████████████████████████████.”

18.As there is a dispute as to whether Kam has complied with the January 2023 Disclosure Order, I will set out the related correspondence and Kam’s disclosure in more detail in §19 to §25 below.

19.Pursuant to the Mareva Injunction and the disclosure orders therein, including the January 2023 Disclosure Order and ████████████████████ ████ HCCT ███████████████,

(a)  Kam and ████ by their solicitors’ letter dated 17 January 2023[2], disclosed:

(i)    her assets in Hong Kong were the property named in §1(2)(a) of the Mareva Injunction with an approximate value of HK$47.4 million and about US$43,000 in the client’s account of her solicitors;

(ii)   HK$170,962,682 of Sum A was currently maintained in D’s Account in Singapore;

(iii)  HK$49,586,000 “has been applied to cover the management fee paid by the Partnership [SSI] to Sunshine Global Inc”; and

(iv)  “steps have been arranged for a sum of HK$49,586,000 to be transferred into [D’s Account] shortly”.

(b)  Kam filed her 3^rd affirmation herein on 19 January 2023 exhibiting her solicitors’ said letter dated 17 January 2023 and confirmed the information therein as true and accurate.

20.The next day on 18 January 2023, the Plaintiff’s solicitors wrote to ████████████████████ enclosing the HCCT Proprietary Injunction and requested the bank to refrain from dealing with the sum enjoined[3]. 

21.In the meantime, by their letter dated 20 January 2023 to Kam’s solicitors[4], the Plaintiff’s solicitors asked for the disclosure of the current whereabouts of the HK$49,586,000.

22.In response by letter dated 31 January 2023[5], Kam’s solicitors said that they were instructed that “a sum equivalent to the amount of management fee applied will be paid into [D’s Account] by 3 February 2023” (my emphasis).  There was no disclosure made in the letter relating to the HK$49,586,000.

23.By its letter dated 9 February 2023, ███████████████████ answered that it was not within the jurisdiction of the Hong Kong Court  █████

█████████████████████████████████████████████████████████████████████████████████.
In this connection, it is common ground that the HCCT Proprietary Injunction cannot be recognized under  █████████

24.On 21 February 2023, the Plaintiff’s solicitors issued a letter to Kam’s solicitors[6] chasing for confirmation with documents that HK$49,586,000 has been paid into D’s Account.

25.By a short letter dated 24 February 2023 to the Plaintiff’s solicitors[7], Kam’s solicitors stated merely that “You will note from the enclosed record HK$170,962,700 and US$6,300,000 are maintained in [D’s Account]”.  Nothing further was said though several pages of completely redacted bank statements (save the 2 entries) were enclosed.  In his submissions, Mr Lam pointed out that US$6,300,000 multiplied by the exchange rate of HK$7.8 to US$1 equals to HK$49,140,000.  Thus, the shortfall of HK$446,000 remained unaccounted for. This is not disputed by Mr Lui.

26.On 27 March 2023, the Plaintiff issued an application in HCCT ████████████████████████████████████████████████████████████████████████████████████████████ (“the HCCT Leave Application”).

27.On ███████████, the HCCT Leave Application was ███████ ███ dismissed ██████████████████████████████████████████

████████████████████████████████████████████████████████████████████████████████████
██████████████████████████████████████████████.

28.On 4 September 2023, ███████████████ the Arbitration ████ ███████████████████████████████████████████████.

29.By 2 summonses both dated 20 November 2023 respectively issued herein and in HCCT ██████, Kam and ████████████ sought to discharge the Mareva Injunction and the HCCT Proprietary Injunction consequential upon similar striking out sought in both set of proceedings by the said summonses.

30.On 27 November 2023, █████████████████████████ Arbitration █████████████████████████████████████████████

31.On 8 February 2024, the Plaintiff issued the present summons.

32.As mentioned, on 30 May 2024, this Court dismissed Kam’s summons herein for striking out and for the consequential discharge of the Mareva Injunction.

33.Shortly after in June 2024, █████ application in HCCT █████ to discharge the HCCT Proprietary Injunction was also dismissed.

Applicable principles

34.Kam did not dispute the well-established principles relating to proprietary injunction.  They were conveniently summarized by DHCJ Marlene Ng (as she then was) in Heitkamp & Thumann Kg v. Living Profit Trading Develop Ltd &  Others [2018] HKCFI 1006 at §55-§57 :

“55. For an interim injunction to protect a claim for trust property, the Amercian Cyanamid principles apply, ie an applicant must show (a) there is a serious question to be tried on the merits of the claims, (b) the balance of convenience is in favour of granting an interlocutory injunction, and (c) it is just and convenient to grant the injunction “although irremediable damage need not necessarily be shown and the court will readily find that the balance of convenience favours the preservation of the fund pending trial. See eg Lewin (supra) at §38-14; A v C [1981] QB 956; CY Foundation Group v Cheng Chee Tock & Ors [2012] 1 HKLRD 532 at §§14, 37”.[33]

56. As to the substantive merits of the claim, “the court need only be satisfied that the claim “is not frivolous or vexatious, in other words, that there is a serious question to be tried.” (American Cyanamid (supra) at 407).  If the opposing party seeks to show there is no serious issue to be tried, the threshold is high, as it would be necessary to demonstrate that the claim should be struck out.  See eg Yifung Properties Ltd & Ors v Manchester Securities Corp and Ors (unreported) CACV258/2015, 9 September 2016, at §20.”[34]

57. In Zimmer Sweden AB v KPN Hong Kong Limited & anor,[35] DHCJ Kent Yee concurred with To J’s observations in Falcon Private Bank Ltd v Borry Bernard Edouard Charles Limited & anor [36] that the application does not have to show risk of dissipation of assets:[37]

“…… A claimant’s right to a proprietary injunction is different. It is issued to preserve assets which a claimant has a proprietary claim so that they can be turned over to the claimant if he is successful in the action. A proprietary injunction is easier to obtain and not subject to the usual liberties inserted into Mareva relief and there is no need to prove risk of dissipation. It is a better relief than Mareva injunction, provided that the property has not been dissipated. ……”” (my emphasis)

35.As pointed out by Mr Lam, and not disputed by Mr Lui, in light of the proprietary nature of a claim, it is unnecessary to demonstrate any risk of dissipation as such and delay per se does not prevent a proprietary injunction from being granted, citing Yan Yu Ying v Leung Wing Hei [2021] HKCFI 3160 at §14-§15, per K Yeung J :

“14. Mr Chang objects to the grant of any interim‑interim relief.  He relies on delay on P’s part in bringing the present application.  He submits that P on 3 February 2021 by the latest knew that the Police had returned the Subject Bitcoins to D.  One of the NCL reports is dated 17 May 2021.  The PowerPoint was demonstrated in June 2021.  P could not demonstrate any “extreme urgency”. Further, there is no risk of dissipation.  Had D intended to dissipate, he would have plenty of time to do so before his arrest, and after the lapsing of the no consent letters.

15. With respect, none of those objections takes into account the proprietary nature of P’s claim.  As explained by Flaux J in Madoff Securities International Ltd & Anor v Raven & Ors [2012] 2 All ER (Comm) 634, at §§127‑128, that:

“127. MSIL seeks a proprietary injunction against the Kohn defendants. It is essentially common ground that there are three elements which the claimant has to demonstrate for the grant of a proprietary injunction, following the approach prescribed by American Cyanamid Co v Ethicon Ltd [1975] 1 All ER 504, [1975] AC 396: (1) that the claimant has shown that there is a serious issue to be tried on the merits; (2) that the balance of convenience is in favour of granting an injunction and (3) that it is just and convenient to grant the injunction.

128. In other words, both the basis for a proprietary injunction and the circumstances in which it will be granted are different from the case of a freezing injunction: see Polly Peck International plc v Nadir (No 2) [1992] 4 All ER 769 at 787 per Lord Donaldson of Lymington MR.  In particular, unlike in the case of a freezing injunction, it is not necessary to show any risk of dissipation of assets and, even if there has been delay in making an application which might lead to refusal of a freezing injunction, a proprietary injunction may nonetheless be granted: see Cherney v Neuman [2009] EWHC 1743 (Ch) at [101]–[102] per Judge Waksman QC sitting as a Judge of the High Court.”

36.Mr Lam accepted that where it is shown that because of the delay, it would be unreasonable to grant the remedy and it has become practically unjust to do so, an application for a proprietary injunction will be refused (Dingway Investment Ltd (in Liquidation) v China City Construction & Development Co (Hong Kong) Ltd (No.2) [2023] 3 HKLRD 705 at §24-§28, Monsanto Co v Stauffer Chemical Co [1984] FSR 559 at 571).

37.Mr Lui emphasized that:

“72. However, a proprietary injunction will not be granted if a monetary award will be an adequate remedy for the plaintiff. In particular, where the proprietary claim of a plaintiff is not to any specific real or personal property but to money, the plaintiff can be adequately compensated by a monetary award, unless there is evidence which calls into question the ability of the defendant to meet the award (for example its insolvency), so that a proprietary injunction is not necessary or justified”

(per Coleman J in Predicine Holdings Ltd v Bianchi (Hong Kong) Limited & Others [2021] HKCFI 123 at §72

38.Mr Lam did not dispute that, but added and referred to the next paragraph of the judgment of that learned judge :

“73. To that point, I would add that a proprietary injunction may be considered necessary or justified where there is evidence which calls into question the willingness of the defendant to meet any award, or which sufficiently demonstrate an intention from which it can be inferred it would not meet an award. In other words, though it is not necessary to show a risk of dissipation for the purposes of obtaining a proprietary injunction, if such a risk is demonstrated it may be an additional factor which points in favour of the grant of a proprietary injunction.”

39.Last but not least, and in support of Kam’s contentions, Mr Lui submitted, and not disputed by Mr Lam and this Court readily accepted, that the granting of an interim injunction, be it proprietary or not, is a discretionary relief and the Court always retains a residual consideration to refuse to grant such relief where it is shown that the application is an abuse of process.

DISCUSSIONS

Non-compliance of the January 2023 Disclosure Order

40.Kam maintained, though rightly not strenuously argued by Mr Lui orally, that she has not failed to comply with the January 2023 Disclosure Order.

41.Under the January 2023 Disclosure Order, Kam was ordered to disclose “the location, nature and value of all assets which represent in whole or in part or are derived from the proceeds of the Sum”.

42.As I set out in paragraph 19(a) above, in Kam’s solicitors’ letter dated 17 January 2023, Kam only disclosed that HK$170,962,682 of Sum A was currently maintained in D’s Account in Singapore and HK$49,586,000 “has been applied to cover the management fee paid by the Partnership [SSI] to Sunshine Global Inc”.  In other words, Kam only said that HK$49,586,000 was used to pay SSGI purported management fees, but without any details whatsoever.

43.In my view, since it is common ground that Kam indirectly wholly owned SSGI and there is evidence that she is the only person operating SSGI and operating the Chiyu Account and she is allegedly currently holding the HK$170,962,682 of Sum A in D’s Account (which is in her name), there is amble evidence to support that Kam must have knowledge as to when and into which bank account(s) of SSGI the HK$49,586,000 has been allegedly paid as “management fee”, the whereabouts of the sum, whether the sum has been converted into other assets and the whereabouts of such assets.  Yet, save the sentence quoted in §42 above, Kam said nothing by way of disclosure.

44.Evidently, merely saying (by her solicitor’s letter) that “steps have been arranged for a sum of HK$49,586,000 to be transferred into [D’s Account] shortly” could not be regard as due disclosure in compliance with the January 2023 Disclosure Order.  The subsequent transfer of US$6,300,000 into D’s Account (not to mention without stating the relationship between this US$6,300,000 and the said sum of HK$49,586,000) could not by any stretch be a fulfilment of her disclosure obligation.  There is also the shortfall of HK$446,000, on which nothing was even mentioned by Kam.

45.In the premises, I was of the clear view that there had not been full compliance with the January 2023 Disclosure Order by Kam and I proceeded to consider the Plaintiff’s present application on that basis.  Moreover, having considered the correspondence set out in §19-§25 and Kam’s conducts, I took the view that I could not regard Kam as a litigant who was sufficiently serious over complying with court orders.

The Mareva Injunction and the HCCT Proprietary Injunction are already sufficient and effective injunctive relief ?

46.I have no difficulty in not accepting Kam’s such bare assertion.

47.Evidently, at the time of the application for the Mareva Injunction and the HCCT Proprietary Injunction (together “the 2 Injunctions”), the Plaintiff had no information as regards the whereabouts of Sum A and Sum B.  Such lack of information was not the Plaintiff’s fault.  Rather, it has repeatedly chased Kam and ████ for the information but was repeatedly refused.

48.It was after having obtained the 2 Injunctions that it was disclosed to the Plaintiff by Kam that HK$170,962,682 was already removed some time ago out of the jurisdiction to Singapore into D’s Account.  Therefore, (a) the Mareva Injunction, which only freezes assets within Hong Kong, does not catch the said sum, (b) there was the difficulty, as above alluded to, in seeking to secure ███████████████████████ compliance with the HCCT Proprietary Injunction.

49.The 2 Injunctions are clearly not “sufficient or effective” in protecting the Plaintiff’s potential interest in Sum A and Sum B, particularly the said sum of HK$170,962,682.  Likewise, I do not regard any fault could be attributed to the Plaintiff for such insufficiency or ineffectiveness.

No abuse of process or real prejudice

50.Kam now claims that she has been vexed by various and multiple applications for injunctive reliefs by the Plaintiff, and particularly parallel applications for proprietary injunctions herein ██████████████, and that such was overly aggressive and she was abused.  Those complaints aside, Kam did not depose to any facts in support of any substantive prejudice that she would or might suffer if the Proprietary Injunction and the Repatriation Order were granted.

51.I find no substance in her such complaints.

52.Evidently, the HCCT Leave Application was taken out by the Plaintiff in March 2023 when it realised by mid February 2023 that it had difficulty in enforcing the HCCT Proprietary Injunction ██████████████ ████████████████████. Though the HCCT Leave Application failed for the reason I mentioned, there was nothing to show that the Leave Application was taken out to abuse ████. Rather, it seems to me to be a mis-step, ███████ █████████████████████████████████████████████████████████████.

53.Having been adjudicated against on 18 August 2023 in HCCT ███████████████████████████████████████████████████████████████████████████████████
███████████████████████████████████████████████████████████████████████████████████
███████████████████████████████████████████████████████████████████████████████████.

54.Kam complained that the Plaintiff adopted a “trial and error” strategy.  By this Court’s reckoning, the Plaintiff has been trying to secure the money to protect it for the purpose of its claims but has been met with full scale resistance from Kam/SSGI, necessitating various procedural steps to be taken.  I find no substance in this complaint by merely describing the procedural steps taken by the Plaintiff by this label of “trial and error”.

55.Mr Lui contended that despite ████████████████████████ was still pending (albeit stayed), the Plaintiff made the present application in February 2024, and Kam thus was prejudiced by having to face 2 parallel applications for proprietary injunction over essentially the same sum of money.  Despite the effort, Mr Lui could but only pointed to the expenditure of extra time and costs as the prejudice suffered by Kam.  I do not accept that the Plaintiff’s such conduct amounted to an abuse or vexation, and in any case not an abuse sufficient to reject the Plaintiff’s present application, for these reasons :

(a)  As Mr Lam pointed out, which I accept, ████████████████ ████████ was made against ███ and not against Kam.  Though it is the Plaintiff’s newly amended case that SSGI has been the alter ego of Kam or a device of hers to perpetrate fraud, it has always been Kam’s stance that such is not the case and herself, SSGI and SSI are distinct legal entities; Kam therefore could not blow hot and cold.

(b)  ████████████████████████ was stayed at the time this application was taken out; in any case, any alleged prejudice is on costs █████████████████████████████████████████
█████████████████████████.

56.A point was also made in Kam’s written submissions to the effect, as I understand it, that on each occasion when the Plaintiff applied for the Mareva Injunction, the HCCT Proprietary Injunction, for leave in the Leave Application and ████████████████████████, the Plaintiff “has misled SSGI/Kam and told the Court … that the proprietary injunctive relief against SSGI will offer sufficient protection”.  Mr Lui, in my view rightly, did not further pursue this point orally.

57.To conclude, I accept the Plaintiff’s explanations that these different applications were made in this action, HCCT █████ and ████████████ at different stages for the reasons and in the circumstances set out above and that the Plaintiff was not trying to seek double or excessive injunctive relief, and the Plaintiff did not abuse the process, or abuse Kam.

Delay ? No dissipation of assets ? Balance of convenience

58.I accept Kam’s point that the Plaintiff could have applied for the Proprietary Injunction and the Repatriation Order by late February 2023 when the Plaintiff has already been informed by Kam that HK$170,962,682 of Sum A was sitting in D’s Account. There was thus a delay of a year between that time and the time the Plaintiff issued the present summons.  Mr Lam did not dispute there was such a delay. However, the Plaintiff was not sitting idle but has taken other not unreasonable steps to seek to secure the money.  Moreover, save delay per se, Kam did not point to any detriment she has suffered by reason of the delay.  I was thus of the clear view that it was not shown that the delay would make it unreasonable or would make it practically unjust to grant the interlocutory relief now sought.

59.Mr Lui argued that it has not been shown that there would be a real risk of dissipation of assets in that there was presently no suggestion that the money was not still maintained in D’s Account.  Mr Lui further argued that the prejudice Kam suffered by reason of the multiple applications for the proprietary injunction should tilt the balance of convenience.

60.Mr Lam submitted that the granting of a proprietary injunction does not depend on such risk being established.

61.On balance of convenience, Mr Lam submitted to the effect that

(a)  All the affirmations filed by Kam in this action and in
HCCT ██████ were affirmed to by her outside Hong Kong, mostly in London.  In other words, Kam was never within the jurisdiction in the course of these proceedings.  She apparently is not resident in Hong Kong.

(b)  The Mareva Injunction, the only injunctive order made against Kam personally does not catch the money in D’s Account.

(c)  The HCCT Proprietary Injunction was made against ████.  █████ █████████████████████████████████████████████████████████████████████████████████████████████████████████████. Further, little is known about ███, ██████████████████████████████████████████████████████████████████████████████████████████████████████████████. Should the money be dissipated, there would be little meaningful recourse by the Plaintiff against ████.

(d)  The HK$170,962,682 and US$6,300,000 in D’s Account are far from secure and their remaining there depends on the will and wish of Kam.

(e)  Kam has not fully complied with the January 2023 Disclosure Order and has not accounted for the shortfall of HK$446,000.

(f)  Thus, there is evidence which calls into question the willingness of her to meet the judgment or that she would still keep the money in D’s Account later on when circumstances changes.

62.As I said, I do not regard Kam having been abused, nor has she suffered any real prejudice as she complained.  I am persuaded by the fact that the Plaintiff’s claim is a proprietary one, and the subject money in which the Plaintiff has a proprietary claim remains outside the jurisdiction and the reach of the Hong Kong Court; and I accept Mr Lam’s submission that its present whereabouts is known and it remains in D’s Account only at the wish of Kam, with little real assurance to the Plaintiff.

63.Kam has not been able to show any substantive prejudice she would suffer by the imposition of the Proprietary Injunction and by ordering the repatriation of the same.

64.I was of the clear view that not granting the present orders to the Plaintiff would carry a greater risk of injustice and that the balance of convenience favoured granting the orders.

No evidence to show that the Plaintiff has a proprietary claim over the US$6,300,000 in D’s Account

65.Mr Lui went through the correspondence mentioned in §19 to §25 above and made the point that there was no admission on the part of Kam that the US$6,300,000 later transferred into D’s Account was the traceable proceeds of Sum A or Sum B and that there was no other evidence whatsoever showing so.  He further submitted that as the Plaintiff’s present application was based on his proprietary claim over the subject sums, and there being no such evidence on the US$6,300,000, the sum should not be caught by the Proprietary Injunction, nor should it be ordered to be repatriated to Hong Kong, nor disclosure be ordered specifically regarding it.

66.It was indisputable that such was the state of the evidence as submitted by Mr Lui.  At the hearing, Mr Lam in my view rightly and sensibly did not further contest the point.

67.The Proprietary Injunction and the Repatriation Order therefore was granted only limited to the HK$170,962,682, with the provision that it was without prejudice to the Plaintiff applying for similar orders should later on there would be evidence tracing the balance of Sum A into other sums or assets.

The Disclosure Order

68.As it has been made clear that there was as yet no disclosure by Kam in respect of the balance of sum A, ie HK$ HK$49,586,000, Mr Lam at the hearing orally seek leave to amend the Plaintiff’s summons to tidy the terms of the Disclosure Order to reflect that disclosure was specifically sought in relation to that balance.  The leave to amend this part was not opposed by Mr Lui.

69.Mr Lam also sought to amend by including a paragraph requiring Kam to exhibit in her affirmation for disclosure all documentations in her possession custody or control supporting the transactions disclosed relating to that sum or part thereof.  Mr Lui informed this Court that he was instructed to oppose the leave to amend this part but did not make any submissions in opposition.  I gave leave to amend for the reasons :

(a)  It is well-established that the discovery of such supporting documents is within the rights of a claimant to seek to trace the money it has a proprietary claim and it has been part of the Plaintiff’s case for discovery that it was sought pursuant to its proprietary rights;

(b)  Without the documentations, the Plaintiff would be hampered in taking further action to trace or secure the sum; and

(c)  Kam has not fully complied with the January 2023 Discovery Order for over a year and she should be ordered to substantiate her disclosure by providing the supporting documents.

70.I thus made the Disclosure Order in its amended terms.

COSTS

71.Mr Lui did not dispute that the costs should follow the event, but submitted that the Plaintiff should pay for the costs of the oral application for amendment of the summons over the terms of the Discovery Order and be deprived of part of its costs as Kam prevailed over the contention over the US$6,300,000 which led to the orders being granted in a reduced form and not as sought by the Plaintiff.

72.After hearing counsel, in the round and taking into account the minor costs of the amendment, I ordered Kam to pay the Plaintiff 90% of its costs of this application, with certificate for 2 counsel, to be summarily assessed on paper with directions therefor given.

73.I thank Mr Lam, Mr Lui and their junior counsel for their able assistance.

Mr Douglas LAM SC leading Ms Sakinah SAT and Mr Arthur POON instructed by Messrs. P.C. Woo & Co. for the Plaintiff

Mr Mike LUI SC leading Mr Jun LEE instructed by Messrs. W K To & Co. for the Defendant