The Administrator in Hong Kong of the Catholic Mission of Macao v. The Hong Kong and Shanghai Banking Corporation and Others
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1. The material facts behind this application may be shortly set out in words that I have made use of before. The plaintiff was the registered shareholder of a considerable number of shared in the defendant bank. In May 1973 the certificates relating to those shares were presented to the bank together with completed share transfer forms. The presentation was not made on behalf of the plaintiff or with his knowledge. It was made on behalf of a person who had no title to the shares whatsoever. The
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HCA000276A/1976 IN THE SUPREME COURT OF HONG KONG HIGH COURT ACTION NO. 276 OF 1976 -----------------
----------------- Coram: Cons, J. Date of Judgment: 9th January 1978. ----------------- JUDGMENT ----------------- 1. The material facts behind this application may be shortly set out in words that I have made use of before. The plaintiff was the registered shareholder of a considerable number of shared in the defendant bank. In May 1973 the certificates relating to those shares were presented to the bank together with completed share transfer forms. The presentation was not made on behalf of the plaintiff or with his knowledge. It was made on behalf of a person who had no title to the shares whatsoever. The signatures on the share transfer forms purporting to be those of the Bishop of Macao - the appropriate signature of the plaintiff: Cap. 1006 - were forged. The bank attended to the presentation and in the due course removed the plaintiff's name from the register, replaced it with the other name given and issued new share certificates accordingly. 2. The truth came to light a few months later and eventually the plaintiff brought his action. By the statement of claim he asked for:
3. At the conclusion of the trial, in so far as it concerned the plaintiff, judgment was given in his favour "in terms of paragraphs (1), (2) and (3) of plaintiff's claim". Not long afterwards it was realised that an order in those terms did not give the plaintiff the benefit of the dividends subsequently declared on the bonus shares or any interest upon such dividends. This application was made to put that matter right. 4. Quite clearly this was an oversight of counsel. And if it had been raised at the trial would have been immediately settled in his favour. Counsel for the defendant very sensibly does not contest the amendment as such. But he takes the opportunity thus afforded to ask that the judgment as a whole should be now amended, this time in his favour, by the removal of all provisions for the payment of interest. Again sensibly counsel for the plaintiff takes no objection to the informality to the application. 5. The two opposing arguments may, I think, be briefly and fairly summarised thus. The plaintiff says that it is the original wrongful act of the bank that has kept him out of his money and therefore as a matter of simple and natural justice he should be entitled to interest for all the time that he has waited. The bank says that since the plaintiff chose to frame his action as a claim for proprietory right, and has recovered that right, he is not in addition entitled to claim damages. Counsel's authority for that proposition is Davis v. Bank of England(1), which at first glance appears to support him. However at that time interest upon an unpaid debt was not recoverable in any court, except where it was provided for by express agreement, and the question that I have to decide today was not raised or pursued in that case. Upon reflection I think that it is wrong in the present circumstances to equate a claim for interest with one for damages. Interest is payable not as a matter of right upon a proven cause of action, but by virtue of section 38 of the Supreme Court Ordinance, Cap.4. When the due date for the payment of dividends declared by a company is reached those dividends become debts payable to the shareholders. If it is necessary for any shareholder to have recourse to the courts to recover his debt the courts would, in the absence of special circumstances, make an award of interest in his favour. 6. Counsel for the plaintiff suggests that the special circumstances here are to be found in Regulation 128 made under The Hongkong and Shanghai Banking Corporation Ordinance, Cap. 70. That provides:
7. Counsel for the plaintiff argues that the operation of this regulation is confined to the regulation that immediately follows, i.e.
I see no reason why this should be so but I am of the opinion that Regulation 128 is to some extent limited in its application, that is, I think, that upon its proper construction it applies only to dividends remaining lawfully unpaid by the bank. This may arise, for example, under Regulation 124 where a dividend is declared but the time for payment is fixed in the future and perhaps also where proper attempts to make payment under Regulation 134 had failed. To construe Regulation 128 otherwise would leave open the possibility that the bank could profit from its own wrong. That cannot have been intended by the legislature. 8. For these reasons I make an order that my judgment given on the 1st December 1976 be amended as requested by the plaintiff but not otherwise. Representation: Ronny Tong (Woo, Kwan, Lee & Lo) for plaintiff. Anthony Dicks (Johnson, Stokes & Master) for defendant. Miss F.Y. Wong of (Yung, Yu, Yuen & Co.) for 1st and 2nd Third Parties. (1) 2 Bing. 393 |