Empire Airport Service Co Ltd v. Yoshiaki Hosoda

HCA000644/1977

IN THE HIGH COURT

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Coram: Cons, J.

Date of Judgment: 14th September 1977.

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DECISION

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1. On the 18th March this year the defendant was committed to prison by Li, J. upon his failure to comply with an order for security made under Order 44A of the Rules of the Supreme Court. He now applies to me for his release. As I understand his counsel he approaches the matter in two ways. The first is under rule 4(2), which gives the court a general power to review at any time, and the second is under rule 5, which relates specifically to lack of due diligence on the part of the plaintiffs in prosecuting the action.

2. Originally there were three actions against the defendant. They were each by a separate limited company but it is conceded that the personalities behind those companies are the same, so that in effect there is only one set of plaintiffs. Only two of the actions remain effective. Judgment was obtained in the third in default of appearance and execution has already been levied. Certain sums of money have also been paid voluntarily by the defendant's parents. It is said, therefore, that it is grossly unfair that the plaintiffs should be able to keep the defendant in prison but that the plaintiffs should instead proceed in the third action under Order 48 and examine the defendant before the Registrar as to his means; that in doing so the plaintiffs would discover that the defendant has no assets whatsoever and in that case, and this I think is the crux of the argument, the execution of any judgment in the present actions would not be obstructed or delayed because, if the defendant were in due course to be imprisoned by way of execution he would be released immediately on his application under Order 49B rule 6. This is an ingenious argument. It has superficial logic, although I have some doubt whether it would be ultimately successful. However I prefer to express no concluded opinion at the moment, for one thing is certain, to be successful a defendant would have to establish very clearly that the plaintiff would be unable, if and when the need arose, to prove against him any of the matters set out in paragraph 3 of rule 6. That is not the position in the present instance. Indeed one affidavit of the defendant would seem to imply that he does in fact have assets, albeit they are outside this jurisdiction.

3. I turn then to the question of delay. The three writs were issued on the 17th March and the defendant was imprisoned, as I have already mentioned, the following day. Approximately three weeks later, the defendant having entered no appearance at all, the plaintiffs obtained judgment in the third action. They deliberately refrained from obtaining judgment in the present actions. This was because it was not until a few days ago that the plaintiffs knew the exact amount that they say is due to them. The writs had been based on the total number of transactions in which the defendant had been involved, but it was not expected that he would be found financially responsible in all of them. The true figure would not be known until the auditors had completed their investigations. Therefore the plaintiffs' solicitors, very properly, advised against proceeding further.

4. Nothing then happened until the 23rd June, when the defendant entered appearances. Almost immediately the plaintiffs applied for summary judgments under Order 14. The usual affidavits were sworn in support, by an employee of the plaintiffs who stated that the defendant was justly and truly indebted to the plaintiffs in the amount claimed on each writ. The affidavits were filed in this court by the plaintiffs' solicitors. Yet at the least those solicitors were fully aware that those statements were probably not true. The auditors had not at that time completed their report. The auditors have done so now and indeed I am told that in relation to these two actions the amount that is now to be claimed is very much less than those entered in the writ, although a further writ may be issued for other monies which ought to have been included in the third action. It is this aspect of this case that has caused me to delay so long in giving this decision. I have hesitated whether or not I should take the matter further. I have eventually decided against so doing. However I would like it to be known that such conduct will not again be treated so lightly. That is why I have adjourned this matter to open court.

5. When the Order 14 summonses came on for hearing they were adjourned for argument to a date to be fixed. Neither side has yet made application to that end but it should not be delayed any longer. I therefore order that the defendant shall be released from prison unless application for a date is made before 4 p.m. tomorrow, in which case the defendant will remain in prison until the decision of the action as a whole or, if judgment be given against him, until the execution of that judgment or further order of this court. The costs of these proceedings are to be costs in cause with certificate for counsel.

Representation:

G.R. Miles (Deacons) for the plaintiffs.

Edward Chan (Bernard Wong & Co.) for the defendant.