Audret P.F. Chow & Co (A Firm) v. Ying Kai Leung and Another
Read the full judgment text of HCMP 87/1973 on BabelCite. This High Court CFI judgment was delivered on 8 October 1973.
1. In January of last year the plaintiff firm, which is a firm of stock brokers, obtained judgment against the first defendant in a sum of $46,865.25 and costs. It was claimed that he had capitalised upon an error made by the plaintiff firm in its accounting system. Despite the efforts of the plaintiff firm the judgment remained unsatisfied. Eventually it was made apparent to the Registrar of this Court that the first defendant had a beneficial interest in some two hundred shares in the second d
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HCMP000087/1973 IN THE SUPREME COURT OF HONG KONG (ORIGINAL JURISDICTION) MISCELLANEOUS PROCEEDINGS NO. 87 OF 1973 -----------------
----------------- Coram: Cons, J. Date of Judgment: 8 October 1973 ----------------- RULING ----------------- 1. In January of last year the plaintiff firm, which is a firm of stock brokers, obtained judgment against the first defendant in a sum of $46,865.25 and costs. It was claimed that he had capitalised upon an error made by the plaintiff firm in its accounting system. Despite the efforts of the plaintiff firm the judgment remained unsatisfied. Eventually it was made apparent to the Registrar of this Court that the first defendant had a beneficial interest in some two hundred shares in the second defendant company, which shares were registered in the name of a third party. Due proceedings were taken and on the 8th of March last year the Registrar made a charging order absolute upon that interest. 2. In May of this year the plaintiff took out an originating summons against both the first defendant and the second defendant company to enforce that charging order. For what it was worth this was the correct procedure: Leggott v. Western(1) and Kolchmann v. Meurice(2). The summons was amended and an order for substituted service on the first defendant had to be made and it was not until the 3rd of July that the summons first came before me. The first defendant did not appear. The plaintiff firm and the second defendant company were then represented by counsel, but not by those counsel who have appeared before me in the present proceedings. I was asked to approve a draft order drawn up, as I understood, with the assistance of counsel for the second defendant company but which was not, strictly speaking, a consent order. That order was divided into three parts which may be briefly paraphrased as follows:-
3. It will be readily observed that the directions given in para.3 extended well beyond the order made in para.2. If carried out in full they would have affected a sale of the legal interest in the shares, whilst all that the plaintiff was entitled to under the order was a sale of the beneficial interest. The sale would have taken place without regard to the position of whoever at that time happened to have been the legal owner. 4. The difficulties inherent in the failure to detect that most elementary mistake were not realised for some time. The second defendant company altered the name in its register and issued a certificate in the new name. There had also been some transactions in respect of bonus shares and dividends but which are not material to the present issue. Then the full implications of these acts must have become apparent. The second defendant company applied ex parte for leave to issue an inter partes summons to vary. The application was filed and dealt with on the same day. I granted leave and at the same time made a preservation order under O.29 r.2 with regard to the newly issued share certificate and granted an injunction against dealing with it or the shares it represented. This action was necessary because the plaintiff firm refused voluntarily to stay its hand. 5. The inter partes summons was in due course returned before me. It does not ask for variation as such but for two specific matters: first, that the share register be restored to its original state and second, that the plaintiff return the new certificate. If such directions are made they will naturally vary the original directions to that extent but they will still leave untouched the earlier direction that Miss Chow sell the shares through a recognised stock exchange. It may well be that without the share certificate she would be unable to do so but the position would be untidy to say the least. It would seem preferable, although I speak without the benefit of argument, to apply to revoke the previous directions in their entirety. 6. Before argument was heard upon the summons itself counsel for the plaintiff firm objected to my jurisdiction to entertain the same. Whilst conceding (I think) that the court acted in error, counsel submits that a summons of this nature is not the correct approach to set it right; proceedings should have been by way of appeal or possibly under the Slip Rule; but that in any event the phrase "liberty to apply", under which it is assumed that the second defendant company is applying, is not authority for a court to vary its previous order. I was referred to the case of Cristel v. Cristel(3). In that action between a husband and a wife a consent order for possession of the matrimonial home was made in the husband's favour but suspended "until the [husband] provides suitable alternative accommodation for the [wife] by providing a two or three-bedroomed house or bungalow etc," with liberty to apply. Later, relying upon those last words, it was sought to vary the order to include "or flat" in addition to "house or bungalow" but the Court of Appeal ruled that this was not possible. 7. The argument for the plaintiff was, if I may say so, very attractively presented but now that I have had time to consider I think it must be wrong. It is true that a court has no power to vary a final order except to correct clerical mistakes or accidental slips or admissions (O.22 r.11) or where the order does not represent the true intention of the court (under its inherent power: Lawrie v. Lees(4) and In re Swire Miller v. Swire(5)), neither of which circumstance is applicable in the present instance. But the matters of immediate concern are not an order of the court in that sense. They are mere directions with respect to the proceedings to be taken under an order of the court, to wit, the actual order for the sale of the beneficial interest made in para.2. Such directions are given under O.44 r.4 and may be revoked or varied at any time. That is the simple answer to the objection. I am satisfied that I have jurisdiction. 8. In order to minimise the costs thrown away in these proceedings, for which I regret I must share equal blame, and to give parties the opportunity to consider their further courses of action, I agreed that this ruling might be delivered direct to solicitors without the necessity for further appearance. The present position must therefore be that the inter partes summons stands adjourned sine die with general liberty to restore and pending such restoration and hearing or until further order of this court the preservation order and injunction shall continue.
Representation: Charles Ching (T.P.F. Chow & Co.) for plaintiff Denis Chang (Deacons) for second defendant. (1) (1884) 12 Q.B.D. 287 (2) (1903) 1 K.B. 534. (3) (1951) 2 K.B. 725. (1) (1881) 7 A.C. 19, 35 (2) (1885) 30 Ch. 239, 243 |