Shishir Kothari t/a Ko Jewels Trading Co v. Gilman & Co Ltd

HCMP000249/1971

IN THE SUPREME COURT OF HONG KONG

APPELLATE JURISDICTION

MISCELLANEOUS PROCEEDINGS NO. 249 OF 1971

(On Appeal from O.J. Action No. 1915 of 1970)

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Coram: Blair-Kerr and Huggins, JJ.

Date of Judgment: 2 November 1971

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JUDGMENT

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Blair-Kerr, S.P.J.:

1. On 22nd October 1971, Mr. Justice Pickering gave judgment in favour of the plaintiff, indicating that he would give his reasons in writing later. On 26th October the defendant gave notice that on 2nd November this Court would be moved under O.59 r.13 for an order that execution on the judgment be stayed until the expiry of 14 days after the delivery of the learned judge's reasons for judgment and

"that such stay be extended pending the appeal if notice of motion of appeal be filed within the said 14 days ......"

2. On 2nd November we dismissed the application indicating that we would record briefly our reasons for so doing.

3. The defendant did not file an affidavit in support of the application; but counsel addressed the Court from the Bar, the substance of his address being that the plaintiff was not a Hong Kong "belonger" in that he had carried on business here only since August or September 1969; that between October 1969 and July 1970 a number of cheques drawn by him were dishonoured; that conditions in Hong Kong differ greatly from conditions obtaining in England in that a considerable number of traders have no real roots in the Colony; that the law takes cognizance of this in that under O.44A provision has been made for the arrest and imprisonment of an absconding debtor; that the plaintiff could leave Hong Kong within a few days; and that in coming to a decision on this application this Court should regard him as in no better position than a person residing out of the jurisdiction.

4. In opposing the application for a stay, Counsel for the plaintiff cited the notes to O.59 r.13 as recorded at p.805 of the 1970 Supreme Court Practice; and his submission was that the defendant had not begun to make out a case for a stay of execution.

5. In Brentwood Wig Manufactory Ltd. v. Poncher⁽¹⁾, when dealing with an application for a stay of execution under the former O.29 r.26 (which was in much the same terms as O.59 r.13), I said:-

"The rule does not state that an appeal shall operate as a stay except in so far as the court may otherwise order. It states that an appeal shall not operate as a stay except in so far as the court may otherwise order. But clearly, in the absence of such a rule, an appeal would not operate as a stay; and the first part of the rule is merely declaratory of the principle that a successful litigant should not be deprived of the fruits of his litigation. In The Annot Lyle⁽²⁾ it was argued by the applicant for a stay pending appeal that a different rule should apply in Admiralty actions. This was rejected by the Court of Appeal. Bowen, L.J. said (p.116):-

'There is no reason .... why in Admiralty cases we should make a practice of depriving a successful litigant of the fruits of his litigation, and locking up funds, to which prima facie he is entitled, for a long time because they are secured by a bail bond. We cannot assume that it is a matter of small importance to a successful party to go without his damages for a long time.'

In Wilson v. Church (No. 2)⁽³⁾ money was ordered to be paid out of a fund and distributed among a large number of persons, many of whom were resident abroad. Cotton, L.J. said (p.458):-

'I am of the opinion that we ought not to allow this fund to be parted with by the trustees .... it is to be distributed among a great number of persons and it is obvious that there would be very great difficulty in getting back the money parted with .... if there had been any case made by the plaintiff that this appeal was not bona fide, that it was for some indirect purpose .... the case would have stood in a different position.'

The majority of the court took the view that a stay should be ordered; and Cotton, L.J. said (p.458):-

It seems to me that this principle does not conflict in any way with the general principle enunciated in The Annot Lyle⁽²⁾. True, the discretion vested in the court under O.29 r.26 is wide; but in my view it would not be a proper exercise of that discretion if a court ordered a stay in a case where, on the material before it, there could not be said to be any real likelihood of the appeal, if successful, being rendered nugatory. As Lord Esher M.R. said in Atkins v. Great Western Railway⁽⁴⁾:-

'As a general rule the only ground for a stay of execution is an affidavit showing that if the damages and costs were paid there is no reasonable probability of getting them back if the appeal succeeds.'"

6. I entirely agree that conditions in Hong Kong differ radically from those prevailing in England. As counsel said, there is no counterpart in the law of England to our O.44A. Only a few days age when dealing with an application under that Order, I said:-

"From time to time during the last 25 years there have been suggestions that the rules relating to personal attachment before judgment should be revoked; but such suggestions have found little favour with the legal profession or indeed with the business community. This attitude is understandable. With the development of international trade and the tremendous improvement in methods of international transport, no doubt it is necessary in a territory such as Hong Kong to have some coercive procedure so that pressure may be brought to bear on 'fly-by-night' merchants and others to ensure that they answer to the commands of this court and bona fide plaintiffs may have in advance some prospect of recovering the value of any judgments which they may subsequently obtain in their favour."

As regards applications for a stay, in the Brentwood⁽¹⁾ case I said:-

"...... I think it would be difficult if not impossible, to lay down any general rule ...... It is for the court in each case to endeavour to assess the chances of a successful litigant removing himself and his assets from the jurisdiction before the decision of the appellate court be known."

For myself, I would not hesitate for a moment to depart from the general rule laid down in The Annot Lyle⁽²⁾ if I had any reasonable cause to believe that a successful litigant was about to remove himself or his assets from the jurisdiction. But, in this case, I agree with counsel for the plaintiff that the defendant has not made out such a case as would warrant this Court ordering a stay of execution. The defendant has not chosen to file any affidavit in support of the application; and this Court will not ordinarily act in a matter of this sort without affidavit evidence. But apart from any procedural defects, we have not seen the judgment or the grounds of appeal. All we know is that the plaintiff has been in business here for 2 years and that in the initial stages some cheques drawn by him were dishonoured. But the reasons for the dishonour are what matters; and of that we have no knowledge.

7. If we had acceded to this application it would have created a very unsatisfactory precedent.

Representation:

Zimmern (Deacons) for Appellant.

Mills-Owens (Johnson, Stokes & Master) for Respondent.

(1) (1966) H.K.L.R. at 649

(2) (1886) 11 P.D. 114

(3) (1879) 12 Ch. 454

(1) (1966) H.K.L.R. 643

(4) (1886) 2 T.L.R. 400