Ki Mee Metal and Plastic Factory Ltd v. Basket Ball Products Factory (A Firm) and Another
Read the full judgment text of HCMP 2357/1984 on BabelCite. This High Court CFI judgment.
1. On 22nd August last, Rhind J. made an ex parte order in the Anton Pillar form directed to the two defendants. The evidence filed on that occasion showed that the plaintiffs owned the design copyright in a particular form of icing set: that the defendants had put on the market an icing set which was a slavish and cheap copy of the plaintiffs set; and that this set was manufactured by the 2nd defendant and sold by the 1st defendant.
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HCMP002357/1984
An Order in Anton Pillar form was made against two defendant firms. In the course of the resulting search, the Order was served upon a servant of the 2nd defendant firm endorsed with a penal notice in corporation form asserting that the recipient was an "officer" of the defendant firm and required to compel obedience to the Order by that firm. Held dismissing motion for contempt against servant:-
IN THE SUPREME COURT OF HONG KONG HIGH COURT MISCELLANEOUS PROCEEDINGS ________ BETWEEN
Coram: The Hon: Mr. Justice Hunter. Dates of Hearing: 6th, 7th, 18th, 19th September and 8th & 9th November 1984. Date of Delivery of Judgment: 9th November 1984. ___________ JUDGMENT ___________ 1. On 22nd August last, Rhind J. made an ex parte order in the Anton Pillar form directed to the two defendants. The evidence filed on that occasion showed that the plaintiffs owned the design copyright in a particular form of icing set: that the defendants had put on the market an icing set which was a slavish and cheap copy of the plaintiffs set; and that this set was manufactured by the 2nd defendant and sold by the 1st defendant. 2. The plaintiff's solicitor duly attended at the 2nd defendant's premises, and there met the two respondents to this motion. The first respondent is Mr. Yiu, the proprietor of the 2nd defendants firm. The 2nd respondent is Mr. Hung, one of two persons employed by that firm. I do not propose to set out the full story and the events of that evening. I am simply going to concentrate on the essentials as far as this motion is concerned. Neither respondent was very cooperative. The order permitted the plaintiffs on remain on the premises only until about 9 p. m. Not long before that deadline the search party discovered a pile of 450 cartons. They were stacked in the corridor ready for delivery. They were tied with plastic tape. Miss Kwong who was in charge of the search party opened one of the cartons and found that it contained 12 small boxes. Each box contained an icing set. These sets appear to her identical to the plaintiff's sets. She replaced the box she had removed for inspection and caused the carton to be resealed. This may be significant because she thereby concealed from the respondents the fact that the carton had ever been opened. She did find some of the packing material in which the sets in the cartons had been packed. A piece of this material she kept and is exhibit JWKK6 before me. This packing material shows an illustration of an icing set identical in design to the plaintiff's. It bears this endorsement "Copyright 1983 Action Industries Inc. - Manufactured in Hong Kong for Action Industries Inc. Cheswick P.A. 15024 U.S.A." The same name and address appears on the back. There is what appears to be a product number also stamped which is 11062. 3. All the carton bore labels which read like this: "11062 OU/B 12 each icing set nozzles made in Hong Kong for Action Industries Inc." The search party was unable to remove these cartons before the 9 o'clock deadline. The matter was left that they were to return the next morning to take them away. If the cartons contained infringing icing sets they fell four square within Rhind J.'s order in two respects. 4. First, clause 1B restrained the defendant's from parting with their possession, and secondly clause 6 required them to be delivered up to the plaintiff's solicitors. The following morning another party from the plaintiff's solicitors duly returned to the premises. The cartons had all disappeared. The explanation Mr. Yiu later gave to Mr. Daniel Ho was that they were collected by some unnamed trading in company at 8 o'clock that morning, and that he had been paid $2,002 for them. 5. In those circumstances the principal complaint made on this motion against Mr. Yiu arises in respect of those cartons is that, in the circumstances I have rehearsed, he failed to deliver them up and then parted with their possession. Initially Mr. Yiu conducted his own case in person. But eventually and fortunately, after some encouragement from the court, he instructed Mrs. Barnes to appear for him. She has taken substantially two points on his behalf. 6. The order in question contained an undertaking by the plaintiffs solicitors that upon the service of the order they would explain the plaintiff's entitlement to institute contempt proceedings should the defendant fail to comply with the terms of the order. Mrs. Barnes has submitted first, that the solicitors failed to comply with their undertaking, and secondly that they failed sufficiently to explain the effect of the order to Mr. Yiu. 7. From my part I think it is unfortunate that our rules contain no express guidance as to the explanation a process server should give. In the old days when orders were perhaps simpler this might not have been too difficult a problem. But an order in the Anton Pillar form such as this is anything but simple. It is written in English and it takes immediate effect. I would personally like the Rules Committee to look at this question, and to give clear guidance as to what explanation should be given by a process server of complicated orders in English, which are to take immediate effect, when such orders are served upon Chinese speaking people. 8. I have had benefit here of the oral evidence of Miss Kwong, as well as her written affirmation. I have been left in no doubt at all that she fully complied with her undertaking, and with her duty as solicitor. I think her decision to explain the order rather than trying to translate it makes sense. I think that she explained the contempt provision, and that Mr. Yiu was left in no doubt at all what the nature of the order was, and what it was that the court was requiring him to do. 9. Mrs. Barnes' next point arises on the facts. She reminds me, quite correctly, that I have here to apply what is common known as the criminal standard of proof. She has reminded me particularly of the observations of Lord Denning M.R. in Re Bramblevale Limited (1970) Ch. 128 at p.137. She invites me to say that that onus had not been discharged in the light of the evidence in Mr. Yiu, supported as it was by Mr. Hung. They both said that these cartons did not contain icing sets at all. They contained only egg slicers and soap holders. These had been mispacked by Mr. Hung some days before. These cartons were not taken away from the premises at all. Half were brought into the premises over night and unpacked, and the other half were moved to another place in another staircase or corridor. They were therefore still there and available to be seen when the search party returned on the 23rd August. But no one on the defendant's part drew the search party's attention to them because Mr. Yiu told them that they had been removed at 8 o'clock that morning and had been sold. This explanation is now said to be a lie. 10. I have no hesitation whatever in rejecting that explanation. I had the opportunately of observing Mr. Yiu in the witness box for some little time. He contradicted himself many times over. He said certain things which on the face of the documents in front of me, and particularly the packing materials, were obviously untrue. Making full allowance for the fact that he was initially in person, and also for the fact that he had throughout to give his evidence through an interpreter, I am regrettably driven to the conclusion that he gave me a series of deliberately false answers. 11. I am satisfied beyond any doubt, reasonable or unreasonable, that these 450 cartons did contain icing sets. They had been manufactured by the 2nd defendant for the 1st defendant. The 1st defendant had provided this packaging material. Action Industries Inc. was the 1st defendant's customer. They were all ready for delivery or collection, by or for the 1st defendant, for transmission to the United States. I strongly suspect that the 2nd defendant needed this $2,002. I think he told Mr. Ho the truth on the morning of the 23rd August that those cartons had been collected by a contractor at 8 o'clock that morning. 12. In my judgment in parting with those cartons in this way, Mr. Yiu was committing a clear breach of this court order and it was a deliberate breach. The position, I think, has been made worse by the fact that he had come to this court and tried to lie his way out of the situation, and has offered the court no sort of explanation or apology. The only two things which can be said in his favour are fortuitous as far as he is concerned. The first is that the plaintiffs have settled their action against the 1st defendant. Mr. Tse the person principally concerned for the 1st defendant is therefore not in jeopardy in respect of the matters that I am considering. I have the strongest possible suspicion that Mr. Tse is as responsible as Mr. Yiu for the removal of these cartons. They were packed and labelled for Mr. Tse's customer. In that form they were of no use to anybody but that customer. I strongly suspect that they were in due course delivered to that customer, who paid Mr. Tse for them. So that I am somewhat embarrassed by the position that a person of whose activities I am as suspicious as that, is not even before the court. 13. The second factor is delay. There was no delay by the plaintiffs here at all. The matter was first brought before me early in September. It was then adjourned to assist the defendant and thereafter it had to be adjourned because of the pressure of other work in my list. The fact remains that I am now dealing with the situation some months after the event. In these circumstances I think that I can sufficiently express the court's disapproval of this conduct n two ways. 14. My first order is that Mr. Yiu pays a fine of $2,000. That is, of course, the sum he received for these cartons, and it is the least penalty I can impose. Secondly, and this is perhaps the more serious penalty, he must pay the plaintiffs costs of this motion. 15. I now turn To the 2nd respondent, Mr. Hung. The facts here are these. On the evening of 22nd August Mr. Yiu left the premises and it in his absence Mr. Hung was being obstructive. Mr. Lau, an experienced process server in the employ of the plaintiffs' solicitors, then served Mr. Hung with a copy of the order. Mr. Lau's affirmation simply said that he served Mr. Hung, who he described as an officer of the 2nd defendant, with a sealed copy of the order. The affirmation goes on to say that the order was endorsed with a penal notice in these terms:
I have no oral evidence from Mr. Lau but I have been invited to infer from the fact that he is a very experienced process server that he explained this penal notice to Mr. Hung. 16. Mr. Hung's account was somewhat different. He agrees that he was approached by Mr. Lau who had a paper with him, and said that this paper was an order of the court, which he, Mr. Hung, had to accept. He asked him his surname, which was then given, and written on the document. I think it is plain that Mr. Hung was reluctant to take the document but it was eventually pushed upon him, or perhaps I should say at him, because it was left on the table in front of him. Mr. Lau then said words to the effect that this is the same as if you have been given the order. Mr. Hung repeatedly said that he had been "authorised" by Mr. Lau. This word I did not start to understand when it was first used. But Mr. Hung explained it in this way. In the absence of Mr. Yiu, Mr. Lau, he said, wanted "to authorise me to be some sort of officer". I asked him what did he mean by "some sort of officer". In reply, he said, it meant "the officer in charge". I confess that that piece of evidence only made sense to me, when for the first time I associated it with the form of penal notice which is on the back of the order. 17. This again seems to me to give rise to a point of practice which may be of some significance. The present position, as I see it, can be summarised in these propositions:-
18. In these circumstances it seems to me that there are three areas in which our practice could with advantage be clarified by the Rules Committee or by Practice Direction namely:-
19. I have set those thoughts out first because to my mind they explain the difficulties in which the plaintiff found itself. The third form of penal notice to be found in note 45/7/6 in the White Book is that appropriate to a corporate defendant. Its phraseology I think derives from Order 45 rule 5(1)(ii) where you find the words "the property of any director or other officer of the body corporate". The plaintiffs' solicitors used this form because it probably seemed to them the most appropriate of the three available. But it was in fact inappropriate because the 2nd defendant was not a limited company and "officer" has a technical meaning in that context. It led to the discussion which I am quite satisfied took place between Mr. Lau and Mr. Hung about Mr. Hung being "some sort of officer". I have little doubt that Mr. Lau was doing his best to explain this penal notice, but the trouble was, I think, that he was trying to explain the inexplicable. It was simply not appropriate to the circumstances before him. The effect upon Mr. Hung I think has been demonstrated by his evidence about authorisation which was so difficult to understand when it was first given. 20. In addition to this confusion, I am unable to conclude upon the evidence led, that Mr. Lau explained the effect of the court order. I have already said that in my judgment a non-party being served with an order such as this must have the effect of the order brought home to him, i.e. that he must not assist in the breach of such an order, if contempt proceeding are to be launched with any chance of success. This seems to me particularly the case where the order is being served upon a servant of a defendant company. It seems to me self-evident that the servant must have brought home to him that the order may require him, if need be, to disobey his own master. 21. I have considerable suspicion about Mr. Hung's part in this episode, and cannot accept a good deal that he had told me, particularly about the cartons. But in the circumstances I have outlined I find it impossible to find him guilty of contempt. So as against him the motion is dismissed.
Representation: Mr. Clement Luk instructed by M/s Johnson, Stokes & Master for Plaintiff. Mrs. J. Barnes instructed by M/s Chan and Lo for YIU Yee-ngai. HUNG Ching-yeung in person. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||