Supreme Finance Ltd v. Wan Hang Trading Ltd and Others

HCA011877/1983

High Court Action No. 11877 of 1983

Courts practice and procedure – judgment debt unsatisfied by debtor - 0.49B, r.1 - imprisonment of debtor - application for direction to bailiff to enlist assistance of Director of Immigration in arresting absconding debtor - Stop List - praecipe did not ask for imprisonment - abolition of writ of ne exeat regno - section 16(2) of the Crown Proceedings Ordinance - proposed order misleading and confusing - whether Court had inherent jurisdiction.

The Plaintiff, a judgment creditor, took out a praecipe for a writ of fi.fa. without expressly asking for the inclusion of a direction to the bailiff to arrest and deliver the judgment debtor to prison. The judgment debt was wholly unsatisfied and the judgment debtor was believed to have left Hong Kong although he was expected to return shortly. The Plaintiff applied for an order which was to be served on the Director of Immigration directing the bailiff, upon information by the Director of Immigration that the judgment debtor is passing through a point of immigration, immediately to attend the said point of immigration and call upon the Director of Immigration to assist him to (inter alia) arrest the judgment debtor and deliver him to prison.

The Attorney General Was permitted by the Court to make submissions on behalf of the Director of Immigration as the application raises a question of public policy on which the Director of Immigration has a view which he desires to bring to the notice of the Court.

HELD:

Application dismissed.

Miss Maria Yuen instructed by Iu, Lai & Li for the Plaintiff

Mr. N. Kaplan, Q.C. and Mr. B. Barlow for the Attorney General

Mr. A. Sakhrani, Q.C. and Mr. Geoffrey Ma instructed by C.Y. Kwan & Co. as amici curiae

Cases cited in the judgment:-

Cases cited in argument but not mentioned in the judgment:-

1983, No. 11877

IN THE SUPREME COURT OF HONG KONG

BETWEEN

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Coram: Mr. Commissioner Lee, Q.C.

Date: 12th August 1983

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JUDGMENT

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1. This matter first came up for hearing before me on 21st July 1983 on the application of the Plaintiff. But Mr. Barlow also appeared on behalf of the Attorney General when he was notified of this application. He indicated to me then that the Attorney General would seek permission from the Court to make representations on behalf of the Director of Immigration. I have a discretion to allow the Attorney General to make representations in a case such as this because it raises a question of public policy on which the executive may have a view which it may desire to bring to my notice. This is very well summarised at page 212 of the Supreme Court Practice 1982 (marginal reference 15/6/9A). I indicated to Miss Yuen that I would not be prepared to give an order in terms of the application without hearing full argu-ment. I also indicated that I would like to have the assistance of Mr. Sakhrani, Q.C. and Mr. Ma as amici curiae.  The matter was then adjourned to 28th July 1983 to enable full argument to be advanced.

2. At the resumed hearing, I have the benefit of hearing very well prepared submissions from counsel who all agreed that I should give my judgment in open court. I so do now.

Relief sought

3. It is necessary to set out the order sought by the Plaintiff:-

4. As this is the first time that an application of this nature is properly argued, I think it desirable to summarise counsel's submissions.

Submissions on behalf of the Plaintiff

5. Miss Yuen referred me to the writ of fieri facias which was in the standard form following form 53 made under Order 45 rule 12 of the Rules of the Supreme Court. The material paragraph in the writ of fi fa. reads as follows:-

"[And we further command you that in case you shall not be able to find sufficient property of the said defendant, or the said defendant shall fail to point out to you any property whereon to levy, you do forthwith arrest the said defendant and deliver him into the custody of the Commissioner of Prisons to be kept in a prison as a prisoner for debt for the period ... unless you shall be discharged from the said imprisonment in due course of law.]"

6. Miss Yuen also referred me to Order 49B rule 1(1) of the Rules of the Supreme Court which provides:-

"If the judgment is for money, it may be enforced by the imprisonment of the party against whom it has been given, or by the attachment and sale of his property, or by both imprisonment and sale, if necessary ..."

7. Miss Yuen takes the following points:-

"If any person who is adjudged bankrupt, or in respect of whose estate a receiving order has been made, after the presentation of a bankruptcy petition by or against him, or within 6 months before such presentation, quits the Colony and takes with him, or attempts or makes pre-paration to quit the Colony and take with him, any part of his property to the amount of $100 or upwards, which ought by law to be divided amongst his creditors, he shall (unless he proves that he had no intent to defraud) be guilty of a misdemeanor."

"... Where the plaintiff in any action in any of Her Majesty's superior courts of law at Westminster in which, if brought before the commencement of this Act, the defendant would have been liable to arrest, proves at any time before final judg-ment by evidence on oath, to the satisfaction of a judge of one of those courts, that the plaintiff has good cause of action against the defendant to the amount of fifty pounds or upwards, and that there is probable cause for believing that the defendant is about to quit England unless he be appre-hended, and that the absence of the defendant from England will materially prejudice the plaintiff in the prosecution of his action, such judge may in the prescribed manner order such defendant to be arrested and imprisoned for a period not exceeding six months, unless and until he has sooner given the prescribed security, not exceeding the amount claimed in the action, that he will not go out of England without the leave of the court ..."

"The word 'execution' in its widest sense signifies the enforcement of or giving effect to the judgments or orders of courts of justice. In a narrower sense, it means the enforcement of those judgments or orders by a public officer under the writs of fieri facias, possession, delivery, sequestration, fieri facias de bonis ecclesiasticis, etc."

"expressed in the form of a royal command directing the sheriff of the county in which the judgment debtor's goods are situate to seize in execution such of the judgment debtor's goods, chattels and other property as are authorised to be seized by law, and thereout to 'cause to be made' (namely to sell) so much of the same as may be sufficient to satisfy the amount of the judgment debt and the costs of execution, and also interest on the amount of the judgment from its date until payment."

Submissions made on behalf of the Director of Immigration

Mr. Kaplan made the following preliminary observations:-

"IT IS ORDERED that Solicitors for the Plaintiff Company be at liberty to request the Director of Immigration to put the name of the 2nd Defendant ... onto the 'stop list' of the Immigration Department."

Mr. Kaplan's main submission is that if the order sought is intended to be a mandatory injunction requiring the Director of Immigration to put the 2nd Defendant's name on the stop list, then the Court has no jurisdiction to grant it because of the provisions of section 16 of the Crown Proceedings Ordinance, Cap. 300, which provides:-

8. Mr. Kaplan further submitted that if the order sought is not intended to be a mandatory injunction on the Director of Immigration to put the name of the 2nd Defendant on the stop list, then it will be a completely futile order in that he will never know when the 2nd Defendant is coming into or going out of Hong Kong without putting the 2nd Defendant's name on the stop list, with the result that the bailiff will never be informed by the Director of Immigration of such fact. He submitted that the order is in a form which is intended to be as close as possible to asking the Court to do something which it has no power to do; alternatively, the intention of serving such an order on the Director of Immigration is to mislead him, particularly when accompanied by a letter similar to the 13 letters handed up to me; or to confuse him even if the order were not to be accompanied by such a letter. He further submitted that the draftsman of the proposed order has deliberately used vague language, perhaps hoping that the Director of Immigration will construe it as requiring him to put the 2nd Defendant's name on the stop list.

9. Mr. Kaplan's second main submission is that the desired effect of the proposed order is to stop the 2nd Defendant from leaving Hong Kong, which is in direct conflict with the clear intention of the legis-lature when it abolished the Writs of ne exeat regno (and colonia) in 1974. The Court has, therefore, no power to stop anybody from leaving Hong Kong on the ground that he is a judgment debtor and has failed to satisfy the judgment debt.

10. Mr. Kaplan submitted that it requires a specific provision in the Inland Revenue Ordinance to give power to members of the Immigration Service to stop someone from leaving Hong Kong when he has failed to pay the assessed tax or give security for such tax. As for wardship cases, it is a contempt of Court to remove the ward out of the jurisdiction. That was why the Director of Immigration was prepared to co-operate with solicitors who inform him of such threatened unauthorised removal.

11. Mr. Kaplan submitted that Mareva injunctions are directed to the assets of the defendant and not to his person; and that the power to grant such injunction does not come from the inherent jurisdiction of the Court but is expressly conferred by statute under section 19(1) of the Supreme Court Ordinance which provides:-

"The High Court may grant ... an injunction ... in all cases in which it appears to the High Court to be just or convenient so to do."

12. He further submitted the power to make Anton Pillar Orders and pre-discovery disclosure orders in aid of Mareva injunctions comes from the inherent jurisdiction of the Court; but even there the Court makes these orders so as to control its own processes but not to fill in gaps left open in the law or to do something which is expressly prohibited by law.

13. Mr. Kaplan further submitted that in this case there is no order from the Court as such requiring the debtor to be imprisoned, and that the order from the Court is that the 2nd Defendant should pay a certain sum of money to the judgment creditor. There is therefore no injunction which restrains the judgment debtor from leaving Hong Kong.

14. Mr. Kaplan further submitted that it will be wrong for the Court to order the Director of Immigration to do something which he is not empowered to do so under the Immigration Ordinance or under any other ordinance.

15. Finally, he submitted that the stop list is drawn up purely for interdepartmental convenience. It is non-statutory, and therefore litigants have no right to have a particular person's name put on such stop list.

Submissions by the amici curiae

16. Mr. Sakhrani made the following submissions:-

Form of the writ of fi.fa.

17. The writ of fi. fa. in question was not produced to me as evidence by the Plaintiff; nor was a copy of such writ contained in my file. Miss Yuen addressed me on the basis that the Writ of fi.fa. was as pre-scribed in Form No. 53 in Appendix A to the Rules of the Supreme Court. I will assume this to be so. The important words which have been relied upon by Miss Yuen as a royal command directed to the bailiff to arrest the 2nd Defendant and deliver him to the debtors' jail are contained in square brackets in the prescribed form No. 53. It is important to refer to the last paragraph thereof:-

"N.B. The words in square brackets are only to be included on the express instructions of the party applying for the writ of fieri facias to issue."

18. That is plainly right because rule 1 of Order 49B leaves the choice to the judgment creditor whether to enforce his judgment for money by the imprisonment of the defendant in question or the attachment and sale of his property or by both methods. It is therefore obvious that if the judgment creditor does not specifically ask for the method of execution by imprisonment, the writ of fi fa. when issued should not contain the words in the square brackets. The praecipe for writ of fieri facias filed on 28th February 1983 on behalf of the Plaintiff did not contain the requisite instructions to have the words within the square brackets to be included. This being the case, the actual writ issued should not contain those vital words. If the writ that was actually issued does not contain these words, then clearly the Plaintiff's application must fail in that none of the Defendants in this action is liable to be imprisoned in the debtors' jail.

19. There is, however, another possibility, which is that although the Plaintiff had not requested in the praecipe for the imprisonment of the 2nd Defendant, yet owing to an oversight on the part of the Registry, the words within the square brackets have not been deleted in the writ of fi fa. which was actually issued. In this case, it may be argued that until the writ of fi fa. containing these words had been set aside for irregularity or until it had been amended by the deletion of the words within the square brackets, it remains a valid direction to the bailiff to arrest and deliver the 2nd Defendant to the debtors' jail. But even so, it would clearly be wrong for me to exercise my discretion, even if I have jurisdiction to do so, to give an order in terms of paragraph 1 of the summons which is intended to have the effect of having the 2nd Defendant arrested at an immigration point and be delivered to the debtors' jail. I therefore feel that whether the actual writ had contained the words within the square brackets or not, I would not make an order in terms of paragraph 1 of the summons. On this ground alone the Plaintiff's application must fail.

20. But it will not be right if I do not proceed further and deal with the carefully prepared submissions of counsel. In so doing, I will assume that there had been no irregularity in the issue of the writ of fi.fe. and that the bailiff had been properly enjoined to arrest and deliver the 2nd Defendant to the debtors' jail.

Form of the Judgment

21. According to the Judgment formally entered on 4th February 1983, the 1st, 2nd and 3rd Defendants are adjudged to pay 2 sums of money to the Plaintiff with interests thereon and costs. There is no order requiring the 2nd Defendant to be imprisoned in case of non-payment of the judgment debt, or to remain within the jurisdiction of the Court. Of course, the Plaintiff has a right to put the 2nd Defendant into the debtors' jail by virtue of the provisions of Order 49B of the Rules of Supreme Court; but even if that right had been properly exercised, it would only mean this: that if the bailiff can find the 2nd Defendant who should fail to point to sufficient property to satisfy the judgment debt, then the bailiff would arrest and deliver him to the debtors' jail. As a matter of practice, the bailiff is instructed by the plaintiff or his solicitors to go to a particular place, usually the home of the defendant, to levy execution there. This is borne out by paragraph 4 of the affirmation of Mr. Sammy Tsoi Sinn Ming filed herein on 16th July 1983. But if the defendant cannot be found, and there is no or insufficient property in his home to satisfy the judgment debt, the bailiff will return to his office pending further instructions from the plaintiff or his solicitors. For practical reasons, the bailiff's office does not and is not expected to search all over Hong Kong for the judgment debtor. Supposing a judgment debtor had avoided arrest by the bailiff by leaving his own home and staying with a friend, and supposing he was later found by the judgment creditor and the bailiff, I still do not think that such an "absconding judgment debtor" could be committed for contempt of court for having tried to avoid being arrested and imprisoned. This underlines the point that the royal command contained in the writ of fi. fa. is only directed to the bailiff; it certainly affects the liberty of the judgment debtor; but it is in no Way intended to be an order restraining him from leaving Hong Kong.

Abolition of writ of ne exeat regno

22. With the abolition of the writs of ne exeat regno and ne exeat colonia in 1974, it is obvious to me that the legislature has taken away from the Courts the power to restrain a person from leaving Hong Kong except in circumstances which are covered by Order 44A of the Rules of the Supreme Court which is not applicable here. In these circumstances I cannot see how it can be argued that a Court in Hong Kong still has the power under its inherent jurisdiction to make an order in terms of paragraph 1 of the summons which is intended to have the effect of preventing the 2nd Defendant from leaving Hong Kong.

23. The freedom of movement, that is, to leave or to return to Hong Kong, is one of the many freedoms enjoyed by the citizens of Hong Kong and is a freedom which is dear to us all and should be guarded jealously by the Courts. I am firmly of the view that short of legislative amendment to the law, it will be wrong for the Courts of Hong Kong to deprive a citizen of this freedom to leave Hong Kong even though he is a judgment debtor who is liable to be imprisoned in the debtors' jail.

Stop List

24. I agree with Mr. Kaplan that the stop list kept by the Immigration Department is entirely for inter-departmental convenience and is non- statutory. A litigant has no right to have the name of a judgment debtor put on the stop list; and it is wrong for the Courts to intervene by requiring the name of such a judgment debtor to be put on the stop list. Just as the Executive must not interfere with the Courts, so the Courts must not intermeddle in the daily administration of the Government except by way of Judicial Review. A citizen can of course request the Director of Immigration to put another person's name on the stop list, but whether such a request will be acceded to must be left to the discretion of the Director of Immigration who will no doubt take legal advice whenever necessary.

Analogy to a Mareva injunction

25. I do not think that the order sought under paragraphs 1 and 2 of the summons has the same effect as the service of an Mareva injunction order on a bank for the following reasons:-

Nature of the relief claimed

26. Paragraph 1 of the summons is in the form of a direction given to the bailiff and paragraph 2 merely requires the proposed order to be served on the Director of Immigration. It is immediately apparent that by paragraph 1 of the summons the Director of Immigration is not required to inform the bailiff should the 2nd Defendant be passing through a point of immigration. The relevant words are: "The bailiff shall upon information by the Director of Immigration that ... the 2nd Defendant ... is passing through a point of immigration ..." All the Director of Immigration is required to do is to render assistance to the bailiff if so called upon to assist him to arrest and deliver the 2nd Defendant to the debtors' jail. Miss Yuen submitted that the Director ought, upon the service on him of the proposed order, to put the 2nd Defendant's name on the stop list. I do not agree. The proposed order does not require him to do so; and the Court has no power to direct him to do so by virtue of section 16(2) of the Crown Proceedings Ordinance. If the 2nd Defendant's name is not put on the stop list, then even if the 2nd Defendant should come back to Hong Kong, there will be no way for the Director of Immigration to be apprised of it. He would thus be unable to inform the bailiff of the fact. On this analysis, the proposed order is futile. But if the intention had been to mislead the Director of Immigration into thinking that he was under a duty to put the 2nd Defendant's name on the stop list by means of an accompanying letter as in the 13 cases brought to my attention, or to confuse the Director of Immigration into thinking that he had such a duty even without such an accompanying letter, then I must not allow myself to be instrumental to such a device. There is a primary duty on the Court to ensure that its order is couched in clear and unambiguous language so that people will know exactly whether they are effected by it or not, and if they are, they will know how to comply with it. It is, therefore, wrong for a Court to make an order which is deliberately couched in vague, misleading and confusing language. As a matter of principle, therefore, I will not accede to this application.

Inherent jurisdiction

27. Nor am I satisfied that after the abolition of the writs of ne exeat regno and colonia in 1974, the Court in Hong Kong still has power under its inherent jurisdiction to prohibit a judgment debtor from leaving Hong Kong although the judgment debt has not been satisfied.

28. I appreciate that many solicitors in Hong Kong feel very strongly that Courts should assist in the enforcement of their own judgments or orders by prohibiting judgment debtors from leaving Hong Kong until after their judgment debts have been fully satisfied. But I cannot see how, in the absence of legislative intervention, the Courts can assume such jurisdiction.

29. For these reasons, the application is dismissed.

30. As it has been agreed that costs will not be asked for whichever way my decision goes, I will make no order as to costs.

Representation:

Miss Maria Yuen instructed by Messrs. Iu, Lai & Li for the Plaintiff

Mr. N. Kaplan, Q.C. and Mr. B. Barlow for the Attorney General

Mr. A. Sakhrani, Q.C. and Mr. Geoffrey Ma instructed by Messrs. C.Y. Kwan & Co as amici curiae