Yung Yuen Ling Alice v. Wong Ming Kan Michael
Read the full judgment text of CACV 310/1998 on BabelCite. This Court of Appeal judgment was delivered on 11 April 2007.
1. There were two summonses before me, one of the plaintiff and one of the defendant. That of the plaintiff sought that payments made out of assets subject to a Mareva injunction be varied, in an unspecified manner, or dispensed with, whilst that of the defendant sought that the injunction be discharged. It is axiomatic that if the defendant were to succeed, the plaintiff’s summons falls to be dismissed. After hearing argument on 3 April 2007 I discharged the Mareva injunction, dismissed the
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IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE ACTION NO. 231 OF 2004 ______________________ BETWEEN
______________________ Before: Hon Wright J in Chambers Date of Hearing: 3 April 2007 Date of Handing Down Judgment: 11 April 2007 _____________________________________ REASONS FOR JUDGMENT _____________________________________ 1.There were two summonses before me, one of the plaintiff and one of the defendant. That of the plaintiff sought that payments made out of assets subject to a Mareva injunction be varied, in an unspecified manner, or dispensed with, whilst that of the defendant sought that the injunction be discharged. It is axiomatic that if the defendant were to succeed, the plaintiff’s summons falls to be dismissed. After hearing argument on 3 April 2007 I discharged the Mareva injunction, dismissed the Plaintiff’s summons and ordered, in each instance, that the Plaintiff pay the Defendant’s costs. These are my reasons. 2.I related the background to these proceedings in my judgment of 1 December 2006 relating to discovery: I do not propose to repeat it in detail. The plaintiff and defendant are, at present, married. All that it is now necessary to say is that the action by the plaintiff relates to the return of moneys which she alleges were her property but which she transferred into the possession of the defendant as a result of misrepresentations which he made to her. Matters have moved on only in the sense that pending matrimonial proceedings have now been transferred from the District Court to this Court. 3.I recognise that I do not sit on appeal of the granting of the original order. The issue before me is whether, in the circumstances presently prevailing and in the exercise of my discretion, the injunction should continue. 4.I discharged the injunction because the cumulative effect of the delay in prosecution of the action (which in itself would have justified the discharge of the injunction), the reduction in the apparent prospects of success by the plaintiff in the main action and the tenuous nature of the risk of dissipation of the assets rendered it appropriate, in the interests of justice, to exercise my discretion in favour of the defendant. Delay 5.Whether a Mareva injunction should be discharged during its term is a matter for the discretion of the court hearing the application: one of the considerations, but not the sole consideration, will be the question of delay. Whether a plaintiff has prosecuted diligently a particular action will be a matter of fact and degree in each instance. 6.A Mareva injunction is an exceptional and intrusive remedy. In Newsgroup Newspapers Limited versus Mirror Group Newspapers (1986) Ltd [1991] FSR 487 Hoffman, J. said:
7.In Sanwa Development Ltd (in liquidation) and Chan Kar-keung and Another CACV 310/1998, Liu, J.A. reiterated
and further
8.By way of example in Lloyds Bowmaker Ltd there had been a delay of 2½ years from the grant of the Mareva injunction, during which period the action had still not been set down for trial. In Sanwa Development Ltd the delay was in excess of three years. It is not the absolute period of time that is of importance, but the diligence, or lack of it, on part of the plaintiff in prosecuting the action. 9.In the present matter it is convenient to have regard to the proceedings in two distinct time periods: the first period is from 7 February 2004 when the Mareva injunction was granted up to December 2005 when the plaintiff was admitted to hospital; the second period is from December 2005 to now. During the first period the plaintiff was in charge of the proceedings whilst in the second period that duty has fallen on the Official Solicitor. In my judgment, the Plaintiff personally and thereafter through the Official Solicitor failed diligently to prosecute the action. 10.Although I have had regard to the entire conduct of these proceedings, a selection of dates adequately illustrates the history:
11.It is worth highlighting that the plaintiff
12.The plaintiff was entitled to change solicitors and to represent herself throughout the first period. The effect of doing so, inevitably, was delay. That is not a situation which should result in prejudice to the defendant. Whether intentionally or by way of simple inactivity, the plaintiff failed to expedite the main action: she has repeatedly had to be urged by the defendant to move the proceedings along. 13.The submission is made on behalf of the plaintiff that at least some of the delay during the first period is attributable to the defendant’s conduct in opposing the Summary Judgment proceedings. Just as the plaintiff has been entitled to exercise her rights in regard to representation, so has the defendant in resisting, upon formal legal advice, the summary judgment proceedings: the difference, however, is that the defendant pursued his opposition to those proceedings expeditiously. 14.There was nothing to prevent the plaintiff from having pursued with the main action whilst the summary judgment proceedings were pending. 15.The Official Solicitor now has been representing the plaintiff for a period in excess of a year. No doubt there has been an inability to obtain instructions from the plaintiff consequent upon her health but the purpose of the appointment is so that decisions may be made in the plaintiff’s best interests without the necessity of obtaining her consent. 16.On the evidence before me no such decisions have been made, nor has the main action progressed other than in accordance with orders of court: on that evidence, more attention has been devoted to quibbling than to pursuing the action or resolving it – see, by way of example, paragraphs 11 to 15, 19 and 20 and 42 to 44 of the affirmation dated 11 October 2006 by the Official Solicitor. 17.During both periods the striking characteristic of the manner in which the main action has been conducted is the lack of a sense of urgency or purpose. I am satisfied that the plaintiff has failed to diligently pursue the main action in such a manner as is required where a Mareva injunction has been granted. On this basis alone, I would have made the order. Prospects of success 18.In order to obtain the relief sought the plaintiff needed to show a good arguable case in the main action. Inherent in demonstrating that fact is the issue of prospects of success in the main action. Given the lapse of time since the injunction was granted, I apply the same test at this stage when deciding whether the injunction should continue. 19.There is no dispute that the plaintiff paid over to the defendant the moneys which are the subject matter of the action. What is in dispute is did the defendant give certain moneys as gifts to the plaintiff and, if so, why did she transfer those moneys back to him, together with moneys of her own? How that question will be resolved will depend to a large extent on the oral evidence of the plaintiff and the defendant and the question of credibility. 20.It is here that the plaintiff runs into, on the face of it at this stage, real, practical difficulties, possibly through no fault of her own. On 18 December 2004 the plaintiff was admitted to Kwai Chung Hospital as a result of an apparent suicide attempt. Since that date she has remained mute. Whether that condition is, in fact, a result of a medical condition or whether it is simply a decision on the part of the plaintiff not to communicate is unclear on the medical reports before me. 21.A medical report dated 21 March 2006 which outlines her medical history continues
22.In a medical certificate dated 25 May 2006 in support of an application under Part II of the Mental Health Ordinance, Cap. 136, a Dr CHEN Kin-shing expressed the opinion that the plaintiff is capable of appreciating her surroundings, that “The prospect of mental recovery was unsatisfactory.” and that “It would be most desirable if she would communicate with us…”. The latter observation suggests that Dr CHEN regarded the plaintiff as being capable of communication should she so wish. 23.In a further certificate in those proceedings, Dr CHAN Kwok-ling noted that
24.In a report dated 18 November 2006 the following appears:
25.The most recent report is dated 2 March 2007. That relates:
26.The theme which recurs in the reports is the plaintiff’s stance that she will not be “bothered” with matters relating to her legal affairs, despite all other progress which she is recorded as making. There appears to be no change in that attitude, whatever may be the cause of it, despite some 16 months of treatment – nor is there any confidence expressed by those treating her that that attitude will change. 27.In a matter where the outcome of an action will substantially depend upon the oral evidence of the parties, the unwillingness or inability of one of them to be concerned with the proceedings and, thus to testify, obviously must affect fundamentally that party’s prospects of success. The Official Solicitor in an affirmation dated 11 October 2006 states that “By reason of her mental conditions…the plaintiff is not in a position to make an affirmation on her own…” 28.On the evidence presently before me unless the plaintiff is able to testify at trial her prospects of success must be limited in the extreme. Risk of dissipation of assets 29.Jiangmen Chao Cheng Thread Co., Ltd v NG Siu Lun and Another CACV47/2000, related to a dispute between spouses, similar to the instant matter. The Court of Appeal allowed an appeal against the grant of a Mareva injunction on the grounds that there was insufficient evidence that there was real risk of dissipation or concealment of assets. Rogers, JA., observed
30.The plaintiff continues to rely upon an act of the defendant to which she referred when launching these proceedings as the basis for showing that there is a real risk of dissipation of the assets, absent the injunction. I am entitled to revisit those allegations in arriving at my decision. 31.The act upon which she primarily relies is an instruction given by the defendant to HSBC Bank International Limited to change the nature of a fixed deposit account. She deals with this in detail at paragraph 30 of her first affirmation dated 7 February 2004 in these terms:
32.The plaintiff thus positively asserts that she had contacted the banker concerned and had a discussion with him during which he furnished this information to her. If that in fact occurred it would obviously be a factor to which substantial weight should be attached. 33.That this is not what happened appears from a subsequent affirmation dated 25 May 2004 by the plaintiff. At paragraph 25 she asserts
34.Nowhere in that affirmation is the “lawyer” identified. There is no supporting affirmation from that “lawyer” regarding this most fundamental of issues. 35.Brink's Mat Ltd v. Elcombe [1988] 1 WLR 1350 (CA) is authority for the proposition that where there is non-disclosure - a position analogous to false disclosure - the court has a discretion as to whether to order the immediate discharge of the ex parte order, or to continue the order or to make a new order on terms. 36.Whether one personally has a telephone conversation of such a nature or whether the contents of such a conversation are related to one by a third party is not a matter which admits of error. It seems to me to be naïve to suggest, as does the Official Solicitor in the affirmation dated 11 October 2006, that this does not matter. In my judgment the plaintiff has been, and remains, less than frank concerning this vital aspect of the matter. 37.Without deciding any question of fact, it is to be noted that the defendant acknowledged having given an instruction to HSBC Bank International Limited and has provided a detailed explanation of why he did so. The Official Solicitor expresses the view that the defendant’s explanation for instructions given to Mr Mak is “incredible and shadowy”. No sensible basis is given for this opinion, which appears to have been formed absent instructions from the plaintiff. Conclusion 38.In the light of all these factors I was satisfied that this is a matter in which it is appropriate that I exercise my discretion in favour of the defendant. 39.Upon the granting of the order setting aside the Mareva injunction the plaintiff's counsel made application that the effect of the order be stayed for a period of 21 days in order that the plaintiff's position could be considered. 40.No good ground was advanced for this application. Stay of the effect of an order is neither automatic nor granted simply upon request of an affected party. 41.In particular, nothing was placed before me to show that there was any greater risk of dissipation of the assets by the defendant than had originally been relied upon when the injunction was granted. In my judgment and especially in the light of all the further information which is before me in the numerous affirmations which have been filed by both parties since the original grant of the injunction, the plaintiff falls woefully short of demonstrating nay real risk of dissipation of assets by the defendant. 42.I consequently refused the further application.
Mr Dennis Law, instructed by Tung, Ng, Tse and Heung, for the Plaintiff Ms June Wee, instructed by Messrs Sit, Fung, Kwong & Shum, for the Defendant |
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Further hearings and rulings under CACV 310/1998