Ho Yuen Ki Winnie v. Ho Hung Sun Stanley and Another

HCA 1097/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1097 OF 2006

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BETWEEN

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Before : Hon Hartmann J in Court

Dates of Hearing : 3-5 July 2007

Date of Handing Down Judgment : 7 August 2007

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J U D G M E N T

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Introduction

1.On 23 May 2006, the plaintiff instituted proceedings in this court by way of writ against the defendants.  The plaintiff is a resident of Hong Kong as are both the defendants.  I am told that all the parties have close personal connections with Hong Kong. 

2.By summons dated 7 August 2006, the defendants applied for an order to stay the plaintiff’s action.  They did so on the basis that Hong Kong is not the appropriate forum to determine the action, Macau being clearly and distinctly the more appropriate forum.

3.This judgment looks to the single issue of whether Macau is the forum conveniens; that is, the jurisdiction in which the plaintiff’s action may be tried more suitably for the interests of all the parties and the ends of justice.

Some background

4.To understand the basis upon which the plaintiff instituted her action, it must be understood that for many years the plaintiff and both defendants held positions of senior management in a company registered in Macau under the name of Sociedade de Turismo e Diversoes de Macau (‘STDM’).  All were shareholders and directors of that company.

5.The principal business of STDM was, and remains, the ownership and management of casinos and hotels in Macau.  Indeed, from 1962 until early 2002, a period of some 40 years, STDM held the sole concession for the operation of casinos in Macau.

6.History records that one of the principal architects of the success of STDM is the first defendant, Dr Stanley Ho.  He was, and remains, Chief Executive Officer of STDM and, through various corporate entities, a major shareholder in the company.  It is the plaintiff’s case that at all material times Dr Ho has effectively controlled the management of the company and that, in Macau, he is a person of very considerable influence.

7.The second defendant is a close associate of Dr Ho.  He was, and is, the manager of STDM and an executive director of an allied company, Shun Tak Holdings Ltd, a publicly listed company in Hong Kong.

8.The plaintiff is the younger sister of Dr Ho and for many years was active in the management of STDM, being an executive director of the company.

9.In or about 2001, however, the plaintiff fell into dispute with STDM.  At that time, the Government of Macau was offering a number of casino licences for tender, ending STDM’s monopoly.  The plaintiff had sought permission to sell her shares in STDM.  If that permission had been given and the shares sold, they would have raised a very considerable amount of capital.  It was alleged by STDM that the plaintiff and her son had attempted to secure one of the new casino licences, enabling the two of them to then go into direct competition with STDM.  On the basis that the plaintiff’s actions were considered by the board of STDM to be profoundly against the interests of STDM, she was removed from her position as an executive director.  In addition, in or about mid-2005, it was resolved at an emergency general meeting of STDM that action be taken to remove her as a shareholder of the company.

10.The plaintiff denied any wrongdoing or culpability on her part.  She contested the actions taken against her.

11.In the result, the courts of Macau have been asked to determine a considerable number of law suits concerning the dispute between STDM and the plaintiff.  These law suits have attracted a good deal of publicity, concerning, as they do, one of Macau’s foremost companies and a number of its foremost personalities.

12.The action commenced in this court by the plaintiff in May 2006 arises out of her dispute with STDM.  But neither STDM nor any of its associated companies are cited as parties to the Hong Kong proceedings.  The plaintiff’s Hong Kong action is instituted against Dr Stanley Ho and Mr Ambrose So in their personal capacities.

13.The plaintiff has pleaded three causes of action which may, in broad terms, be described as follows :

(i)	The first cause of action
	As against the first defendant, for employing unlawful means to prevent the plaintiff transferring her shares in STDM to third parties as she deemed best and, as against both defendants, for conspiring to cause her economic loss by preventing her disposing of her shares other than to the first defendant’s family at below market value.
(ii)	The second cause of action
	As against both defendants, for defamation, it being alleged, first, that in 2001 the second defendant defamed the plaintiff by telling the press that she was in financial difficulties, owing a large sum of money to STDM and, second, that in 2006 the first defendant defamed her by saying that she persisted in vexatious litigation against STDM, litigation that was ‘frivolous’ and ‘rubbish’, and that her attempt to secure a casino licence in opposition to STDM had shown her to be ‘cheap’ and ‘despicable’.
	In respect of the defamation claim against the second defendant, Mr Ambrose So, it is to be noted that, in terms of a letter dated 22 November 2006, he waived any time bar defence if the action is pursued against him in Macau.
(iii)	The third cause of action
	As against both defendants, for an account of certain monies due to the plaintiff as annual bonuses from STDM in an amount equivalent to 1% of the company’s net annual income, the allegation being that the first and/or second defendants wrongfully retained most of those monies.
	The plaintiff accepts she signed an ‘irrevocable instruction’ that a certain amount of the bonus was to be paid to third parties.  This instruction, dated 22 June 1994, was written in English and was to the following effect :
	“	To Accounts Department S.T.D.M.
		I, Winnie Ho Yuen Ki, hereby irrevocably to instruct you, upon receipt of the 1% bonus payable to me by STDM, to pay the following sums of money to the payees specified below:-
		1.	Ernest Ho (holder of H.K. Identity Card No.XXXXXXXX), HK$1 Million;
		2.	So Shu Fai (holder of H.K. Identity Card No.XXXXXXXX), 45% of the balance after deducting (1) above.
		This instruction is irrevocable without the prior written consent of all the payees.”
	It is the plaintiff’s case that this instruction was only intended to be for one year.  It will be argued by the defendants that it was intended to be unlimited as to time.

The ‘Spiliada’ test

14.It is now well established that, in determining an application for a stay of Hong Kong proceedings on the basis of forum non conveniens, the test to be applied is the test defined by the House of Lords in Spiliada Maritime Corp v. Cansulex Ltd [1987] 1 AC 460.  In Pei Zheng Middle School and Another v. China Pui Ching Education Foundation Ltd and Others (unreported, CACV 262/2005, 21 February 2006), Cheung JA set out the test in the following terms :

“	1.	The single question to be decided is whether there is some other available forum, having competent jurisdiction, which is the appropriate forum for the trial of an action i.e. in which the action may be tried more suitably for the interests of all the parties and the ends of justice.
	2.	In order to answer this question, the applicant for the stay has to establish that first, Hong Kong is not the natural or appropriate forum (‘appropriate’ in this context means the forum has the most real and substantial connection with the action) and second, there is another available forum which is clearly or distinctly more appropriate than Hong Kong.  Failure by the applicant to establish these two matters at this stage is fatal.
	3.	If the applicant is able to establish both of these two matters, then the plaintiff in the Hong Kong proceeding has to show that he will be deprived of a legitimate personal or juridical advantage if the action is tried in a forum other than Hong Kong.
	4.	If the plaintiff is able to establish this, the court will have to balance the advantages of the alternative forum with the disadvantages that the plaintiff may suffer.  Deprivation of one or more personal advantages will not necessarily be fatal to the applicant for the stay if he is able to establish to the court’s satisfaction that substantial justice will be done in the available appropriate forum.”

Is Macau a more appropriate forum for determining the action than Hong Kong?

15.In my judgment, Paul Shieh SC, counsel for the defendants, clearly demonstrated that Macau is the natural and most appropriate forum for the resolution of the plaintiff’s action.  Indeed, when Mr Martin Lee SC, leading counsel for the plaintiff, rose to his feet in answer, he chose not to contest this issue.

16.Mr Shieh conducted a detailed analysis of the plaintiff’s three causes of action to show, in respect of each, that Macau was plainly the forum conveniens.  In doing so, inter alia, he raised the following matters :

The first cause of action

17.The basis of this claim is the tort (or torts) of conspiracy to commit an unlawful act and/or to interfere with economic interests.  Most of the relevant events took place in Macau and the Hong Kong court will therefore have to be satisfied that the tort is (or the torts are) actionable under both the lex loci delicti (Macau law) and the lex fori (Hong Kong law).  In short, the Hong Kong court will have to determine a number of important issues in accordance with both Hong Kong and Macanese law.  The issues will include whether, in accordance with the company’s articles under Macanese law, the plaintiff was dismissed as a director of STDM without good cause, and whether she has been rightly excluded as a shareholder of STDM.

18.In order to determine all the issues arising, said Mr Shieh, the Hong Kong court will be forced to look at numerous and often complex issues of Macanese law.  As one example, the doctrine of good faith under Macanese law is said to be different in certain subtle respects from that of Hong Kong law.

19.A further difficulty arises, said Mr Shieh, in that the relevant papers are in the custody of STDM.  STDM, however, is not a party to the proceedings and is not subject to the discovery or subpoena jurisdiction of the Hong Kong courts.  The documents could, of course, be obtained but invariably only by means of the cumbersome and more expensive procedure of letters of request.

20.It is also to be noted, said Mr Shieh, that many of the documents will require translation from Portuguese.

The second cause of action

21.The alleged defamatory statements took place in Macau.  Accordingly, as with the first cause of action, the Hong Kong court will have to be satisfied that the torts are actionable under both the law of Macau and Hong Kong.  In addition, the defendants, in justifying their statements, will need to make reference not only to the nature and effect of various legal actions in the Macanese courts that were instituted by the plaintiff and have been condemned by Dr Ho as being ‘rubbish’ or ‘frivolous’ but also to many financial documents belonging to and in the custody of STDM.

The third cause of action

22.The alleged agreements reached concerning the payment of the annual bonus of 1% must be judged according to the law of Macau.  But the issue of law is not straightforward.  There will be dispute, said Mr Shieh, as to the law in respect of at least one material issue and if that issue is determined in favour of the defendants, the applicant’s claim will fail on that basis alone.  In short, a true interpretation of Macanese law, not the law of Hong Kong, will be decisive.

23.As with the first two causes of action, said Mr Shieh, many of the crucial documents belong to and are in the custody of STDM.

24.In broad summary, as I have understood it, Mr Shieh set out the following reasons why Macau is plainly the appropriate forum :

(i)	All the issues to be determined will require an extensive exploration of Macanese law and will therefore require – at considerable expense in time and cost – an exposition of relevant legal principles by experts in Macanese law.
(ii)	This will be compounded by the fact that evidence will have to be given of the history of earlier, and on-going, litigation in Macau : its nature and consequence.
(iii)	Many of the documents which are crucial to the case belong to and are in the custody of STDM, a Macanese company.  STDM is not a party to the action and is not amenable to the jurisdiction of the Hong Kong court.
(iv)	In any event, the plaintiff’s action arises essentially out of a dispute concerning the rights and obligations of directors and officers of a Macanese corporation carrying on business in Macau.  Many, if not most, of the witnesses will be persons whose relevant testimony will relate to events in Macau.  All in all, therefore, Hong Kong, far from being the natural forum, is an artificial one.

If the action is determined in Macau will the plaintiff be deprived of a legitimate personal or juridical advantage?

25.It is here that the plaintiff has stood her ground.  As her counsel, Mr Lee, expressed it, there is one compelling reason why the plaintiff is incapable of pursuing, and will not pursue, her action in Macau.  It is because she has a rationally based fear that, if she is forced to do so, she and/or her lawyers will at some stage of the proceedings, be the victim of physical violence.  In short, if she litigates this action in Macau, her safety, and the safety of her representatives, will be at risk.

26.The plaintiff’s fear for her safety, and/or that of her lawyers, said Mr Lee, is based on the fact that there has been a history of violence.  A recitation of that history reveals cogent evidence which objectively supports her fear, showing it to be entirely rational.  This history may be described as follows :

(i)	In September 2002, Mr C.K. Mok, a Hong Kong solicitor who was representing the plaintiff in her dispute with STDM and her brother, Dr Ho, was assaulted by a number of men.  The assaulted took place in Hong Kong.
(ii)	A few months later, while still representing the plaintiff, Mr Mok was assaulted again by a number of men.  This second assault took place near his home in Hong Kong.
(iii)	After this second assault, on the basis that both must have been linked to his representation of the plaintiff, Mr Mok gave up his representation.
(iv)	In or about May 2004, the plaintiff received two letters, one in English, one in Chinese characters.  The English letter – composed seemingly of letters cut out from some magazine or similar document and pasted onto the page – said :
	“	Stop talking.  Don’t come to Macau.  Remember C.K. Mok.”
(v)	The Chinese letter was typed and was to the following effect :
	“	Be careful, be careful!  The current conditions in Macau are very bad for everybody, especially for an old lady like you.  So hope you won’t come.  Dangerous!  Don’t come!”
(vi)	A few months later, two of the plaintiff’s new representatives in her on-going dispute with STDM and her brother, her solicitor and her accountant, also received intimidatory letters.  Both were written in what I have earlier described as cut-out letters pasted onto the page and both repeated exactly what has been said in the first letter to the plaintiff herself :
	“	Stop talking.  Don’t come to Macau.  Remember C.K. Mok.”
(vii)	In August 2006, the plaintiff’s new solicitor, Mr Albert Ho, also well known as a liberal politician, was himself assaulted by an unknown group of men in Hong Kong.  The assault was so bad that Mr Ho had to be hospitalised for several days.

27.On behalf of the plaintiff, it was submitted that fairly early in the dispute she was detained against her will in the offices of STDM in Macau by her brother, Dr Ho, and others.  This constituted the crime of false imprisonment and was the first act of intimidation that has given rise to the plaintiff’s fear of returning to Macau.  That incident, I am told, have been investigated by the authorities in Macau.  No charges have been laid against Dr Ho or others, indeed the plaintiff herself apparently faces some form of criminal action.  In the circumstances, I have not taken this incident into account. 

28.As to the physical assaults in Hong Kong, neither Mr Mok nor Mr Ho were able to say for sure why they had been assaulted.  Police investigations have not been successful.  But the fact remains that two solicitors of unblemished professional integrity have been assaulted, one of them twice, the only known common denominator being the fact that, at the time of the attacks, both were representing the plaintiff in her Macau litigation.

29.To that must be added the fact that warning letters have been sent to the plaintiff herself and to two more of her representatives in her dispute with STDM and Dr Ho.  Those letters are put together in the same way (like theatrical blackmail letters) and contain the exact same warning to remember what has happened to Mr C.K. Mok.  The plain implication, and manifestly the intended implication, is that, if the plaintiff and her counsel persist with their litigation in Macau, they themselves run a risk of violent visitation.

30.To date, therefore, two of the plaintiffs’ representatives have been assaulted, two have received anonymous warnings.  The plaintiff herself has received two such warnings.  That, in my view, speaks of a concerted campaign of intimidation, the warning being : ‘Do not pursue litigation in Macau.’  Without mincing words, it is an attempt by thuggery to prevent the plaintiff from pursuing what she believes to be her legitimate rights through the courts of Macau.  In my view, in all common sense, no other inference can reasonably be drawn.

31.In my judgment, it is important to recognise that the intimidatory letters warned against the plaintiff going to Macau.  It is not for me to conduct an exercise of speculation.  But I believe I am entitled to recognise that there may be persons in Macau who believe they have vested interests in ensuring that the plaintiff is prevented from pursuing her claims in that jurisdiction. 

32.Has this concerted campaign to prevent the applicant pursuing litigation in Macau caused the plaintiff to fear going to Macau?  She says that it has.  Indeed, the plaintiff asserts that she has not set foot in Macau for several years and will not do so even if it means that she has to forfeit her right in law to pursue her action in the courts of Macau.  It is to be remembered that the plaintiff is not a young woman.  I understand that she is over 80 years of age.  In all the circumstances, her fears are understandable.

33.Does this history of intimidation constitute cogent, objective evidence that, if the plaintiff goes to Macau to pursue her action, there is a real danger that she and/or her representatives may be subject to harm?  Yes, I believe it does.  Past conduct is a standard tool for estimating future risk. 

34.In any event, in my view, in many ways it can be said that the damage has already been done.  The seeds of fear have been sown.  As Mr Lee said during the course of submissions, if the plaintiff is forced to pursue her litigation in Macau, even if, in fact, there is no remaining danger to her, how can she be sure of that?  The culprits, for example, have not been identified and arrested.  Fears as to her personal safety, said Mr Lee, must influence the manner of the plaintiff’s litigation and may well mean that, if she has to give evidence in the courts of Macau, she will refuse to do so for fear of her personal safety.

35.During the course of submissions, it was said on behalf of the defendants that, to allow the plaintiff’s action to continue in Hong Kong would be to submit to the intimidation.  But that is not the issue.  The issue is whether the plaintiff should be forced to give up her legal proceedings in Hong Kong, proceedings which she has instituted in this jurisdiction as of right, and start them again in a jurisdiction in which she is subject to credible threats of intimidation.  Why should she be placed at that disadvantage?  That strikes me as a denial of justice to the plaintiff more than an act of balancing opposing measures of convenience.

36.As I have said, who was responsible for the campaign of intimidation is not known.  There is no evidence that either defendant would tarnish his reputation with such conduct.  But again, that is not the issue.  The issue, in my view, is whether the plaintiff should be directed by this court to conduct her litigation in a jurisdiction in respect of which she and her lawyers have been the subject of intimidation.

37.During argument, it was suggested that objectively the plaintiff has no real grounds for fear.  If and when she has to set foot in Macau she can arrange for personal protection.  But that submission, in my view, tells more in favour of the plaintiff’s case to have the proceedings conducted in Hong Kong than against it.  In blunt terms, this court is being asked to say to the plaintiff : ‘Don’t worry.  Get yourself a couple of bodyguards.’  In circumstances such as this, common law courts do not knowingly put litigants in harm’s way, either by way of emotional or physical trauma. 

38.During the course of argument, much was made of the fact that the plaintiff is still pursuing litigation in Macau against STDM and that her lawyers have made a number of visits to Macau in respect of that litigation.  This, it was said, gives the lie to the assertion that there is cogent evidence that the plaintiff is the victim of intimidation.  The assertion of intimidation is, therefore, purely tactical.

39.I disagree.  What must be remembered is that the plaintiff has said that she is herself too afraid to go to Macau to pursue her litigation; in short, that she would rather abandon her case then run the risk of having to be in Macau in order to testify.  That fear, I believe, is rational.  In any event, the fact that her lawyers have been able to go to Macau on one or two occasions does not exclude the very real possibility that, if further litigation takes place, especially litigation that perhaps brings about adverse publicity in Macau, past threats may not be activated by further shows of intimidation.

40.But even if I am wrong in that regard, the Macau litigation, as I understand it, concerns STDM, the company being a party.  There is no other jurisdiction in which the plaintiff can pursue her actions against STDM.  She has no alternative.  In the present case, however, there is an alternative and the plaintiff legitimately has taken advantage of that alternative.

41.During the course of argument, mention was made of Askin and others v. ABSA Bank Limited and others (unreported), The Times, 23 February 1999, a judgment of the English Court of Appeal.  In that judgment, it was recognised that fears for personal safety may constitute a proper ground for a plaintiff to oppose an application for stay on the ground of forum non conveniens.  In that case, the Court of Appeal held that there was no cogent evidence that the plaintiff’s personal safety would be at risk.  In the case now before me, however, on a consideration of the facts, I have come to a different conclusion. 

42.In my judgment, therefore, the plaintiff has shown that, if her action must be tried in Macau, she will be deprived of a legitimate personal advantage.

Balancing the advantages of the alternative forum with the disadvantages that the plaintiff may suffer

43.It is plain, I think, all else being equal, that the legitimate interests of all the parties would best be served if the plaintiff’s action is determined in Macau.  The natural forum is Macau.  In Hong Kong there will be added costs and probably extra delay.  But regrettably, all else is not equal.  I have found that there is cogent evidence that, if the plaintiff is forced to bring her action in Macau, her personal safety, and that of her representatives, may well be at risk.

44.In my view, therefore, this is a matter which must be determined by looking to the ends of justice.

45.In doing so, I bear in mind that Hong Kong and Macau are neighbouring jurisdictions.  Witnesses can move easily between the two.  I also bear in mind that the question of the extra burden of costs has not been raised as being determinative.

46.It is fundamental in all civilised societies that nobody should be forced to conduct litigation in fear of their personal safety.  Here in Hong Kong at least the plaintiff is better assured of her safety.  The balance must therefore fall in her favour.

Conclusion

47.For the reasons given, the defendants’ application is dismissed.  There will be an order nisi awarding costs to the plaintiff, the order to be made final 21 days after the handing down of this judgment unless an application for a different order is made within that time.

Mr Martin Lee, SC and Mr Erik Shum,  instructed by Messrs Ho, Tse, Wai & Partners, for the Plaintiff

Mr Paul Shieh, SC instructed by Messrs Herbert Smith, for the 1^st and 2^nd Defendants