Kensington International Ltd v. Ics Secretaries Ltd

HCMP 2261/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 2261 OF 2006

______________________

BETWEEN

______________________

HCMP 2696/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 2696 OF 2006

______________________

BETWEEN

______________________

Before : Deputy High Court Judge Carlson in Chambers

Dates of Hearing : 28 and 29 June 2007

Date of Judgment : 30 June 2007

______________________

J U D G M E N T

______________________

Introduction

1.The summonses now before me raise the very important question of whether an applicant in a Norwich Pharmacal applicationcan disclose documents and information obtained as a result of such an application to 3^rd parties or whether it is restricted to making use of such documents and information only for the purposes for which the application was expressly made and for which the order of the court was granted.

2.I am concerned by the fact that there appears to be a fundamental and worrying divergence of opinion between the applicant on the one hand and the respondent and the other parties who have been given leave to intervene in these proceedings on the other, as to this basic proposition.  It seems to me that there can be no halfway position on an issue such as this.  One or other side must be hopelessly in error in this regard.

3.The background to this can be stated shortly in this judgment because I do not propose to repeat here the history of this matter which I have already set out extensively in my judgment of 31 May this year to which reference will need to be made in order to obtain a full understanding of what has already passed between these parties.

4.Suffice it to say for present purposes that the applicant has obtained Norwich Pharmacal orders against the respondent on 2 November 2006, varied on 16 November 2006 which I will refer to as the 1^st Norwich Pharmacal order.  The respondent duly complied with that order.  The documents that were produced by the respondent as a result of the order were made use of by the applicant to make a fresh Norwich Pharmacal application.  In making that 2^nd application, the applicant exhibited all the documents disclosed under the 1^st order to the affidavit of Mr Schwarzkopf in support of its 2^nd application.

5.As appears in the affidavit of Mr Gall dated 28 June 2007, the documents that were disclosed by the respondent as a result of the 1^st Norwich Pharmacal order have now been passed to the operators of a website called Globalwitness.com who have published substantial parts of that documentation under cover of an article entitled:  “Congo:  Is President’s son paying for designer shopping sprees with country’s oil money”.  This article also includes a section headed:

“	How payments that may derive from oil sales flowed via shell companies into offshore accounts from which credit card bills are paid.”

The disclosure also includes the credit card statements of the Congo’s president’s son Mr Denis Sassou-Nguesso.  In addition there is also referent to the activities of Mr Ollivier who is the 6^th intervener and his company Pan African Consultancy Limited, the 5^th intervener in these proceedings.  It is very plain that this disclosure is, to put it at its lowest, highly embarrassing to the companies and the individuals concerned.  The applicant admits that it has disclosed these documents to this website.  It is by no means far-fetched, indeed so much is accepted by the applicant, to say that its purpose in doing so is to put pressure on the Congo, and the interveners who are said to be involved in assisting the Congo, to pay the applicant what it owes under the judgments that the applicant has obtained against it.

6.The respondent and the interveners who say that they are angered by these disclosures seek orders to put a stop to further disclosure of this type, and indeed there has been another subsequent article in a respected Dow Jones publication based on this disclose material, and in addition there is also in application to impose a stay on the 2^nd Norwich Pharmacal order made by me as a result of my judgment of 31 May pending a decision as to whether these proceedings should now be dismissed for abuse of process by the applicant in making such disclosures.

7.This therefore is how the matter lies.  Unfortunately, this round of summonses has been conducted in some haste which is not surprising given the nature of the events that have taken place since 26 June when all of this came to light.  On Thursday, when the matter came before me ex parte with short notice being given to the applicant.  I made limited interim orders designed to avoid a repetition of disclosure to 3^rd parties.  Yesterday, I heard the argument and because I will not be sitting and will be out of Hong Kong from tomorrow, Sunday, I am delivering judgment this morning.  I would have preferred to have had more time to consider the matter and the authorities in more detail.  Nevertheless, this judgment must stand on its merit as it is.

The Law

8.In an admirably succinct and clear submission, Miss Ismail has put the case for the 1^st intervener and for Mr Denis Sassou-Nguesso who I have also allowed to intervene, which has largely been adopted on behalf of the remaining interveners and by the respondent, although I have of course also heard for Mr Grossman SC for the 5^th and 6^th interveners, from Mr Payne for the 4^th intervener and for Mr Blaise Elenga who I have also given leave to intervene, as well as from Mr Beresford on behalf of the respondent.

9.What their cases come to is that, of its nature a Norwich Pharmacal proceeding is a highly unusual process.  In this regard, I have been referred to a passage in the speech of Lord Woolf in the House of Lord’s decision in Asworth Hospital Authority v MGN Ltd [2002] 1 WLR 2033.  At paragraph 57 he described the process in the following way:

“

[57]

The Norwich Pharmacal jurisdiction is an exceptional one and one which is only exercised by the courts when they are satisfied that it is necessary that it should be exercised.  New situations are inevitably going to arise where it will be appropriate for the jurisdiction to be exercised where it has not been exercised previously.  The limits which applied to its use in its infancy should not be allowed to stultify its use now that it has become a valuable and mature remedy.  That new circumstances for its appropriate use will continue to arise is illustrated by the decision of Scott V-C in P v T Ltd [1997] 4 All ER 200, [1997] 1 WLR 1309 (where relief was granted because it was necessary in the interests of justice albeit that the claimant was not able to identify without discovery what would be the appropriate cause of action).”

The starting point to Miss Ismail’s submission is paragraph 3 of the order of 16 November.  It is in the following terms:

“	The Applicant do have leave to use information and documents obtained as a result of this order for the purpose of :-
	(a)	actual or contemplated proceedings against Cotrade Asia, HVL or any other entity the Applicant contends is an emanation of the Congolese state, and
	(b)	enforcement in Hong Kong, England and Wales and elsewhere of the balance of the judgment debts due under the English Commercial Court Judgments entered against Congo on 20th December 2002 in claim number 1088, 21st January 2003 in claim number 1281, 21st January 2003 in claim number 1282 and 28th January 2003 in claim number 1357.”

Its terms are therefore clear, setting out the purpose to which the applicant could put documents and information obtained under the order.  From this, Miss Ismail goes on to say that no leave was granted which would permit the applicant to leak disclosure under that order to the press or internet websites.  For this she gets further support from Lord Woolf’s speech in Asworth.  At paragraphs 59 and 60 he said this:

“	[59]	One of the arguments Mr Browne placed before their Lordships for not adopting the non-technical approach, which I regard as being correct was that if the disclosure was not linked with proceedings which would actually be brought, there would be no means of the court protecting a defendant against misuse of the material which was disclosed.
	[60]	I agree that this is a matter for concern.  However, this concern will be met if an order for disclosure is not made unless a claimant has identified clearly the wrongdoing on which he relies in general terms and identifies the purposes for which the disclosure will be used when it is made.  The use of the material will then be restricted expressly or implicitly to the disclosed purposes unless and until the court permits it to be used for another purpose.”

10.What Miss Ismail gets from these passages and the previous one is that the court will be vigilant to ensure that an applicant must identify the purpose for the relief that he seeking, which is what this applicant had done when it applied for these orders in the first place and the order that I made paragraph 3 supra restricted the use to which the material could be used and to no other.  Indeed, Miss Ismail asks rhetorically whether I would have even contemplated allowing the disclosed material to be disseminated in the way that the applicant now has done, given the very limited purposes that such material can be deployed by a successful applicant.

The Applicant’s Reply

11.Mr Hunsworth, in a series of confident and trenchant submissions, suggests that Miss Ismail and others who have adopted what she has had to say have completely missed the point.  He seeks to draw a distinction between the documents that had been passed on to 3^rd parties which he says are in the public domain and therefore no longer subject to any restriction on use whether express or implied at law, and those that are still confidential and cannot be disclosed.  He submits that after careful consideration only documents referred to during the hearing of 28 May, a hearing in chambers but open to the public, have been passed on to Globalwitness.  He submits that anything said in that hearing and any document referred to on that occasion is now in the public domain.  Once in the public domain any previous restriction on use of a document is waived.  He has referred me to passages in Hollander’s Documentary Evidence, 9^th Edition.  At 21-48 the author citing Mahom v Rahn [1997] 3 All ER 687says that the implied undertaking not to use documents disclosed in litigation save for the purposes of that litigation goes once that document has been read out in court or referred to in court.  Mr Hunsworth relies on O.24 r.14A of the Rules of the High Court which is of course to that effect.  It is in these terms:

“

Any undertaking whether express or implied, not to use a document for any purposes other than those of the proceedings in which it is disclosed shall cease to apply to such a document after it has been read to or by the court, or referred to, in open court, unless the court for special reasons has otherwise ordered on the application of a party or of the person to whom the document belongs.”

Accordingly, submits Mr Hunsworth, these parties can have no complaint.  This has been disclosure advisedly made after careful consideration of what had been referred to in the hearing of 28 May and nothing else.

Conclusion

12.In reply, Miss Ismail says that Mr Hunsworth’s approach demonstrates a fundamental misunderstanding of the situation.  O.24 r.14A has to do with undertakings as to disclosure and when that undertaking ceases to have effect.  What I am concerned with is an express order of the court [paragraph 3 supra] which identifies the purposes to which the disclosed material obtained in draconian proceedings such as these against innocent parties could be put.  That did not include passing it on to an internet website.

13.I am convinced that Miss Ismail’s approach is the correct one.  The fact that the disclosure is covered by an order rather than a collateral undertaking is fundamental.  And it needs to be said that this is disclosure obtained in the course of an exceptional jurisdiction, to borrow Lord Woolf’s description of it, under which the court is vigilant to ensure that the information and documents so obtained are not misused.

14.I regret to say that the respondent and the interveners have been done a great injustice by this disclosure.  Whether they are ultimately found to be unsavoury or corrupt is neither here nor there at this stage.  The order of the court of 16 November has been breached by what has happened. 

15.I therefore propose to make an order in terms of paragraphs 2 and 3 of the summons of Laracy Gall dated 28 June and I will now stay the Norwich Pharmacal order of 31 May until further order.  I have already granted to stay of the order pending appeal to the 5^th and 6^th interveners but the stay that I am now ordering is one in favour of the respondent and all the interveners pending a hearing before me as to whether I ought to discharge these proceedings for abuse of process.  I have heard submissions from Mr Beresford as to the nature of the court’s powers in its inherent jurisdiction to make such orders but now is not the time for such a course.  I would propose to adjourn the matter which is the earliest date before me following my return to sitting.  I have indicated the nature of the orders that I am minded to make today by using paragraphs 2 and 3 of Laracy Gall’s summons as a draft which can be amended mutatis mutandis to suit the cases of the respondent and the other interveners. 

16.As to costs I propose to adjourn the argument to after I have heard the applications for dismissal based on abuse of process, although I will gladly hear the parties now on the form of today’s order and any consequential directions and on costs as well, although they have heard my suggestion on that.

Nicholas Hunsworth, of Messrs Johnson, Stokes & Master, for the Applicant

Roger Beresford, instructed by Messrs Robertsons, for the Respondent

Roxanne Ismail, instructed by Messrs Laracy Gall, for the 1st, 2nd and 3rd Interveners

Gregory Payne, of Messrs Tanner De Witt, for the 4th Intervener

Grossman, S.C. leading Andrew Sheppard, instructed by Messrs Kennedys, for the 5th and 6th Interveners