Pacific Electric Wire & Cable Co Ltd v. Harmutty Ltd and Others

CACV 208/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 208 OF 2008

(ON APPEAL FROM HCA NO. 2763 OF 2004)

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BETWEEN

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Before: Hon Tang VP and Yuen JA in Court

Date of Hearing: 5 December 2008

Date of Judgment: 5 December 2008

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J UD G M E N T

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Hon Tang VP:

1.On 18 January 2008, Saunders J gave summary judgment against, amongst others, the 18^th and 19^th defendants.  In relation to these defendants, he ordered that the 18^th defendant should deliver to PEWC Asset Holdings Limited (“PAH”) a duly executed transfer in favour of PAH of all the shares of and in PCL Holdings Ltd, registered in its name, within 28 days of that order, failing which the plaintiff would be at liberty to apply to the Registrar of the High Court to direct one of the Deputy Registrars or such other judicial officer as he might appoint to execute all necessary transfers in favour of PAH as soon as is practicable after the making of such application.  A similar order was made against the 19^th defendant.  As I understand it, the period of 28 days expired on 22 September 2008. 

2.The appeal against these orders has been fixed to be heard in March 2009.  These defendants, however, had applied for a stay of the order pending appeal to Saunders J which was refused on 4 July 2008.  These defendants then applied to Rogers VP for a stay pending appeal.  Rogers VP said, when he dismissed the application on 25 August 2008, that he was not satisfied that the appeal would be rendered nugatory nor that the defendants had strong grounds of appeal.

3.By summons dated 3 September 2008, these defendants then appealed to us for a stay pending appeal.

4.But pending today’s hearing, they applied on 22 September 2008 for an interim stay pending the hearing before us today.  That application was refused by Yuen JA on 2 October 2008.

5.By letter dated 3 December 2008 from these defendants’ solicitors, the court was informed that these defendants no longer wished to proceed with this appeal.  These defendants asserted that the appeal had been rendered academic because the transfer of the relevant shares under the order of Saunders J had been executed by the Deputy Registrar on 3 November 2008.  However, because the parties were unable to agree on an appropriate order as to costs in relation to this appeal, the parties have appeared before us this morning. 

6.Mr Clifford Smith, SC, appearing for these defendants, submitted that they conceded that this appeal should be dismissed, but that so far as the costs of the appeal is concerned, they should only be ordered to pay the costs of the appeal up to 6 November 2008.  6 November 2008 was the date when, according to Mr Smith, the solicitors for the plaintiff had given them an ultimatum regarding the appeal, informing them that if they were not to abandon the appeal, brief would be delivered to senior counsel.

7.Mr Smith submitted that costs should be limited to 6 November 2008, notwithstanding that they had rejected the ultimatum because the solicitors for the plaintiff had failed to inform them by the letter of 6 November 2008, that on 3 November 2008, the Deputy Registrar had executed the relevant instrument(s) of transfer.  I believe they were formally informed of the same by letter of 25 November 2008.  Mr Smith submitted that had they known on 6 November 2008 that the relevant transfers had already been executed on 3 November 2008, since they took the view that that would have rendered the present appeal academic, they would have informed the solicitors for the plaintiff that they no longer wished to proceed with the present appeal.  But Mr Anthony Neoh, SC, appearing for the plaintiff, reminded us that when these defendants applied for an interim stay pending the appeal from Rogers VP, in the 3^rd affirmation of Kim Boreham dated 22 September 2008, it was said that unless an interim stay of execution was granted by the Court of Appeal, the plaintiff had indicated that it might take steps to execute the judgment after 22 September 2008.  So it is quite clear that they were aware that the plaintiff would take steps to have the judgment executed.  In fact, looking at the correspondence, there is a letter dated 10 September 2008 from the plaintiff’s solicitors to these defendants’ solicitors, informing them that if the order were not complied with within the time limit, they would take action to enforce the order.  Indeed, the order of Saunders J, that I have already referred to, especially provided for the possibility of the transfers being executed by a Deputy Registrar.  I was told that was made at the request of Mr Anthony Neoh SC, because it was thought at the time that these defendants would not voluntarily comply with the order of Saunders J.

8.There is also a letter dated 10 October 2008 from the plaintiff’s solicitors, Messrs W K To & Co., to the Registrar, asking the Registrar to appoint a Deputy Registrar to execute the relevant documents.  The copy that we have states quite clearly that it was copied to these defendants’ solicitors.  Mr Smith has informed us, and of course we accept, that notwithstanding that the letter was apparently copied to the solicitors, they had not seen the letter at the relevant time.  But be that as it may, the fact remains that the letter had been sent, and I do not believe that should affect the question of the incidence of costs so far as this appeal is concerned.

9.Mr Smith has submitted that the fact that the transfers had been executed has rendered this appeal academic.  That is of course a sensible view to take, but I do not accept that as a matter of jurisdiction, the court has no power in a suitable case to undo what has been done.  We have not heard submissions on the merits of this appeal, but we have had the benefit of written submissions from both Mr Smith and Mr Neoh on the merits of the appeal.  It is unnecessary for the present purpose for us to decide where the merits lie, but I have to say that on the material before me, I should be very surprised if this appeal were to succeed. 

10.In all the circumstances, the order that I would make is that this appeal be dismissed, and I will make the usual order as to costs, namely, that it is dismissed with costs against the 18^th and 19^th defendants.

Hon Yuen JA:

11.I agree.

Mr Clifford Smith SC and Ms Rachel Lam, instructed by Messrs Tanner De Witt, for the 18^th & 19^th Defendants.

Mr Anthony Neoh SC and Ms Barbara Wong, instructed by Messrs W K To & Co., for the Plaintiff.