Re Pccw Ltd

Read the full judgment text of CACV 85/2009 on BabelCite. This Court of Appeal judgment was delivered on 16 April 2009.

1. At the commencement of the hearing of this appeal application was made on behalf of the appellant to admit further evidence.  That evidence consisted of an affirmation stating that the Chief Executive Officer of Fortis Asia Limited, Charles Stuart Fraser, had telephoned the Senior Manager of the Enforcement Division of the Securities and Futures Commission (“SFC”) on the day before the hearing of this appeal and had subsequently attended an interview.  The substance of what Mr Fraser had told

Cited by 1 case

Case No.CACV 85/2009
Court
Court of Appeal
Date16 Apr 2009
Judge
Case Document
100%Judiciary

cacv 85/2009

in the high court of the

hong kong special administrative region

court of appeal

civil appeal no. 85 of 2009

(on appeal from HCMP NO. 2382 of 2008)

_______________________

  IN THE MATTER of PCCW LIMITED
(電訊盈科有限公司)
  and
  IN THE MATTER of the Companies Ordinance, Chapter 32

______________________

Before: Hon Rogers VP, Lam and Barma JJ in Court

Date of Hearing: 16 April 2009

Date of Judgment: 16 April 2009

Date of Handing Down Reasons for Refusal of Further Evidence: 11 May 2009

____________________________________________

REASONS FOR REFUSAL OF FURTHER EVIDENCE

_____________________________________________

Hon Rogers VP:

1.At the commencement of the hearing of this appeal application was made on behalf of the appellant to admit further evidence.  That evidence consisted of an affirmation stating that the Chief Executive Officer of Fortis Asia Limited, Charles Stuart Fraser, had telephoned the Senior Manager of the Enforcement Division of the Securities and Futures Commission (“SFC”) on the day before the hearing of this appeal and had subsequently attended an interview.  The substance of what Mr Fraser had told the SFC was that in early December 2008, Mr Lam Hau Wah had approached Mr Fraser because he had cash flow problems arising from his investment in about 5 to 6 properties in the Bel Air Development and losses he had incurred in the stock and currency markets.  As a result, he needed some $30 million for the completion due to take place on 12 December 2008.  Fortis thereupon granted Mr Lam 2 loans, one of $10 million and the other of $20 million.  The second was structured as an arrangement to buyback what was referred to as Mr Lam’s “family head bonus”.

2.The second matter was an affirmation by Cheuk Kam Wa, a director of the Corporate Finance Division of the SFC.  That related to an analysis which had been carried out in respect of 27 privatisation schemes which had been sanctioned or failed since 1 July 2004.

3.This court refused leave to adduce that evidence and said that brief reasons would be given later.  That we now do at the same time as handing down the reasons for judgment on the appeal.  Reference to those reasons can be made for fuller details of the facts of the case.

4.In respect of the evidence relating to Mr Fraser, it was clear that he had only approached the SFC the day prior to the hearing of the appeal and thus it could be said that the SFC could not reasonably be expected to have adduced that evidence in the court below.  Mr Yu SC, on behalf of PCRD, resisted the admission of that evidence because it was said that it would not be determinative of the appeal.  The evidence was, on its face, clearly believable as it was supported by documentary evidence.  It was also relevant, possibly in relation to more than one aspect relating to the 500 board lots of PCCW shares purchased by Mr Lam.  This court considered that in the absence of the evidence having been put to Mr Lam and in the absence of discovery, if the evidence were to be admitted there was a danger that it would necessitate an adjournment and further delays.  Since the appeal had been brought on an urgent basis, this court considered that the better course was not to admit that evidence so as to avoid any necessity for an adjournment.

5.As regards the evidence in relation to the previous schemes of arrangement, the evidence might have been procured earlier, albeit as a matter of practicality the SFC might have been hard pushed to have produced it in the time available.  This court declined the admission because it was evidence to counter a statement made by Mr Christopher Howe of Anglo Chinese Corporate Finance Limited that it was not uncommon for arbitageurs to split their shares into board lots or to acquire board lots and register them in the name of nominees in order to increase the number of their votes.  Since that statement had merely been an assertion unsupported by reference to specific cases that had occurred prior to the present Scheme, this court considered that it carried insufficient weight to warrant the inclusion of further evidence at this stage.  As it transpired little reliance was placed on Mr Howe's statement.

(Anthony Rogers)
Vice-President

(M H Lam)
Judge of the Court of First Instance

(Aarif Barma)
Judge of the Court of First Instance

Mr Michael Todd QC, Mr John Scott SC, Mr Jonathan Harris SC & Mr William Wong instructed by Messrs Richards Butler for the Applicant/1st Respondent

Mr Winston Poon SC & Mr Godfrey Lam SC instructed by Securities and Futures Commission, the Intervener/Appellant

Mr Denis Chang SC, Mr Benjamin Yu SC, Ms Linda Chan & Mr Laurence Li instructed by Messrs Arculli Fong & Ng for Pacific Century Regional Developments Limited and Starvest Limited, the Interested Parties/2nd & 3rd Respondents

Mr Samuel Chan instructed by Messrs Baker & McKenzie for China Netcom Corporation (BVI) Limited, the Interested Party/4th Respondent

Wong Yuk Kwun, the Interested Party/5th Respondent in person (Present)

Mr Daniel R Fung SC, Mr Hectar Pun & Mr Newman Lam instructed by Messrs JCC Cheung & Co. for Hung Sau Chun, the Interested Party/ 6th Respondent & Wong Tak Lau, the Interested Party (Independent Shareholder)

Wong Lai Chun, the Interested Party/7th Respondent in person (Present)

Mr Lee Wing Kui instructed by Messrs Fan Wong & Tso for Mr Au Ching Chuen (Independent Shareholder)

Submissions received by:

Chan Pang Ching 陳鵬程
Tam Yuk Kuen 譚玉娟
Tang Kwok Chiu 鄧國昭
Leung Kwok Keung 梁國强
Yun Mei Far 甄美花
Chan Po Kam 陳寶琴
Au Yeung Leung Sau Ling 歐陽梁秀玲
Lam Chung Wah 林長華
Yip Mei Wan 葉美雲
Chow Wai Ling 鄒慧玲
Lau Siu Cheung 劉兆祥

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