Li Guozhu v. Ma Hongqi and Others

HCA 2023/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 2023 OF 2009

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BETWEEN

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Before: Deputy High Court Judge Carlson in Chambers

Date of Hearing: 24 August 2010

Date of Ruling (Handed Down): 7 September 2010

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R U L I N G

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1.This is an application by the Plaintiff for leave to appeal against an order made by me on 23 March this year discharging an interlocutory injunction as it applied against the 10th Defendant.

2.Leave to appeal can only be granted if the court decides that the appeal is one with reasonable prospects of success.  What this means is that more than an arguable case is required although the would-be appellant does not have to go so far as showing that the appeal will probably succeed [SMSE v KL [2009] 4 HKLRD 125].

3.Miss Liang, who did not appear at the original hearing, has advanced five grounds of appeal.  Before I consider those grounds, it may be helpful to re-visit the conduct of the Plaintiff in relation to the litigation and in his approach to the Defendants.

4.As appears in the judgment, the Plaintiff has only served the 11th Defendant with the writ, a Hong Kong-registered company controlled by him.  Unsurprisingly, the 11th Defendant has been completely pliant.  It has not contested the injunction and it has entered an acknowledgment of service indicating that it will not be defending the action. Once the injunction was obtained leave was sought to serve the other defendants with notice of the injunction on the Mainland, which was effected through cross-border channels established for that purpose.  The 10th Defendant has been the only defendant who has attempted to address the action in Hong Kong. Miss Liang submits that, contrary to my finding that the 10th  Defendant was not served with the writ, the fact is that the 10th Defendant came to Hong Kong to seek legal advice here and went to the Plaintiff’s solicitors offices where he was given a copy of the writ and the inter parties order in respect of the injunction.  She submits that he must be taken to have been personally served with the writ in accordance with RHC, O.65 r.2.

5.That submission is completely at odds with the Plaintiff’s stance to the 10th Defendant’s attempt to have the injunction discharged.  There was a hearing before me on 1 December 2009.  The Plaintiff’s position was that the 10th Defendant had no locus to seek a discharge of the injunction because the injunction was only directed to the 11th Defendant (the company).  I ruled that because the injunction, as drawn up, affected him he had sufficient standing to apply for the discharge of its effects against him.  By his stance on 1 December, the Plaintiff was not to seeking to rely on any service of the writ on 10th Defendant nor was any mention made of that fact by the Plaintiff’s counsel (not Miss Liang) on that occasion.  To have done so would have been seen to give the 10th Defendant standing to fully engage in the action.

6.As appears in the judgment which discharged the injunction, I was greatly troubled by the overall conduct of the Plaintiff in the way that he has approached the Defendants other than the 11th Defendant which he controls.  By not serving the other defendants, and I am satisfied that he ought not to be heard to be saying that the 10th Defendant was served with the writ in circumstances where he appears to have disavowed that fact on 1 December (to which no reference had been made by his counsel on that occasion) in seeking to suggest that this defendant did not have a sufficient interest in the action to be permitted to discharge the injunction.  He should not be allowed to shift his ground on this when it appears to suit him.

7.The fact of the matter is that he has chosen not to serve the other defendants with the writ, although the 10th Defendant has to accept that he had notice of the writ by 1 December following his visit to the 11th Defendant’s solicitors offices when he was provided with a copy of it as he was with a copy of the injunction.  The effect of his conduct therefore was, as described in the judgment, to seek to bind the other defendants by merely obtaining an order from the court that they should be given notice of the injunction on the Mainland and when one of them came to this court to have it discharged, it was then submitted on the Plaintiff’s behalf that this individual lacked standing to make the application.

8.In the exercise of what is a discretionary jurisdiction that sort of conduct ought to be taken into account against the applicant for the injunction, as is the general approach taken by him in shaping the litigation as he has.

9.From these observations, I turn to the proposed grounds of appeal.

10.The first ground of appeal suggests that I fell into error in suggesting that the 10th Defendant had been deprived of an opportunity not to challenge the court’s jurisdiction or to apply for a stay. This is based on the fact, drawn to my attention for the first time on this application, that the 10th Defendant had gone to the Plaintiff’s solicitors offices and had been given a copy of the writ, and of course he had notice of the injunction which had, in any event, been served on him on the Mainland.

11.With this ground, as with all grounds of appeal, the judge against whose orders an appeal is sought to be brought needs to be entirely objective in deciding whether to give leave based on the perceived merit of the appeal.  I have decided that when faced with the shape of the action, as it has been imposed on all the parties who have not been served with the writ — no application having been made by the Plaintiff to serve them, it lies ill in the mouth of the Plaintiff to suggest otherwise in the case of this 10th Defendant against whom it had been suggested on 1 December that he had no standing to discharge the injunction.  I have previously made these points.  In respect of this ground therefore I conclude that there are no reasonably arguable grounds of appeal.

12.The next two grounds relate to my view that the appropriate forum for this dispute is the court at Bao Ying.  Complaint is made that this was a premature conclusion as well as a wrong one.  The fact is that proceedings have now been started, and in my view wisely so, at Bao Ying.  It seemed to me that I was entitled to form this view of the matter having regard to my general appreciation of the affirmation evidence.  In deciding whether to retain or discharge the injunction as against this defendant  I was entitled to look the matter overall and come to this conclusion.  I do not consider that this affords a reasonably arguable ground of appeal.

13.The next ground is specifically directed to the fact that the 10th Defendant was personally served with the writ on 20 October 2009.  I take the view, and I have dealt with this already, that in submitting that the 10th Defendant had no locus to argue for a discharge of the injunction, the Plaintiff must be held to be saying that this did not amount to formal service of the writ on him.  The Plaintiff cannot blow hot and cold on such an important matter.  He made his election in the course of the argument on 1 December 2009.

14.Finally, it is said that I erred in discharging the injunction when it was directed against the 11th Defendant only.  I have not discharged the injunction.  It remains in place against the 11th Defendant, to whom it is directed and I specifically said nothing about its effect against the other defendants, save for the 10th.  I have held that its effects do not bind him for the reasons that I gave.  This ground adds nothing to the argument and it must therefore fail.

15.Accordingly, I refuse leave to appeal.  The application must stand dismissed with costs.

Ella Liang, instructed by Messrs K Y Lo & Co. for the Plaintiff

Alan M. S. Ng, instructed by Messrs Yip, Tse & Tang for the 10th Defendant

The 1st to 9th and 11th to 13th Defendants, in person did not appear and were not represented