Read the full judgment text of HCA 1479/2009 on BabelCite. This Court of First Instance judgment was delivered on 10 March 2011 before Deputy High Court Judge Burrell.
Civil procedure – Mareva injunction – fortification of cross-undertaking as to damages – appropriate quantum – speculative loss of investment opportunities – form of order – bank guarantee versus payment into court – costs – plaintiff encashed shareholding said to be worth HK$3 billion and resigned as Chairman in July 2010 – 2nd defendant forced to sell securities to meet margin call caused by Mareva order, shares now worth about HK$5 million more – 3rd defendant made HK$5 million profit on sale of Easyknit shares and claimed HK$15 million in lost investment opportunities – whether straightforward loss-of-value approach justifies HK$5–6 million for 2nd defendant – whether speculative loss of investment opportunities justifies HK$15 million for 3rd defendant – whether bank guarantee or payment into court is the appropriate form – whether costs should follow the event or be in the cause – held: HK$6 million for 2nd defendant adopting straightforward approach based on actual loss of share value – held: HK$6 million for 3rd defendant, his HK$15 million claim being wholly speculative and rose-tinted, but court taking broad view of unquantifiable risk – held: bank guarantee preferred over payment into court for consistency with the earlier order of Coleman DHCJ, both forms being equally secure – held: costs in the cause – orders: plaintiff to provide HK$6 million by bank guarantee within 28 days for each of the 2nd and 3rd defendants, failing which the Mareva injunction shall lapse; costs of the application in the cause.
Legal issues: Appropriate quantum of fortification for the 2nd defendant's cross-undertaking · Appropriate quantum of fortification for the 3rd defendant's cross-undertaking · Form of fortification order – bank guarantee versus payment into court · Costs of the fortification application
Outcome: Fortification granted: plaintiff ordered to provide HK$6 million by way of bank guarantee in respect of each of the 2nd and 3rd defendants within 28 days, failing which the Mareva injunction shall lapse; costs of the application in the cause.