Compania Sud Americana De Vapores Sa v. Hin-pro International Logistics Ltd

HCMP 1932/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO 1932OF 2014

(ON AN INTENDED APPEAL FROM HCMP NO. 1449 of 2014)

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BETWEEN

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Before : Hon Cheung CJHC and Lam VP

Date of Judgment : 16 October 2014

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JUDGMENT

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Hon Lam VP (giving the Judgment of the Court):

1.This is an application for leave to appeal against the decision of Deputy High Court Judge Saunders on 17 July 2014. By that decision, the learned judge appointed receivers and managers in respect of the Defendant and all its assets. The appointment was made in aid of a Mareva injunction granted by the judge on 16 June 2014 which in turn was in aid of a worldwide Mareva injunction granted by Walker J in England on 13 June 2014. Disclosure order was made in the order of 16 June 2014 and the Defendant had not complied with it.

2.This decision is interlocutory in nature.  The Defendant did not apply for leave to appeal against that decision within the 14 days period.  The Defendant now seeks leave to appeal out of time from this court.  The explanation given by the Defendant in respect of the delay was that it had been misinformed by the solicitors for the Plaintiff as to the date of hearing of the summons for the appointment of receivers and mangers.

3.The history of the matter was set out in the judgment of the judge on 17 July 2014.  The appointment of receivers and managers was an exercise of discretion.  This court will only interfere with an exercise of discretion in the limited circumstances set out by Lord Diplock in Hadmor Productions Ltd v Hamilton [1983] 1 AC 191 at p.220B-F, see also the recent judgment of the Court of Final Appeal in SPH v SA [2014] 3 HKLRD 497 at para 65.     

4.We are not satisfied with the explanation given for the delay on the part of the Defendant.  In the affirmation of the director and shareholder of the Defendant, Ms Su Wei affirmed on 5 August 2014, she said she was misled by 2 letters from the Plaintiff’s solicitors dated 15 July 2014 as she was not conversant with English.  What happened was that the original summons (14 July 2014) was returnable on 21 July.  Then a second summons was issued on 15 July 2014 seeking abridgement of time; it was returnable on 17 July.  The covering letters serving the summonses mistakenly stated the return day to be 19 July.

5.However, the actual return day of 17 July was clearly stated on the summons served.  According to the evidence of Ms Su Wei, the Defendant only instructed solicitors on 17 July.  The Defendant did not appear at the hearing of 17 July.  But the solicitors for the Defendant were well aware that the hearing took place on 17 July as evidenced by the letter dated 18 July 2014 from Messrs Damien Shea & Co [“DSC”] (acting for the Defendant) to the solicitors for the Plaintiff.  In that letter, DSC asked for the outcome of the hearing on 17 July.  Further, by reason of DSC’s involvement in the past in respect of DCCJ 1684 of 2013 (in respect of the enforcement in Hong Kong of costs order made in the English proceedings), it did not come into the picture as a newcomer.

6.In any event, there is no dispute that the order of 17 July came to the notice of the Defendant soon after it was made.  There is no explanation as to why application for leave to appeal was not made to the Court of First Instance within time.  Further, the Defendant had been dilatory in making its application to this court.  Though the summons was lodged on 5 August 2014, the Defendant did not file at the same time a statement in accordance with Order 59 Rule 2A(1).  Nor did the Defendant lodge a bundle of documents in accordance with the directions given by the court in a letter of 7 August 2014.  The court had to make an unless order on 18 August before those documents were filed. No explanation was offered for the late filing of these documents. In the skeleton submissions of Mr Chu (counsel for the Defendant), he did not put forward any explanation for not applying to the judge for leave to appeal within time. 

7.This court has repeatedly stressed the importance of the first tier decision of the court below on an application for leave: see Singh Arjun v Secretary for Justice [2014] 2 HKLRD 678 and Kiddie China Ltd v Etech Fire Ltd HCMP 1673 of 2014, 16 Sept 2014.  The court is now even more vigilant in guarding against attempts to circumvent this first tier requirement. Application for leave out of time will not be that readily entertained if there is no good explanation for not seeking leave from the court below within time.

8.On the facts of the present case, we are not minded to grant any extension of time to the Defendant to appeal.  The grounds put forward in Mr Chu’s submissions are wholly unarguable.  It seems to us that the Defendant is simply playing on some kind of delaying tactics. 

9.The judge has carefully explained in his judgment why he was satisfied that there should be an appointment of receivers and managers.  He referred to the relevant principles and applied them to the present case.  Mr Chu’s submissions cannot pinpoint any specific error on the part of the judge in the exercise of his discretion. 

10.Three main points were made by Mr Chu.  None of them has merit.  First, he suggested that the Mareva injunction is sufficient to protect the Plaintiff’s interest. The judge had assessed that the existing interim relief (including the Mareva injunctions in place) was inadequate, see para 19.  That assessment is a matter for the judge and we see no reason to disagree with him.

11.Second, Mr Chu submitted that the Plaintiff was guilty of non-disclosure in respect of the proceedings in the PRC.  With respect, the Defendant had not explained why the PRC proceedings are relevant for present purposes.  As mentioned at the beginning, the appointment of receivers and managers are made in aid of the Mareva injunction which in turn is in aid of the Mareva injunction granted in the English action.  The PRC proceedings, insofar as they are continuing, are in breach of the anti-suit injunction granted in the English action.  We fail to see the relevance of the PRC proceedings in the present context. 

12.Third, Mr Chu submitted that the jurisdiction clause in the Bill of Lading is not an exclusive one.  Again, in our view, that is a complete red herring.  It cannot be disputed that the English court has jurisdiction over the matter.  Whether it is exclusive or not does not matter.  What matters is that a worldwide Mareva injunction has been granted.  And as far as we can see, the Defendant had not put forward any viable ground to challenge that Mareva injunction.    

13.On the whole, we do not discern any errors in the exercise of the discretion by the judge.

14.For these reasons we do not think the intended appeal has any reasonable prospect of success.  We refuse to grant extension of time to the Defendant to apply for leave.

15.We are of the view that the application of the Defendant is totally without merit and we make an order pursuant to Order 59 rule 2A(8) of the Rules of High Court that no party may request this determination to be reconsidered at an oral hearing inter partes.

16.We also order the Defendant to pay the costs of the Plaintiff in the present proceedings.  We are of the view that the application is completely hopeless and it should not have been brought in the first place.  In the circumstances, we are minded to order costs on an indemnity basis.  We shall fix the costs by way of gross sum assessment.  The Plaintiff shall file and serve its statement of costs (not more than 3 pages) within 7 days from the handing down of this judgment.  The Defendant shall file and serve its objections (if any) within 7 days thereafter.
The costs shall be fixed by us on paper.

Mr John Scott, SC and Mr John Hui, instructed by Stephenson Harwood, for the plaintiff (respondent)

Mr George Chu, instructed by Damien Shea & Co, for the defendant (appellant)