張才奎所託管中國山水投資有限公司股份and Another v. 張才奎and Another

HCA 1564/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1564 OF 2015

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DECISION
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1.In respect of the application for appointment of receivers by the plaintiffs in HCA 1564/2015, I am going to allow it. The application was issued on 10 July 2015 and is only heard today. Strictly speaking, the defendants do not have enough time since the issue of the summons to consider it. Accordingly, I am treating it as ex parte on notice.

2.I am informed by counsel for the plaintiffs that the basis on which this application was issued was the same as in the other High Court actions before me.  The receivers are going to be the same. 

3.Mr Lam SC, counsel for the 1^st defendant, objects to my issuing the receivership order in respect of these particulars and asks for time to deal with this summons.  He has given various reasons but, with respect, they do not assist him.  That receivers have already been appointed in respect of the other High Court actions, in fact, it is a point in favour of the plaintiffs. The identities of the receivers are certain and they have worked in the rest of the cases to demonstrate the suitability to handle the shares in the present new action. 

4.Whilst the court respects that the defendants do have a right to be heard and whilst the court also notes that the receivers have been appointed to the board of China Shanshui Investment Company Limited, as of now, there are matters which the court cannot overlook which have happened in the interim since this series of litigation had started.

5.As pointed out by Mr Joffe for the plaintiffs, employees in the other High Court actions have been subject to alleged duress and threats, which caused them to withdraw from the actions.  In addition, the 1^st defendant has gone about so far as to try and transfer shares and do acts trying to dilute the shareholding of the plaintiffs in the other High Court actions. Afterwards

6.It is true that there is an injunction in place in HCMP 1506/2015, restraining the defendants from disposing of all shares under the trust. I consider it more prudent to have the receivership order than merely relying on this injunction which, on the face of it, might cover only some of the plaintiffs in other actions but not the plaintiffs here.

7.Mr Lam has taken the point that the statement of claim filed by the plaintiffs in this new action contained a statement of truth signed by one Mr Gao.  This gentleman featured prominently in the other High Court actions.  The point taken was that Order 41A does not permit a non-party to sign the statement of truth. 

8.Mr Joffe has pointed me to Order 41A rule 3(7) which permits a non-party to file a statement of truth.  In any case, this is a technical matter which can be remedied by the plaintiff should they consider it necessary to find another person to replace Mr Gao.  At present, I do not see how the signing of a statement of truth by Mr Gao can invalidate the action or the statement of claim.

9.Having regard to the history of this series of litigation under these High Court actions, and also the petitions, this series of litigation cries out for rapid and stern measure and, hopefully, cost-saving measures, having regard to the fact that the plaintiffs are employees, hard-working people, who have to stand up against the defendants who apparently are stronger financially. 

10.In my view, it is appropriate to grant the receivership orders sought.  It will be on the same terms as those granted by Lam J in the other High Court actions and subject to the same proviso as set out in paragraph 18 of his decision dated 17 June 2015, and I so order.

11.There will be liberty to apply. 

12.If the defendants do not agree to this order, of course they can always apply, on good grounds, to set aside the receivership order.

(Submissions on costs)

13.The order will be the same as the one made by Lam J.

Mr Victor Joffe and Ms Rachel Lam, instructed by K & L Gates, for the 1^st and 2^nd plaintiffs

Mr Paul Lam SC and Mr Jean-Paul Wou, instructed by Deacons, for the 1^st defendant