THE HONG KONG AND SHANGHAI BANKING CORPORATION v. GOBIND MOHAN ALSO KNOWN AS OBI MOHAN

IN THE COURT OF APPEAL

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JUDGMENT

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Sir Alan Huggins, V.-P.:

1. These are appeals against the refusal of a stay of orders under 0.49B for the cross-examination of two judgment debtors. The judgments were entered in 1977. The actions were for repayment of a loan and upon a guarantee of that loan. No steps were taken to levy execution on the judgment debts until June 1984, when the orders under 0.49B were applied for. By then the judgment debtors had commenced an action (which has been referred to throughout as the "main action”) against the judgment creditor and their solicitors for negligence, the negligence alleged being apparently in relation to advice given concerning the floatation of a company for which the borrowed moneys had been used. The trial of the main action was fixed as long ago as 13th December 1983 for a hearing on 1st October 1984.

2. The appeals, as I say, are against this refusal of a stay. We do not have any reasons from the judge as to why he refused a stay but we do have a judgment on another matter, in which it would appear that he was satisfied that it would be proper that the cross-examination should take place before the hearing of the main action.

3. I approach the matter in this way. It seems to me that the whole of the difficulty in this case arises because of the bank's delay in making its applications under 0.49B. But for that delay any order which was made could have been appealed and the appeal could have been heard and disposed of well before the hearing of the main action. For my part I see no particular unfairness in the hearing of the applications before the trial of the main actions - as the judge saw none - and had the matter been disposed of, as it could very well have been, several months ago then no difficulty would have arisen. I see no reason why because of the delay in obtaining the orders under 0.49B the judgment debtors should, in effect, be deprived of their right of appeal against those orders. In reality what is being sought on the other appeal is a variation of the orders. It is not suggested that the judgment debtors should never be cross-examined but that they should be cross-examined at a later date. Whether there is any merit in that appeal or not, it is conceded that the appeal is not entirely without merit. The refusal of the stay is in effect to deprive the judgment debtors of their opportunity to contest the propriety of the orders made under 0. 49B. That, I think, is wrong and I would allow this appeal and grant a stay.

Silke, J.A.:

4. My approach would be the same as that of My Lord the Vice-President and I am respectfully in agreement with the conclusion which he reached and with the order he proposes.

18th September, 1984.