BECKTON INTERNATIONAL LTD AND ANOTHER v. OOI LEAN CHOO

HCA 1945/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1945 OF 2014

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D E C I S I O N

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1.  There are 2 applications before the court. Firstly, an application by the plaintiffs dated 23 February 2015 to vary the Mareva injunction order dated 3 October 2014 (“Injunction”) in respect of the “Specific Sum” stipulated therein, ie, the limit of the Injunction, from HK$3.9 m to just over HK$330,000.  Secondly, the defendant’s application dated 25 February 2015 to discharge the Injunction upon payment into court by her of a sum just over HK$148,000.

2.  Briefly, the Injunction was granted on the basis that the defendant was holding certain rental payments and sales revenue on trust for respectively the 1^st and 2^nd plaintiffs.  The defendant was holding such funds by reason of her relationship as the secretary of Mr Ulrich Behringer, who is the sole beneficial owner of the plaintiffs.  Their relationship broke down in August 2014, and the defendant had refused to hand over the funds to the plaintiffs. 

3.  However, after the grant of the Injunction, between the 2 to 8 January 2015 the defendant has made 3 payments into court totalling just over HK$3.96 m.  Those payments represent what the defendant says are the rental and revenue she received on behalf of the plaintiffs.  Pursuant to the terms under “Exceptions To This Order” of the Injunction, that order had ceased to have effect as of the 8 January 2015.

4.  Regrettably, the fact that the Injunction had ceased to have effect is something which the plaintiffs have either overlooked or have refused to recognise.  It must be said that there is a duty on the part of the plaintiffs to act strictly within the scope of an order which they have obtained ex parte. 

5.  The plaintiffs are dissatisfied with the payment of HK$3.96 m.  They say that the Specific Sum did not take into account the revenue paid into the defendant’s bank account by the 2^nd plaintiff’s customers from 14 August to 12 November 2014.  Altogether, 9 transactions have been identified.  There is no dispute over 4 of those transactions.  Hence the willingness of the defendant to make an additional payment into court as stated above.

6.  The 5 disputed transactions amount to just over HK$182,000.  The materials before the court show that there are genuine arguments whether the money in question have already been paid into court (in respect of 4 of the disputed transactions) or has gone into the defendant’s bank account at all.  In light of the defendant’s willingness to payment the disputed funds into court in order to free herself from the Injunction, the dispute over these 5 transactions deserves careful consideration. 

7.  This brings me to the proper approach to the plaintiffs’ application.  It is wrong to treat it as a variation of the Injunction.  The Injunction had ceased to have effect since 8 January this year.  This application must be treated as an application for another Mareva injunction against the defendant. 

8.  The plaintiffs seem to have an erroneous perception to this relief.  It is regarded as a nuclear weapon in the judicial arsenal for good reasons.  It is not to be deployed unnecessarily or in an oppressive manner. 

9.  Given the development in this case, in particular the payments into court made and going to be made by the defendant, it is surprising for the plaintiffs to insist on making a second application for Mareva injunction for a relatively small sum of money.  The purpose of this relief is not to provide a guarantee for the plaintiffs in the recovery in this action.  There is good reason to believe that the plaintiffs have acted oppressively in these matters. 

10.  Further, I am unable to see how the 2^nd application can be justified in terms of proportionality : see O 1, r 1A.

11.  Furthermore, it is quite unusual to make an inter parte application for Mareva injunction because of the risk of dissipation.  With the present circumstances, I do not accept that such risk has been made out.   

12.  As regards the Plaintiffs’ argument that there is a proprietary claim over the money in question, it seems to me that there is a real possibility that such money has been mixed with the funds from other source(s) in the defendant’s account, and that issue has not been properly addressed in this application.

13.  In these circumstances, this application must be declined.  I  should say that even if all the requisite requirements for the application have been made out, I would nevertheless have exercised my discretion to decline to make another intrusive order against the defendant because it is oppressive and disproportionate. 

14.  As regards the defendant’s application, the payment into court is not contested and leave is accordingly granted.  Although the Injunction had ceased to have effect, it should be formally discharged.  In the premises, I make the order sought in paras 1 and 2 of the defendant’s summons. 

15.  I am grateful to both counsel for their assistance and shall hear the parties on costs.