Spark Rich (China) Ltd. v. Valrose Ltd.

CACV 249/1998

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 249 OF 1998

(ON APPEAL FROM HCMP NO. 3739 OF 1997)

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J U D G M E N T

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Rogers, J.A. (giving the judgment of the Court) :

1. In respect of the application for leave to appeal, that is as of right. There is no dispute about that. We give leave conditional upon the payment of security for costs of the sum of $400,000 to be paid into Court by the 14th May.

2. Turning to the question of the stay of execution, the Defendant, who was the appellant in this Court, seeks a stay of execution. It does so on the basis that the Plaintiff is a shell company. It is said that if the $7.3m plus interest be paid to the Plaintiff and the appellant were successful on appeal, there is every likelihood that that money may disappear and be irrecoverable. Winding-up proceedings have, however, been commenced already and so this matter is not entirely without its difficulty. We have been told by Counsel for the Defendant that it is likely to exchange contracts for the sale of the building today but at a substantially lower price than has been estimated in the affidavits.

3. In the affidavit filed by Christer Agell in the winding-up proceedings dated 30th March 1999, it was said that taking into account interest and costs, the amount which was owed to the plaintiff was in the region of HK$9.5 to $10m.

4. In our view, proper security for that must be given. In view of the sale which is likely to take place, which we are told, will be completed on the 8th June, we think the appropriate order to make is that there should be a stay of execution until the 10th June and thereafter, the stay should continue conditional upon the payment into Court by the Defendant of the sum of $10m.