OPERA NATIONAL DE PARIS v. SUN BON INTERNATIONAL LOGISTIC LTD

DCCJ 218/2021

[2022] HKDC 1405

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 218 OF 2021

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BETWEEN

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DECISION

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Introduction

1.  By a summons filed on 9 August 2022, the plaintiff applied for leave to appeal against my decision dated 26 July 2022 (“my decision”).

Legal principles

2.  Section 63A(2) of the District Court Ordinance provides:-

“(2) Leave to appeal shall not be granted unless the judge, the master or the Court of Appeal hearing the application for leave is satisfied that—

(a) the appeal has a reasonable prospect of success; or

(b) there is some other reason in the interests of justice why the appeal should be heard.”

3.  The test of whether an appeal has a reasonable prospect of success under the new statutory provision is the same test as applied before the amendment to Cap 336, ie whether the applicant for leave can show that he has an arguable case with reasonable chances of success on appeal as is laid down in Ma Bik Yung v Ko Chuen [2009] 3 HKC 359. A reasonable prospect of success means an appeal with prospects that are more than “fanciful” but which do not need to be shown to be “probable”: see Wing Tat Haberdashery Co Ltd v Elegance Development & Industrial Co Ltd, HCMP 357/2011, 8 July 2011, unreported.

4.  Where the appeal is against the exercise of a discretion, the appellant ought to demonstrate that the decision was plainly wrong, or that the trial judge has taken irrelevant matters into consideration or has ignored relevant matters: see SMM v TWM (Child: Relocation) [2010] 4 HKLRD 37 at p 48.

Ground 1 Sea change of case

5.  Mr Thomas Wong, counsel for the plaintiff, complained that I should have held that the defendant had had a sea change of its case, or that the current defence is incredible in material aspects so that it is not real, bona fide, or arguable/believable.

6.  In his submission, Mr Wong basically repeated what he had identified as showing the change of the defendant’s case in the written submission in opposition to the defendant’s appeal before me. Mr Wong also largely repeated the submission on the lack of explanation and evidence in various aspects of the defendant’s case.

7.  I have indeed taken note of Mr Wong’s submission in the deliberation of my decision. In short, I do not consider the complaint of Mr Wong is made out and the various queries raised by Mr Wong are facts sensitive which ought to be resolved by a trial.

8.  Mr Wong placed reliance on the decision of the learned master in support of his argument on the sea change of case and lack of explanation and evidence. With due respect, that does not take his argument any further for the simple reason that on appeal of my decision, the Court of Appeal will treat the substantial discretion as that of mine, not of the learned master: see Hong Kong Civil Procedure 2022 Vol 1 at 58/1/2.

9.  In a summary judgment application, the court is concerned with whether there are triable issues which ought to be resolved by a trial. Forensic examination of the evidence is unnecessary and inappropriate. Suffice it to say, I am of the view that the defendant’s assertions are believable. I do not need to and indeed should not consider whether those assertions are to be believed: see the speech of Godfrey JA in Ng Shou Chun v Hung Chun San, CACV 182/1993, 26 January1994, unreported, at p 4.

10.  In criticizing the lack of explanation and evidence in various aspects of the defendant’s case, Mr Wong is dangerously inviting the court to embark on a mini-trial on affidavit evidence. To borrow the words of Bokhary JA (as he then was) in Re Safe Rich Industries Ltd, CACV 81/1994, 3 November 1994, unreported, at p 5:

“For my own part, I must say that when I used to hear applications for summary judgment I was never so unfortunate as to come across any advocate bold enough to attempt to get me to embark upon a mini-trial on affidavit evidence. But I fully accept of course that it may have been attempted before other judges; and certainly no such attempt should ever be made.”

Ground 2 Ministerial receipt

11.  Mr Wong again placed heavy reliance on The Yerrid Law Firm v Qiansbaizi Trading Ltd [2021] HKCFI 620 and said it is binding on this court.

12.  For reasons I have stated in my decision, The Yerrid Law Firm (supra) is not applicable to the present case.

13.  Mr Wong sought to argue that by paragraph 11.1 of the licensing guide (“the guide”) of the Customs and Excise Department (“C & E”) dated February 2020, a licensee is obliged to use the bank account in the name of the licensee’s company, the sole proprietor, partner, director or ultimate owner of the licensee. The BOC account was therefore not approved by the C & E.

14.  With due respect, the argument of Mr Wong is artificial and unsound. The obligation of the licensee to comply with the guide cannot be equated with the need for approval by the C & E. If approval from the C & E is required in respect of the use of bank account, it should have been placed in section VIII of the guide under the heading of “Changes that require CCE’s prior approval”. Further, there must be a mechanism of seeking approval to be followed by the licensee before the submission of the Form 6, which is lacking either in the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, Cap 615 (“AMLO”) or in the guide. Therefore, I am of the firm view that s 40 of AMLO only imposes a duty on the money service operator to notify the Commissioner of any change in particulars. No prior approval from the Commissioner of Customs and Excise is required.

15.  It may be that WT has committed a breach of the obligation under paragraph 11.1 of the guide, such breach may render WT be subjected to disciplinary actions under s 43 of the AMLO. However, it does not follow that the transaction would become void ab initio or unlawful as Mr Wong put it. The fact remains that the BOC account was used by WT to receive the money.

16.  As a last resort, Mr Wong quoted part of a sentence in paragraph 50 in Grupo Pacifica Incorporada v Worldwide Marine Product Ltd [2018] HKCFI 1930. With due respect, it is unhelpful. First, no agency relationship was pleaded (nor evidence in support thereof) by the 1^st defendant in that case. The defence of ministerial receipt was only “faintly” argued before the learned Recorder. Secondly, the learned Recorder only expressed his view in a hypothetical situation. The so-called illegitimate transaction as found by the learned Recorder was specific to the evidence in that case, so was the issue of reversibility. It also remains to be demonstrated by Mr Wong that the transaction was reversible in the absence of any evidence.

17.  In the course of developing his argument, Mr Wong again sought support from the decision of the learned master. For reasons I have given in paragraph 8 above, such reliance would not assist Mr Wong.

Ground 3 Conditional leave to defend

18.  At the hearing of the appeal, the issue of whether conditional leave to defend should be granted was neither raised nor even mentioned. As such, this intended ground is a non-starter.

19.  In any event, it must be apparent from my decision that I was of the view that the defendant had properly raised the defence of ministerial receipt and there are triable issues that can only be resolved by a trial. The defendant is entitled to defend unconditionally.

Ground 4 Interests of justice

20.  Mr Wong regarded the decision of the learned master and that of mine as divergence in judicial opinion and submitted that it is necessary for the Court of Appeal “to settle authoritatively such divergence in judicial opinion, particularly have regard to the reality that the ONP (the plaintiff) has been deprived of a final summary judgment”.

21.  I find it hard to understand Mr Wong’s submission.

22.  Both the decision of the learned master and that of mine are liable to be overturned on appeal. It cannot be said that the decisions of different level of courts is divergence in judicial opinion. The fact that the plaintiff was granted summary judgment which was set aside on appeal does not make it to fall within the ambit of s 63A(2)(b) of the District Court Ordinance.

23.  Lastly, the issue of ministerial receipt is yet to be argued at the trial. It is certainly pre-mature to have the issue examined by the Court of Appeal.

Conclusion and order

24.  By reasons of the aforesaid, I am not satisfied that the plaintiff’s intended appeal has reached the threshold of granting leave and therefore the plaintiff’s summons must be dismissed.

Costs

25.  Costs to follow the event. I make a costs order nisi that the plaintiff shall pay the defendant the costs of this application with certificate for counsel. Such costs to be assessed summarily.

26.  In the absence of any application for variation by summons within 14 days from the date of this decision, the costs order nisi shall become absolute.

27.  Upon the making of the costs order absolute and for the purpose of summary assessment of costs, the plaintiff shall lodge and serve a list of objections to the defendant’s statement of costs dated 19 September 2022 within 7 days from the date of the order absolute.