RICHARDSON GREENSHIELDS OF CANADA (PACIFIC) LIMITED v. BERNARD CHENG AH-HUNG

BETWEEN :-

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JUDGMENT

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1. This is an appeal against a Decision given by Master Betts on 9th July of this year, giving judgment to the Plaintiff under Order 14. If ever an appeal to a judge in Chambers could be called an abuse of the process of the Court, this is the one that comes perilously near to it. There is an absolute right of appeal but this comes perilously near to abusing that absolute right. It is not the first time in this Court, that this man has adduced the arguments raised before me in an attempt to avoid the consequences of unsuccessful speculation. He raised them before Mr. Justice Hunter in another matter, which is now the subject of an appeal to the Court of Appeal : The less I say about that, therefore, the better.

2. This man entered into contracts with the Plaintiff, which are exhibited, that it would act for him as broker, as agent and, in certain circumstances, possibly as principal. What I am concerned with at the moment are purchases of gold from Rothschi1ds, Mocattas and Troika. The Defendant received bought and sold notes; the Defendant received monthly statements of account; and Defendant received a breakdown of his indebtedness. Practically every one of those necessary documents has been withheld from this Court. He says now that no transactions were executed on his behalf, notwithstanding all the confirmatory notes supplied to this Court by the Plaintiff and the one supplied by him. He says that because the figures in the transactions as between the Plaintiff and him "do not match" the figures in the transactions between the Plaintiff and Rothschi1ds, the Plaintiff and Troika and the Plaintiff of Mocattas. What that has to do with it, is beyond me. There is ample evidence that these transactions were carried out for and on his behalf by the Plaintiff. The Defendant says he ought to be given leave to defend so as to enable him to cross-examine the Plaintiff on the figures and how they are arrived at. He says there are discrepancies between the figures. There is an admitted discrepancy in the claimed figure of US$195,000.00 odd of US$3.99 which the Defendant said was so trivial, they really could not be bothered spending the time looking it up; I do not blame them. Sooner or later, they must look it up, and tell the Plaintiff, but, for the purposes of this matter, I cannot see how any question of cross-examination can arise over US$3.99 out of US$195,000.00 odd.

3. The Defendant then says these tradings were illegal, but exhibited before me evidence that they are not illegal. The Defendant says that the Plaintiff was acting unlawfully as a commodity trader, but there is evidence before me from the Commissioner for Commodities Trading that that is not so. Mr. Chong urges upon me that I am not bound by what the Commissioner said; that is perfectly true - I am not. But it does help me when I come to my decision as to whether or not there is an arguable case.

4. I must revert for a moment to the documents that I referred to, as Mr. Chong has told me, very properly, that his lay client does have those documents, and is resident in Hong Kong. There is no explanation, however, why they are not before me.

5. I am now told that, although there was exhibited before Master Betts a draft defence and counterclaim, I am now told that the case is "undoubtedly" one of fraud, of cheating, of fraudulent misrepresentation and of deceit. Strong words : Very strong allegations : And I have to look at this application,therefore, in the light of them because, if there were genuine suspicion of such fraud then I would give leave to defend.

6. Then there is an allegation that the Defendant has been negligent. I have rarely seen at such a insubstantial series of allegations of negligence. I am not going to go through them in detail. I do not, for my own part, feel that they disclose any defence to this action at all, and they are insubstantial to the degree of less than shadowy.

7. If all that stood alone, it would be enough, but there is more. On the 13th of April, the Defendant wrote to the Plaintiff accepting his indebtedness, and making an offer of payment : None was forthcoming, and so, on the 17th of April, the statement of claim was served. On the 18th of April an ex parte Mareva was obtained, and on 26th of April, the return date, the matter came before Deputy Judge Nazareth Q.C.. Before Deputy Judge Nazareth, the matter came on what is entitled a "consent summons". It was signed by both solicitors. An order in terms was made, and the learned Deputy Judge thereupon made a consent order calling upon the Defendant to sell his speedboat, a catamaran, a Mercedes motor car and two properties, for delivery up of documents of title, and the nett proceeds of sale had to be put into a bank account. There was provision for his drawing living expenses of $30,000 and rental of $50,000 in respect of certain property. Anything in excess of that was to be paid into the joint account. It is utterly beyond me how anyone could, by consent, allow such an order to be made, if he had an absolute defence in fraud and, if in fact, there had never been any transactions made by the Plaintiff on his behalf, and if the Plaintiff had acted illegally throughout and was by law disentitled from recovering any money from him. It went further than that : That very day he wrote another letter to the Plaintiff, and making proposals to repay.

8. Another action came on before Mr. Justice Hunter concerning the same Defendant. He advanced almost the same arguments throughout before Mr. Justice Hunter. Mr. Justice Hunter disposed of that case, giving reasons which, for the most part, I most respectfully adopt. So far as facts are concerned, I cannot, of course, adopt any of the reasoning of Mr. Justice Hunter because I have no idea of what facts were put before him. However, in so far as matters of law are concerned, which were disposed of before Mr. Justice Hunter, it seems to me to be quite pointless as to spend the whole day advancing them again before me, in the hope that I might decide another way. That is particularly pointless when Mr. Justice Hunter's decision is now the subject of an appeal to the Court of Appeal.

9. However, that is all as may be, I am not bound by Mr. Justice Hunter's decision : I am not going to let it fetter me in my decision. I have come to a firm conclusion that there are no triab1e issues here; that the Defence is, at its highest, shadowy and insubstantial, but it would be straining the imagination to find that it were even that.

10. This appeal will be dismissed with costs. Mr. Cheung, with the propriety for which he is well-known, has not sought to persuade me to impose a higher scale of costs, a matter which I would have considered if he had made such a submission. As it is the costs will be taxed on a party to party basis.

BETWEEN :-

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Coram: The Hon. Mr. Justice Jackson-Lipkin in Chambers.

Date of Hearing: 5th August, 1985.

Date of Delivery of Ruling: 5th August, 1985 at 4:10 p.m..

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RULING

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11. An application has been made for stay of execution pending appeal. The principal ground appears to be that my brother Hunter granted a stay in the other case. Perhaps my brother Hunter is a little more tender-hearted than I am - I know not. All I can say is this, that none of the basic facts necessary for a Judge at first instance to know in order to decide whether or not to grant a stay, is before me. It may be, as in the Tregunter case, that an application to the Court of Appeal will disclose those facts necessary for the Court to decide whether or not to grant a stay. I am in the same position here as I was in the Tregunter case : I have absolutely nothing whatever to go on, and applying the general principles of an appeal not giving rise to a stay of execution, I refuse this application. It may, of course, be renewed, on proper evidence, before the Court of Appeal once the notice of appeal has been lodged.

12. Before concluding, I wish to pay tribute to the courage and tenacity of Mr. K. N. Chong in his presentation of this case, in the face of almost insuperable difficulties.