HON SHU PING v. LAU YUEN CHING AND ANOTHER

HCA 847/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 847 OF 2001

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J U D G M E N T

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1.  The plaintiff as beneficial owner sues the defendants who were said to have held shares in 2 companies on his behalf.

Background as to relationships

2.  Indisputably before 29 July 1997, the 2^nd defendant and one Madam Lai Mei Ying (“Madam Lai”) each held one share in each of 2 companies – Fu Guang International Investments Ltd (“Fu Guang”) and Wellmax Shipping Ltd (“Wellmax”) (collectively “the companies”).  The 1^st defendant and Madam Lai were the companies’ directors.

3.  In July 1997, Madam Lai transferred her share in each of Wellmax and Fu Guang to the plaintiff.  The 2^nd defendant transferred her share in each of Wellmax and Fu Guang to the 1^st defendant.

4.  On 30 July 1997, 9,998 shares in Wellmax were allotted to the plaintiff.  On 29 September 1997, 9,998 shares in Fu Guang were allotted to the plaintiff.  The net position after the allotments was that the Plaintiff held 9,999 shares and the 1^st defendant held 1 share in each of the companies.  The 1^st defendant and the plaintiff (who substituted Madam Lai) were the only directors in each of the 2 companies.

5.  The plaintiff purportedly resigned as director from both companies from 1^st February 1999 and was substituted by the 2^nd defendant (the sister-in-law of the 1^st defendant).

6.  On 1 March 1999, the plaintiff transferred to the 2^nd defendant all his 9,999 shares in both companies.  By then, the 1^st and 2^nd defendants became the only directors and shareholders of both companies.

The plaintiff’s case

7.  The plaintiff was an engineer by training.  He is a citizen of the PRC, having obtained the right of residence in Hong Kong in 1996.  He normally resided in the Mainland.  His business was to import to the Mainland photo equipment and consumables manufactured by Fuji Film of Japan.  Business expanded.  The companies were acquired by the 1^st defendant on his instructions and on his behalf.  Fu Guang was engaged in business and holding of properties; Wellmax merely held properties.  Trusting the defendants, the plaintiff let them hold the shares on trust for him and be the directors to conduct the businesses “on trust” for him.  The 1^st defendant was the manager of the 2 companies.

8.  In 1999, the plaintiff was asked by the 1^st defendant to sign papers which had the effect of stripping him of his shareholding and directorship in breach of trust.   Both in 1997 and 1999, the 1^st defendant had orally represented to the plaintiff that the 2^nd defendant and Madam Lai had executed declarations of trust in his favour in respect of the shares.  The plaintiff relied on the representation and did not do anything to protect his interest in the companies.

9.  In 1995 and 1997, a total of 3 properties were purchased in the name of Fu Guang and 5 (3 being offices and 2 being car parks) in the name of Wellmax on the instructions of the plaintiff.  (See the table in paragraph 33 below.) Properties of Fu Guang had been used as staff quarters; those of Wellmax as offices and car parks of the 2 companies.  The purchases and capital for the business had been funded by the plaintiff or mortgages.  The mortgages were in turn funded by business revenue of the 2 companies.

10.  Save for property (c) which was sold in September 2000, all the properties were sold in March 2000, without the plaintiff’s instructions and in breach of trust.  The defendants had also failed to account the sale proceeds to the plaintiff or the companies.

11.  The plaintiff further pleaded that in breach of trust, the defendants had damaged the business relationship of the 2 companies with China Hong Kong Photo Products Holdings Limited (“the Photo Products Company”) and its related companies to the detriment of the 2 companies:

(i)  By taking out unjustified and unwarranted legal action in the PRC against the subsidiary of the Photo Products Company, namely, Zhuhai Realscore Photosensitive Material Making Co Ltd, in the name of Fu Guang; and

(ii)  Making unjustified demands, remarks and public announcements against the Photo Products Company and its related companies in the name of Fu Guang.

12.  In November 1999, the plaintiff was advised by the accountant (Ms Chan Yin Lan) of Fu Guang that he needed to put up money to repay the loan to Bank of Communications, as the proceeds of sale of goods were about $2,000,000 but the credit limit of $9,000,000 was about to be exceeded. The plaintiff remitted about $7,000,000 to Ms Chan with instructions for her to repay the mortgages and the bank.  Subsequent to the remittance, the plaintiff could no longer contact Ms Chan.  The offices and staff quarters were also vacated.  It was then that the plaintiff discovered the misconduct of the defendants.

13.  In December 1999, the 1^st defendant made an announcement in the name of Fu Guang and Wellmax in the Hong Kong Sing Dao Daily that the plaintiff was just a manager and his job had been terminated.  The 1^st defendant also called the plaintiff and said he had taken the $9,000,000.  On top of that, the 1^st defendant demanded for $5,000,000 more before returning the companies to the plaintiff. The 1^st defendant had subsequently through another person offered to return the companies for a lesser sum of $3,000,000.  The plaintiff had not paid as demanded.  Thereafter the plaintiff lost contact with the 1^st defendant.

14.  The defendants closed the businesses of Fu Guang and Wellmax at the end of 1999. 

15.  The defendants had, without consent or knowledge of the plaintiff, taken away all the moneys, books, documents and records of Fu Guang and Wellmax. 

16.  At the end of 1999, the plaintiff had to remain in Zhuhai to assist the Central Government in investigations of his business until his name was cleared in 2000.

17.  Without the consent and knowledge of the plaintiff, the defendants had purportedly appointed one Chan Wah Keung, clerk of Messrs Ivan Tang & Co, solicitors, as a director of Fu Guang on 2 April, 2001.

18.  The plaintiff also discovered that the cash in the accounts of 2 other companies of his were also withdrawn without his consent.  The information on these bank accounts was with the defendants.

19.  There was also allegation that the defendants had damaged the business relationship of the plaintiff with others (para 11 above) but for present purposes the plaintiff does not pursue this head of claim.

20.  On 19 September 2007, the 1^st defendant transferred all the shares in Fu Guang to Lai Yee Fuk.  On 20 September 2007, the 1^st defendant transferred all the shares in Wellmax to Lai Yee Fuk.  On 10 and 6 October 2008, the 1^st defendant applied as director for de-registration of Fu Guang and Wellmax respectively.  The companies were accordingly de-registered.  They were only reinstated by my order yesterday in HCMP 739 and 740 of 2012.

The defence

21.  The defendants admitted that the 2 companies had acquired the 8 properties and sold them to various purchasers as pleaded in the re-amended statement of claim.  Allegedly, the sale of the properties was prompted by the companies’ inability to meet the mortgages.  The proceeds had been utilized to set off the mortgages.

22.  However, the defendants denied that there was a trust or that there had been breach of trust or fiduciary duties.  They alleged that the plaintiff was just the manager.  It was not financially viable to carry on the business of Fu Guang because it failed to recoup the sum owed by Zhuhai Photographic Equipment Company which stood at over $133,000,000 and was confirmed by the plaintiff on 19 September 1999.

The issues

23.  The issues are (i) whether or not the plaintiff was the true beneficial owner of the shares; and (ii) whether the defendants had acted in breach of trust/fiduciary duties as alleged.

The evidence

24.  The plaintiff has adduced evidence through his own witness statements and that of his wife Madam Lee Siu Lam (Mrs Hon).  He has also produced a bundle of documents.  Since the evidence was not contested, I accept the plaintiff’s evidence as truthful. 

25.  The defendants did not appear despite having filed the witness statement of the 1^st defendant.  I shall not admit it as evidence of the facts save to the extent commented upon by Mr Yau, counsel for the Plaintiff, in paragraphs 28, 29, 35 and 36 below.

26.  I accept the uncontested valuation evidence of the 8 properties from the plaintiff.

Whether the plaintiff was the true beneficial owner of the shares

27.  The plaintiff did not know English.  He reposed trust and confidence, firstly in the 1^st defendant and then in his wife and the 2^nd defendant. On his own evidence, the plaintiff could not recall what exactly he had been told to sign or what happened each time he was asked to sign.  Whatever he was told, he signed under the impression that those were measures taken to protect his interest.  His trust in the 1^st defendant turned out to be misplaced. 

28.  The increase in share capital in 1998 and the allotments of 9,998 shares to the plaintiff was strong evidence to show that the plaintiff was the true beneficial owner.  There was complete absence of explanation from the defendants as to why there was such allotments that gave the plaintiff virtually total control of the companies.

29.  As submitted by Mr Yau, there had been multiple injections of large sums of money between 1995 and 1999 by the plaintiff from his own resources to the tune of $42,574,081.27[1] to Fu Guang, Wellmax or the 1^st defendant.  That could not possibly be explained by the allegation that the plaintiff was a manager of the companies.  The defence did not contain any plea to refute the capital input by the plaintiff.  The witness statement of the 1^st defendant avoided any explanation as to why those injections were made and the source of funds for the purchase of the 8 properties and capital for the businesses.

30.  I am satisfied on the plaintiff’s evidence as to the purpose of setting up of the companies.  As the plaintiff was not conversant in law, one cannot expect him to describe his relationship with the defendants in terms of the trusts ascribed by his lawyers in his pleadings. However, I have no difficulty in finding that, at all times, the defendants had held the shares in the 2 companies on his behalf.  I also find that the plaintiff had funded the purchase of the 8 properties with the assistance of mortgages and provided capital for the businesses of the companies. 

Breach of trust/fiduciary duties

31.  In tricking the plaintiff into transferring away his shares in 1999 to the 2^nd defendant and then to Lai Yee Fuk without the consent of the plaintiff, the defendants had clearly acted in breach of trust.

32.  Further, I am satisfied that the defendants had, without consent of the plaintiff, sold the 8 properties to purported purchasers related to the 1^st defendant:

(i)  Property (a) was sold to the 1^st defendant’s Father.

(ii)  Property (c) was sold to Yeung Kam Yuk of Flat A, 21/F, Block B, Golden Villa, 200 Castle Peak Road, New Territories, which was also the address of the 1^st defendant as found in the company search records of Fu Guang.

(iii)  Properties (d) to (h) were sold to Li Lai Ching of Room 601, On Mei House, Cheung On Estate, Tsing Yi, which used to be the address of the 1^st defendant as found in the company search records of Fu Guang and Wellmax.

These purported sales were apparently not bona fide or at arm’s length.

33.  Moreover the sales were at undervalue.  The evidence can be summarized as follows:

Property (ownership)		Date of assignment & purchase  price (HK$)	Date of assignment and sale price (HK$)	Date for valuation based on date of sale & purchase agreement	Market value according to valuation  report
(a)	Flat F on 16/F, Skyline Plaza (Fu Guang)	14.7.1995 4,500,000.00	15.3.2000 3,200,000.00	2.2.2000	3,460,000.00
(b)	Flat C on 19/F, Skyline Plaza (Fu Guang)	14.7.1995 4,571,740.60	31.3.2000 3,580,000.00	28.2.2000	3,600,000.00
(c)	Flat E on 27/F, Two Island Place (Fu Guang)	26.7.1995 12,524,000.00	8.9.2000 4,560,000.00	22.8.2000	5,030,000.00
(d)	Unit 3 on 21/F, Fortune Commercial Building (Wellmax)	1.9.1995 1,160,000.00	7.3.2000 780,000.00	7.3.2000	920,000.00
(e)	Unit 5 on 21/F, Fortune Commercial Building (Wellmax)	20.4.1995 2,660,000.00
(f)	Unit 6 on 21/F, Fortune Commercial Building (Wellmax)
(g)	Parking space P308 on 3/F, Fortune Commercial Building (Wellmax)	1.9.1995 600,000.00	7.3.2000 200,000.00	7.3.2000	600,000.00
(h)	Parking space P309 on 3/F, Fortune Commercial Building (Wellmax)	1.9.1995 600,000.00
Total:		26,615,740.60	12,320,000.00		13,610,000.00

34.  In a document disclosed by the defendants, there was evidence that a mortgage loan of $3,878,834.63 was redeemed on 8 September 2000, the same date as the assignment of property (c).  The plaintiff has fairly conceded that the sale proceeds might have been applied to redeem that mortgage.

35.  The 1^st defendant explained in his witness statement (para 13) that the properties were sold at the relevant prices because of the SARS epidemic in 2003.  This was a clear lie.  The properties were all sold in 2000, well before the SARS outbreak.

36.  The conduct of the 1^st defendant in suddenly selling all the properties and closing down the companies evidenced their dishonesty.  Such conduct was clear indication that they were trying to squeeze as much as possible from the companies. There was no explanation in the 1^st defendant’s witness statement as to why the plaintiff was removed as an “employee”.

37.  Their greed was further revealed from seeking a ransom of $5,000,000 as consideration for “returning” the companies to the plaintiff.

38.  The dishonesty of the defendants could also be seen from misleading Mrs Hon as to the plaintiff’s ownership of the shares, thereby causing her to repay the mortgages for properties in Guangzhou under the name of Fu Guang.  In May 1999, the 1^st defendant gave some notarized documents[2] to Mrs Hon including (i) a power of attorney given by Fu Guang authorizing Mrs Hon to deal with 3 properties in Guangzhou held in the name of Liu Han (刘汉), an employee of Fu Guang holding the properties on trust for the plaintiff; and (ii) the annual returns of Fu Guang filed in October 1998 showing that the plaintiff held 9,999 shares.  The 1^st defendant even represented to Mrs Hon that his one share held was on trust for the plaintiff.  In fact, by that time, all the shares had been purportedly transferred to the 2^nd defendant.  Believing that the plaintiff was the registered owner and beneficial owner of the shares in Fu Guang, Mrs Hon repaid more than RMB1,700,000 for the mortgages for 3 properties under the name of Fu Guang.  In October 2000, without Mrs Hon’s knowing, the 1^st defendant acting in the name of Fu Guang, revoked the power of attorney in her favour and applied for title deeds for Fu Guang.  Mrs Hon later sued Fu Guang in Guangzhou for repayment of the RMB1,700,000 odd.  The Guangzhou court confronted Fu Guang’s lawyer as to why the notarized documents showing the plaintiff to be the majority shareholder was shown to Mrs Hon when the defendants were then the shareholders.  The lawyers for Fu Guang claimed that they were not sure.  Mrs Hon eventually won the case and obtained the properties in satisfaction of the judgment sum of RMB1,700,000 odd and interest: (2004) 穗中法審監民再字第144號, (2005) 穗中法民四終字第2135號.

39.  In the proceedings under the same Guangzhou judgments, Fu Guang (represented by the 1^st defendant) had even relied on 4 documents purportedly signed by the plaintiff, three of which were adjudged to be not signed or written by him.

40.  I find that in transferring the shares in the 2 companies to themselves, seeking the ransom and eventually disposing of them to Lai Yee Fuk, the defendants had breached their duties as trustees for the plaintiff.  They had also breached their duties to the companies in selling the properties at undervalue, and failing to account the proceeds of sale.  They had also embezzled monies of Fu Guang and Wellmax.  They had run down the business of the companies and dissipated the assets to the detriment of the companies.  They disappeared with the assets, books, accounts and documents of the companies. 

Reliefs sought

41.  The plaintiff is plainly entitled to a declaration that each of the defendants held the shares in the 2 companies on trust for him.  As between the plaintiff and the defendants, he is entitled to a re-transfer of the shares to him.  Since the defendants had transferred those shares to Lai Yee Fuk, the plaintiff may have to take further action to get back the shares.  The plaintiffs should also be entitled to an inquiry of damages and as to any benefits received by the defendants while they held the shares on trust for him and payment of any amount due on such inquiry.

42.  The plaintiff seeks further reliefs (collectively “the other reliefs”) in the form of:

(i)  restitutionary compensation against the 1^st defendant for his breach of trust in closing down and moving elsewhere the business and converting the books, accounts and documents of the 2 companies;

(ii)  account of the sale proceeds received by them from the purported sales of the properties or a vesting order of the properties which the defendants acquired with the proceeds of sale if the plaintiff so elects;

(iii)  damages for breach of fiduciary duties arising out of the purported sales of the properties;

(iv)  damages for breach of trust and fiduciary duties;

(v)  inquiry of damages.

43.  Insofar as the defendants had purportedly disposed of properties and businesses of the companies, the other reliefs were claimable by the 2 companies instead of the plaintiff.

44.  Mr Yau very fairly acknowledged that the “no reflective loss” principle may preclude the plaintiff from recovery of any monetary loss from the  defendants.  That principle provides that a shareholder cannot recover loss which is merely reflective of the loss suffered by the company.  There is no exception to this principle.  It applies even if the wrongdoer has acted in breach of his duties to the company and the shareholders, and steals the whole of the company’s business.  The exception stated in Giles v Rhind [2001] 2 BCLC 582 should not be followed in Hong Kong.  The most authoritative statement of the principle can be found in Lord Millet NPJ’s decision in the Court of Final Appeal in Waddington Ltd v Chan Chun Hoo (2008) 11 HKCFAR 370.

“47. A company is a legal entity separate and distinct from its members. It has its own assets and liabilities and its own creditors. The company’s property belongs to the company and not to its shareholders. If the company has a cause of action, this represents a legal chose in action which represents part of its assets. Accordingly, where a company suffers loss as a result of an actionable wrong done to it, the cause of action is vested in the company and the company alone can sue. This is the first rule in Foss v Harbottle(1843) 2 Hare 461. No action lies at the suit of a shareholder suing as such, though exceptionally he may be permitted to bring a derivative action in right of the company and recover damages on its behalf: see Wallersteiner v Moir(No 2) [1975] 1 QB 373 CA at p.390; Prudential Assurance Co Ltd v Newman Industries Ltd(No 2) [1982] Ch 204 CA (Prudential) at p.210; Johnson v Gore Wood & Co[2002] 2 AC 1 at p.61 et seq.

48. The injustice which would result if a derivative action were not available where the company is controlled by the alleged wrongdoers is vividly described by Lord Denning MR in Wallersteiner v Moir(No.2) (supra) at p.390:

‘But suppose [the company] is defrauded by insiders who control its affairs – by directors who hold a majority oftheshares –who then can sue for damages? Those directors are themselves the wrongdoers. If a board meeting is held, they will not authorise the proceedings to be taken by the company against themselves. If a general meeting is called, they will vote down any suggestion that the company should sue them themselves. Yet the company is the one person who is damnified. It is the one person who should sue. In one way or another some means must be found for the company to sue. Otherwise the law would fail in its purpose. Injustice would be done without redress.’ (Emphasis added.)

…

82. I explained the rationale of the principle in Johnson v Gore Wood & Co (supra) at p.62, where I said:

‘If the shareholder is allowed to recover in respect of such loss, then either there will be double recovery at the expense of the defendant or the shareholder will recover at the expense of the company and its creditors and other shareholders. Neither course can be permitted. This is a matter of principle; there is no discretion involved. Justice to the defendant requires the exclusion of one claim or the other; protection of the interests of the company’s creditors requires that it is the company which is allowed to recover to the exclusion of the shareholder.’

83. In Giles v Rhind(supra), Chadwick LJ said at p.643 that the principle laid down in Johnson v Gore Wood & Co(supra) did not apply where the claim is made against:

‘a wrongdoer who, in breach of his contract with the company and its shareholders, ‘steals’ the whole of the company’s business, with the intention that the company should be so denuded of funds that it cannot pursue its remedy against him, and who gives effect to that intention by an application for security for costs which his own breach of contract has made it impossible for the company to provide.’

84. In that case the company, which was in administrative receivership, brought proceedings against the wrongdoing director, who demanded and obtained an order for security for costs which successfully stifled the proceedings. When the company discontinued the action a shareholder brought proceedings on its own behalf to recover its own loss. It was conceded that this was reflective loss, but the Court of Appeal permitted the action to proceed.

85. It is impossible not to share the determination of the Court of Appeal not to allow a defendant who has been guilty of such conduct to escape liability. But with respect it could not be right to allow the shareholder to bring an action for its own benefit; this would entail recovery by the wrong party to the prejudice of the company and its creditors. It would produce precisely the result which I identified as unacceptable in Johnson v Gore Wood & Co(supra) at p.64D; it would allow the plaintiff to obtain by a judgment of the court the very same extraction of value from the company at the expense of its creditors that it alleged the defendant had obtained by fraud. The Court of Appeal vouchsafed no explanation to justify this result, an explanation which might be thought to be particularly necessary given that the company was in administrative receivership.

86. Some way needed to be found in Giles v Rhindwhich would allow the company to recover damages despite the discontinuance of its own proceedings. If the company had not been in administrative receivership, the simplest course would have been to allow the shareholder to bring a derivative action. As it was, this course would not have been open, for the company was no longer under the control of the wrongdoer. But the court could have given the shareholder leave to apply to direct the administrative receiver to bring the action if the shareholder was willing to fund it. The discontinuance should not have been an obstacle to either course. There is no logic in allowing such an action where the wrongdoers are in a position to stifle any proceedings by the company, and disallowing it where they have succeeded in doing so.

87. The Court of Appeal may have assumed that the principle established in Johnson v Gore Wood & Cois not engaged where the company has lost the right to sue.  But the House of Lords expressly applied the principle not only where the company had the right to sue but also where it had declined or failed to sue. There was nothing new in this.  In Prudential (supra) it had been submitted that a personal action at the suit of the shareholder will lie to recover reflective loss if the company’s remedy is for some reason not pursued.  The Court of Appeal countered the argument (at p.223) by posing the rhetorical question: “How can the failure of the company to pursue its remedy against the robber entitle the shareholder to recover for himself?”

88. The facts of the present case do not bring it within measurable distance of the exception described in Giles v Rhind.  But Barma J went further and held that the supposed exception does not exist, and I respectfully agree with him.  The case has been followed in England at first instance in Perry v Day[2005] 2 BCLC 405 and referred to without enthusiasm by the Court of Appeal in Day v Cook [2002] 1 BCLC 1 and Gardner v Parker[2004] 2 BCLC 554.  But in all these cases the court was bound by the decision in Giles v Rhind.  In my opinion Giles v Rhind and Perry v Daywere wrongly decided and should not be followed in Hong Kong.”

45.  A recent statement of these principles can be found in the case of Pico North Asia Holdings Ltd v Cheung Yuk Ting Linda & another, HCA 1371/2009, 8 February 2011,  Fok JA sitting as an additional judge of the Court of First Instance:

“4. The rule against reflective loss originates judicially in the decision of the English Court of Appeal in Prudential Assurance Co. Ltd v Newman Industries Ltd (No.2) [1982] Ch 204. The rule was authoritatively discussed by the House of Lords in Johnson v Gore Wood & Co. (a firm) [2002] 2 AC 1.

5. The following is the effect of the speeches in Johnson’s case as summarised by Blackburn J in Giles v Rhind [2001] 2 BCLC 582 (subject to two qualifications added by Chadwick LJ in the Court of Appeal in that case):

(1) A loss claimed by a shareholder which is merely reflective of a loss suffered by the company – i.e. a loss which would be made good if the company had enforced in full its rights against the defendant wrongdoer – is not recoverable by the shareholder, save in a case where, by reason of the wrong done to it, the company is unable to pursue its claim against the wrongdoer;

…

(3) the irrecoverable loss (being merely reflective of the company’s loss) is not confined to the individual claimant’s loss of dividends on his shares or diminution in value of his shareholding in the company but extends to all other payments which the shareholder might have obtained from the company if it had not been deprived of its funds and also to other payments which the company would have made if it had had the necessary funds even if the plaintiff would have received them qua employee and not qua shareholder, save that this does not apply to the loss of future benefits to which the claimant had an expectation but no contractual entitlement;

(4) the principle is not rooted simply in the avoidance of double recovery in fact; it extends to heads of loss which the company could have claimed but has chosen not to and therefore includes the case where the company has settled for less than it might; and

(5) provided the loss claimed by the shareholder is merely reflective of the company’s loss and provided the defendant wrongdoer owed duties both to the company and to the shareholder, it is irrelevant that the duties so owed may be different in content.”

46.  Mr Yau does not argue against these principles. The plaintiff is not even the registered shareholder of the 2 companies.  Without being granted the declaration of trust now sought, the plaintiff as an alleged beneficial ownership may not have the locus to institute a derivative action against the delinquent directors for the benefit of the 2 companies.  (The move to amend the statement of claim to add in the companies as defendants was not pursued by the time of trial, with express reservation of the right to institute a future action against the defendants, the companies, Lai Yee Fuk or other persons as the plaintiff deems fit.)  The plaintiff is not entitled to the other reliefs.

Order

47.  I order as follows:

(1) There be a declaration that each of the defendants had held the shares registered in his/her name in Fu Guang and Wellmax respectively on trust for the plaintiff absolutely. 

(2) There be an account, inquiry and tracing of all benefits received by each of the defendants whilst he/she remained registered shareholders of Fu Guang and/or Wellmax and the damages suffered by the plaintiff.

(3) Other reliefs sought are dismissed.

On a nisi basis:

(4) The costs of this action (including any costs reserved) shall be to the plaintiff, to be summarily assessed on 6 July 2012 on the papers without the need for attendance.

(5) The plaintiff shall file and serve a costs statement by 20 June 2012.

(6) The defendants shall file and serve grounds in objection by 4 July 2012.

(7) Any application to vary the order nisi in paragraphs (4) to (6) shall be made within 21 days of the handing down of this judgment.

48.  I am most grateful to Mr Yau, who has come into the picture at a very late stage after the pre-trial review, for his assistance.  I appreciate that whilst doing his best to advance the interests of his client, he has exhibited fairness in conducting this matter notwithstanding the absence of the defendants.