CHAN CHEUNG HING v. CHAN TANT LAN AND OTHERS

IN THE COURT OF APPEAL

Civil Appeal

No. 156 of 1987

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J U D G M E N T

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Clough, J.A.

1. The plaintiff in this action appeals against the refusal of Mayo J., on the 10th November 1987, to grant him a Mareva injunction and other very wide ranging interlocutory discovery and relief against all four defendants.

2. The action is another round in protracted litigation between the plaintiff and the first defendant who were formerly husband and wife, I will refer to them as the husband and the wife respectively. The third defendant is the wife's son by a former marriage. The litigation began with divorce proceedings between husband and wife as long ago as 1979.

3. There is a history of bitterness and intransigence between the parties. They have been continuously at loggerheads over immovable property which was valued at $1.98 million on the 25th October 1983 when land values were lower than they are today. So far the husband has derived no benefit from any of the property. He is conducting, his litigation on legal aid. The wife has always been professionally represented. She has assigned away her interest in three of the four disputed properties to pay what must have been substantial legal fees. If this deplorable state of affairs is permitted to continue, and if the wife should become liable to pay further substantial legal costs, she will face financial ruin in her declining years.

4. The properties which are the subject of these proceedings and of the earlier consolidated divorce jurisdiction proceedings are as follows:

(a)    14-20 Wah Wing Industrial Building, 8th Floor, Workshop Unit C,, 14-20 WinegYip Street, Kwai Chung, New Territories ("the Workshop Unit");

(b)    2 Un Chau Street, 2nd Floor, Flat F, Kowloon ("the Un Chau Street flat");

(c)    2 Fat Cheung Street, Ground Floor and Cockloft, Kowloon.("the Fat Cheung Street property".); and

(d)    286-300 Cheung Sha Wan Road, South Ocean Building, 3rd Floor, Flat C, Kowloon ("the Cheung Sha Wan Road flat").

It will be convenient to refer to the properties mentioned at (b), (c) and (d) above together as "the non-industrial properties". At all material times until about the 23rd January 1987 all these Properties were held in the name of the wife only.

5. The stage was set for the present action by the following orders made in the consolidated divorce jurisdiction proceedings and by the events consequential to those orders. On the 16th December 1983, on the husband's application relating inter alia to all the above mentioned properties, Power J. made an order ("Power J.'s first order") under Section 6 of the Married Persons Status Ordinance (Can. 18.2) in respect of only the Workshop Unit which he directed to be sold and the proceeds divided equally between the husband and the wife. By the same order, which contained no directions under Order 31, the sale was directed to he left in abeyance with liberty to apply. On the 26th January 1984 the husband filed a notice of appeal against this order but abandoned the appeal on the 5th April 1984. The wife gave notice of appeal against the Same order on the 28th January 1984.

6. On the 12th March 1984, on the husband's application, Power J. made an order ("Power J.'s second order") under section 6(a) of the Matrimonial Proceedings and Property Ordinance (Cap. 192) directing, the wife to transfer "a half interest" in each of the non-industrial Properties to the husband. On the 25th April 1984 the wife gave notice of appeal against this order. Both the wife's appeal's, which had been consolidated, were eventually dismissed more than two years later on the 30th May 1986, not on the merits, but as the consequence of her unsuccessful appeal to this court against the order of Rhind J. made on the 7th April 1986 dismissing her appeal from the order of Master Woolley made on the 14th February 1986 dismissing her application to set down her appeals out of time.

7. Between the date of Power J.'s Second order and the dismissal of her consolidated appeals against both Power J.'s orders on the 30th May 1986 the wife did not comply with Power J.'s second order by transferring an undivided half share in the non-industrial properties to the husband.

8. However she saw fit, without reference to the husband or his advisers, to make lettings of two of the non-industrial properties and of the Workshop Unit.

9. On the 1st April 1986 the wife let the Fat Cheung Street property to the second defendant (who has sub-let at a substantially enhanced rent) for commercial purposes for a term of three years at a rent of $3,000 per month exclusive of rates, property tax and Crown rent, with a right to renew for a second term of three years at a rent which the landlord may increase by 20 per cent. On the 15th April 1986 the wife let the Un Chau Street flat to the third defendant (her son) for residential use at a monthly rent of $1,000 but otherwise for, the same term and upon the same conditions as in the case of the tenancy of the Fat Cheung Street property.

10. On The 1st, May 1986 the wife also let the Workshop Unit to the fourth defendant (a lady whom the husband claims to he closely associated with the third defendant) for commercial purposes at a monthly rent of $2,000 but otherwise for the same term and upon the same conditions, as in the case of the other properties previously let by her. This property was subsequently sub-let at a substantially enhanced rent.

11. On the application of the husband Power J. made another order ("Power J.'s third order") on the 28th July 1986 in the consolidated divorce jurisdiction proceedings. This order related to all the four properties. It directed that a half share in all the non-industrial properties he transferred to the husband forthwith and that the Workshop Unit he sold forthwith and the net proceeds of sale be equally divided between the husband and the wife. By the, same order the wife was directed to furnish accounts in respect of the four properties to the husband within 14 days.

12. Notwithstanding Power J.'s third order, the wife saw fit, on the 1st August 1986, to let the Cheung Sha Wan Road flat to the fourth defendant for no specified purpose at a rent of $1,000 per month but otherwise for the same term and on the same conditions as in the case of the lettings of the other properties. The husband claims, in reliance.on Professional valuation evidence, that in all cases these lettings have been made at a substantial undervalue which has had a corresponding depreciatory effect on the value of his half share in the reversion of all the properties. Indeed the husband contends that the lettings were effected at a rent which produces no income for him after the discharge of management outgoings.

13. The next move by the wife was the sale of her half share in the three non-industrial properties. On the. 1st October 1986 she assigned her half share in the reversion in the Un Chau Street flat (which she had previously let to the third defendant) to the fourth defendant for a price of $70,000. On the same day the wife assigned her half share in the reversion in the Fat Cheung Street property (which she had previously let to the second defendant)_.to the third defendant for a price of $220,000. On the 3rd November 1986 the wife assigned her half share in the reversion in the Cheung Sha Wan Road flat (which she had previously let to the fourth defendant) to the third defendant for a price of $55,000.

14. By this time the position was that the wife had parted with all her beneficial interest in all the non-industrial properties for a total consideration of $335,000. The effect of her lettings and assignments was that, pending compliance with Power J.'s second and third orders by the assignment of one half share in each of the non-industrial properties to the husband, the third and fourth defendants together controlled the Un Chau Street and Cheung Sha Wan Road flats and the second and third defendants together controlled the Fat Cheung Street Property. In reliance on professional valuation evidence, the husband contends that having let the non-industrial properties at a substantial undervalue, the wife had sold her reversionary half interest in those properties at a substantial undervalue.

15. After Power J.'s third order made on the 28th July 1986 efforts on the part of those advising the husband to bring about the sale of the Workshop Unit were of no avail. This is hardly surprising having regard to the generality of the order in question. The wife's deliberate continued failure to transfer a half share in the non-industrial properties to the husband resulted in the making of a peremptory four day order by Mayo J. on the 12th January 1987, on the application of the husband, directing the wife to make the transfers in compliance with Power J.'s third order. In default of compliance by the wife the Registrar of the Supreme Court was required by Mayo J.'s order to execute the necessary assignments. This he did on or about the 23rd January 1987 after the wife had remained in default.

16. After an acrimonious exchange of correspondence between the parties' advisers regarding the disposal of the net proceeds of the pending sale of the Workshop Unit pursuant to power J.'s third order, the husband issued a summons in the consolidated divorce jurisdiction proceedings on the 17th March 1987 for an injunction restraining the wife from disposing of the net proceeds of the sale in question which was then due to take place on the 23rd March 1987 by public auction with a reserve of $700,000.

17. The auction proved abortive on the 23rd March 1987 because the highest bid was only $400,000. The wife's solicitors indicated that they had instructions to put the property up again for sale by auction as soon as possible with a reserve price of $380,000, but this was strongly opposed on behalf of the husband. After further inconclusive correspondence Mr. Harrison for the Director of Legal Aid sent a letter dated the 27th April 1987 on the husband's behalf to the wife informing her that the director proposed "in due course" to issue a writ against her to restrain her until further order from selling the Workshop Unit and seeking to set aside the fourth defendant's tenancy of that property which had been granted on the 1st May 1986. The letter went on to say as follows:-

"I am advised that as a constructive trustee of the property you should not take any steps to dispose of the property before an application for an injunction is made. This letter serves to give you express notice of the trust affecting the property. As a constructive trustee you are, of course, obliged to perform certain judicial obligations in respect of this property, or otherwise account to the Court."

18. A letter in corresponding terms was sent to the wife's solicitors and to the auctioneers, both of whom were informed that they were "in effect" constructive trustees of the Workshop Unit together with the wife and that, as such, they should not take any steps to dispose of the property before an application for an injunction was made.

19. These letters make strange reading in the light of Power J.'s third order under which the wife was bound to sell the Workshop Unit forthwith. The proper course at this time would have been for the husband to apply to the judge seised of the consolidated divorce jurisdiction proceedings for a stay sine die of Power J.'s third order in so far as it related to the Workshop Unit in order to enable the husband to bring separate proceedings before the sale to set aside the tenancy and possibly the sub-tenancies affecting the Workshop Unit.

20. Be that as it may the letters in question resulted in a deferment of the sale of the Workshop Unit by the wife. It was not until more than three months later that her solicitors, by a letter dated the 3rd August 1987, wrote to the Director of Legal Aid, referring to Mr. Harrison's letter of the 27th April 1987 and expressing the belief that as the Director no longer seemed interested in applying to the court, they intended, unless they heard from him to the contrary, to suggest to the wife that they should comply with Power J.'s third order (for sale of the Workshop Unit) without further delay. At this stage' the writ in the husband's new action, with which this appeal is concerned, had been issued on the 30th July 1987, but it had not yet been served. Personal service of the writ was effected on the wife on the 10th August 1987.

21. The husband's new action is founded on breach of trust claims against all the defendants. The Statement of Claim is lacking in several respects in material averments. Thus no mention is made of power J.'s orders affecting the properties which must be the basis for contending that the wife is a trustee of the Workshop Unit for herself and the husband in equal shares, that until the 1st October 1986 she held the Un Chau Street flat and the Fat Cheung Street property on similar trusts and that until the 3rd November 1986 she held the Cheung Sha Wan Road flat on similar trusts.

22. The lettings of all the properties by the wife are pleaded and alleged to have been effected in breach of trust by reason of the length of the terms (with options to renew) and the insufficiency of the rent. The assignments by the wife of her half share in the three non-industrial properties are alleged to have been effected in breach of trust. The basis of this last alleged breach of trust is pleaded in a manner which I find obscure.

23. Suffice it to say for the purposes of this appeal that the third and fourth defendant's are alleged in paragraph 13 to have become on the 1st October 1986, constructive trustees of the Fat Cheung Street property and the Un Chau Street flat respectively and the third defendant is alleged in paragraph 17 to have become on the 3rd November 1986 a constructive trustee of a "half legal interest" in the Cheung Sha Wan Road flat. In each case the constructive trusts are alleged to be "to hold the same for the benefit of the husband and the wife in equal shares subject only to any competing equitable interests." In paragraph 19 it is pleaded that the second, third and fourth defendants "are constructive-trustees in respect of the trusts in the properties.'

24. The relief sought in the prayer to the Statement of Claim is extremely wide ranging and includes a claim for an injunction to prevent all the defendants "disposing of trust property", the appointment of a receiver, accounts, an order effecting, the reconveyance "to the trustee of any properties disposed of in breach of trust" and damages for breach of trust.

25. The husband's summons for interlocutory relief which has given rise this appeal was issued on the 7th. August 1987 and was heard by Mayo J. on the 10th November after a welter of evidence had been filed by all the parties including allegations and counter allegations going right back to the beginning of the divorce jurisdiction proceedings. As a result the appeal bundles number over 700 pages.

26. Relief was sought by the husband's summons by reference to an attached draft order which contained no cross undertaking as to damages by the husband and applied for an order of unprecedented scope and form. It was sought to injunct all the defendants from disposing of any of their assets (without any specified limit) except with the "express written permission of the court". Each of the defendants was to be permitted to "receive and thereafter to spend" $5,000 per month "provided that each Defendant accounts to the plaintiff or his solicitor to his or its reasonable satisfaction as from where the money is received".

27. Discovery of assets was to be required from all the defendants and it was sought to obtain an order that they should answer a number of questions concerning the identity of the tenants, licensees and occupants of the relevant properties and the terms of each licence or tenancy. All such discovery was to be verified on oath or affirmation.

28. After a two day hearing the judge dismissed the plaintiff's application to grant any relief against the second, third and fourth defendants. It is not necessary to consider his reasons for that decision because counsel for the husband, Mr. Spicer, withdrew the appeal as regards those defendants on the first day of the hearing of the appeal after it had been pointed out to him that the Statement of Claim lacked the necessary material averments upon which to found a plea of constructive trusteeship against those defendants.

29. As regards the wife, the judge was satisfied that an arguable case had been made out that she had become a constructive trustee of the properties affected by Power J.'s orders and that she had been guilty of breaches of trust by reason of the letting of the properties at an undervalue.

30. Subject to the overriding question of the balance of convenience on consideration of the evidence as a whole, one of the two essential requirements for the granting of a Mareva injunction laid down in Ninemia Maritime Corporation v. Trave Schiffahrtsgesellschaft⁽¹⁾ is that a plaintiff must show at least a good arguable case. While the judge's reference in his judgment merely to an arguable case may therefore be open to criticism, I have no doubt that the valuation evidence and the evidence of actual sub-letting rentals adduced on behalf of the husband was ample to satisfy the Ninemia⁽¹⁾ test of a good arguable case of breach of trust by the wife in relation to her sub-letting of the properties. The assignments are quite a different matter concerning, which the judge did not commit himself` one way or the other. For my part I am unable to see any basis for the contention that the wife was in breach of trust when she assigned away her own half share in the non-industrial properties.'

31. The second essential requirement for a Mareva injunction laid down in the Ninemia⁽¹⁾ case, is, assuming that the husband has shown at least a good arguable case, does the court conclude on the evidence as a whole that the refusal of a Marewa injunction would involve a real risk that a judgment in favour of the husband would remain unsatisfied? The judge concluded that the husband had not' satisfied this requirement.

32. As regards the Workshop Unit he referred to the correspondence which had been exchanged between the Director and the wife's solicitors with a view to the sale of that property for the mutual advantage of husband and wife. He observed that the wife had undertaken not to sell the property without prior notice to the husband.

33. As regards the non-industrial properties, the judge indicated that there was no evidence that the wife had attempted to sell the husband's interest in them. In his view the evidence fell short of establishing that there was a risk of dissipation of assets by the wife and he warned himself against simply providing a security for the husband before judgment yet to be obtained.

34. A further matter which weighed heavily with the judge in relation to the application generally was delay. He pointed to the fact that the husband had become aware in September 1986 of the lettings of the properties effected by the wife and he had become aware in October 1986 of her sales of her half interest in the no-industrial properties. I mention that the assignment of the wife's half interest in the Cheung Sha Wan Road flat was not in fact made until the 3rd November 1986. The judge mentioned also that the delay on the part of the husband had been prejudicial to the defendants in that there had been knowledge of the wife's lettings. he concluded:-

"By its, very nature time is an important element in a genuine mareva situation. I think that the delay of itself would have been sufficient to justify my withholding granting the injunctions sought."

35. The judge declined to accede to a submission by Mr. Spicer for alternative relief which appears to have been made in Mr. Spicer's reply after counsel for the defendants had addressed the court on the Mareva issue. He stayed his decision on the husband's summons pending the hearing by him on the next day of an application by the husband in the consolidated divorce jurisdiction proceedings for the appointment of a receiver to get in inter alia the husband's income derived from the Workshop Unit and to carry out Power J.'s first and third orders relating to that property. That application resulted in a consent order of Mayo J. to which I will refer later, but the judge's decision on the Mareva application was not the subject of any further stay and Mayo J.'s order dismissing the application was dated the 10th November 1987.

36. By his notice of appeal the husband sought to have Mayo. J.'s order dismissing the husband's Mareva application set aside and to obtain an order in terms of the husband's summons dated the 7th August 1987. In the alternative the husband sought an injunction to prevent the distribution of any of the proceeds of sale of the Workshop Unit to the wife.

37. At the hearing of the appeal Mr. Spicer never abandoned the claim for the wider relief sought by reference to the draft order annexed to the husband's summons but he did not press his arguments in Support of this relief. In my judgment this was a hopeless cause. Considering the evidence as a whole it clearly showed that the only available asset of the wife upon which a Mreva injunction could bite was her interest in the Workshop property. She had sold her half shares in the non-industrial properties by the 3rd November 1986 and thereby raised a total sum of $355,000 in order to solve her financial problems and pay her solicitors fees, which must have been substantial bearing in mind that the hearings before Power J. had taken 8 days and that she was the subject of adverse orders as to costs in relation to those hearings and in relation to her abortive appeal from the orders of Power J. Her legal costs alone must have exhausted most of the proceeds of sale of her interest in the non-industrial properties.

38. The second, third and fourth defendants having been eliminated from the appeal it soon became apparent that, as regards the wife, the appeal was only really concerned with her  interest in the Workshop Unit. In relation to this property Mr. Spicer contended that the evidence established that there was a real risk that the wife would dispose of her interest in the proceeds of sale yet to be realised. This was a new point which had not been raised below on behalf of the husband, although we were told by Mr. Spicer that the judge himself had raised the question of the possibility of the wife selling her half interest in that property and had been told by Mr. Tsang, counsel for the wife that she was prepared to give an undertaking not to do so.

39. Assuming, without deciding, that the evidence (particularly the evidence of the wife's deliberate underlettings at undervalue and her contumacious disregard of Power J.'s second and third orders requiring her to make transfers to the husband) showed a real risk of the wife making an anticipatory disposal of her entitlement to the future proceeds of sale of the Workshop Unit, this possibility was never relied upon by the husband before Mayo J. Accordingly, in my judgment, he is not to be faulted on this appeal for not considering it when accepting that the disposal of the Workshop Unit by the wife otherwise than in accordance with Power J.'s third order was ruled out by the proposed undertaking mentioned by counsel during the hearing below.

40. Mayo J. did not make his final decision on the Mareva application until after he had made a consent order on the husband's application for the appointment of a receiver in the consolidated divorce jurisdiction proceedings on the 11th November 1987. That order is strangely drafted but I consider it to be sufficiently clear in its terms to appoint a receiver to get in the husband's income entitlement from the Workshop Unit pending sale and to carry out or procure the carrying out of the sale of that property directed by Power J.'s first and third orders.

41. The orders directed that the net proceeds of sale of the property were to be divided between the husband and the wife, but it seems to be implicit from the terms of the consent order made by Mayo J. that the receiver was to sell the property as an officer of the court authorised to be the vendor, to receive the purchase price from the purchaser and divide the net proceeds of sale between the husband and the wife with the approval of the court after discharging the expenses of the sale and passing his accounts.

42. The consent order lacks the usual directions for the receiver's remuneration, for the passing of his accounts and disposal of the net balance upon the order of the court to he found in a well drawn receivership order but, there being no provision in the order for the receiver's discharge, he would in due course have to obtain it by order of the court on the application of the husband as the party having the conduct of the proceedings: Kerr on Receivers, 17th edition, at p. 248; Atkin's Court Forms, 2nd edition, Vo1. 33 (1981 Issue) p. 162. The order of discharge would direct him to pass his final accounts and direct the manner of disposal of the net balance in his hands: see Atkin, Vol. 33, p. 248, Form 85.

43. It therefore seems to be inconceivable that any receiver nominated pursuant to the consent order (which was suspended but will be activated when this appeal is disposed of) would, as an officer of the court, contemplate distributing the net proceeds of a future sale of the Workshop premises to the husband or the wife until he has passed his final accounts in court and obtained the approval of the court for the distribution of the final balance in his hands in accordance with Power J.'s third order.

44. This means that there is no realistic possibility of the wife's half share of the net proceeds of sale of the Workshop Unit being, paid to her by the receiver without the husband having, ample opportunity to intervene if he has cause to do so. The need for the alternative relief sought in the husband's notice of appeal (an order preventing distribution of any of the net proceeds of sale to the wife) therefore does not arise at the present juncture.

45. Moreover, in view of the husband's genuine claim that the wife has sought to diminish the value of the Workshop Unit realisable on the execution of, the sale directed by Power J.'s second and third orders, I apprehend that he will he advised to apply to the judge seised of the divorce jurisdiction proceedings for a stay of the execution of Power J.'s third order (in so far as it directs a sale of the Workshop Unit) until the husband's breach of trust action is concluded and, if the husband succeeds, at least the tenancy granted by the wife to the fourth Defendant on the 1st May 1986 has been set aside. It is reasonable to expect that such action will be taken. If it is, it will be an additional reason for concluding that the alternative relief sought by the husband in the notice of appeal is not necessary.

46. No application to amend the notice of appeal was made to bring it in to line with Mr. Spicer's contention that the judge should at least have granted a Mareva injunction restraining the wife from disposing of her interest in the proceeds of sale of the Workshop Unit. Instead Mr. Spicer submitted that the court was under a duty, where wide interlocutory relief was sought, to consider whether the applicant; although not entitled to the aide relief sought, was entitled to a lesser degree of relief. He had evidently made a similar submission below, but not in terms by reference to the possible disposal by the wife of her interest in the proceeds of sale of the Workshop Unit.

47. In support of his submission Mr. Spicer relied on the dictum of Scott J. in Columbia picture Industries v. Robinson⁽²⁾ at p. 445 where that judge said:

"It is also alleged that a breach of duty was committed by the plaintiffs, solicitors and counsel in seeking an order in unnecessarily wide and onerous terms. This, too, is based on the dictum of Dillon L.J. In the Booker McConnell case that I have already read. In that dictum the learned Lord Justice expressed the view that it was the duty of solicitors and counsel to give careful consideration to the necessity of seeking Anton Piller relief. It is consistent with that view to regard the solicitors and counsel as under a duty also not to seek an order,in unnecessarily wide terms. These considerations underline the basically unsatisfactory nature of Anton Piller procedure. The safeguard against orders that ought not to be made or against orders made in unnecessarily wide terms is, or ought to be, the judge. The solicitors and counsel must obviously accent the duty of ensuring that full disclosure of all relevant material is made to the court. But if that. duty of full disclosure is discharged, why should not solicitors and counsel apply for the most favourable order they can persuade the court to grant?"

48. Properly understood in its context Scott J.'s dictum does not, in my judgment, support any basis for faulting Mayo J. for not granting relief in a form that was never sought below on behalf of the husband. Scott J. was considering, in the Columbia picture Industries⁽²⁾ case, the position of a judge when wide Anton Piller relief is being sought from him ex parte. The issue to which Scott J. was addressing his mind was whether solicitors applying ex parte for Anton Piller relief on behalf of plaintiffs in a video piracy case are under a duty not, to seek an order in unnecessarily wide and onerous terms. It had been contended before him that there was a dictum of Dillon L.J. in Booker McConnell plc. v. Plascow⁽³⁾ at p. 441 which impliedly indicated the existence of such a duty. Scott L.J. went on to express his doubts in the Columbia picture Industries Case at p. 446 whether such a duty existed.

49. It seems to me that to hold that a solicitor or counsel is not in breach of duty to the court if, after making full disclosure of all material matters, he applies for relief in too wide or onerous a form, because it is for the judge to ensure that relief is not granted in the form of an order which should not be made, is by no means to be understood as implying that if a judge refuses interlocutory Mareva relief which is far too wide against all the assets of four defendants, he is to be held on appeal to have wrongly failed to grant very much narrower Mareva relief relating to a specified asset of one of the four defendants when that relief was never sought below as an alternative to the wider relief.

50. I agree with Mr. Tsang, counsel for the wife, that to accede to Mr. Spicer's argument would be not only to misapply Scott J.'s dictum cited above but also open the floodgates to appeals from judges' decisions on interlocutory applications deliberately framed in the widest possible terms with a view to a subsequent appeal seeking narrower relief if it suited the plaintiff. In the present case it is true that Mr. Spicer did address the judge regarding, the possibility of alternative relief. However he told us that he never asked the judge for an order to restrain the wife from disposing of her interest in the proceeds of sale of the workshop Unit but adopted a broader approach. Moreover no application was made to amend the notice of appeal to seek the relief for which Mr. Spicer contended at the hearing, of the appeal.

51. For my part I entertain the gravest doubt whether there can be any basis for granting an inter partes interlocutory Mareva injunction to any plaintiff who has all the information relied upon to infer a real risk of dissipation of assets by the defendant but writes a letter before action to the defendant indicating that he intends "in due course" to start proceedings and then waits for 3 months before issuing his writ and applying for a Mareva injunction. Such conduct is not consistent with a sense of urgency or a genuine belief in a real risk of dissipation of assets.

52. Be that as it may, we were informed by Mr. Tsang on the second day of the hearing of the appeal that it was the intention of his client when giving her undertaking in the consent order made by Mayo J. on the 11th November 1987 that the undertaking should be understood to extend to any disposition by the wife of her interest in the Workshop Unit. This would of course catch her interest in the proceeds of sale of that, property. Once Mr. Tsang, had made this clear it was apparent that the husband had been given the relief he was belatedly seeking at the hearing of the appeal.

53. Mr. Spicer pointed out that the undertaking was expressed to extend "until released by the Court". For my part I do not accept that such language must be taken to mean that the dismissal of the husband's application for a Mareva injunction and of this appeal would necessarily result in the wife making a successful application for the release of her undertaking. The very fact that Mr. Tsang said what he did on the appeal regarding the undertaking seems to me to militate against such an application being contemplated.

54. However the undertaking in the consent order was expressed to apply to dispositions of "the property the subject of this summons" (sic). I have no difficulty in relating the undertaking to the Workshop Unit, but it seems to me that the words used are not capable of being construed naturally to extend to a disposition of the wife's interest in the proceeds of sale of that property.

55. Nevertheless, on reflection I do not consider that in all the circumstances it could be right on appeal to entertain on its merits for the first time the contention of Mr. Spicer that a Mareva injunction against the wife limited to her share of the proceeds of sale of the Workshop Unit should be granted to the husband. The undertaking in the consent order of Mayo J., as elaborated by Mr. Tsang, renders this exercise unnecessary in any event.

56. Furthermore, although Mr. Tsang's elaboration of the undertaking came late in the day, it seems to me that if the wife had been given notice of the husband's intention to seek an order on appeal injuncting the wife from disposing of her interest in the proceeds of sale of the Workshop Unit she may (as Mr. Tsang pointed out) have sought leave to file further evidence of her intentions. The fact that Power J. found her evidence in the divorce jurisdiction proceedings to be wholly lacking, in credibility does not mean that any subsequent evidence adduced by her must necessarily be given no credence. More significant is the likelihood that her counsel or solicitors would have indicated before the hearing of the appeal that their client intended her undertaking in the consent order to inhibit her from disposing of her interest in the proceeds of sale of the Workshop Unit. This would have saved the costs of the appeal.

57. Accordingly I would dismiss this appeal. Now that there are two distinct sets of concurrent proceedings subsisting in which both the husband and the wife are parties I would order a speedy trial of the pending breach of trust action with full supervisory directions with a view to resolving expeditiously the uncertainty concerning the fourth defendant's tenancy of the Workshop Unit, so that the reversion on that property can he sold in the most advantageous manner in compliance with Power J.'s third order. It is imperative that the court should see to it that further delays in the proceedings between husband and wife, which began as long ago as 1979, be prevented in the interest of all concerned.

58. At the hearing of this appeal we indicated that we would hand down our judgment under Order 42 rule 5B without requiring, the attendance of counsel in order to give counsel the opportunity to consider the judgment before addressing us further as to costs and as to the form of order to be made. Arrangements should now be made for this court, as presently constituted, to be re-convened for further argument on those matters on a date to be fixed in consultation with counsel.

Fuad, J.A.:

59. I agree that the appeal should be dismissed for the reasons given by my Lord. I also agree with the form of the order he has proposed and outlined.

Hunter, J.A.:

60. I also agree.

(1) [1983] 2 Lloyd's Rep. 600 (C.A.)

(2) [1986] F.S.R. 367

(3) [1985] R.P.C. 425