XCHRX MAK SHUI CHO & SON LTD. AND ANOTHER v. CHAN SHUK CHUN AND OTHERS

HCA 3265/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 3265 OF 2001

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R U L I N G

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1. Mr Li for the Plaintiffs today seeks the orders contained in the Plaintiffs' summons of 14 August 2001 in order to support the order for disclosure originally made by Waung J on 19 July 2001 as extended by Chu J on 27 July 2001.

2. Mr Li concedes that the orders he seeks today are wider than those made by Waung J but he contends that they are justifiable orders, firstly, to enable the Plaintiffs to locate the whereabouts of its assets which it seeks to preserve. He points out that, according to the Plaintiffs' calculation, a sum in the region of $5m. has not been accounted for and he also points out the paucity of assets any of the Defendants now admit in their affidavits that they possess.

3. Secondly, he contends that the orders are justifiable to enable the Plaintiffs to identify other possible wrongdoers in order that steps may be taken against them to preserve and recover the Plaintiffs' assets.

4. The 1st Defendant today appears in person. The 5th and 6th Defendants are represented by Mr Chow of Joseph S C Chan & Co.

5. Insofar as the 1st Defendant is concerned, the only part of the proposed order sought that affects her is in paragraph 1 of the summons. She states that she has no objection to an order being made in the terms of paragraphs 1(a), 1(c) and 1(d). She does object to providing copies of bank statements and passbooks as sought in sub-paragraph (b) as they would reveal details of her private transactions.

6. But as Steven Gee says in his work Mareva injunctions and Anton Piller relief, 4th edition at page 350:

" A disclosure order invades a defendant's privacy. Before judgment, a defendant is entitled to keep his financial affairs confidential. But this confidentiality may be overridden. Disclosure may be required if the information is relevant to the resolution of the issues in the case, or if it is needed to make Mareva relief effective. Confidentiality may have to give way to the doing of justice between the parties or to the advancement of the public interest."

7. In my view, the Plaintiffs have made out a strong case for the order they seek against the 1st Defendant, and indeed the other Defendants, if the Mareva order is to be effective, and the Plaintiffs' interests to which I have referred must override the 1st Defendant's right to privacy in respect of her bank statements and passbooks.

8. Mr Chow for the 5th and 6th Defendants argues that he has not yet taken full instruction from his clients as to their position on the Plaintiffs' allegations. It would therefore be wrong, he says, to make a wider order before his clients have had an opportunity to make an affidavit, or affidavits, in reply to the Plaintiffs' allegations. I would observe, however, that Mr Chow represented the 5th and 6th Defendants on the return day 27 July and that therefore the 5th and 6th Defendants had been represented for at least 21 days, which is adequate time for them to give instructions as to the essence of their allegations.

9. He further says that because some of the documents sought by the Plaintiffs in today's summons were seized by the Commercial Crime Bureau before he had an opportunity to advise the 5th and 6th Defendants whether they could claim privilege in relation to them, the court should not make any order until the 5th and 6th Defendants had been able to recover the documents or copies thereof from the Commercial Crime Bureau so the question of privilege can be considered in relation to the documents.

10. I recognise that the Defendants should not be deprived of an opportunity to raise the question of privilege in respect of particular documents and should have an opportunity to consider the question of privilege in relation to documents which are now in the possession of the Commercial Crime Bureau.

11. I recognise also that the order the court should make should make provision for the Defendants to make an application for an extension of time if they are unable to obtain documents from banks or the Commercial Crime Bureau within time to comply with the order of the court.

12. In the light of these considerations I am prepared to make an order in terms of the draft which has been submitted to me after lunch by Mr Li as amended.