RHONDA JEANINE POHN v. MAC RICHARD POHN AND OTHERS

HCA 1381/2010

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1381 OF 2010

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D E C I S I O N
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1.  This is an application by the 1st defendant for leave to appeal against my refusal on 12 March 2015 to vary or discharge a proprietary injunction granted by Deputy High Court Judge Mayo on 5 October 2012 which enjoined the defendants from dealing with or withdrawing any money or assets of the 2nd defendant.

2.  After the injunction was granted ex parte on 5 October 2012, the defendants did not seek its discharge but consented through their legal representatives on 6 November 2012 to its continuation until trial or further order.  Since then, there was no material change in the circumstances regarding the grant of the injunction.  I therefore did not entertain the 1st defendant’s application made on 14 January 2015 for discharge of the injunction.

3.  The trial of the action has now been fixed to commence on 27 May 2015.

4.  Regarding the variation of the injunction for release of funds for the defendants to contest the plaintiff’s claim, since this is a proprietary injunction, the 1st defendant has to demonstrate with full and frank evidence that there are no other available assets that can be used to pay his legal expenses (see para 29/1/35 of Hong Kong Civil Procedure 2015). 

5.  The application was in fact adjourned on 27 January 2015 for the 1st defendant to file further affidavit to set out his financial circumstances and how they had changed since 2012.  But he failed to make good use of the opportunity. I found in my decision that he had not given full and frank evidence of his existing financial situation or to explain what had happened to the US$1.3 million which he had withdrawn from the 2nd defendant in and before April 2010.  I therefore dismissed the application for variation as well.

The legal principle

6.  The 1st defendant now seeks leave to appeal under section 14AA(1) and (4) of the High Court Ordinance, Cap 4 and O 59 r 2B of the Rules of the High Court.  Sections 14AA(1) and (4) of the Ordinance provide.

“(1) Except as provided by rules of court, no appeal lies to the Court of Appeal from an interlocutory judgment or order of the Court of First Instance in any civil cause or matter unless leave to appeal has been granted by the Court of First Instance or the Court of Appeal.

…

(4) Leave to appeal for the purpose of subsection (1) shall not be granted unless the court 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.”

This application is made under section 14AA(4)(a).

7.  It has been explained in the case of SMSE v KL [2009] 4 HKLRD 125 at para 17 per Le Pichon, JA that “reasonable” means more than fanciful but without having to be probable.

8.  The grounds of appeal are in the 1st defendant’s written submissions.  His first ground is that I had put too much emphasis on financial disclosure by him rather than the length of delay by the plaintiff which prejudiced him.

9.  This ground is an excuse for his failure to be full and frank on his financial situation which is a must for the variation of a proprietary injunction.

10.  Regarding the delay, I have already dealt with it in para 25 of my decision.  I said that the 1st defendant had not pin-pointed any period of inactivity or delay for which the plaintiff should be responsible.

11.  The 1st defendant also argued that it was wrong for me to say that he should have explained the whereabouts of the US$1.3 million that he had withdrawn from the 2nd defendant.  He said he had no such discovery obligation. I think he has misunderstood the reason why I regarded it important that he should account for the whereabouts of that money.  The reason being that if he is still sitting on that money, then he would have no ground for release of funds from the 2nd defendant by varying the injunction.

12.  Apart from the above, he also made some other arguments on the facts which I do not think are of significance in relation to this application.

13.  All in all, I find that the 1st defendant has not given any ground which would give a reasonable prospect of success to the appeal.

14.  I therefore dismiss the application with costs against the 1st defendant.