WFM MOTORS PTY LTD. v. MALCOLM MAYDWELL

CACV 148/1995

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 148 OF 1995

(ON APPEAL FROM HCMP NO. 1405 OF 1994)

---------------------------

----------------------

J U D G M E N T

----------------------

Nazareth V-P:

1. This is an application by the solicitors of the plaintiff, WFM Motors Pty Ltd, "for an order that a sum of $100,000 together with interest thereon in the Court of First Instance to the credit of this matter be paid out to the [plaintiff's] solicitors on its own authority, alternatively for directions as to the conduct of this application".

2. The sum was paid in by the defendant, Malcolm Maydwell, pursuant to the order of the Court of Appeal dated 16 February 1996, in the context of the defendant's application for leave to appeal to the Privy Council. In the event, the Privy Council's advice was against the defendant who was ordered to pay costs.

3. A bankruptcy order was made against the plaintiff and the Official Receiver appointed trustee in bankruptcy. The defendant's solicitors now seek payment out of the entire sum of $100,000 with the interest thereon. In that regard the Official Receiver is concerned about the interest of other creditors and thus associates himself with the application to have the matter in effect sanctioned by the Court. Besides it is very doubtful whether a single judge of this Court now has jurisdiction to decide this matter, but the parties have agreed that this would be expeditious and save costs and therefore to abide by the decision of a single judge of this Court. Purely upon that not wholly satisfactory basis, I have decided to entertain the application.

4. The applicants, i.e. the defendant's solicitors, rely primarily upon the wording of Rule 4(a) of the Order-in-Council regulating appeals from the Supreme Court or Court of Appeal for Hong Kong to Her Majesty-in-Council made in 1909. Rule 4(a) provides that:

"Leave to appeal under Rule 2 shall only be granted by the Court in the first instance that

(a) upon condition of the Appellant, within a period to be fixed by the Court, but not exceeding three months from the date of the hearing of the application for leave to appeal, entering into good and sufficient security, to the satisfaction of the Court in a sum not exceeding $100,000 for the due prosecution of the Appeal and the payment of all such costs as may become payable to the Respondent in the event of the Appellant not obtaining an order granting him final leave to appeal, or of the Appeal being dismissed for non-prosecution, or of His Majesty in Council ordering the Appellant to pay the Respondent costs of the appeal (as the case may be);

..."

5. For his part, the Official Receiver's concerns stem from the actual wording of the formal order of the Court of Appeal made on 16 February 1996. The material part of this was couched in the following terms:

"CONDITIONAL UPON the Defendant within 3 months from the date hereof entering into good and sufficient security to the satisfaction of the Court in the sum of HK$100,000 for the due prosecution of the appeal and the payment of all such costs as may become payable to the Plaintiff in the event of the Defendant not obtaining an order granting final leave to appeal;"

As is plain, the order does not include the other two conditions that appear in Rule 4(a). That could possibly be thought to imply that it is only the two conditions included to which the security relates. However, it seems to me that the exclusion of the other conditions may well have been an oversight. That view is entirely consistent with the words of the judgment. This can be seen from pages 3R to 4C of that judgment handed down on 29 February 1996:

"We therefore gave leave to appeal subject to the following:-

(1) The Defendant to provide security for the costs of the appeal in the sum of $100,000 within 3 months."

That with respect, would have been the normal and entirely correct framing of the order in my view, since it would then have imported the conditions or purposes of the security that on my reading of Rule 4(a) appear to be mandatory. In those circumstances, I have no hesitation in concluding that all four conditions apply to the security, notwithstanding that only two happened to be included in the formal order. It follows that, in my view, the application should be granted.

6. There will accordingly an order for payment out in terms of the application to the plaintiff, i.e. the WFM Motors Pty Ltd solicitors on their own authority. I make no order as to costs pursuant to the agreement of the parties as to that.