AKTIESELSKABET DANSK SKIBFINANSIERING (body corporate) v. ROBERT JOHN FRANCIS BROTHERS

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

FACV No. 25 of 1998

FINAL APPEAL NO. 25 OF 1998 (CIVIL)

(ON APPEAL FROM CACV NO. 107 OF 1997)

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D E C I S I O N

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Mr Justice Bokhary PJ:

1. I am asked to make two directions. In the fraudulent trading appeal, the respondents will say that concurrent findings of fact stand in the appellant's way, and that the Court ought not to disturb those findings. Indeed, the respondents have raised what they call an "objection" to the Court reviewing those findings; and they ask me, sitting as a single permanent judge, to direct that their objection be determined by the Court in a preliminary hearing to be held at the outset of the hearing of the appeals.

2. They seek an ancillary direction that the order of speeches in that preliminary hearing be as follows: Wheelock Marden; the other respondents; the appellant; Wheelock Marden; and finally the other respondents.

3. All of that impacts on the misrepresentation appeals in the following way. Two misrepresentations are alleged. The first involves the suppression of a cashflow dated 18 March 1983. It is said by the appellant that this cashflow painted a gloomy picture which contradicted earlier representations of an optimistic nature, so that its suppression constituted a misrepresentation. The second misrepresentation, which has been referred to as the "group" misrepresentation, involves the representation that the Wheelock Marden group stood behind Wheelock Maritime and its subsidiaries.

4. Accepting that sauce for the goose is sauce for the gander, the respondents accept that if a preliminary hearing is directed in regard to the appellant's attack on concurrent findings, then a similar preliminary hearing should be directed in regard to their i.e. the respondents' attack on the concurrent findings that the 18 March 1983 cashflow had been suppressed. I pause to mention that although the Court of Appeal overturned the judge's judgment in favour of the appellant on the misrepresentation claims, that court refused to disturb the judge's finding of suppression, and allowed the misrepresentation appeals on another basis.

5. As far as the "group" misrepresentation is concerned, the judge found that the representation in question had been made but that it had been made in an honest belief in its truth. The judge's finding of such belief was supported by the Court of Appeal. The existence or otherwise of such a belief is relevant to the fraudulent trading claim. And the concurrent findings of such belief are among the concurrent findings attacked in the fraudulent trading appeal.

6. The respondents say that the "preliminary hearing" direction which they seek would save time and costs. The appellant disputes this, and also says that a preliminary hearing would give the respondents the advantage of the first word and the last word, which advantage they would not otherwise have. It is not clear to me whether the appellant suggests that this consideration in any way motivates the respondents' application for a preliminary hearing. In any event, I am confident that the respondents seek such a hearing for the reason which they give, namely a desire to save time and costs.

7. Having said that, I am of the view that a preliminary hearing of the kind sought would not be an appropriate course in the present case. I doubt if preliminary hearings into objections to attacks on concurrent findings are generally appropriate or indeed ever appropriate. By their nature, such attacks tend not to lend themselves to preliminary hearings. Anyway, whether or not such hearings may be appropriate in some cases, I am firmly of the view that it would not be appropriate for me to direct such a hearing in the present case.

8. The fact that no such preliminary hearing is held does not by any means involve the Court being forced to listen at length to hopeless attacks on concurrent findings. In the appeal to the Privy Council from Hong Kong in M.E. Mak and Wocom Commodities Ltd [1997] HKLRD 43, counsel for the appellant was not permitted to develop all the points which he had outlined and hoped to deploy in his attack on concurrent findings. Of course I do not expect that counsel for the appellant in the present case will attempt to address the Court at length on hopeless points. I merely observe that there are, if the need arises, ways of controlling these matters without a preliminary hearing.

9. In the result, I decline to make a direction for a preliminary hearing.

10. Now that counsel know my decision as to that, I will hear them further on the other direction which I am asked to make, namely a direction as to the length of the hearing of the appeals.

[Further Submissions on Length of Hearing]

11. As to the length of the hearing of the appeals, the appellant now estimates 20 working days while the respondents now estimate 15 working days. At an earlier stage, the rival estimates were much further apart than that; but the gap has narrowed.

12. All things considered, I direct 15 working days, being three continuous weeks of five working days each, be set aside for the hearing of the appeals.

13. The parties will no doubt realise that the Court will expect the hearing to finish within that period, and will confidently place its faith in all counsel to use every endeavour to ensure that the hearing will finish within that period. But if for any reason it does not, the parties should know that is almost certain that the Court will continue with the hearing uninterrupted rather than adjourn to fresh dates.

[Submissions on Costs]

14. All counsel are agreed that "costs in the appeal" is the usual order for costs in regard to applications of this kind. But Mr Clifford Smith for the appellant submits that there are reasons in the present case for some costs order more favourable to his client. I can understand Mr Clifford Smith's submission here. But, all things considered, I propose to make the costs of this directions application costs in the appeal i.e. costs in the fraudulent trading appeal, FACV No. 27 of 1998.

Representation: