FAN YIN WA v. LEUNG MEI YEE

DCMP 2181/2023

[2023] HKDC 831

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 2181 OF 2023

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DECISION

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Introduction

1.  This is an application by the Plaintiff (“P”) by inter parte summons dated 17 May 2023 (“the Summons”) against Hang Seng Bank Limited (“the Bank”) pursuant to section 21 of the Evidence Ordinance, Cap. 8 (“EO”) and the inherent jurisdiction of the Court for an order that the Bank do within 28 days provide P true copies of the following documents:

(a)  The monthly bank statements of the Defendant’s account no. 789492113668 with the Bank (“the Account”) for the period between 1 April 2022 to the date of the Order to be made herein;

(b)  If, on or after 2 May 2022, there has been any transfer of money from the Account to any other bank accounts of the Defendant held with the Bank, the monthly bank statements of the account(s) into which such money was transferred from the date of such transfer to the date of the Order to be made herein; and

(c)  If, on or after 2 May 2022, there has been any transfer of money from the Account to any bank account in the name of the Defendant but held in a bank other than the Bank or to any account held in the name of other third party in whichever bank, such document sufficient to show the identity of the transferee, the bank account number, bank name, the amount and the date of the transfer(s).

2.  The Defendant and the Bank have been served the Summons and the supporting Affirmation of P.

3.  By a letter dated 24 May 2023 to P’s solicitors, the Bank indicated therein that they will adopt a neutral stance in respect of the Summons and will not attend today’s hearing.

4.  The Defendant and the Bank have not appeared at today’s hearing.

5.  After hearing Ms Lam, solicitors for P, I granted an order in terms of the Summons save as narrowed by me. Here are my reasons.

Background

6.  P claims she is a victim of an online fraud.

7.  According to P, she received a message from a person called 王斌 (“Wang”) on Facebook messenger on 7 February 2022.

8.  Wang told P that that he came from Nanjing, China to Hong Kong and worked at an information technology (“IT”) company. He said he did not have any siblings and his parents passed away when he was young. As P felt sympathetic to Wang, they started to chat on “WhatsApp” and over time developed an online romantic relationship.

9.  On about 18 February 2022, Wang introduced P to a bogus online investment platform (www.larcmacb.online/h5) (“the Website”) which he boasted because of his IT skills was able to make modification to the Website and adjust the return rate of his investment. Wang eventually persuaded P to register her own account and make investment through the Website.

10.  Between 20 February 2022 and 14 April 2022, P repeatedly transferred various sums of money to bank account numbers as advised by the customer service officer of the Website as investment. When she tried to withdraw her investments, she was told she had to transfer further sums to settle tax and other fees. After further money transfers, eventually, when P realized that she could not withdraw her investments, she stopped transferring any more money. However, P said she believed at that time that Wang would pay her back for the money lost in the investment through the Website.

11.  In around May 2022, Wang requested P to help repay money he owed to money lenders and said that he would repay P when he returned to Hong Kong from Macau.

12.  P agreed and as directed by Wang:

(1)  On 2 May 2022, P transferred HK$80,000.00 from her Bank of China account to the Account; and

(2)  On 4 May 2022, P further transferred HK$100,000.00 from her Bank of China account to the Account.

13.  Between 2 and 4 May 2022, P also remitted various sums to various other bank accounts on the instructions of Wang purportedly to repay other debts of Wang.

14.  On 4 May 2022, when Wang should have returned to Hong Kong, P kept on calling Wang but Wang did not pick up the phone. It was then that P realized that she had been defrauded by Wang.

15.  On 5 May 2022, P reported the matter to the Police.

16.  In total, between February to May 2022, P claims to have suffered a loss of over HK$1,250,000.00 as a result of the fraud.

17.  According to the Police’s letter dated 3 January 2023 (“Police’s Letter”), based on their investigation of the reported fraud, HK$180,000.00 (“the Sum”) was transferred to the Account of the Bank belonging to the Defendant. Some money was also found in another bank account of the Defendant with another bank (“the Other Account”). Consent was not granted for further dealing with the money in the Other Account under the provisions of section 25A(2) of the Drug Trafficking (Recovery of Proceeds) Ordinance, Cap. 405 and Organized and Serious Crimes Ordinance, Cap. 455.

18.  By Originating Summons, proceedings have been commenced against the Defendant for inter alia a declaration that the amount of HK$180,000.00 in the Account is held on trust by the Defendant as constructive trustee for P.

Applicable principles

19.  Section 21(1) of EO provides that on the application of any party to any proceedings, the court or a judge may order that such party be at liberty to inspect and take copies of any entries in a banker’s record for any of the purposes of such proceedings.

20.  It is now well established that under section 21 of EO, it must be shown that there is a probability that the account will contain materials germane to an issue to be tried between the parties. In short, the test is one of relevance. See e.g. Assets Investment PT Ltd v United Islamic Investments Foundation (unreported, HCA No. 4392 of 1993, 21 January 1994), §8 per Barnett J; Chan Wai Sun & Another v Law Shiu Kai [2003] 3 HKLRD 954, §10 per Chu J (as she then was); Tiger Resort Asia Ltd v Kazuo Okada [2018] HKCFI 472, §28 per Deputy Judge Keith Yeung SC (as he then was); and Aisan Corporation of America & Another v Unknown Bank Account Holder(s) [2023] HKCFI 567, §13 per Au-Yeung J.

21.  It has also been repeatedly said that the privacy of the defendant and the bank/customer confidence has to be respected and thus the power under section 21 of EO has to be exercised with great caution. The power should only be exercised where it is clearly established that the account is really that of the party to the proceedings or that the party is so closely connected with it that it would be evidence against him: see e.g. Chan Wai Sun, §9; Tiger Resort Asia Ltd, §29 and Aisan Corporation of America, §14.

22.  More recently, in Hwang Joon Sang & Anor v Golden Electronics Inc (No 2) [2021] 2 HKLRD 87, Coleman J summarized the relevant principles guiding the exercise of the court’s discretion in granting such order. See at §§8-10:

“8. The primary purpose of a discovery order made under s.21 of the EO is to preserve the assets or property which might otherwise be dissipated notwithstanding an injunction not to do so. Though the court will not lightly use its powers to order disclosure of full information touching the confidential relationship of banker and customer, such an order may be justified where the plaintiff seeks to trace funds which, in equity, belong to it and of which there is strong evidence that it has been fraudulently deprived, where delay might result in the dissipation of the funds before trial.

9. There are three limits to the exercise of the power, being: (1) the plaintiff must demonstrate a real prospect that the information may lead to the location or preservation of assets to which he is making a proprietary claim; (2) where documents are required to be disclosed, the third party should be entitled to the same specificity in the documents he is asked to produce as he would be if served with a subpoena; and (3) even if the application prima facie falls within the principle for disclosure, the court needs to balance the potential advantage of disclosure against the detriment to the person against whom the order is sought, not merely in terms of costs (for which he is ordinarily compensated on an indemnity basis by the terms of the order) but by way of invasion of privacy and requiring breach of obligations of confidence owed to others.

10. Further, the plaintiff is ordinarily required to give an undertaking that whatever information is obtained would be used only for the purposes of the action to trace the funds, and not for any other purpose.”

Application of the principles to the present case

23.  P has submitted that the documents sought to be produced will establish that D received the Sum and shed light on where the Sum has gone.

24.  I am satisfied that there is strong evidence that P has been defrauded. In P’s Affirmation, she has exhibited her Bank of China statements which demonstrate that she did transfer the Sum to the Defendant on 2 and 3 May 2022 (although in P’s Affirmation and her statement to the Police the latter date is given as 4 May 2022). The Police’s Letter also confirms the same.

25.  Ms Lam has submitted that the order sought is not unduly wide. I noted that the bank statements of the Account sought is for the period from 1 April 2022. However, the first of the two transfer to the Defendant was on 2 May 2022. I have invited Ms Lam to explain why P seeks production of bank statements one month before the transfer of the Sum where P has not alleged there were other transfer to D prior to 2 May 2022. Nonetheless, I remain unsatisfied that it would be proper to order production of the bank statements of the Account prior to 2 May 2022. Ms Lam then confirmed that in that case she would be happy to limit the order to the period on or after 2 May 2022.

26.  I am satisfied that the documents sought (limited to on or after 2 May 2022) are germane to the issue of the fund flow of the Sum and the identities of the wrongdoers. There is a real prospect that the information may lead to the location or preservation of assets to which P is making a proprietary claim.

27.  Balancing the potential advantage of disclosure against the detriment to the Bank (by way of invasion of privacy and requiring breach of the obligations of confidence owed to others), in my view it is appropriate to grant the orders sought as limited by me. My view is fortified by my consideration of the important policy consideration, as expressed by Deputy Judge Keith Yeung SC (as he then was) in Akbank TAS v Mainford Ltd [2018] HKCFI 363 at §16, that Hong Kong being an international city, the law should be facilitative but not obstructive when a victim of a cybercrime (like P according to her case) comes to our courts for lawful redresses against the true culprits.

28.  I therefore do grant an order in terms of the Summons save for paragraph 1(a) the monthly bank statements to be provided is limited to the period between 2 May 2022 up to the date of this order.

29.  Given the orders granted by me under s.21 of EO, it is not necessary for me to consider the application under the inherent jurisdiction of the Court.