XCHRX CHINA EVERBRIGHT - IHD PACIFIC LTD. v. CH'NG POH

HCA 12837/95

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 12837 OF 1995

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REASONS FOR DECISION

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1. On 30 November 1999, the Defendant applied for an adjournment of the trial of this action, which is scheduled to commence on 17 January 2000 with 15 days reserved. At the end of the hearing, I refused the application and due to the time, said I would reduce my reasons for the decision into writing.

2. There is only one reason for the application for the adjournment, and that is so that the trial takes place after the Defendant's intended appeal to the Court of Final Appeal in respect of third party proceedings.

3. In respect of those third party proceedings, I had in January this year struck out the Third Party Statement of Claim, which was then based on two causes of action, indemnity and contribution.

4. In July, the Defendant appealed to the Court of Appeal, at which stage two further causes of action, in unfair enrichment and constructive trust, were sought to be added.

5. On 30 August 1999, the Court of Appeal gave its decision dismissing the appeal.

6. On 24 September 1999, the Defendant issued a Notice of Motion for leave from the Court of Appeal to appeal to the Court of Final Appeal. I am surprised that the Defendant should take three and a half weeks to come to a decision whether to seek leave from the Court of Appeal to appeal to the Court of Final Appeal, considering that the points raised in the Notice of Motion had already been taken in the Court of Appeal in July. However, there was no information before me that any earlier date would have been available to the Defendant even if it had issued the Notice of Motion with greater alacrity.

7. On 30 November 1999, the Court of Appeal refused leave. I am informed by Mr Strachan QC, leading counsel for the Defendant, that he has instructions to apply for leave from the Court of Final Appeal. Mr Strachan says that those instructing him have indications that a date for an application to the Court of Final Appeal for leave would not be available until January 2000, when the trial of this action is due to start; hence the present application to adjourn the trial date of this action.

8. In my view, it would not be right to adjourn this trial again. (I say "again" because there have already been 2 abortive starts - first in July 1998 and again in May 1999).

9. An adjournment would clearly be unjust to the Plaintiff. It had commenced its action in 1995. It relies, under s.62 Evidence Ordinance, on the Defendant's conviction in 1994 of conspiracy to defraud by dishonestly causing and permitting the Plaintiff to participate in an exchange of cashier orders and cheques in order to conceal the fact that certain money was used improperly to give financial assistance for the acquisition of the Plaintiff's shares. The Plaintiff is seeking the return of that money with interest. The burden is on the Defendant to show that the conviction is erroneous. The Plaintiff has no interest in the third party proceedings.

10. If there were third proceedings afoot, then the directions as to trial which had been given by Master Cannon in March 1998 would clearly be sensible. But the fact is that at this point, there are no extant third party proceedings. The Defendant has exhausted the means of maintaining third party proceedings in the High Court. It has not yet sought leave to appeal to the Court of Final Appeal. Leave may or may not be granted. Even if leave were granted, the Defendant may or may not succeed eventually at the substantive hearing of the appeal. In my view, it would not be fair to the Plaintiff to have its trial adjourned because the Defendant hopes to succeed in the Court of Final Appeal against the intended Third Party. It is not for this court to examine the criticisms that Mr Strachan has of the Court of Appeal's decision.

11. It is correct that the Defendant has paid money into court which has been deposited in an interest-bearing account. But the Plaintiff is a public company which is in business. If it is entitled to the money (and it has the benefit of the Defendant's conviction as evidence), it should not be kept out of the money in order to await proceedings which may not be revived, and with which it has nothing to do.

12. Accordingly, after balancing all the circumstances and in the exercise of my discretion, I dismissed the Defendant's application for an adjournment with costs. There was no objection to a certificate for two counsel.