LEE LAI CHUEN v. WONG KONG HAFEE

HCA 1214/2025

[2025] HKCFI 5962

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1214 OF 2025

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DECISION

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Introduction and Background

1.  By Summons dated 12 September 2025 (“the Summons”), the Plaintiff (“P”)  seeks: (1)  a proprietary injunction, a Mareva injunction and ancillary disclosure order against the Defendant (“D”)  in terms of the draft order annexed thereto; (2)  a disclosure order against Bank of China (Hong Kong)  Limited (“BOC”); and (3)  a disclosure order against Standard Chartered Bank (Hong Kong)  Limited (“SCB”).  I shall refer to BOC and SCB collectively as “the Banks”.  

2.  According to P’s Affirmation filed in support of the Summons (“Supporting Affirmation”):

(1)  P is 83 years old and is the shareholder and managing director of the Company;

(2)  P has been residing with her domestic helper at her residence (“the Residence”);

(3)  D is a driver employed by the Company assigned to serve P.  From time to time, D would bring along documents of the Company for P to sign at the Residence and assist with miscellaneous household duties;

(4)  P has maintained a bank account with SCB (“P’s Account”).  She kept the cheque book and bank statements for P’s Account locked up in the cupboard of her bedroom;

(5)  Sometime in June 2024, she found that some of the monthly bank statements of P’s Account were missing and she sought to obtain the missing statements from SCB;

(6)  With the assistance of SCB’s staff, she discovered the following sums were withdrawn from P’s Account and paid into the bank account of D maintained with BOC (“D’s BOC Account”)  by way of cheques signed by her (“the Cheques”): (a) on 15 December 2023, the sum of HK$685,000; (b) on 31 January 2024, the sum of HK$2.2M; and (c) on 2 May 2024, the sum of HK$4.3M (collectively, “the Sums”);

(7)  Due to lapse of time, P does not recall exactly the circumstances in which she signed the Cheques but suspected that D had stolen the Cheques and included the Cheques among the documents of the Company which he brought to her for signing, falsely representing that they required her signature;

(8)  P reported the matter to the Hong Kong Police (“the Police”)  on 24 June 2024 and made statements to the Police;

(9)  On 21 May 2025, the Police informed P that they have managed to freeze D’s bank account maintained with SCB (“D’s SCB Account”)  which has a remaining balance of HK$500,000;

(10)  By Writ of Summons filed on 26 June 2025 (“the Writ”), P commenced the present proceedings against D;

(11)  On 8 July 2025, P’s solicitors were informed that D is currently being detained in Pak Sha Wan Correctional Institution (“PSWCI”); and

(12)  Despite service of the Writ, D has not acknowledged service nor filed any defence.

3.  According to the affirmation(s)  of service filed on behalf of P, the Summons and Supporting Affirmation were served on the registered offices of the Banks and D at PSWCI. The Amended Writ of Summons with an Amended Statement of Claim (“ASOC”)  was filed on 19 September 2025 and was served on D.

4.  SCB, by letter to P’s solicitors dated 22 September 2025, has stated that it remains neutral to the disclosure application save for requiring 28 days for production of the documents requested and seek costs on an indemnity basis.  BOC, through their legal representatives, by letter dated 25 September 2025, has written to this court indicating that it takes a neutral stance to the application save for requesting their costs be paid on an indemnity basis to be summarily assessed by this court.  The Banks’ comments have now been incorporated into a Draft Order submitted to me.

5.  At the substantive hearing of the Summons, Mr Lee, counsel, appeared for P.  D and the Banks have not appeared.

Discussion and Disposition

Re: Proprietary injunction, Mareva injunction and ancillary disclosure orders against D

6.  The legal principles governing proprietary injunction are well-established.  For the grant of a proprietary injunction, there are three requirements: (1)  there is a serious issue to be tried on the merits; (2)  that the balance of convenience lies in favour of the injunction; and (3)  it is just and convenient to grant the injunction.  The threshold of “serious issue to be tried” is not a very steep hurdle but if the opposing party seeks to show that there is no serious issue to be tried, the threshold is high as it would be necessary to demonstrate that the claim should be struck out.  Furthermore, it is not necessary to show any risk of dissipation of assets although if such risk is demonstrated, it may be an additional factor in favour of the grant of injunction.  Nor is it necessary to show that damages would not be an adequate remedy.  However, it remains necessary to demonstrate that the balance of convenience favours the granting of the injunction, and that it would be just and convenient to do so.  It would not be granted if a monetary award would be adequate remedy for the plaintiff. In particular, where the propriety claim of the plaintiff is not to any specific real or personal property but to money, the plaintiff can be adequately compensated by a monetary award, unless there is evidence which calls into question the ability of the defendant to meet the award, so that a proprietary injunction is not necessary or justified.  See e.g. Predicine Holdings Ltd v Bianchi (Hong Kong)  Limited & Ors [2021] HKCFI 123 per Coleman J at §§69-73; and DBS Bank (Hong Kong)  Limited v Tian Wen Quan (unrep), 12 October 2017 per Anthony Chan J (as he then was)  at §§11-18.

7.  In Zhang Yan & Ors v ASA Bullion Limited [2019] HKCFI 179 Recorder Eugene Fung SC (as he then was) at §11(3)  and (4), held that a proprietary injunction must relate to a specific asset held by or under the control of the defendant, or its traceable proceeds, in respect of which a proprietary claim is raised by the plaintiff.  Furthermore, in order to justify the grant of a proprietary injunction, the plaintiff should ordinarily adduce some reasonable evidence of existence of the specific asset (or its traceable proceeds)  and that the same is being held by or under the control of the defendant.  Where the asset forming the subject matter of the proprietary claim has been dissipated and can no longer be traced, a proprietary injunction cannot ordinarily be granted. These propositions were taken from 任俊國v Chin Choi Ming (unrep)  HCA 2017/2017, 6 November 2017 at §§20-22 per Chow J as he then was. 

8.  In Welly Grace Limited & Ors v Keung Yee Man & Ors [2023] HKCFI 3082, the learned Recorder (as he then was)  revisited and confirmed those principles: see §§22-30.  In particular, at §30 he held:

“ In the context of obtaining a proprietary injunction, the plaintiff needs to demonstrate a serious issue to be tried in relation to his proprietary claim, which would involve not only a consideration of the merits of the claim being brought by the plaintiff, but also an examination of the tracing exercise pursuant to which the asset in question has been identified. As far as the tracing exercise is concerned, the plaintiff should adduce reasonable evidence to show a serious issue to be tried that the asset or its traceable substitute is being held by or under the control of the defendant. As to what would constitute reasonable evidence to show ‘the existence of the specific asset or its traceable proceeds and that the same are still being held by or under the control of the defendant’, that must naturally depend on the facts and circumstances of each case, including but not limited to the stage of the proceedings, the information available to the plaintiff at the time when the proprietary injunction is sought, and any materials with sufficient cogency from the defendant.”

9.  As for the principles applicable to the grant of Mareva injunction, these are also well-established.  The applicant has to show that: (1)  there is a good arguable case on the merits; (2)  there are assets within the jurisdiction; (3)  the balance of convenience is in favour of granting an injunction; (4)  there is a risk of dissipation of those assets so as to render any judgment which the plaintiff may obtain nugatory; and (5)  he must comply with a strict duty of full and frank disclosure.  See Zhang Yan & Ors at §17 and Hong Kong Civil Procedure 2025, Vol.1, §29/1/65.

10.  Applying the above principles to the facts of the present case, notwithstanding the submissions of Mr Lee, I am not persuaded that I should grant a proprietary injunction to restrain D from disposing, dealing with or diminishing, “the value of the money transferred by [P] into the account numbered 012-586-1-0105018-0 held with [BOC] on 15 December 2023 (in the sum of HK$685,000 or any part thereof), 31 January 2024 (in the sum of HK$2,200,000 or any part thereof)  and 2 May 2024 (in the sum of HK$4,300,000 or any part thereof)  or their fruits or proceeds, including any interest earned or other income received or derived from the said monies”.

11.  I am of the view that there is no reasonable evidence to show a serious issue to be tried that the sums of HK$685,000, HK$2.2M and HK$4.3M are being held by D in D’s BOC Account.  Indeed, it is known that the Police froze D’s SCB Account which suggests that the Sums or parts thereof may have been transferred into that account from D’s BOC Account.

12.  Whilst Mr Lee recognized that part of the Sums may no longer be held by or under D’s control, he submitted that the words “or any part thereof” ensures that the proprietary injunction only bites property which in fact remains held by or under D’s control or is otherwise traceable to the Sums.  With respect, this would circumvent the requirement for P to demonstrate by reasonable evidence the existence of the specific asset or its traceable asset, and that it remains held by D or under D’s control.

13.  It is also important to bear in mind that an injunction (or any order of the court with penal consequences)  is a serious matter, potentially and usually, constituting a serious interference with a defendant’s right otherwise to deal with property as he sees fit.  Any restriction needs to be clear and precise, so that the defendant knows with clarity and precision what he can and cannot do.  See Predicine Holdings Ltd at §23.  To restrain D from dealing with the Sums “or any part thereof” or “their fruits or proceeds”, is plainly unclear and imprecise.  I cannot see how D would clearly understand what exact amount is restrained.

14.  It was also submitted by Mr Lee that P has no visibility over D’s bank accounts and that is why P is also seeking ancillary disclosure orders.  In my view, this would be an improper use of an application for proprietary injunction together with ancillary disclosure orders, where clearly, P can currently point to no identifiable asset in the hands of the D which can form the subject matter of a proprietary claim by P. 

15.  Mr Lee also submitted that there is no evidence that D had dissipated the Sums to third parties and there is at least a serious issue to be tried that the Sums or its traceable proceeds or part thereof may still be held by D or under the control of D.  However, given the Sums were transferred to D’s BOC Account in December 2023, January 2024 and May 2024, and the apparent dissipation to D’s SCB Account, and the fact D’s BOC Account was not frozen by the Police, I cannot accept the assertion, unsupported by any cogent evidence, that the Sums or parts thereof are still being held in D’s BOC Account.  If there is reasonable evidence to show that parts of the Sum have been diverted into other accounts held by or under the control of D, then the application for proprietary injunction should be to restrain the disposal of those sums in those accounts.

16.  In all, I am not satisfied that the proprietary injunction sought should be granted.

17.  However, I am prepared to grant the Mareva injunction sought.  I am satisfied that: (1)  there is a good arguable case, at the very least, based on unjust enrichment.  Whilst other causes of actions are pleaded in the ASOC, that would suffice for present purposes; (2)  there are assets within the jurisdiction as the Police has frozen D’s SCB Account with a balance of HK$500,000; (3)  there is a risk of dissipation given the demonstrated dissipation of the Funds by D from D’s BOC Account to D’s SCB Account; and (4)  given the alleged fraudulent behaviour of D, the actual dissipation of the Funds from D’s BOC Account to D’s SCB Account with HK$500,000 remaining, and there being no information of D’s financial position that he is able to satisfy monetary judgment against him, the balance of convenience lies in favour of the granting the Mareva injunction. 

18.  Accordingly, I will make an order in terms of the draft Injunction Order as amended by me save for paragraph 1 (i.e. proprietary injunction is not granted).

Re: Disclosure orders against the Banks

19.  The applicable principles for Norwich Pharmacal relief are well-settled.  It is not a usual order and will not be lightly granted in the absence of powerful factors:

(1)  It is made against an innocent party whose only involvement is to become mixed up in the tortious or wrongful activities of others;

(2)  The wrongdoing exists only on the part of a person or persons against whom no relief may be sought at the stage of the application and against whom there is probably insufficient evidence to found an action;

(3)  There will usually be a legal relationship between the innocent person against whom a discovery order is sought and the alleged wrongdoer, and the relationship may involve strict duties to be observed on the innocent party’s part.  Any discovery to be made will involve a breach of confidentiality and may expose the innocent party to civil liability and possibly even criminal liability; and

(4)  The court must accordingly balance the competing interests of the victim of the alleged wrongdoing and an innocent party caught up in the wrongdoing.

See A Co v B Co [2002] 3 HKLRD 111 at §12 per Ma J (as he then was).

20.  In A Co v B Co at §13, the main requirements for Norwich Pharmacal relief were set out:

(1)  There must be cogent and compelling evidence to demonstrate that serious tortious or wrongful activities have taken place (where fraud or similar serious allegations are made, the degree of proof must correspondingly be high);

(2)  It must be clearly demonstrated that the order will or will very likely reap substantial and worthwhile benefits for the plaintiff, and where a tracing claim is likely to be made there must be a serious possibility that the discovery sought will either allow the plaintiff to preserve what may well be his assets or realistically lead to the discovery of such assets; and

(3)  The discovery sought must not be unduly wide, so an order must be specific and also restricted to those documents or those classes of documents that are necessary to enable the plaintiff to preserve or discover assets.

21.  The applicable principles governing an order under s.21 of EO are also well-established.  Although it has been said that such order is justified where the plaintiff seeks to trace funds which in equity belongs to him and of which there was strong evidence that he has been fraudulently deprived, there are 3 limits:

(1)  Firstly, 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)  Secondly, the documents sought to be disclosed must be identified with some specificity as would be expected of a subpoena; and

(3)  Thirdly, the court needs to balance the potential advantage against the detriment to the person against whom the order is sought, not merely in terms of costs but by way of invasion of privacy and requiring breach of obligations of confidence to others.

See CTO (HK)  Ltd v Li Man Chiu & Others [2002] 2 HKLRD 875, §§12-13 per Deputy Judge Poon (as he then was); and Hwang Joon Sang v Golden Electronics Inc. (No 2) [2021] 2 HKLRD 87 at §§8-9 per Coleman J.

22.  Applying the above legal principles to the facts of the present case, I am satisfied that the disclosure orders sought, whether under the Norwich Pharmacal jurisdiction of the court or under s.21 of EO, should be granted against the Banks.

23.  Firstly, I am satisfied from the Supporting Affirmation that there is cogent and compelling evidence to demonstrate that a prima facie case of wrong being committed against P.

24.  Secondly, I am satisfied that there is a real prospect that the requested documents would reap real and substantial benefit to P.  There is a real prospect that the information sought will lead to the location and preservation of P’s assets by enabling P to identify and trace the whereabouts of the Sums or their traceable proceeds.  I accept at this moment, P has no other means to find out the transfers from P’s Account to D’s SCB Accounts and whether there were other transfers to D’s other accounts maintained with the Banks.

25.  Thirdly, I am satisfied that the discovery sought is specifically defined and not unduly wide.  I have also taken into account the neutral stance adopted by the Banks who have not suggested any difficulty in complying with the orders sought save for the timing for provision of the documents which have been incorporated into the Draft Orders.  I am also satisfied the disclosure sought are limited to those documents necessary to trace and preserve P’s monies.

26.  Having balanced the competing interest of the victim and the innocent party (the Banks)  caught up in the wrongdoing, and mindful that the power to order disclosure should be exercised with great caution, I would make an order in terms of the Draft Orders against the Banks (as amended by me).