WONG HING MO v. STANDARD CHARTERED BANK (HONG KONG) LTD

DCMP 5815/2024

[2024] HKDC 1967

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO 5815 OF 2024

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DECISION

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Introduction and Background Facts

1.  I have before me an application by the Plaintiff (“P”) for disclosure against Standard Chartered Bank (Hong Kong) Limited (“the Bank”) pursuant to s 21 of the Evidence Ordinance, Cap 8 (“EO”) and under the court’s jurisdiction to grant Norwich Pharmacal relief by way of an Originating Summons filed on 15 October 2024 (“the OS”).

2.  P is a 75 years old retiree.  He claims to be a victim of an investment scam.  He allegedly was induced by a fraudster to join a WhatsApp Group and through an investment app he transferred or deposited the following sums of monies to various accounts as instructed:

(1)  On 15 September 2023, he transferred HK$350,200 from his Hang Seng Bank account (“P’s Account”) to an account held with HSBC;

(2)  On 28 September 2023, he transferred HK$210,228 from P’s Account to an account held with OCBC Wing Hang Bank; and

(3)  On 29 September 2023, he deposited HK$100,000 cash, which he had withdrawn from P’s Account, to an account held with the Bank (“the Subject Account”).

3.  When he had not received any refund and could not retrieve his funds from his account held with the investment app and after doing online searches, P realized that he had been scammed and reported the matter to the Hong Kong Police (“the Police”) on 19 October 2023.

4.  According to P, by correspondence with the Police between 7 March 2024 and 2 April 2024, the Police informed P’s solicitors inter alia that the Subject Account with an amount of HK$100,000 has been frozen but they cannot provide the correspondence address and branch information of the Subject Account.

5.  The Bank has been served the OS. It has indicated in correspondence with P’s Solicitors that, subject to requesting 28 days from the service of a sealed order to comply with the order and the usual indemnity that P pays its costs and expenses on an indemnity basis, it takes a neutral position and seeks to be excused from attending today’s hearing.  The Bank has not appeared today.

6.  Ms Chan, counsel for P, appeared today.

Applicable principles

7.  The applicable principles governing an order under s 21 of EO are well-established.  Although it has been said that a s 21 order is justified where the plaintiff seeks to trace funds which in equity belong 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.

8.  The applicable principles for Norwich Pharmacal relief are also 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).

9.  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 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.

Analysis and Orders

10.  Applying the above legal principles to the facts of the present case, I am satisfied, whether the jurisdictional basis is under s 21 of EO or Norwich Pharmacal, the order sought should be granted.

11.  There is before me cogent and compelling evidence that P has been defrauded to deposit HK$100,000 to the Subject Account.

12.  The information sought by P are highly germane to the identity and contact details of the holder(s) of the Subject Account.  Disclosure of such information would likely reap substantial and worthwhile benefit to enable P to ascertain identity of parties involved in the scam against whom proceedings might be commenced and/or enable P to serve court documents on those parties.

13.  The discovery sought is specifically defined and not unduly wide.  I have also taken into account the lack of objection by the Bank, save for the time for compliance which is already taken account in the draft order submitted to me, who has not suggested any difficulty in complying with the order sought.

14.  Having balanced the competing interests of the victim and the innocent party (the Bank) 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 order.