AKAI HOLDINGS LTD (IN COMPULSORY LIGUIDATION) AND OTHERS v. HO WING ON, CHRISTOPHER AND ANOTHER

HCCL 37/2005 and
HCCL 40/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMMERCIAL ACTION NOS. 37 and 40 of 2005

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J U D G M E N T

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The applications

1. This is an ongoing discovery dispute in this action between on the one hand the liquidator plaintiff(s), and on the other the 1^st defendant, Mr Christopher Ho, and the 2^nd defendant, The Grande Holdings Ltd; this dispute has its origin in an ancillary disclosure order made by this court against both defendants at the time of granting direct Mareva injunctive relief against the 1^st defendant.

2. There are two applications before the Court which are the subject of this Judgment:

(i)  The plaintiff’s summons dated 17 March 2009, which summons stood adjourned from a previous hearing on 19 March 2009, attended by Mr Kosmin QC on behalf of the liquidator plaintiff and by Mr Snowden QC for the 2^nd to 20^th defendants: see Reasons for Decisions handed down by this court on 16 April 2009.

At this hearing this summons has been referred to as ‘the interrogation summons’, whereby the plaintiff requested an order that there be leave to interrogate the 1^st defendant in this action, Mr Christopher Ho, alternatively that Mr Ho be cross-examined on oath with regard to certain transactions which have come to the attention of the plaintiff liquidator, and which are said to have raised concerns as to the veracity of Mr Ho and as to the issue of his compliance with the terms of a Mareva order made against him; and

(ii)  The plaintiff’s summons dated 27 April 2009, as substantially amended and re-dated 5 May 2009; at this hearing this has been referred to as ‘the specification summons’.

  By this summons the plaintiff liquidator seeks from Mr Ho a further affidavit which can be said properly to comply with paragraph 6 of the Mareva injunction Order of this court dated 17 February 2009 [‘the Mareva Order’], whereby inter alia Mr Ho was to inform the plaintiff of all his assets of an individual value of US$100,000.

  As matters transpired, this second summons, which in its amended form condescends to considerable detail in terms of specific categories of material now sought from Mr Ho (at paragraphs 1-3 thereof) and also from the 2^nd defendant to this action, Grande Holdings Ltd (at paragraphs 4 and 5), was characterised by Mr Kosmin QC, who again appeared with Mr Manzoni for the plaintiff liquidator, as the principal substantive application now before the court; he suggested that the interrogation summons had to all intents and purposes been superceded by the subsequent application.

  This amended ‘specification summons’ further seeks an order that the 1^st defendant, Mr Ho, be cross-examined on oath as to his assets, and as to the content of his affirmation evidence purportedly filed in compliance with the disclosure order of this court contained in the Mareva Order, and that two directors of the 2^nd defendant, Grande Holdings Ltd, also be cross-examined on oath as to the assets of that company purportedly disclosed in the affirmation evidence of the 2^nd defendant filed pursuant to the Mareva Order.

The procedural background

3. At the outset I should say a little about the manner in which this particular debate has arisen.

4. These consolidated actions represent but two in a series of actions taken by the plaintiff liquidators of Akai Holdings Ltd, which has been in liquidation since 2001, in an attempt to recoup/recover assets of Akai which, it is alleged, had been misappropriated from that company in what by common consensus is thought to be one of the largest corporate failures in Hong Kong history; when the liquidators came onto the scene, there was, I am told, no more than US$167,000 left in the till, hence the fact that in the ‘Akai litigation’ the liquidators are ‘funded’ by professional litigation funders, which are thought to be Australian companies specializing in this form of activity, as to the existence and activity of which this court has expressed some concern (vide the court’s discussion of this situation at paragraphs 124-143 of its Mareva Judgment dated 9 February 2009).

5. These two actions commenced in 2005, and the pleadings therein are voluminous, running into several hundreds of pages.

6. By summons dated 19 November 2008, the liquidator, in the person of Mr Borrelli, mounted an application for a Mareva injunction against Mr Ho, the 1^st defendant, and against The Grande Holdings Ltd (‘Grande’) the Hong Kong publicly listed 2^nd defendant.

7. On 9 February 2009 this court handed down its decision by a Judgment of that date.  That Judgment speaks for itself.

8. In short, the court ordered Mareva relief against Mr Ho personally, but not directly against Grande, and also ordered disclosure of assets asagainst both Mr Ho and Grande.

9. The precise terms of the Mareva Order as engrossed were determined at a hearing on 17 February 2009 which was attended by Mr Dobby, the plaintiffs’ solicitor, and by Mr Abraham Chan of counsel for the 1^st and 2^nd defendants.

10. Paragraph 6 of that Order read thus:

“Each of the First and Second Defendants must inform the Plaintiffs’ solicitors in writing within 42 days from the date hereof of all their assets of an individual value of US$100,000 in the case of the First Defendant and US$150,000 in the case of the Second Defendant, whether within or outside Hong Kong, whether in their own names or not, and whether solely or jointly owned, giving the value, location and details of all such assets.   The First and Second Defendants may be entitled to refuse to provide some or all of this information on the grounds that it may incriminate them.”

11. Paragraph 7 of the Order recited that the information disclosed by each of the First and Second Defendants must be confirmed on affidavit to be served on the plaintiffs within 14 days of the disclosure given pursuant to paragraph 6 of the Order, and Schedule 3 of the Order provided details under the heading of “Particular Assets Subject to this Order” of both Mr Ho and Grande.

12. The Mareva Order of 17 February 2009 appears to have been just the beginning of associated applications to the court.

13. Thus, on 17 March 2009 the 1^st and 2^nd defendants took out a summons requesting ‘clarification’ of the Order, and further, by amended summons dated 6 March 2006, the 1^st defendant applied for a stay of execution of the ancillary disclosure order made against the 1^st defendant pending the hearing of his appeal in CACV 44 of 2009, under Notice of Appeal dated 5 March 2009, against the grant of  Mareva relief, which appeal I am told is due to be entertained by the Court of Appeal on 22 July 2009.

14. For its part the plaintiff liquidator took out ‘the interrogation summons’ dated 17 March 2009, to which reference has been made at the outset of this judgment.

15. At the end of the hearing of these three applications on 19 March 2009, this court adjourned ‘the interrogation summons’, which now is restored for adjudication, but dismissed the ‘clarification summons’ and the ‘stay of execution’ summons.

16. The next event of note was that on 31 March 2009 Mr Ho and Grande, in the person of a Ms Christine Asprey (whom, I am told, is Mr Ho’s sister) filed affidavits purporting to make disclosure pursuant to paragraph 6 of the Mareva Order.

17. It is fair to say that the quality of this disclosure left the plaintiff liquidator unimpressed, and on 6 and 14 April 2009 Messrs Lovells, solicitors for the plaintiffs in these actions, wrote to Messrs Baker & McKenzie, solicitors for the 1^st and 2^nd defendants, to complain as to the adequacy and quality of the ‘disclosure’ as thus made.

18. On 14 April Baker & McKenzie replied that it would not be possible to respond by that day in light of the work then required to complete Grande’s annual financial results, which were due to be announced on 22 April, and also the completion of the Points of Defence, which document was due to be filed on 15 April 2009; accordingly it was said that they would take instructions on Lovells’ complaints as to the allegedly inadequate disclosure within the two weeks following.

19. Two days later this court handed down its ‘Reasons for Decisions’ for the dismissal of the respective applications for a stay of execution and for ‘clarification’ of the Mareva Order, and on the following day, 17 April 2009 Baker & McKenzie wrote to Lovells in order to provide an explanation for the two commercial transactions (the ‘Lafe transaction’ and the ‘Sansui transaction’), the knowledge of which had stimulated the plaintiff to issue ‘the interrogation summons’ on the same day.

20. On 27 April 2009, the plaintiff issued the initial version of ‘the specification summons’, which was marked returnable on 30 April 2009, for an order requiring Mr Ho and Grande to “fully and properly” comply with paragraph 6 of the Mareva Order, and further to exhibit financial statements and tax returns, and to address issues raised by Lovells in their letters to Baker & McKenzie of 6 and 14 April 2009.

21. At the hearing on 30 April, the plaintiff submitted draft orders which now were sought in lieu of those orders originally sought in the summons of 27 April 2009, and further agreed, after discussion between Bench and counsel, to amend the summons to reflect the application as now was being advanced in terms of the specification and increased ambit of the additional material sought; this, it was said, represented the substance of that which the plaintiff liquidator considered “proper and appropriate” disclosure ancillary to the Mareva relief as earlier granted.

22. Accordingly, the court adjourned the so-called ‘interrogation summons’ and the ‘specification summons’ to a day’s hearing on 8 May 2009, and also made relevant consequential directions.

23. On 6 May 2009 Baker &  McKenzie wrote to Lovells setting out in detail Grande’s response to the matters set out in Lovells’ letters of 6 and 14 April, and on 7 May 2009, that is one day prior to the substantive hearing, Mr Ho filed his 4^th affirmation dealing with certain matters arising.

Ambit of the discovery argument

24. Each party has taken the time and trouble to produce detailed and informative skeleton arguments with regard to the summonses presently before the court, and I have found both documents to be of considerable assistance.

25. In light of the extent of the information and argument as has been committed to paper, I hope I will be forgiven if for immediate purposes I merely outline the main lines of argument adopted by each side.

26. For the 1st and 2nd defendants, Mr Ho and Grande, Mr Godfrey Lam SC, leading Ms Lau, made his initial focus the ‘interrogation summons’, and in reliance upon, inter alia, dicta in A J Bekhor & Co Ltd v Bilton [1981] 1 QB 923, at 949B-C, Mr Lam emphasized that disclosure orders are based upon what is necessary to make the Mareva injunction effective, and that any disclosure order must be approached in light of this purpose; in this context reference also was made to the observations of Ma J (as he then was) in Yau Chiu Wah v Gold Chief Investment Ltd & anr [2002] 2 HKLRD 832, at 840, wherein the learned judge had emphasized that the purpose of making an ancillary disclosure order was to identify and preserve the assets of the defendant falling within the scope of the injunction.

27. Mr Lam also laid considerable stress upon the principle that neither interrogation nor cross-examination should be granted for the purpose of uncovering whether the defendant in question has acted in breach of the Mareva injunction as granted – which, he suggested, appeared to have been the main focus of the correspondence which had emanated from Messrs Lovells in connection with this summons – and that it also was important to bear in mind that cross-examination for the purpose of uncovering whether or not the defendant had broken undertakings to the court should not be given: see, for example, Gee, Commercial Injunctions, 5th ed., at para 22.025, and Memory Corp plc v Sidhu [2000] Ch 645, at 647, 649.

28. Accordingly, he asked that the ‘interrogation summons’ be dismissed.

29. As to the ‘specification summons’ Mr Lam made a number of points.

30. He noted that in principle no objection was made to the attendance for cross-examination of Mr Ho and Ms Asprey (or of another director, Mr Adrian Ma, who would swear an affidavit confirmatory of that sworn by Ms Asprey, who had sworn her affidavit only by reason of Mr Ma’s temporary absence from Hong Kong) for the purpose of legitimate cross-examination; at the same time, however, Mr Lam submitted that extensive details of assets, such as were now sought by the plaintiff in the ‘specification summons’, are not necessary where it already is established what assets have been covered by the injunction, and that there was no reason why for present purposes the plaintiff should need to know further details, such as, for example, the basis of the valuations which had been given of the assets now disclosed.

31. Mr Lam emphasized that the court should be vigilant not to permit the Mareva jurisdiction to be used by the plaintiff obtaining that order to obtain security for the claim – which was yet to be sustained, proved and adjudged – nor to permit the defendants to be treated as judgment debtors.

32. Mr Lam stressed that there was no intention on the part of Mr Ho or of Grande to conceal any assets, that there had been effected “conscientious disclosure” thus far, and that in any event Mr Ho and Grande (through Mr Adrian Ma) openly had stated their willingness to attend examination on oath relating to the disclosure thus far made.

33. Moreover, light of the fact that the plaintiff liquidator was ‘funded’ in this litigation by third party litigation funders, Mr Lam also cast doubt upon the motives of the plaintiff in seeking such extensive further disclosure as was set out on the face of the amended ‘specification summons’, noting that the type of information as now sought doubtless would be useful for the plaintiff to have “for their own commercial purposes”, and that it was not necessary as part of the disclosure which had been ordered in aid of the Mareva relief as granted.

34. In his skeleton argument Mr Lam made specific comments upon each of the paragraphs of the ‘specification summons’, and left the court in no doubt but that in his submission this was unnecessary and inappropriate satellite litigation against a backdrop wherein, as the 1st and 2nd defendants maintained, already there had been “full compliance” with the disclosure order contained in paragraph 6 of the Order of 17 February 2009, and that the present amended ‘specification summons’ represented a step too far, and was “oppressive, unnecessary and egregious.”

35. Whilst both leading counsel agreed upon basic legal principle, it is perhaps unsurprising in the circumstances that Mr Kosmin QC took an entirely contrary view of the merits – and of the necessity – of the ‘specification summons’, although he made it clear at the outset that since Mr Ho and Mr Ma now were apparently offering themselves for cross-examination, he considered that the so-called ‘interrogation summons’ had been rendered little more than a preliminary sideshow, and that the substance thereof effectively had elided into the substance of the amended and far more detailed ‘specification summons’.

36. Accordingly, Mr Kosmin focused his efforts upon this latter application, in which regard his basis thesis was that Mr Ho and Grande had been “playing games” in terms of the quality and quantity of the disclosure as thus far made, and that in effect they were “cocking a snook” at the relevant court order in a manner which was little short of “disgraceful”.

37. Whilst Mr Kosmin acknowledged the apparent statement of intent to appear and to be cross-examined on the part of Mr Ho personally, and now also of Mr Ma for Grande (in lieu of Ms Asprey), he submitted that should the ‘disclosure’ made to-date to be permitted to be left in its current wholly inadequate state, the inevitable result would be that such cross-examination as now was being offered in reality would prove wholly ineffective, and that upon such cross-examination the deponents would be able to take refuge in responses which indicated that they were unable ’off the top of their heads’ to recall any degree of detail in terms of the primary categories of assets thus far disclosed.

38. Thus, leading counsel submitted, this exercise effectively would prove a re-run of the earlier section 221 examinations which the Akai liquidator had conducted, wherein little of use was obtained by the liquidator by reason of a lack of documentary evidence made available in advance upon which to found any serious cross-examination.  If this be correct, Mr Kosmin suggested, there was a clear and pressing necessity for an appropriate level of asset disclosure in anticipation of the now-promised cross-examination.

39. As to Mr Lam’s point that it was not the purpose of ancillary disclosure orders to function as vehicles for detecting breach of the disclosure order as made, Mr Kosmin made it clear that he understood the purport of that submission, but noted that the final sentence of paragraph 6 of the primary Order of 17 February 2009 had made due allowance for this eventuality, viz.: “The First and Second Defendants may be entitled to refuse to provide some or all of this information on the grounds that it may incriminate them.”

40. Mr Kosmin further submitted that this latest bout of opposition on the part both of Mr Ho and Grande to what he insisted were “wholly legitimate and sustainable requests” for the additional disclosure now requested was entirely consistent with the nature of the defendants’ earlier applications which had been rejected by the court, namely the attempt at ‘clarification’ of the disclosure order, and the application that there be a stay of execution of such order pending the appeal, now due to be heard on 22 July 2009, against the grant of direct Mareva relief against Mr Ho personally.

41. Accordingly, Mr Kosmin asked the court to take a view as to the motives behind the present stout opposition to what, he insisted, were entirely reasonable disclosure requests which clearly were necessary to make effective such Mareva relief as had been granted.

42. Mr Kosmin’s skeleton in this regard goes into some detail in terms of the categories of disclosure which now were sought by the liquidator, and he observed that Mr Ho’s 3^rd affidavit sworn on 31 March 2009 not only provided, as he put it, “woefully inadequate” information, but that on its face it was in breach of paragraph 6 of the Mareva order; in this regard he suggested that the most obvious example of such inadequacy is that Mr Ho purported only to identify the principal categories of assets held by the family trust, contrary to his express obligation to disclose all assets over the value-level specified.

43. He also provides a detailed commentary of the assets of which disclosure was sought under various generic heads, viz: Jewellery and Objets d’Art, Cash, Bank Accounts and other investments, the assets within the ‘Trust’ (itself inadequately defined), which appear principally to be shareholdings in 14 overseas companies absent any identification of what is held by those companies, and also a property at Mount Kellett, which evidently is used as Mr Ho’s home in Hong Kong, albeit of this property there had been no mention in his affidavit, and in fact its existence had come to the plaintiff’s attention only as the result of a newspaper report in the Standard of 7 April 2009 of a domestic dispute involving Mr Ho.

44. As to the disclosure purportedly effected by Grande, Mr Kosmin was equally critical, submitting that Ms Asprey’s affidavit sworn on behalf of Grande “contains little or none of the details that are required properly to comply with the disclosure order.”

45. This skeleton argument speaks for itself; suffice it to say that Mr Kosmin characterised the ‘disclosure’ to-date as “deliberate evasion”, a situation which the now-amended ‘specification summons’ was designed to remedy, and he asked for an order in terms of that application.

The ‘specification summons’: Decision

46. Notwithstanding Mr Lam’s admirable efforts upon his clients’ behalf, wherein at no time was there any attempt unfairly to ‘gloss’ or otherwise to obfuscate in his vigorous defence of the adequacy and appropriateness of the existing disclosure, I had considerable sympathy with Mr Kosmin’s complaint as to the transparent defects within the disclosure exercise as thus far effected; in fact, given the obvious approach to, and the limited content of, the disclosure as presently provided, it was difficult not to conclude that Mr Ho appears to have little interest in essaying appropriate compliance, and in lieu thereof that which has been proffered to-date amounts to little more than a gesture towards going through the disclosure motions.

47. I hope that this characterisation is not unfair, but I regret that I have been driven to this opinion.

48. Accordingly, I view the amended ‘specification summons’ essentially as a remedial exercise, wherein Mr Ho and Grande are offered a further chance to provide a fuller and more complete asset picture than hitherto has been the case.

49. Nor do I accept the beguiling notion that the asset disclosure defects of which vigorous complaint now is mounted – and which have been disputed – in themselves would best be rectified simply and solely by means of proffering Mr Ho and Mr Ma for cross-examination, which represents the defendants’ current position. 

50. It strikes me as tolerably clear that absent primary data upon which to cross-examine, the overwhelming probability is that any such exercise would be rendered nugatory in practical terms, given the lack of detailed recollection likely to be invoked by both examinees, with the result that the plaintiff, which has obtained Mareva injunctive relief against Mr Ho directly, and ancillary disclosure orders against both Mr Ho and Grande, now would be no further forward in any realistic identification of the assets the subject of this relief.  As Ma J observed in Yau Chiu Wah v Gold Chief Investment Ltd, op cit.,

“…the cross-examination of a deponent is not simply an examination on an appointed date.  It is possible if not probable that further discovery in preparation for the hearing may be required.  The production of accounts in the case of a company is perhaps the best example of this…”

51. I bear in mind the existence of the appeal now pending against the grant of the primary Mareva relief, and that if such appeal by Mr Ho – Grande is not, I understand, appealing the disclosure order made against it – were to be successful, then the jurisdictional basis for the disclosure as now sought by the liquidator necessarily would fall, but for present purposes the court must proceed on the basis that such inital Order was correctly made; as earlier observed, the court has rejected the application for a stay of execution of the disclosure order, emphasising in the judgment on that application (at paragraph 37 et seq) that the court agreed with the views of David Steel J in Motorola Credit Corporation v Cem Cegiz Uzan [2002] 2 All ER (Comm) 945 that in situations wherein there remained the possibility of a transfer or hiding of funds – which Mr Kosmin maintains precisely remains the risk in this case – that “the sooner the matter is clear on paper the better”, and further that, as Lord Woolf also put in on appeal in that case (at [2002] EWCA 98), a disclosure order is “intimately involved in the effectiveness of the freezing order.”

52. I accept also the proposition that in the commercial context there is now abroad a more robust judicial attitude towards ensuring the effectiveness of Mareva relief, and a to an extent a drawing back (or advancing from) arguably the more conservative ‘Bekhor v Bilton’ emphasis discernible in the Nineties; in this connection Mr Kosmin drew the attention of the court to the relatively recent observations of Arden LJ in Dadourian Group v Simms (No 2), [2007] 2 All ER 329 at 335E, wherein her Ladyship observed:

“A freezing order is an important tool in the court’s armoury for the purpose of doing justice between the parties, or more precisely for the purpose of preventing or policing the disposition of assets which would inhibit the enforcement of an order.  In the normal situation, failures to provide information about assets subject to a freezing order can be enforced by orders for further information.  Litigants who are the subject of an order to produce further information will generally produce it to the best of their ability.  But that is not always the case, and the court will in particular be astute to identify those defendants who are deliberately concealing assets…”

53. It seems to me that in the present circumstances, that mythical (and allegedly reasonable) observer, the man on the Shawkiwan tram, might think that the instant case was and is particularly one where the court should be thus “astute”, lest a mockery be made of the disclosure process. 

54. The fact that Mr Ho appears to care little about the opinion and/or orders of the Hong Kong court ultimately is nothing to the central issue, which is that in my view inadequate disclosure thus far has been made, and upon application being made in an attempt to rectify this situation, the court should take such reasonable steps as it has available within its “armoury” to ensure that there is substantial practical compliance with its orders.

55. In my view the history of events to-date tends to supports this position: in this context I refer to the attempts to limit the scope of the Order as made, the assertion that the discovery obligations are more limited than the court clearly regards as appropriate, and the tenor and content of the inter-solicitor correspondence on the point, which all buttress the view that Mr Ho and Grande are strongly motivated not to reveal the extent of their assets.

56. The result is that I have been convinced to grant a substantial proportion of that which presently is sought in the body of the amended ‘specification summons’, to the detailed provisions of which I now briefly turn.

The discovery sought by the plaintiff liquidator

57. As against Mr Ho personally, the application for additional discovery essentially is in three parts:

Paragraph 1 deals with three different asset classes, namely collections of furniture, jewellery, crystal, watches, paintings and objets d’art, collections of wine, and savings accounts, investment portfolios, unit trusts and pension funds; paragraph 2 specifies 6 categories of ancillary details and, where relevant, associated documentation in connection with the asset categories specified in paragraph 1; and paragraph 3 goes to the provision of bank account details, details relating to the source of all funds which the 1^st defendant uses to pay his living expenses, a summary breakdown of those expenses, and lastly, the request to address particular issues identified in the plaintiffs’ solicitor’s letters dated 6^th and 14^th April 2009.

58. As against Grande, two paragraphs go to the specified discovery now sought: paragraph 4 seeks affidavit/affirmation evidence sworn by a director of that company of all its assets of an individual value of US$150,000, within or without Hong Kong, and howsoever held, giving value, location and details of such assets; whilst paragraph 5 itemises, as subparagraphs (a) to (h), eight categories of the detail required pursuant to the assets to be listed pursuant to paragraph 4.

59. In addition, paragraph 6 of the amended summons seeks a further or alternative order that the 1^st defendant be cross-examined on oath as to his assets, including those disclosed and to be disclosed in accordance with paragraph 1 of the summons, whilst paragraph 7 requests that Mr Ho, Mr Adrian Ma Chi Chiu and Ms Asprey Lai Shan, Christine, as directors of Grande be cross-examined on oath as to the 2^nd defendant’s assets, including those assets to be divulged in an affidavit to be sworn pursuant to paragraph 4 of this order.

60. Finally, paragraph 8 of the revised application seeks an order for costs of and occasioned by this application on an indemnity basis, whilst paragraph 9 provides for liberty for the plaintiffs to apply.

61. I have set out in outline the content of this amended summons because in making the Order which I have decided to grant on this application I cross-reference the terms of this Order to the internal numeration of the amended ‘specification summons’.

62. In addition to such further disclosure I now have decided is appropriate – the better, in Lord Woolf’s words in Motorola, op cit., at 955h, to give “the teeth which are critical to the freezing order” – I should make it clear that I recognize that this further disclosure goes further than the existing disclosure order, in that in certain instances it seeks delivery up of documentation evidencing disclosed assets, and documents which identify the Trust which stands at the apex of Mr Ho’s asset structure pyramid – vide ‘Schedule D’, to which reference is made (at paragraph 34 thereof) in the ‘clarification of Order’ judgment dated 16 April 2009.

63. This aspect of the matter has given me pause for reflection, not least given Mr Lam’s crisp observation that notwithstanding the dismissal of the 1^st and 2^nd defendant’s application to ‘clarify’ the Order of 17 February 2009, nevertheless in turn the plaintiff liquidator himself now is seeking to rewrite/extend the ambit of the original order.

64. At first blush this argument appears to have some resonance, but on reflection it seems to me that it does not succeed; this application as now mounted by the plaintiff was necessitated by the deficient approach towards the disclosure as originally ordered ancillary to the Mareva injunctive relief, and if as a direct consequence of such deficient disclosure, the plaintiff is required substantially to revisit the issue and to complain about what has been done in the course of such purported compliance, it does not seem to me to be impermissible subsequently to extend its detailed ambit consequent upon the perfunctory and clearly incomplete disclosure as in fact made.

65. As Mr Kosmin pointed out, it is evident that there is jurisdiction to grant this order if the interests of justice so require, and the patent deficiency of the asset disclosure as thus far purportedly made by the 1^st and 2^nd defendants serves reasonably to buttress the perceived necessity on the part of the plaintiff liquidator for the specified degree of asset disclosure as now sought. 

66. In this connection there has been cited to this court parts of the judgment of Openshaw J in Cinar Productions v Panju [2006] EWHC 2557, in particular at paragraphs 10-15 thereof, wherein the learned judge observed, inter alia, that whilst orders for the delivery up of documents is intrusive and overrides privacy and confidentiality, nonetheless this is justified in “the compelling interests of justice”.

67. Mr Justice Openshaw in that case also adverted to the argument placed before him by counsel for the defendant that production of further material enhances the potential risk of subsequent contempt proceedings being founded against the defendant, and he appears to have had little hesitation in rejecting this line of argument, noting (op cit., at paragraph 12) that “if such an argument was upheld it would effectively prevent orders for the delivery up of documents being made or being pursued against evasive defendants”; in the same vein (op cit., at paragraph 13) the judge also saw no difficulty in principle in “requiring the defendant to deliver up documents relating to his past financial conduct because it may identify the whereabouts of present and existing assets.”

68. I thus see no conceptual objection to granting an Order in the terms hereinafter set out which, in my judgment, is required in the interests of justice in this case; as I have observed, the apparent evasiveness to-date towards discovery serves to reinforce the merits of the present application.

The Order to be made

69. I have reflected upon the categories/subcategories as enumerated in the amended ‘specification summons’, and the parties’ helpful and detailed submissions with regard to each such individual category/subcategory, and after evaluating the competing arguments, and reflecting upon the necessity for such disclosure in the interests of justice, in the exercise of my discretion I have attempted to strike a balance between the interests of the plaintiff liquidator and the legitimate interests of the 1^st and 2^nd defendants; such balancing exercise attempts to informs the decisions thus reached.

70. I would further add that since cross-examination has been volunteered by the 1^st and 2^nd defendants, and since the avowed purpose of the plaintiff liquidator in pursuing such further discovery, now to be supplemented by cross-examination, solely is to enable the effective enforcement of the Mareva relief which has been granted, I see no necessity to become concerned as to the potential difficulties which Gee, op cit., at paragraph 22.025, suggests may arise when there is “blended together” a cross-examination for the purpose of enabling an effective enforcement of a court order with a cross-examination directed to uncovering whether the defendant has broken undertakings given to the court; in any event, if and in so far as there may arise some difficulty of this nature during such cross-examination, there remains in the 1^st and 2^nd defendants the opportunity and right to invoke the privilege against self-incrimination. 

71. Accordingly I now make the Order in the terms hereinbelow indicated; as earlier noted, the content of this Order is cross-referenced to the particular paragraphs/subparagraphs of the amended ‘specification summons’, and I should be grateful if junior counsel on each side would agree the cumulative form of Order to be engrossed in order to reflect the following:

(i)  There is to be an order in terms of paragraph 1 of the amended summons;

(ii) There is to be an order in terms of subparagraphs 2 (a),  (b),(c),(e),(g), and (h).  The application in terms of subparagraphs 2 (d) and (f) is refused;

(iii)    There is to be an order in terms of subparagraphs 3 (a), (b), (c).  The application in terms of subparagraph 3(d) is refused;

(iv)    There is to be an order in terms of paragraphs 4.

(v) There is to be an order in terms of subparagraphs 5 (a), (b), (c), (d), (e) and (g).  The application in terms of subparagraphs 5(f) and (h) is refused;

(vi)    As to the orders in (i) to (iv) above, such disclosure is to be made within 21 days of the date on which the engrossed  Order is served on the solicitors for the 1^st and 2^nd defendants;

(vii)   There is to be an order in terms of paragraphs 6 and 7 (relating to cross-examination), save that:

(a) if and in so far as Mr Adrian Ma deposes on oath to the truth of the content of the 1^st affidavit of Ms Christine Asprey, thereby adopting such evidence as his own, Ms Asprey need not attend for the purpose of cross-examination;

(b) absent such a confirmatory affidavit/affirmation from Mr Ma, Ms Asprey herself is to attend for the purpose of cross-examination;

(c) such cross-examination as aforesaid is to be conducted on a date to be fixed before the High Court Judge seized with the future conduct of this case, and in any event not earlier than 21 days subsequent to receipt of the disclosure particularized at paragraphs (i) to (v) above;

(viii)  There is to be liberty to all parties to apply.

Costs

72. Paragraph 8 of the amended ‘specification summons’ requests that the costs of and occasioned by the application be to the plaintiffs to be paid by the 1^st and 2^nd defendants on an indemnity basis.

73. In normal course I should be minded to essay a costs’ order nisi consequent upon the resolution of this amended summons; however, on this occasion I consider it prudent to reserve costs, and so order.

74. I say this in light of the forthcoming appeal to be mounted by the 1^st defendant against the ‘Mareva Order’ of 17 February 2009, which appeal, as earlier indicated, is to be entertained by the Court of Appeal on 22^nd July 2009.

75. As earlier noted, if and in so far as that appeal were to be successful in any part, the foundation of the disclosure orders as then made will be removed, and in such eventuality there may be a consequential ‘ripple effect’ in terms of the costs orders relating to subsequent applications, including this ‘specification summons’.

76. Accordingly, in this instance I see no downside to reserving costs to await the appellate event, and, in the absence of agreement on the issue, further to order that written submissions on costs be made to this court not later than 14 days after the determination of the forthcoming appeal.

The ‘interrogation summons’: Decision

77. The focus of the argument on and in the terms of the ‘specification summons’ effectively has rendered the earlier ‘interrogation summons’ something of a preliminary side-show, since for all practical purposes it was overtaken by the summons issued some five weeks later, and as thereafter amended.  In this regard, Mr Kosmin made it clear that in the circumstances as had evolved, his focus entirely was upon the subsequent amended application.

78. I accept the submission that in substantive terms there is no necessity for any order to be made on this earlier summons, although I suspect that there may be some residual argument as to costs; in this context, I repeat my earlier observation as to the appropriateness of reserving any such costs’ argument pending the 1^st defendant’s appeal.

79. Accordingly, the Order of this court upon the plaintiff’s summons dated 17 March 2009 is that there be no order on the substantive application, save that as to the costs thereof, absent agreement thereon, it is further ordered that the issue be reserved to this court, to be determined on the basis of written submissions submitted to this court no later than 14 days after the determination of the appeal on 22 July 2009.

80. Once again, I should be grateful if junior counsel would agree upon the precise form of this Order.