XCHRX OSK ASIA FUTURES LTD. v. LAM CHI BAN STANLEY & ANOTHER

HCA10335/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO.10335 OF 2000

--------------

--------------

-----------------------

J U D G M E N T

-----------------------

1. This is an application by the 1st defendant for a stay of execution of the judgment granted by me in favour of the plaintiff on 16 July 2001 and the judgment was for a sum of some $9 million. The application now by the 1st defendant is for a stay of execution on the ground that there is a pending appeal, the date of which has not yet been fixed although I understand it has been set down.

2. The basis of the application is that the 1st defendant has a good prospect of success with the appeal and that he would be financially ruined if the execution is allowed to proceed. I am not persuaded that there is a good prospect of success but I need to say very little about this as the matter is pending appeal but nothing produced had changed my mind that the judgment that I had given in July was wrong.

3. The main emphasis, however, of the application is, on whether the exceptional grounds have been shown by the 1st defendant so that the rather unusual order should be given by the court granting a stay of execution. I think it is well-known that the court does not likely deprive a successful party from the fruit of the judgment, so the court does not easily grant a stay of execution in favour of an unsuccessful party. Exception can be made (certainly not a situation here), where the plaintiff, either a foreign resident or is in such poor financial state, that if execution is allowed to proceed that the plaintiff would not be able to return the money to the 1st defendant after a successful appeal. Everything, therefore, turns on the 1st defendant's contention that he would be financially ruined.

4. But financially ruined, by itself, is not a ground for a stay of execution. For someone who has got to pay a large sum on the judgment which may either exceed his assets or where it would eat substantially into his available assets, it could not be said someone would be financially ruined so that no execution should be ordered. By itself, this is not a ground.

5. What the 1st defendant seems to be saying is that the shares which are subject of a charge nisi if the plaintiff is allowed to proceed with execution, then the 1st defendant would be in such a prejudicial position that the properties in China, which is the main assets of the company, the shares of which is the subject of the charge, may not be available to the 1st defendant's company after a successful appeal. But that is a bold assertion made without any supporting material. I have read very carefully the latest affirmation of the 1st defendant at pages 194-195, and the key contention is the assertion that the original agreement would be considered invalid if execution is allowed to proceed. There is, certainly, no supporting material and it seems to go contrary to common sense.

6. I have, therefore, come to the conclusion that in all the circumstances, this is not the case where I can be satisfied that a stay of execution ought to be granted. In my belief, it would be doing a great injustice to the plaintiff if a stay of execution is granted in favour of the 1st defendant who is, I think, a skillful businessman and who is merely using the court process to prolong this struggle. The application of the 1st defendant for a stay of execution is therefore refused with costs.