RE JINRO (HK) INTERNATIONAL LTD.

HCCW 1352/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) NO. 1352 OF 2001

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D E C I S I O N

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1. On 7 October 2002, when the petition came before me at a call-over hearing, I gave directions giving leave to set down the petition for hearing with four days reserved. I indicated to Jinro (H. K.) International Limited ("the Company") at that hearing that if the Company wishes to respond to the 6th affidavit of Jeffrey Fergus filed on behalf of the petitioners on 2 October 2002 and if it wishes to rely on expert evidence relating to Belgian law, the Company should seek leave from the Court to do so well before the hearing of the petition.

2. On 30 October 2002, the trial dates for the hearing of the petition were fixed with a date for a pre-trial review which is today. The petition will be heard on 25 to 28 March 2003.

3. On 11 January 2003, four days before the hearing of the pre-trial review, a summons was issued by the Company seeking leave to do mainly two things. Firstly, the Company seeks leave to file three additional affidavits. Secondly, the Company wishes to seek a direction that the question of the petitioners' locus standi in these proceedings be determined as a preliminary issue. The time estimated for that application as set out in the summons is two hours. I say nothing in this ruling as to whether this summons could and should have been taken out earlier, and whether the reason advanced by the Company for taking out this summons only on 11 January 2003 (due to the change of counsel) is a good one.

4. I would simply deal with the summons in the exercise of my powers of case management. As I have indicated to counsel at the outset, having read their detailed submissions in writing, I do not propose to hear oral addresses. This is my determination on the summons of the Company.

5. Regarding the application for leave to adduce additional affidavits, the first affidavit is that of Mr Ivan Peeters on the Euroclear System. I have read this affidavit, it does not seem to me that what the deponent deals with in that affidavit touches on any issue of law. What he has done is to give an account of his understanding of the working and practice of the Euroclear System. It may be that part of what he says is merely a commentary on what the other side's witness Mr Fergus has said in his affidavit, but as I see it, there is nothing objectionable in this affidavit, so I propose to allow the Company to adduce as evidence the second affidavit of Mr Peeters.

6. The next affidavit that the Company wishes to put in is an affidavit from Mr Marc van der Haegen who is a Belgian lawyer. Having read his affidavit, it seems to me that the point of law covered by his affidavit is a very narrow one. I am unable to say, having read his affidavit, that the issue of law covered by him would be totally irrelevant to present proceedings. So for that reason, I would also give leave for the Company to put in the affidavit of Mr van der Haegen.

7. The last affirmation is an affirmation made by Mr Hak Chul Kim who is a president of Jinro Ltd, the major shareholder of the Company. Mr Kim's affidavit gives a further account of the composition proceedings of Jinro Ltd in Korea as well as discussions on the restructuring of Jinro Ltd, and what he perceives to be the reasons or motives of the petitioners in seeking to wind up the Company. A number of articles in newspapers and journals are exhibited to his affirmation.

8. My preliminary view is that some of the matters in Mr Kim's affirmation may not be germane to the issues that this Court is concerned with. However, that would only go to what weight should be attached to his affirmation. At the moment, I am not disinclined to disallow his evidence so I would also admit the affirmation of Mr Hak Chul Kim.

9. Having made an order in terms of paragraph 1 of the summons, I turn to paragraph 2 of the summons. The petitioners should have leave to file evidence in reply to the three additional affidavits put in by the Company, I would give the petitioners 28 days from today to do so.

10. Regarding the third paragraph of the summons, the Company seeks leave to file and serve a further affidavit giving an update on the restructuring of the Jinro Group three days before the substantive hearing of the amended petition. I would give the Company leave to do so, but I think three days would be too close to the hearing date and would leave insufficient time for the petitioners to respond to this, in case the petitioners should find it necessary to respond to this further affidavit from the Company. I give leave to the Company to file and serve one further affidavit giving an update as to the restructuring of the Jinro Group, 14 days before the hearing of the petition on 25 March 2003. I also give leave to the petitioners to file and serve evidence in reply to that affidavit from the Company seven days before the hearing of the petition.

11. Lastly, I turn to the direction sought by the Company that the question of the petitioners' locus standi be determined as a preliminary issue. In my view, the direction sought by the Company is simply a non-starter. I see no basis for hiving off that issue from the rest of the issues I would be concerned with in the petition. It would not be conducive to a just and convenient disposal of the proceedings to give the direction sought by the Company, let alone the lateness in which the application was made.

12. As for the costs of the summons, I make an order that the costs of the summons are to be in the cause of the petition.