NOMURA INTERNATIONAL (HONG KONG) LTD AND OTHERS v. SECURITIES AND FUTURES COMMISSION

CACV No. 34 of 1998

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 34 OF 1998

(ON APPEAL FROM AL NO. 108 OF 1997)

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J U D G M E N T

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Rogers, J.A.

1. This is an application for leave to appeal to the Court of Final Appeal against a judgment which was handed down on 7th May of this year. The background to this case can be taken from that judgment and I will not repeat it here. It is, however, important in my view to set out what are said to be the questions which are sought to be determined on this appeal. There are two:

Question 1.

2. Mr. Shieh on behalf of the Applicant formulated the first question as follows. Whether in a case involving parallel and contested regulatory proceedings in Hong Kong and another friendly jurisdiction against the same or related parties raising common issues of fact and law, that the correct test to be adopted in law in respect of an application to stay the Hong Kong proceedings should involve a consideration of circumstances including whether the foreign forum is plainly the more appropriate forum in which to decide contested issues that are common to both proceedings so as to avoid as far as possible the inherent disadvantage of parallel proceedings and burdensome duplication of effort of justifying the impugned activity or trading concurrently before two different forum.

3. The question in my view is not precise and the first objection taken by Mr. Bleach S.C. on behalf of the Respondent is that it does not set out the test which the Applicants say should be applied. In answer to questions from the Court, Mr Shieh on behalf of the Appellants was at first doubtful but said that the test would include whether there was a risk of serious injustice. How such test is said to apply, I regret I cannot see, at least from the formulation which has been presented.

4. Mr. Shieh says that even if it were to be assumed that the test which the Court said should be applied in respect of stay applications, namely whether there was a real risk of serious prejudice which may lead to injustice was correct where there were domestic proceedings running in parallel (whether they be disciplinary proceedings or civil proceedings or a combination of both) because there was here an international dimension, it changes the situation and changes the test. But in the absence of formulating the test, it is difficult, if not impossible, to identify what it is about this international element which alters the risk of prejudice upon which the Applicants say they are entitled to a non-permanent stay of these proceedings.

5. In my view, there is no authority which has been put forward by Mr. Shieh for his arguments, and indeed, he impliedly said in the course of argument that such authorities that existed were against it.

6. In my view, there has been no question raised which merits this Court in allowing this matter to proceed to the Court of Final Appeal. Hence, I do not consider that in the words of Section 22(1)(b) of the Court of Final Appeal Ordinance that there is a question of great general or public importance which ought to be submitted to the Court for decision.

7. Even if I were wrong about that, and the question of stay of disciplinary proceedings were to be considered in a broad way to involve questions of great general or public importance, because of the nature of the argument which has been advanced which in effect has been rejected both by this Court and by the Court below, in my view, as a matter of discretion, this Court should not exercise its discretion to grant leave to appeal.

Question 2.

8. The second question formulated by the Applicants is: If the correct test is that of "a real risk of serious prejudice which may lead to injustice" whether in applying that test, the Courts can and should have regard to:

(1) whether or not the foreign forum is plainly the more or appropriate forum in which to decide the contested issues of fact and law that are common to these proceedings;

(2) the advantages that would flow to the parties from awaiting the outcome of the foreign proceedings;

(3) the inherent undesirability of and difficulties involved in multiple proceedings or whether there must be evidence of actual prejudice caused by the parallel proceedings.

9. It was pointed out by Mr. Bleach, that there seems to be at best a lacuna in the wording because the Court did not say that there should be evidence of prejudice, what the Court said is that there should be evidence of a serious risk, and evidence from which the Court could glean there was a serious risk of prejudice.

10. In my view, this question is too abstruse to be sanctioned as a proper question for the Court of Final Appeal. I do not consider it necessary to go into all the facets of it but certainly many of those points were raised. If it is a matter of discretion, it is certainly not a matter for the Court of Final Appeal and, in my view, leave to appeal should not be given in respect of this question.

11. I would, therefore, dismiss this application accordingly.

Liu, J.A.

12. I agree. Both questions as formulated are, in effect, complaints of the wrong application by this court of a well-established test. They are not proper questions to go to the Court of final Appeal.

Nazareth, Acting C.J.H.C.

13. I also agree that leave should be refused.