WINGAMES INVESTMENTS LTD AND ANOTHER v. MASCOT LAND LTD AND OTHERS

HCA 907/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 907 OF 2011

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BETWEEN

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REASONS FOR DECISION

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1.  This reasons for decision concerns the grant (against the 1^st to 3^rd and 5^th to 6^th defendants (“the 5 defendants”)) and continuation (against the 4^th defendant (“D4”)) of an interim injunction order up to 15 July 2011. The order was made on the summons day. I also dismissed the 1^st defendant’s (“D1’s”) application for payment-into court. The brief reasons for the orders appear below.

2.  The earlier summons day fell on 3 June 2011, when the plaintiffs sought an interlocutory injunction order against all defendants.  At the end of that hearing, the plaintiffs’ said application was adjourned to 15 July 2011 to be dealt with by the summons judge, or as he may direct.

3.  On the plaintiffs’ application for an interim order to “hold the ring”, the 5 defendants gave an undertaking in lieu to last until 17 June.  D4 refused to gave such an undertaking and an interim order in similar terms was made against it, also to last until the said date.

4.  At the 3 June hearing, the 5 defendants produced a 3-page Chinese document.  This was said by counsel to show imminent pending transactions which form part of the ordinary course of business; no evidence was adduced in support of it.  The plaintiffs complained that they had not seen the document before.

5.  The matter was adjourned to 17 June to enable the plaintiffs to consider that document and to decide if they would object to the transactions therein.  Should the parties still disagree over that matter, it could be dealt with on 17 June.

6.  In short, the parties could not reach agreement because the defence refused to provide further information regarding the document.  Further, at the 17 June hearing, the defence refused to give further undertaking (to last up to 15 July), and opposed the grant of an interim order pending that hearing.  No affirmation evidence has been filed by the defence for the purpose of the 17 June hearing (though the 5 defendants have produced two affirmations for use at the 15 July hearing (not yet filed)).

7.  Despite various criticisms having been levied against the plaintiffs’ case (including their failure to file or serve a statement of claim), I found that the plaintiffs had established enough merits in their case to justify the grant of an interim order.  There is no substance in the defence objection to the form of the interim order.

8.  As regards balance of convenience, because of the failure to disclose further information, very little was known about the transactions set out in the said 3-page document; in particular, both the supporting documents and the factual details were lacking.  As has been the case on 3 June, I was satisfied on 17 June that a grant/continuation of the interim order should carry the least risk of injustice to all parties concerned.

9.  As regards the fortification of the plaintiffs’ cross-undertaking as to damages, there was no change of circumstances relative to the 3 June hearing.  Taking into account the deposit of the sum originally held by the plaintiffs into an escrow account (and in the context of the contractual relationship among the parties), I considered fortification to be unnecessary.

10.  As regards D1’s application for payment-into court, I did not find the fact that one of several partners of the plaintiffs’ solicitors was a beneficial owner of one of the plaintiffs’ subsidiary companies to render the sum in the escrow account to be any less safe than a payment-into court, or the present arrangement to be any less desirable.