QUESTNET LTD v. KURT GEORG ROCCO RINCK AND ANOTHER

HCA 1475/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1475 OF 2006

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J U D G M E N T

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1.  In a decision delivered by me on 30 November 2006, following prolonged interlocutory matters in which Mr Rinck filed a number of affidavits which were relevant not only to the interlocutory matters but also to the issue of summary judgement, summary judgement was entered against Mr Rinck.

2.  In the course of those interlocutory matters, on 17 November 2006, I found Mr Rinck to be in contempt of court in that he had failed, within a required time, to file an affidavit setting out the balance is remaining in certain bank accounts, together with an account of his dealing with those accounts and funds therein.

3.  On both occasions Mr Rinck, although having being represented previously, was unrepresented and did not appear.

4.  Sentencing on the matter of contempt was adjourned and a warrant was issued to arrest Mr Rinck to bring him before the court for sentence.  Mr Rinck now resides in Bali, and has not returned to Hong Kong.  He has not yet been sentenced on the matter of contempt and has taken no steps whatsoever to purge his contempt.

5.  On 14 September 2007, Mr Rinck filed a summons to set aside the summary judgement entered on 30 November 2006.  The application was not accompanied by an affidavit and on 12 October 2007, I dismissed the summons, without prejudice to Mr Rinck’s right to apply again, the application to be supported by an appropriate affidavit.

6.  On 10 December 2007, a further summons to set aside the summary judgement of 30 November 2006, was filed, this time accompanied by an affidavit.

7.  Mr Maurellet takes the preliminary point that Mr Rinck, being in contempt, ought not to be heard in the same cause until he has purged his contempt.

8.  The usual rule is the person in contempt will not be heard in the same cause until he has purged his contempt: see Hadkinson v Hadkinson [1952] All ER 567 CA.  The rule has recently been confirmed in Hong Kong by the Court of Appeal in Hotung v H Yuen Ki [2007] 4 HKLRD 384 at 396-398.  There the court permitted the contemnor to proceed as the order not complied with was the very order that was being appealed, that circumstance being an exception to the usual rule.

9.  The order in respect of which Mr Rinck is in contempt is not the summary judgement order.  It is an order requiring disclosure of information relevant to the case of QuestNet, which information was in the hands of Mr Rinck, and not QuestNet.

10.  Mr Maurellet does not contend that the purging of the contempt, that it is Mr Rinck’s compliance with the order for disclosure, is an essential step in dealing with the application to set aside the judgment.  There is no evidence that the course of justice is being impeded by the continuation of Mr Rinck’s contempt.  In so saying I do not in any way minimise the gravity of Mr Rinck’s contempt. 

11.  The primary point taken is that by allowing the proceedings to go on without the contempt being purged, and without proper affidavits of disclosure, would mean Mr Rinck can taunt and ignore the Hong Kong courts when it suits him, but at the same time use the court’s process, only when it is to his advantage.

12.  The situation where the order sought to be appealed is itself the order that is the subject of contempt proceedings is plainly in a quite different class.  To apply the rule in such a case would, in effect, prevent a person from attacking the very foundation of a contempt finding.  That could not be right.

13.  In the present application however that situation does not arise.  Mr Rinck was found to have not only made false and misleading affidavits in relation to the requirement for disclosure, but to have deliberately set about frustrating the purpose of the orders by giving as little information as possible.  Over a year has passed now since the decision in contempt proceedings, and Mr Rinck has taken no steps at all to appeal against the findings in that respect.

14.  Instead, when faced with the consequences of the enforcement of the summary judgement, Mr Rinck disregards his contempt and seeks to set aside the summary judgement.

15.  In the whole of the circumstances I accept Mr Maurellet’s submission that this is a proper case in which Mr Rinck should not be permitted to seek the assistance of the court in setting aside the summary judgement until such time as he has purged his contempt by filing proper affidavits of disclosure, and returned to Hong Kong for sentencing.

16.  The application to set aside the summary judgement will be stayed for a period of three months, that is until Monday 9 May 2008, to enable Mr Rinck to purge his contempt and to return to Hong Kong for sentencing on the matter of contempt.  If he should fail so to do, the application to set aside the summary judgement will stand dismissed.

17.  All questions of costs are reserved.