THE MANILA BANKING CORPORATIOON v. VICENTE G. PUYAT AND OTHERS

1988, No. A7451

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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J U D G M E N T

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1. The facts of this case appear in the statement of claim and in the evidence filed on behalf of the parties. In view of concessions made by Mr Wong, Counsel who appeared for the defendants, the summons, issued on behalf of the 4th defendant to discharge the injunction that I granted on the 17th November 1988 and continued on the 23rd November 1988 could not succeed. However, Mr Wong went on to seek a variation of that injunction to enable the 1st and 2nd defendants, the directors of the company, to receive their annual emoluments and for a payment of $338,000, which is the subject matter of an application for security for costs, to be paid for legal expenses.

2. Mr Poon, counsel for the plaintiff, responded to the application to vary, before making a submission upon his client's summons, to enter judgment upon admissions. The admissions are set out in paragraphs 2 and 3 of the 1st defendant's affidavit, made on the 20th December 1988 which was confirmed by the 2nd defendant in his affidavit of the 31st December 1988. Paragraphs 2 and 3 of the 1st defendant's affidavit read as follows :-

    "............

(2)    I confirm that I am a stock holder of the Manila and Hongkong Capital Corporation Limited (MHKCC), having two shares registered under my name, and I am also a director of the Hongkong-Manila Investment Services Limited (HMIS). I also confirm that HMIS is a wholly owned subsidiary of MHKCC which, in turn, is a wholly owned subsidiary of the Manila Bank.

(3)    I further state that I am authorised herein by the Board of Directors of Manila Bank, to confirm the fact that the only nominees of the Manila Bank with the MHKCC and the HMIS are the following:

(a)    Vicente G. Puyat; and

(b)    Hermilando I. Mandanas who are given the continuing trust to hold on to the shares presently registered in their respective names in the books of said corporation/s, and to act as trustee/s, for and in behalf of Manila Bank, for said shares until such trust is expressly revoked and/or cancelled by Manila Bank.'"

3. Mr Poon also relies upon the admissions made by Mr Wong during the course of his submission today.

4. The 1st and 2nd defendants are the only directors of the 3rd and 4th defendants, and the 4th defendant is a wholly owned subsidiary of the 3rd defendant which, in turn, is a wholly owned subsidiary of the plaintiff. The 5th defendant, in turn, is a wholly owned subsidiary of the 4th defendant, and, in turn, is a wholly owned subsidiary of the plaintiff, and the shares of that company are registered in the name of Commerce Nominees Limited, in trust for the 4th defendant. Quite clearly, as a result of the admissions, the plaintiff is entitled to judgment as sought for the reliefs set out in the statement of claim so that I shall make the order as prayed. In view of my decision, the summons issued on behalf of the 4th defendant to discharge or vary the injunction, and the summons issued on behalf of all the defendants for security for costs must be dismissed with costs.