HONG KONG WAH SANG INDUSTRIAL CO LTD AND ANOTHER v. THE HONGKONG AND SHANGHAI BANKING CORPORATION LTD AND ANOTHER

HCMP2219/2007

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 2219 OF 2007

----------------------

----------------------

-------------------------

----------------------

R U L I N G

----------------------

1.  Fundamentally, this matter revolves around the issue of whether Guy Lam has the authority to call for the statements and other information that is required from the bank.  This in turn requires an inquiry as to whether he was validly removed as legal representative by the July 2006 resolution.  For that to have happened validly, his father’s, LPC’s, authority in relation to PRC Realty, a British Virgin Islands company, is now in sharp focus.  As a result the law of the PRC and of the British Virgin Islands is highly relevant.

2.  On the last occasion, in May, I adjourned the matter to enable further PRC legal opinion to be obtained concerning Guy Lam’s standing as legal representative and on the more general point about what powers a legal representative could exercise.  That evidence has now been obtained, although, as appears from a very helpful schedule produced by Mr Yuen SC, the experts have not entirely engaged each other on some important points.

3.  This search for the answer into the question of whether Guy had been validly removed by the LPC-sponsored resolution to purportedly remove him in July 2006 has now travelled to the BVI and both parties have obtained opinions from there as to LPC’s authority in relation to PRC Realty, which was behind that resolution.  This is the background.

4.  Mr Edward Chan SC submits that given the present state of the evidence the case is simply not ready to go.  He needs to reply to an important point on BVI law.  Mr Yuen says that he has had enough time to do so (8 days) but more fundamentally Mr Chan submits that there are simply too many disputes between the legal experts for me to work through them on paper. I should adjourn, give further directions and, amongst other directions, order that the experts appear and be cross-examined.

5.  Mr Yuen counters by pointing to the timetable.  There has already been considerable delay.  This matter started last year and when I adjourned in May I had expected the matter to proceed expeditiously.  Mr Yuen is right about that but this in itself cannot be determinative of Mr Chan’s application for an adjournment. 

6.  For my part I would be cautious when faced with foreign law to decide what that law is on the basis of conflicting expert evidence, although I am mindful of the cases that Mr Yuen has referred to in his skeleton as to how this evidence may be approached by a judge in such circumstances.  Mr Yuen has sought to underline, what he says is, the limited area of dispute between the China law experts based on his schedule and Mr Chan really not having attempted to develop these differences.  Nevertheless, differences there are, as in fact appears from Mr Yuen’s schedule, and there is the outstanding issue of Mr Chan’s wish to complete his BVI expert evidence as to which he has only had eight days to respond, which I believe is not really sufficient.

7.  The case must ultimately turn on foreign law as to whether Guy Lam has the authority to ask for this documentation.  I am in agreement with Mr Chan, that I would not feel able to resolve differences between the China law experts without having them cross-examined and so, for this reason alone, the matter should go over.  I also believe now that BVI law has also assumed such importance that Mr Chan should be able to complete his response on that.  I do not believe that eight days is enough to have dealt with an important point such as this. 

8.  Finally, I am also of the view that this case ought to go forward as one matter; to split it up into two would not be right and so I direct that it all goes over to a date to be fixed and I will now hear the parties as to further directions.