BANK OF INDIA v. MURJANI INDUSTRIES (HK) LTD AND ANOTHER

HEADNOTE

Application of the doctrine of "stare decisis" to the Court of Appeal.

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

J U D G M E N T

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

Kempster, JA:

1. This is an appeal from that part of the judgment of Godfrey J. given on 29 may last by which he dismissed the appeal of Mohan Bhagwandas Murjani from an order which Master Perrior had made on the 22 of that month, at the instance of the Bank of India, prohibiting him, subject to extension or renewal, from leaving Hong Kong until 22 June 1989 or such time as he should pay or secure payment to the Bank of US$10,798,955.91.

2. The Bank of India first obtained a Prohibition Order against Mr. Murjani on 24 February. It was granted by Sears J. pursuant to RSC Order 44A Rule 1 before issue of the writ claiming the sum in question from him as a guarantor of the debts of Murjani Industries (HK) Limited. On 23 March Barnes J. renewed the Order for one month. That order was in turn renewed for a further month by Master Jones on 21 April. It expired on 23 May. Meanwhile on 27 April summary judgment had been entered against Mr. Murjani for the monies claimed and on 16 May Sears J. made an order pursuant to RSC Order 49B for his oral examination. His solicitors have written to those acting for the plaintiffs to say that he will attend on 23 June being the day fixed.

3. By his grounds of appeal Mr. Murjani challenges the court's jurisdiction under section 21B of the Supreme Court Ordinance (Cap. 4) to make the Prohibition order of 22 May and seeks its discharge. The immediately material terms of that section are :

"(1) The court shall have jurisdiction to make an order prohibiting a person from leaving Hong Kong (a prohibition order) to facilitate the enforcement securing or pursuance of -

(a) a judgment against that person for the payment of a specified sum of money;

(b) a judgment or order against that person -

(i) for the payment of the amount to be assessed;

(ii) requiring him to deliver any property or perform any other act;

or

(c) a civil claim (other than a judgment) -

(i) for the payment of money or damages; or

(ii) for the delivery of any property the performance of any other act.

....

(5) (a) An order under subsection (1) shall lapse -

(i) on the expiry of one month but the Court may, on the application of the judgment creditor or claimant, extend or renew the order for a period which does not exceed, with the initial period of one month and any other period of extension or renewal, 3 months; ... ".

4. Only one order, it is submitted, may be made in any one action and once, as in the instant case, that order has been extended or renewed so as to run for the maximum period of three months the powers of the Court under s21B are exhausted.

5. Certainly the provisions of the order are apt for the reasonable protection of the interests of a plaintiff with a virtually indisputable claim who may expect smoothly to proceed, by way of summary judgment, from issue of writ to examination of the judgment debtor pursuant to RSC Order 49B. If, however, an alleged debtor for money is able to satisfy the court that he has a substantial defence to the plaintiff's claim the court "shall" discharge any order which has been made pursuant both to s21B of the Ordinance and to RSC Order 44A; usually ex parte and in form No. 106 in Appendix. A.

6. It is common ground that in the event of ambiguity the intention of the legislature may be ascertained from the wording of the section and of the rules which were together amended by the Debtors (Arrest and Imprisonment) Ordinance 1984.

7. Inevitably Mr. Tang, for the bank, has referred us to sections 2(1) and 7(2) of the Interpretation and General Clauses Ordinance (Cap. 1) :

"Save where the contrary intention appears either from this Ordinance or from the context of any other Ordinance or instrument..... Words and expresssions in the singular include the plural....".

8. Nothing in that or the Supreme Court Ordinance, he submits, evinces a contrary intention and section 21B(l) must be construed to read "The Court shall have jurisdiction to make an order or orders.....".

9. For my part I agree that no contrary intention appears in the legislation. The terms of Order 49B Rule 1A(3) provide:

"Where the examination is adjourned, the Court shall order that the judgment debtor appear at the resumption of the examination and may -

(a) order that he be prohibited from leaving Hong Kong...."

10. I cannot think that the court is precluded from making such an order if, prior to judgment the debtor has already been the subject of an order under RSC Order 44A for three months.

11. No fetter on the exercise of judicial discretion to extend, namely to inhibit the rights of the defendant for a further period of less than one month, or to renew, namely to inhibit his rights for a further month, is imposed. It is to be expected that when faced with an application to extend or renew the court will be concerned to know whether or not the plaintiff is pursuing his remedies with due diligence so as to enable him effectively to invoke RSC Order 49B. If, as a result of an appeal for example, the plaintiff has not secured even interlocutory judgment within the time limited and seeks a fresh order he will also have to satisfy the court, for the second or perhaps third time, as prescribed in section 21B(3). The manifest intention of the legislature was to require supervision by the court of the invasion of normal liberty authorised by the section, more particularly after the passage of time, with full powers under subsection (4) to discharge or to impose conditions.

12. Had I found the legislation ambiguous it would, I accept, had been proper to attempt so to construe it as to afford the defendant the greatest possible degree of personal liberty and to comply with the obligations of HM's Government in relation to Hong Kong under the International Covenant on Civil and Political Rights. In the latter regard only Article 12 would appear material:

"2. Everyone should be free to leave any country including his own.

3. The above-mentioned rights shall not be subject to any restrictions except those which are provided by law, are necessary to protect .... the rights..... of others and are consistent with the other rights recognised in the present Covenant."

13. As Mr. Thomas, for the judgment debtor, concedes provision for Prohibition Orders is made by law and thought necessary to protect the rights of creditors.

14. If I am right in concluding that more than one order may be made under section 21B(1) of the Supreme Court Ordinance it is unnecessary to inquire whether or not we are in any event bound by the earlier unanimous decision of this court to like effect when sitting; as presently, as a court of three to determine an interlocutory appeal. Hong Kong Industrial and Commercial Bank Ltd. v. Tommy Wong and Others Civil Appeal No. 22 of 1986 (Unreported). The Hong Kong Court of Appeal has regarded itself as bound by its own decisions at least since Ng Yuen-shiu v. A.G. 1981 HKLR 352 subject only to three exceptions akin to those stated in Young v. Bristol Aeroplane Co. Ltd. 1944 KB 718 namely where it is confronted by conflicting decisions of its own, where the previous decision cannot stand with a subsequent decision of the Privy Council or of the House of Lords and where the previous decision was given per incuriam. By the latter expression is meant a decision given in ignorance of the terms of a statute or a rule having the force if a statute or of an earlier material decision of its own or of another court. It is not submitted that the decision in the Hong Kong Industrial and Commercial Bank case was given per incuriam but we are reminded that it was made after an ex parte hearing at which only one side was represented and in relation to an interlocutory issue.

15. That the earlier appeal was argued ex parte, albeit the Judge at first instance had given a reasoned judgment, does not seem significant. As Webster J. said in Amanuel v. Alexandros Shipping Co. (1986) 1 Q.B. 464 at p. 469:

"..... the ordinary doctrine of precedent ... is applied, not to the same case between the same parties but, in the interests of consistency and certainty, to avoid different cases on the same facts being decided differently."

As before that judge ''No authority has been cited to me which suggests that a decision made ex parte is not a decision to which the ordinary rules of precedent apply." In Leung Yiu-ming & Ors. v. Jade Palace Restaurant Centre Ltd. (1985) H.K.L.R. 231 reference was made to the assumption of jurisdiction in the absence of argument in a previous case in circumstances where the per incuriam exception might well have been applicable while in A.G. v. LAU Chiu-tak (1984) H.K.L.R. 23 this to choose between earlier conflicting decisions in a sentencing context.

16. As to the interlocutory issue reliance was placed upon Boys v. Chaplin (1968) 2 Q.B. 1. The point in question was not canvassed when the matter went to the House of Lords.

At p.23 Lord Denning, M.R. is reported as follows:

"But is Machado v. Fontes binding on this court? I do not think so. It was an interlocutory appeal, heard by two lords justices only, on the bare question whether there should be leave to amend or not. Such questions are dealt with expeditiously - I might almost say summarily - because they do not usually raise points of great moment. On the occasions when they do raise important points arrangements are made to have them heard by three judges... I cannot regard such a decision as a binding precedent. There is no case in the books where a decision of two lords justices has been held to be binding when it is afterwards discovered to be wrong. On the contrary there are three cases in which such a decision has been overruled by a court of three or more".

Lord Upjohn, at p 30, agreed that :

"If this court thought that Machado v Fontes was wrongly decided it could probably review that case because it was an interlocutory appeal heard by two judges ...".

Diplock LJ said, at p 35,

"In the Court of Appeal we are bound by judicial decisions of the House of Lords, but so far as concerns the binding effect on the Court of Appeal of its own decisions our fetters too are self-imposed. Their extent was discussed in Young v Bristol Aeroplane Co Ltd and I concede that the decision in Machado v Fontes does not fall within any of the three exceptions to the binding effect of decision of the Court of Appeal upon a subsequent Court of Appeal of co-ordinate jurisdiction which are set out in Young's case. But in Young's case it was only final judgments of the Court of Appeal which were under consideration. Machado v Fontes ....was an interlocutory not a final judgment .... the appeal may be heard by two lords justices .... Young's case .... does not, as I think, preclude this court from declining to follow the ratio decidendi of a previous interlocutory order of the Court of Appeal if this court thinks that the ratio decidendi was wrong".

17. Since the principles of Young's case were subsequently and unequivocally indorsed by the House of Lords in Davis v Johnson [1979] AC 264 and I do not think that the ratio decidendi of the three judgments given in Hong Kong Industrial & commercial Bank Ltd v Tommy Wong was wrong I hold that we are bound by it and am happy so to do in the interests of legal certainty.

18. I would dismiss this appeal.

Clough J.A.:

19. I agree with all that has been said by Kempster JA and would also dismiss the appeal.

Mortimer J.:

20. I agree.