LAI MEI CHUN SWANA v. LAI CHUNG KONG AND OTHERS

DCCJ 5350/2009

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 5350 OF 2009

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

JUDGMENT

1.  This is an application by the Plaintiff against all the Defendants for an injunction to restrain them from using or disclosing the information contained in the bank statements of an account kept with Wing Hang Bank Limited in the joint names of the Plaintiff and the late Mr. Lai Chung Kwan (“the Deceased”), being account no. 153768 (“the joint account”) for the period from February 2006 to December 2008, and for damages. In order to better understand the claim of the Plaintiff, it is necessary to set out the background leading to the dispute herein.

Background

2.  The Plaintiff and the 1^st, 2^nd and 4^th Defendants are brothers and sisters.  They are all children of Mr. Lai Fook (“Mr. Lai the senior”).  Mr. Lai the senior and his wife Wong Ying have the following children:

1. Miss Lai Mi Har

2. Miss Lai Mei Ling (“Ling”)

3. The Plaintiff

4. The 1^st Defendant

5. Miss Lai Mei Lin

6. Mr. Lai Chung Fai

7. The 2^nd Defendant

8. The Deceased

9. The 4^th Defendant

3.  The 3^rd Defendant is a limited company with 80,000 shares.  Mr. Lai the senior holds 10,000 shares.  All the sons including the 1^st, 2^nd and 4^th Defendants, the Deceased, and Mr. Lai Chung Fai, each holds 14,000 shares.  The 1^st and 2^nd Defendants and Mr. Lai Chung Fai were and are the only directors of the 3^rd Defendant.  The 4^th Defendant was and is the accountant of the 3^rd Defendant.  Mr. Lai the senior passed away on 4 February 1995 and the Deceased passed away on 11 December 2008.

4.  According to the affirmation of the Plaintiff filed in a High Court Action HCA No. 401 of 2009 (“the High Court Action”), the Deceased had a stroke on 5 March 2005 which left him partially paralyzed.  Until his death on 11 December 2008, the Deceased had incurred substantial expenses for his medical treatment and home care equipment.  The Plaintiff claims that on 20 September 2005, she had reached an agreement with the 3^rd Defendant through the 1^st Defendant that she would pay for the medical treatment of the Deceased in advance and the 3^rd Defendant would reimburse her for the money that she actually paid.  The payment to the Plaintiff would be debited to the account of the Deceased with the 3^rd Defendant.

5.  I also refer to paragraph 10 of the Statement of Claim filed in the High Court Action.  It is the case of the Plaintiff that the said agreement was reached in the presence of the 1^st Defendant, the Plaintiff, Mr. Lai Chung Fai and the Deceased.

6.  The Plaintiff claims that during the period from 22 June 2005 to 31 December 2008, she had made a total payment of about HK$5.79 million for the medical expenses of the Deceased.  And during the period from 16 December 2005 to 24 September 2008, the 3^rd Defendant only reimbursed her for a total sum of about HK$3.77 million by way of cheques drawn in favour of the Deceased.  All these cheques were deposited into “an account under the names of the Plaintiff and [the Deceased] at Wing Hang Bank, which account had been opened by the Plaintiff and [the Deceased] on 15 December 2005”.  It is not clear from the Statement of Claim if the Plaintiff is referring to the same joint account.  But from the bank statement disclosed herein, we are talking about the same joint account.

7.  I presume the Plaintiff got reimburse from the money paid into the joint names account.  But there is a balance of HK$2 million more which has not been paid. The 3^rd Defendant denies the said agreement or that the Plaintiff has paid for the said medical expenses for the Deceased.  Accordingly, the Plaintiff instituted the High Court Action against the 3^rd Defendant to recover the said balance of about HK$ 2 million. This is an on-going litigation in the High Court.

Administration of the Estate of the Deceased

8.  Before I continue with the development in the High Court Action, I have to set out what happened at the same time in relation to application for administration of the estate of the Deceased.  Understandably, the Deceased has valuable assets, at least in form of the shares in the 3^rd Defendant.  It is the evidence of the 1^st Defendant (which is not agreed to by the Plaintiff and which I would consider further hereinafter) that in or about Lunar New Year in late January 2009, he as the elder son discussed with other siblings on the issue relating to the administration of the Deceased’s estate.  He claims that all the brothers and sisters including the Plaintiff agreed to appoint him and the 2^nd Defendant as the intended administrators of the Deceased. 

9.  Having obtained the consensus of all the brothers and sisters, the 1^st and 2^nd Defendants engaged Messrs. Chui and Lau to handle the application for letters of administration for the estate of the Deceased.  Messrs. Chui and Lau wrote to the banks with which the Deceased maintained account requesting for information of any accounts held by the Deceased.  In respond, Wing Hang Bank provided Messrs. Chui and Lau, with copies of the statement of the joint account.  In fact, the joint account has 2 sub-accounts, the saving account (“the 1^st account”) and the current account (“the 2^nd account”).

10.  By then, the Plaintiff had started the High Court Action against the 3^rd Defendant.  The 1^st and 2^nd Defendants were under the impression that the Plaintiff was targeting both of them only.  Hence, in an attempt to settle the action amicably and to facilitate the administration of the estate, Messrs. Chui and Lau on behalf of the 1^st and 2^nd Defendants proposed to the Plaintiff that the 1^st and 2^nd Defendants would resign as the intended administrators and some other siblings would take over the position.  And in early August 2009, the 1^st and 2^nd Defendants resigned as the intended administrators.

11.  After their resignation, the siblings (other than the Plaintiff) agreed to have the 4^th Defendant and Ling to act as the intended administrators. The 1^st and 2^nd Defendants passed the copy banks statement to the 4^th Defendant and Ling. 

Specific Discovery in the High Court Action

12.  At the stage of discovery of the High Court Action, the Plaintiff has not disclosed the bank statement of the joint account.

13.  The 3^rd Defendant took out an application for specific discovery in the High Court Action.  Though the 1^st, 2^nd and/or 4^th Defendants had obtained the bank statement of the 2^nd account through Messrs. Chui and Lau in their capacity as intended administrators, they had not disclosed those accounts in the supporting affidavit for specific discovery filed by the 3^rd Defendant.  The 1^st Defendant in his supporting affidavit referred to the Statement of Claim where the Plaintiff mentioned a joint account with Wing Hang Bank, and called it the first account.  He also mentioned that, from conversation with the Deceased before he passed away, he knew about a joint account in Wing Hang Bank for trading stocks through the Plaintiff’s security company, which he called the second account.

14.  The application was resisted by the Plaintiff.  The Plaintiff said on oath that there is only one joint account with the Deceased at Wing Hang Bank. She claims that the so-called second account does not exist.  In any event, she argued that the bank statement of the two accounts would not be relevant.

15.  On 23 October 2009, the High Court refused the application of the 3^rd Defendant.  The 1^st, 2^nd and 4^th Defendants said the Plaintiff was telling lie to the Court on oath.  And upon legal advice, the 3^rd Defendant made a 2^nd application for specific discovery of the bank statement of the 2^nd account.  And in support of this 2^nd application, the 4^th Defendant filed an affirmation dated 23 September 2009.  In the affirmation, the 4^th Defendant disclosed the existence of the 1^st and 2^nd accounts, which he came to know in the course of preparing to apply for letter of administration for the estate of the Deceased.  The 4^th Defendant indentified the 2^nd account as the second account and also pointed to certain transaction recorded in the bank statement of the 2^nd account which he submitted would be relevant to the issue in the High Court Action.

16.  In reply, the Plaintiff explained that it is her genuine belief that the 1^st account is a deposit account and the 2^nd account is a sub-account of the 1^st account, being a current account in nature.  To her, the two accounts are just one integrated account and is the account mentioned in her Statement of Claim.  That is reason when she denies the second account on the mistaken thought that the Defendants are talking about another joint account.  She also denies that the information in the 2^nd account has any relevance to the issue in the High Court Action.

17.  The 2^nd application for discovery in the High Court Action was heard by Master Ho who ordered on 10 September 2010 that the Plaintiff should disclose the bank statement of the 2^nd account for the period from January 2008 to December 2008. 

This Action and the Plaintiff’s case

18.  On 22 December 2009, the Plaintiff issued the first action in this consolidated action against the 1^st, 2^nd and 3^rd Defendants seeking an injunction to restrain the 1^st, 2^nd and 3^rd Defendants from using or disclosing the bank statement of the joint account, namely account with Wing Hang Bank No. 153768, which I presume include both the 1^st and 2^nd accounts.  The Plaintiff further claims an order for the Defendants to deliver up all the bank statement to the Plaintiff and for damages for breach of confidence.

19.  I am not aware of any application for interlocutory injunction in this action.  And on 20 January 2010, the Plaintiff commenced DCCJ 220 of 2010 against the 4^th Defendant for similar release.  Both actions have been consolidated.

20.  It is the case of the Plaintiff (as set out in the Statement of Claim for the consolidation actions) that at all material time, the bank statement and all information therein of the 1^st and 2^nd accounts were confidential to the Plaintiff and the Deceased jointly (paragraph 6 of the Statement of Claim).  And it was stated that such confidential information relates to the joint finances of the Plaintiff and the Deceased and is obviously private and confidential.  Further, the bank statement is transaction records arising out of and kept in a professional banker-customer relationship.

21.  The Plaintiff claims that upon the 1^st and 2^nd Defendants receiving the bank statement from the bank, each of them knew or ought to have known the confidential nature of the document.  Since the 1^st and 2^nd Defendants applied to the bank for the document in the capacity of and “intended administrator”, they would have received the confidential information in a quasi-fiduciary relationship towards the Deceased and the Plaintiff.  Such quasi-fiduciary relationship necessarily carries with it the duty of confidence.  And the Plaintiff claims that the 1^st and 2^nd Defendants were in breach of their duty of confidence by disclosing the confidential information to the 3^rd Defendant and/or the 4^th Defendant.

22.  For the disclosure to the 3^rd Defendant, the Plaintiff is relying on the fact that the 1^st and 2^nd Defendants were directors of the 3^rd Defendant and accordingly the 3^rd Defendant would be imputed with the knowledge and information of the accounts.  The 3^rd Defendant would also be under a duty of confidence to the Plaintiff and the Deceased.

23.  The Plaintiff complains that the 3^rd Defendant breached his duty of confidence by threatening to adduce the confidential information in the bank account as evidence in the High Court Action in an attempt to discredit the Plaintiff. 

24.  And in respect of the 4^th Defendant and Ling, the Plaintiff claims that when they replaced the 1^st and 2^nd Defendant and hold themselves out as the intended administrators, they would be under a duty of confidential to the Plaintiff and the Deceased jointly.  And the Plaintiff claims that the 4^th Defendant was in breach of his duty of confidence by using the confidential information in his affirmation dated 23 December 2009, which I mentioned above.  Indeed, the Plaintiff claims that the 4^th Defendant used the confidential information with the malicious intention to discredit the Plaintiff.

Issues in Dispute

25.  Before moving into consider the evidence of the case, it is necessary to reconsider the issues in dispute.  After all, this is an application by the Plaintiff for injunction; the main ruling for this Court is whether there is justification for the grant of an injunction. 

26.  It is not disputed that the 1^st and 2^nd Defendants obtained the bank statement in their capacity as the intended administrators. The Plaintiff denies that she has agreed to have the 1^st and 2^nd Defendants to apply for letters of administration for the estate of the Deceased.  The first issue is whether there was such an agreement.

27.  The next issue is whether they have a duty of confidence towards the Plaintiff and the Deceased when they obtained the bank statement, and if so, whether they have been in breach when they released those information to the 4^th Defendant as the successor to be the intended administrator. 

28.  The third issue is whether the 4^th Defendant also owed a duty of confidence to the Plaintiff when he received the bank statement from the 1^st and 2^nd Defendants.  If so, is he in breach when he disclosed the information of the bank statement in the High Court Action.  And the 4^th Defendant also raised the defence that he may disclose the information on the ground of public interest.

29.  And finally, whether the 3^rd Defendant is in possession of any confidential information; and if so, does it owe any duty of confidence to the Plaintiff.

30.  Before the closing, I set out a list of suggested areas for counsels to assist.  I am grateful to both counsels who have addressed my concern in addition to their individual comments on their client’s case.  I would just start with the capacity of an intended administrator.

Intended Administrator

31.  It is the submission of Mr. Vaughan, Counsel for the Plaintiff that there does not exist a legal capacity as intended administrator.

32.  I believe the term has been loosely used by practitioner to describe an applicant for a grant in respect of the estate of a person under the Probate and Administration Ordinance.  Mr. Lam, counsel for the Defendants refers me to Section 24A of the Probate and Administration Ordinance which provides that the applicant should file a supporting affidavit which exhibit a schedule setting out the assets and liability of the Deceased as at the date of his death known to the applicant.  And it has been a common practice for probate solicitors that, before putting in an application, to circulate to all banks asking if the Deceased kept a bank account with them.

33.  Technically, an intended administrator has no power to do anything as administrator before the grant of letters of administration (per Le Pachon J.A. in Chin Lan Hon & others v. Cheung Poh Choo & others [2005] 3HKLRD 811).  The applicant in asking for bank information is acting in the assumed character of administrator and that the act done should be for the benefit of the estate.  The doctrine of relation back applied when he subsequently obtained the letter of administration.

34.  Accordingly, the intended administrator is a person who intends to apply for probate or letter of administration.  Subject to the principle of relation back, he does not have the power of an administrator.  He only has limited power to act in the interest of the estate which could be rectified by the principle of relation back.  To collect bank statement must be one of the reasonable and necessary acts for the benefit of the estate and for the application of letters of administration.

Agreement for 1^st and 2^nd Defendants to apply for Letter of Administration

35.  It is the evidence of the 1^st Defendant that in or about the Lunar New Year holiday in late January 2009, when visiting his siblings or engaging in telephone conversation with them, he as the eldest son discussed with them the issue in relation to the administration of the Deceased’s estate.  The family members agreed to appoint him and the 2^nd Defendant as the intended administrators of the estate.  And he discussed the matter with the Plaintiff on 29 January 2009, the 4^th day of lunar New Year.  He said at about lunchtime, he visited the office of the Plaintiff; he suggested to the Plaintiff that he and the 2^nd Defendant should act jointly as intended administrators and the Plaintiff expressly agreed with his proposal.

36.  Further, on or about 2 February 2009, the 1^st Defendant telephoned the Plaintiff informing her that they had engaged Messrs. Chui and Lau to handle the application for letters of administration.  He said he had informed her that for purpose of applying for letter of administration, discovery of the Deceased’s asset would be conducted.  He also enquired with the Plaintiff if she knew about any bank account which the Deceased might have. The Plaintiff replied saying that she never cared about other person’s account.  He also asked the Plaintiff for her identity card for possessing the application of letters of administration.  On 3 February 2009, the Plaintiff faxed to the 1^st Defendant’s office a copy of her Hong Kong identity card.  Later, at the request of the 1^st Defendant, the Plaintiff faxed her address to the 1^st Defendant.

37.  The Plaintiff complains that the 1^st and 2^nd Defendants obtained the information from the bank without her consent.  But she had not stated clearly in her witness statement whether she agreed to the arrangement for the 1^st and 2^nd Defendants to apply for letter of administration.  When being cross-examined, she tried to explain that the 1^st Defendant asked for her agreement but she had not expressed her consent.  She also claimed that the 1^st Defendant made the enquiry in a very informal manner.  But she agreed that she had faxed her identity card and her address to the 1^st Defendant.  The Plaintiff explained that when she faxed the identity card to the 1^st Defendant, she also faxed to the 1^st Defendant the balance of the medical expenses she paid on behalf of the Deceased.

38.  Even from the Plaintiff’s evidence, she cannot deny that there had been discussion among the siblings of the administration of the estate of the Deceased.  I can understand that such “agreement” would not be a formal one. It is really the consensus among the siblings that some of them would make the application.  It is quite clear that the Plaintiff knew about it and agreed to it at least when she faxed over her identity card and the address.  This must be information to facilitate the 1^st and the 2^nd Defendants to apply for letter of administration.

39.  I accept the evidence of the 1^st Defendant and find that there is a consensus among the siblings that the 1^st and 2^nd Defendants would apply for letter of administration. 

40.  Mr. Vaughan in his closing submission submitted that this point is neither here or there.  In one sense I agree.  In many cases, there is no consensus among all the beneficiaries or persons entitled to apply for letters of administration.  Someone would take the action to apply for letters of administration, and other beneficiary may object.

41.  On the other hand, as submitted by Mr. Lam, since intended administrators have to ascertain the assets of the estate, the Plaintiff in consenting to the 1^st and 2^nd Defendants’ application for letters of administration, must also consent to their obtaining the bank statement and the information therein.  I agree.  And this is a factor to be taken into account in considering, if the Defendants were in breach of the duty confidence, if injunction and/or damages should be awarded.

Any Duty of Confidence by 1^st and 2^nd Defendants

42.  It is the argument of the Plaintiff that the bank statements are confidential in nature.  They relate to the finance transaction of the Plaintiff and/or the Deceased.  The bank owes a duty of confidence to the Plaintiff and the Deceased jointly.  I believe there is no argument on this general principle on the duty of a bank.

43.  When the 1^st and 2^nd Defendants received the information in the account on the transaction carried out by the Deceased solely or jointly with the Plaintiff, they received it as the intended administrators. I was referred to the judgment of Lord Griffiths in A.G. v. Guardian Newspapers (No. 2) 1 A.C. 109 at 268.  His Lordship said in his judgment that:

“The duty of confidence, is, as a general rule, also imposed on a third party who is in possession of information which he knows is subject to an obligation to confidence ……….. If this was not the law the right would of little practical value: there would be no point in imposing a duty of confidence in respect of the sequence of the marital bed if newspapers were free to publish those sequences when betrayed to them by the unfaithful partner in the marriage. When trade sequences are betrayed by confidant to a third party it is usually the third party who is to exploit the information and it is the activity on the third party that must be stopped in order to protect the owner of the trade sequence.”

44.  It is the case of the Plaintiff that when the bank provided the bank statement to the 1^st and 2^nd Defendants, which is confidential in nature, the 1^st and 2^nd Defendants must also owe a duty of confidence to the Plaintiff and the Deceased since they must also know the confidential nature of the bank statement.

45.  I would also refer to the judgment of Dennings MR in Seager v. Copydex Ltd. [1967] 1WLR 923 when His Lordship said –

“The law on this subject does not depend on any implied contract. It depends on the broad principle of equity that he who has received information in confidence shall not take unfair advantage of it. He must not make use of it to the prejudice of him who gave it without obtaining his consent.”

46.  I believe Mr. Lam is not really arguing against this duty of confidence. 

47.  But there has to be at least one qualification.  The bank statement is in respect of the joint account.  The Deceased must be entitled, before he died, to receive the information of the monthly statement and to make use of the information, say for filing of tax return.  And after he died, Mr. Vaughan argues that all the property would pass to the Plaintiff as the surviving account holder.  But he has not supported his argument with any authority nor provides me with the express term of the bank mandate.  I am of view that the right to the information should be with the estate of the Deceased.

48.  Hence when the 1^st and 2^nd Defendants used the bank statement in the administration of the estate of the Deceased, including the application for letters of administration, they are assuming the power of the intended administrators which I analysed above.  I agree that they owe a duty of confidence to the Plaintiff and the Deceased with the qualification that they should only use the bank statement for the purpose of the application for letter of administration or administration of the estate. 

Resignation by 1^st and 2^nd Defendants as Intended Administrators

49.  It is not disputed that the 1^st and 2^nd Defendants passed on the bank statement to the 4^th Defendant and Ling. It is not disputed that for this change of intended administrator or applicant, the Plaintiff has not consented.

50.  I think Mr. Lam must be correct to say that a person is free to resign as an intended administrator.  The issue really turns on upon resigning, how he should deal with information, such as the bank statement he had obtained, in the course of preparation for the application. 

51.  As I analysed above, there are bound to be cases when not all the beneficiaries or parties entitled to apply for letter of administration have consensus. There is no provision that consent of all beneficiaries is required.  I believe the 4^th Defendant and Ling are entitled to apply, and the Plaintiff is equally entitled to oppose.

52.  Mr. Lam submits that when the intended administrator resigned from office, there is no reason why he could not pass on the documents and information to the newly appointed intended administrator.  It is a waste of money, and not for the benefit of the estate if the bank statement has to be returned to the bank and the newly appointed intended administrator has to apply afresh.

53.  It is the Plaintiff’s case that the 1^st and 2^nd Defendants were in breach of their duty of confidence when they transferred the bank statements to the 4^th Defendant and Ling.  As between the Plaintiff and the 1^st and 2^nd Defendants, the question is whether the transfer of document is part of the process of application for administration. 

54.  The replacement of the applicant is not an unexpected event in application for letters of administration.  When the intended administrators were replaced, it is natural for the documents collected be transferred to the new intended administrators.  Indeed, in some case, (and possibly this case), the documents are kept by the same solicitor firm acting for the intended administrators (both the outgoing and the incoming).  I do not agree that it would be a breach of the duty of confidence which I analysed above when the statement is transferred to the incoming intended administrators to facilitate the preparation of the necessary application, even though the Plaintiff may not have agreed to the new intended administrators.

55.  If I were wrong, it only means that on resignation, the 1^st and 2^nd Defendants should return the bank statement to the Bank.  Alternatively, they with the new intended administrators could jointly write to the Bank seeking its agreement to pass on the bank statement.  I cannot imagine the bank would refuse.  Be that the case, there would be at most a technical breach on the part of the 1^st and 2^nd Defendants when they transferred the bank statement to the 4^th Defendant without obtaining the approval of the bank. There is no suggestion that the intention of all the other siblings to have the 4^th Defendant and Ling to apply for letter of administration is not genuine.

56.  If there were a technical breach, I would consider later if injunctive relief is appropriate.

Any Duty of Confidence on the 4^th Defendant to the Plaintiff and the Deceased

57.  And when the bank statements were passed to the 4^th Defendant and Ling as intended administrators, they must become aware that they are holding the confidential information of the Plaintiff and the Deceased.  The 4^th Defendant would be in the same position of the 1^st and 2^nd Defendants to owe a duty of confidence to the Plaintiff and the Deceased as I analysed above.

Joint Property

58.  Before I move on, I should mention one side issue.  Mr. Lam argues that the right to the confidential information of the account is the joint property of the Plaintiff and the Deceased.  Accordingly, the Plaintiff would not be in a position to enforce the right without joining the Deceased.

59.  I do not have the mandate of the account.  Assuming that the right to the information and the property in the account is joint, the question turns on whether the duty of confidential by the bank to the Plaintiff and the Deceased are joined or joined and several.  I refer to paragraph 15/4/12 of the Hong Kong Civil Procedure 2011 which said:

“Where a husband and wife deposited funds in a joint account to the bank to whom they give a written mandate to honour all cheques and orders, if but only if, they were signed by both account holders the bank owes an obligation to the account holders jointly to honour their instructions, but it also owes an obligations separately to each of the account holders severally not to honour instructions unless signed by each of them. Therefore, the wife is entitled to sue the bank, in respect of the several obligations owe to her without joining her husband and she was entitled to declaration that the bank has wrongly debited the account in respect of funds transferred there from on instructions signed by the husband alone, and further entitled to damages and interest (Katlin v. Curprus Finance Corp. London) LTD [1983] Q.B. 759.”

60.  While this passage is not directly on the issue, it is authority to support that the duty of the Bank to holders of joint account could be several, depending on the nature of the right to be protected.  The duty of confidence is a negative covenant that the bank should not disclose information in the account.  It should be a duty owed separately to the Deceased and the Plaintiff.  The Plaintiff may enforce it herself and I do not agree that the Plaintiff has to be joined.  And if this is an issue, I would have expected the Defendants to have taken out application to stay this proceeding much earlier on.

Any Breach of Confidence by the 4^th Defendant

61.  I do not believe the 4^th Defendant, or the 1^st and 2^nd Defendants are disputing they have a duty of confidence to the Plaintiff and the Deceased.  Hence, for the first application for specific discovery in the High Court Action, they have not disclosed the bank statement or any information of the 2^nd account to the High Court. 

62.  When the 4^th Defendant disclosed the bank statement for the second application for discovery in the High Court Action, there would be prima facie breach of the duty of confidence.  The main argument by Mr. Lam on behalf of the 4^th Defendant is that it is in the public interest to allow the 4^th Defendant to disclose the information.  And alternatively, the matter has now been resolved in the High Court, and there is no further threat of disclosure of the bank statement.  It is not necessary and academic for the Plaintiff to proceed with their claim for injunction.  I shall take these two issues one by one.

Interest of Public

63.  The Plaintiff explained that in the High Court Action, she was misled by the affidavit of the Defendants to think that the Defendants are referring to an account other than the joint account.  Reading from all these, the Plaintiff may have committed a genuine mistake or may have presented a less than frank picture to the High Court Master.

64.  Mr. Lam submits that when a prima facie case of misconduct is established it would be sufficient to raise the defence of public interest. And he submits that from the evidence, there is at least a prima facie case or reasonable ground for suspicion that the Plaintiff lied on oath.  But the question is what misconduct has to be proved. 

65.  The duty of confidence of a bank is not absolute.  In Tournier v National Provincial and Union Bank of England [1924] 1 KB 461, Barker LJ identifies the limits of the duty of confidentiality in the context of a banker-customer contract as follows,:

“On principle I think that the qualifications can be classified under four heads: (a) Where disclosure is under compulsion by law; (b) where there is a duty to the public to disclose; (c) where the interests of the bank require disclosure; (d) where the disclosure is made by the express or implied consent of the customer.”

66.  The 4^th Defendant would be bound by the same duty of confidence of the bank to its customer.  It is opened to him to prove that there is a duty to the public to disclose, and the burden rests on him. 

67.  Mr. Lam also refers to the said English case of A.G. v. Guardian Newspapers (No. 2).  Lord Goff in his judgment set out the board general principle when a duty of confidence would arise.  His Lordship said to this board general principle, there are three limiting principles.  The first is that the principle of confidentiality only applies to information to the extent that it is confidential.  The second limiting principal is that the duty of confidential applies neither to useless information nor to trivia.  The third limiting principle is that, although the basis of the law’s protection of confidence is that there is a public interest that confidences should be preserved and protected by the law, nevertheless that public interest may be outweighed by some other countervailing public interest which favour disclosure.  The third limitation may apply, to all types of confidential information.  In this limiting principle which may require a court to carry out a balancing operation, weighing the public interest in maintaining confidence against a countervailing public interest favour disclosure.

68.  This judgment reinforce the argument that a bank (and hence the 4^th Defendant) may disclose confidential information if it is in the interest of public.  This exception is analyzed in details by Scott L.J. in the case of A.G. v. Guardian Newspapers (No. 2).  Scott L.J. considered the judgment of Lord Denning M R in Initial Services Limited v. Putteril [1968] 1 QB 396 when Lord Denning referred to crimes, fraud and misdeeds, both actually committed as well as those in contemplation may justify disclosure.  Scott L.J. further referred to other judgment and said that the principle should not be limited to cases as defined.  But equally, from this judgment, the matter of misdeed that justify a disclosure are mainly fraud and criminal matters or when national security are in jeopardy.

69.  For the present case, it is a financial dispute between private individual.  Taking the 4^th Defendant’s case to the highest, he is alleging that the Plaintiff had lied to the Court when she put in her affirmation stating that there is no other account with the Wing Hang Bank.  As Mr. Vaughan rightly pointed out, there is no finding before Master Ho that the Plaintiff had committed perjury or had lied to the Court.    Given that I have very limited information about the proceeding and the evidential document presented to the High Court Action in the application for discovery, I am not in a position to conclude that the Plaintiff has lied to the Court.  I am not convinced that a prima facie case of fraud or perjury has been established.

70.  It is always a balancing exercise between the confidence which we wish to protect, and the interest of public not to allow anyone to hide behind the protection of confidence to create crime and insecurity to the society.  From the cases I referred above, the misconduct is related to fraud, crime or act against national security.  I am not convinced that because of some missing information in an affidavit used in a dispute between private individuals, it is in the interest of public to allow a person to breach his duty of confidence.

71.  In those circumstances, I do not agree with Mr. Lam could rely on the ground of public interest to disclose the bank statement.  Accordingly, he would be in breach of his duty of confidence.

Remedy against breach of Confidence

72.  Mr. Vaughan argues that for proven breach, the Court would be less stringent in asking whether there is an imminent threat of a future breach before granting an injunction.  He refers me to Equitable Remedies by Spry, 7^th Ed. at para. 392-396.  I just quote the following passage –

“…whether the court should exercise its discretion so as to enjoin the performance of the acts in question, he must satisfy the court that there is a sufficient risk that these act will take place to render it just, in all the circumstances, that an injunction should be granted. To this extent the decision of the court is discretionary and does not depend on proof of imminence of the material acts on the balcony of probabilities. This is not to say that proof on the balance of probabilities that the acts that are complained of will in fact occur is not generally sufficient. On the contrary, proof of that kind must be considered ordinarily to give rise to a right to specific relief. But the more fundamental enquiry relates to the extent of hardship that would be caused by leaving the plaintiff to resort to damages or to renew his application subsequently if the threat of injury to him should become greater, and this consideration in turn depends not merely on the précis probability that the act to be enjoined will take place, but also on the gravity of those acts and on the degree of damage or inconvenience that they would cause if they took place. Further, as will be seen, account must be taken of such considerations as the degree of any hardship that might be caused the defendant if an injunction were granted, any inequitable conduct on the part of the plaintiff and other discretionary matters.”

73.  It is clear that it is a balancing exercise.  For past breach, the remedy would be on damages.  And it is future breach that I have to consider if an injunction should be granted.  And I must take into account the probability of future breach, the damage or inconvenience to the Plaintiff, and the hardship to the Defendants.  While not exactly on breach of duty of confidence, I refer to a judgment by Deputy Judge Muttrie, as he then was on injunction against breach of restrictive covenant.  In Winland Finance Limited v. Profit Fine Limited and another HCA 1045 of 2005, the Deputy Judge also set out some examples when injunction would not be granted for breach of restrictive covenant –

“The effect of these authorities is indeed that, in almost every case, a negative covenant will be enforced, or a nuisance abated, by means of injunction, and the court will not allow the wrongdoer to buy his way out by paying damages. However, this is not an absolute. In Shelfer v. City of London Electric Lighting Co. [1895] 1 Ch. 287, it was held that a person who has the benefit of a restrictive covenant is, as a general rule, entitled to an injunction on the trial of the action as distinct from an award of damages unless :

(1) the injury to the plaintiff's legal rights is small;

(2) it is capable of being estimated in terms of money;

(3) it can adequately be compensated for by a small payment; and

(4) it would be oppressive to the defendant to grant an injunction.

74.  If the 1^st and 2^nd Defendants were in breach of the duty of confidence as I analysed above, which is a technical breach when they passed the bank statement to the 4^th Defendant and Ling, the injury to the Plaintiff is nominal, if any.  I do not believe this is a situation when the Court needs to grant any injunction against them.  They are bound by the duty of confidence which I analyzed above and that would be sufficient protection for the Plaintiff.  And I do not see any damage that would result to the Plaintiff. 

75.  Should I grant injunction against the 4^th Defendant?  Mr. Lam submits that the matter is now water under the bridge.  That is obvious.  The only reason why the 4^th Defendant wished to put in the bank statement in his affidavit as an exhibit is to show that there is “another account” in the Wing Hang Bank which the Plaintiff had not disclosed in the High Court Action.  The order of Master Ho has been granted and part of the bank statement of the 2^nd account is now being disclosed in the High Court Action.  Such document disclosed is subject to implied undertaking by the parties to keep it confidential to the action.    There is no evidence to suggest further breach of a similar nature by the 4^th Defendant in future.

76.  While the 1^st and 2^nd Defendants did transfer the document to the 4^th Defendant and Ling, there is no evidence to suggest that the 4^th Defendant and/or Ling would pass on the bank statement to other parties. 

77.  Mr. Vaughan tried to suggest that the 1^st, 2^nd and 4^th Defendants may continue to pass on the information to the other intended administrator.  While I accept it is possible for further change of the intended administrators, but there is no evidence to suggest that the 4^th Defendant and Ling would misuse the document otherwise.  And if they resign and transfer the bank document to the new intended administrator, it may not be a breach if they had the bank’s consent as I analysed above.

78.  Further, the 4^th Defendant would be bound by his duty of confidence to the Plaintiff.  When there is no threat of a repeated breach or breach in future, this is a factor against the grant an injunction.  Indeed, the 4^th Defendant had been very careful in making use of the bank statement.  The evidence shows that only at the second application when he decided to disclose the bank statement and clearly he had in mind the duty of confidence.  It may have been a mistake on the legal advisor that the 4^th Defendant decided to put in the affirmation and I do not consider the 4^th Defendant had intended to abuse the duty of confidence.  The Plaintiff suggested that the 4^th Defendant used the confidential information with the malicious intention.  There is no basis for such an accusation.

79.  And what other use could be made of the bank statement other than for administration of the estate, and the High Court Action? 

80.  It is the evidence of the Plaintiff that the joint account is record of the money transactions carried out by or on behalf of the Deceased.  From the evidence, this would include his medical expenses, and some trading of stock done through the Plaintiff’s company.  Mr. Lam submits that the data are in fact information privy to the Deceased.  I would not go that far.  The statement may also include act done by the Plaintiff herself when she monitored the funds in this account.  And the apparent use of the bank statement would be for administration of the estate of the Deceased, which the 4^th Defendant should be entitled to use as after all, the Deceased is an owner of the information in the bank statement.

81.  And what damage the Plaintiff would suffer if the document is passed to some other intended administrators?  I fail to see any other than nominal, if any.

82.  Balance all the factors, I do not consider it is a just case for this Court to exercise my discretion to grant an injunction.  Accordingly, I refuse to grant the injunction against the 4^th Defendant.

Injunction against the 3^rd Defendant

83.  Turning to the 3^rd Defendant, I have to decide if the 3^rd Defendant had been in possession of the bank statement. 

84.  Before the 1^st and 2^nd Defendants passed on the bank statement to the 4^th Defendant, they had those bank statements as the intended administrators.  While they also wear their hats as the directors of the 3^rd Defendant, it does not follow that the 3^rd Defendant also had possession of the bank statement or knowledge of the bank statement. 

85.  It is true that the 4^th Defendant when he filed his affirmation, he deposed that he filed for and on behalf the 3^rd Defendant in the High Court Action.  To that, and at that moment, the 3^rd Defendant is in possession of the bank statement.  Indeed, technically they have the copy of the bank statement which formed the exhibits in the affirmation now filed in the High Court Action and in the file of their solicitors.  But the breach of confident is committed by the 4^th Defendant and there is no suggestion that the 3^rd Defendant would use those documents other than as permitted for the High Court Action.  There is no evidence to suggest that they would use the bank statement in future.  Accordingly, I do not find any justification to order an injunction against the 3^rd Defendant.

Damages

86.  The Plaintiff also seeks damages.  Mr. Vaughan claims nominal damages for the Plaintiff.  I have no further assistance in his closing on this claim.

87.  In cases of breach of duty of confidence, it does not necessary follow that damages would be awarded.  It is now settled that damages may be awarded (per Bohkary JA，as then was, in China Light & Power Co. Ltd and anr. v. Michael Edward Ashton Ford CACV108 of 1995).  But what are the damages suffered by the Plaintiff?

88.  In this case, given the ruling of Master Ho, the Plaintiff should have disclosed those bank accounts earlier.  Taking the Plaintiff’s case, she had made a genuine mistake within the 1^st and 2^nd accounts. Then the mistake has been set right.  No damages could be found.  In those circumstances, there is not a case where damages should be awarded.

Delivery of the Bank Statement by 4^th Defendant to the Plaintiff

89.  Mr. Lam submits that the bank statement is property of the Wing Hang Bank and the information are the joint property of the Plaintiff and the Deceased. Technically, the Plaintiff cannot claim the property without joining the Deceased.

90.  I believe the consideration for an order of delivery rise and fall with the injunction order.  Since the bank statement consists of information being joint property of the Plaintiff and the Deceased, it may be appropriate for an order of delivery if I grant the injunction.  Given that I disallowed the injunction, and I agree that the 4^th Defendant would have a legitimate right to use the bank statement for apply of letters of administration of the Deceased, I see no basis for the claim. 

Conclusion

91.  In conclusion, the Plaintiff failed in this case for the reason afore mentioned. 

92.  On the order of cost, it is more complicated.  While the Plaintiff is not successful, I do find that the 4^th Defendant has been in breach of his duty of confidence.  The 1^st 2^nd and 3^rd Defendants should have costs and the 4^th Defendant should bear the costs of the Plaintiff.  Balancing all factors, I consider the fair order of costs should be no order as to costs.  I would give an order nisi accordingly which order shall become absolute within 14 days.