STANDARD CHARTERED BANK v. CHINA YIN KING COMPANY LIMITED AND OTHERS

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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

BETWEEN

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

DECISION

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

1. A Mareva Injunction has been granted on the application of the plaintiff against all five defendants. In this 9:30 application, I am told that the 5th defendant has not been served with the summons. The primary objective, so far as the 1st to the 4th defendants are concerned, is to have paragraph 5 of the Mareva Injunction Order stayed until the ultimate determination of the inter prates summonses for the proposed continuation or discharge of that injunction.

2. There has been, as I understand it, some disagreement as to whether or not the matter was broached, adjudicated upon and determined before Hopkinson, J. After hearing the concise submission advanced on behalf of the 1st to the 4th defendants, I find it quite unnecessary to call upon Mr. Yu, counsel for the plaintiff. I am prepared, to all intents and purposes, to go on the assumption that the matter had not been so broached, adjudicated upon and determined before Hopkinson, J. What is being sought by the first four defendants is to stay paragraph 5 of the Mareva Injunction Order enjoining these defendants to disclose certain banking activities in relation to the subject loan, in particular, with the 5th defendant bank. Paragraph 5 requires of the 1st defendant, by its officer, and the 2nd, 3rd and the 4th defendants, by themselves, to make and serve on the plaintiff at the offices of their solicitors by 10:00 o'clock today, so it was extended by Hopkinson, J., an affidavit or affirmation stating whether the 1st to the 4th defendants hold in their names any bank accounts or accounts with deposit-taking or other finance companies and the sums or balances presently standing in their respective credit therein, together with copy statements of account with such banks or deposit - taking or other finance institutions for those sums or balances, AND whether any part of the amount in question, US$962,500.00 received by the 1st defendant from the plaintiff on the 14th November 1986 remains in any of these accounts, and if so, then defining the account, account number, name of the banks or financial institutions in which such sum or sums remain. It also seeks particulars of any disposition or the whereabouts of any part of this US$962,500.00.

3. Paragraph 5 appears to be wide in scope and extent. It appears to be unrestricted in ambit. These matters will have to be examined when the 10:00 o'clock summonses come to be heard. Suffice it for me to say that there exists a Court Order comprising paragraph 5, as I have attempted to outline, against the 1st to the 4th defendants. These defendants dispute the entitlement and the propriety of the plaintiff in its ex prate application for procuring this Mareva Injunction. That would again have to be decided in time to come.

4. I pose two questions for myself: if in fact the plaintiff is proper and correct in its application for the said Mareva Injunction, then obviously the interim stay from 10:00 until the ultimate determination of the inter prate summonses should not be acceded to. Even if the plaintiff is improper and incorrect in its application for the said Mareva Injunction, justice dictates that the order, in particular paragraph 5 thereof, should still be obeyed pending challenge unless there are circumstances to justify its temporary suspension. Counsel for the 1st to the 4th defendants has brought to my notice urgency only in the time element. It was submitted that unless the interim stay is granted, the Order will have to be complied with and that as the defendants' summons to discharge the Mareva Injunction and the plaintiff's inter prates summons for its proposed continuation are pending determination of the Court, it would not be desirable in the circumstances not to grant an interim stay of ,at least, paragraph 5.

5. We begin with paragraph 5 against the 1st to the 4th defendants, presumably against also the 5th defendant in its full rigor. Counsel for the 1st to the 4th defendants suggested that as a matter of principle, an interim stay ought to be granted. I was not assisted as to what principle it was. Counsel for these defendants suggested that the first four defendants have absolutely nothing to conceal. As a matter of fact, so it was stated, most, if not all, of the information sought in relation to the US$962,500.00 is and has been within the knowledge of the plaintiff bank. In short, these four defendants have not been able to show any possible prejudice in not obtaining an interim stay of paragraph 5.

6. Information obtained in the Mareva Injunction cannot and should not be used except for the purposes of these proceedings.

7. It has not been shown to me that it is either legitimate or desirable to have paragraph 5 of the Mareva Injunction granted by Bawley, J., the time for compliance of which has been extended by Hopkinson, J., to be stayed in the interim until the ultimate determination of the plaintiff's inter prates summons and these defendants' summons to discharge.

8. For all these reasons, I do not find it necessary to call upon Mr. Yu for the plaintiff bank. The application for interim stay of paragraph 5 of the Mareva Injunction should be, in my view, refused and I refuse it with costs to the plaintiff against the first four defendants.