THE NATIONAL COMMERCIAL BANK LTD. v. HON WAI SZE

HCA5708/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO.5708 OF 2000

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J U D G M E N T

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1. This is an appeal by the defendant from two orders made by the masters. The first was the order made on 9 April 2001 and the second is the order made on 13 August 2001.

2. The order made on 9 April was, although it was said to be an order nisi, basically to provide that on the application by the plaintiff for summary judgment, that conditional leave be granted to the defendant to defend on condition of payment in of the whole amount claimed of some $16 million, but there was provision for the variation of the condition if the application was made, I think, within a short period of time stated therein.

3. The defendant did not appeal from that order of 9 April. The defendant therefore affirmed the order by applying for the issue of summons to vary the condition of $16 million and filed an affidavit in support. There were a number of interlocutory orders made by the court. Eventually at the hearing of the application by the defendant, the court dismissed the application to vary, affirmed the previous condition of the $16 million and that was done by the order of 13 August 2001.

4. At the hearing today of these two appeals, two issues calls for consideration. The first issue is whether the defendant could appeal out of time against the order of 9 April because it is admitted that the present appeal that had been brought by Notice of Appeal fixed some time in August was way out of time. I have taken the view that the defendant is out of time to appeal against that order of 9 April and in the circumstances, it is not open for the defendant to pursue that appeal.

5. The second issue that was canvassed which took some time at the hearing was whether the master was wrong in not altering the condition of $16 million. The contention of Mr Kwok for the defendant, who has said everything that could be said on behalf of the defendant, is that there was affidavit material put before the court alleging poverty or inability to pay and that therefore the master ought to have varied the condition by reducing the sum. I think Mr Kwok found it difficult to even nominate a figure to substitute the $16 million. He half-heartedly referred to a figure of "zero", but I think therein lies his difficulty.

6. Whenever there is an application by the defendant to say that a quantum set on a conditional leave defence was too high, it is incumbent upon the defendant to file a proper and full affidavit of means supported by reliable documentary evidence as to his whole means, his way of life, not just his capital, but also his inability to raise any kind of money or what kind of money in order to meet an appropriate condition. So the court will expect to see a proper affidavit of means on such an application. This obviously was not done by the defendant when the 5th affirmation of the defendant at p.159 of 26 April was filed. One must bear in mind here that the defendant is, I think by all accounts, a wheedler dealer, a business lady from China, who has been actively engaged in property speculation or property development by manipulating large number of companies and properties. So an affidavit of means from a lady with that kind of background would have to be fairly full, much fuller than from an ordinary person. But instead of doing that, she put in a vague and general affidavit of means, and that is to be seen from pp.159 to 162.

7. Ms Molloy for the plaintiff made various criticism of the affidavit and I agree with her. Her criticism is amply borne out by the fact that the plaintiff was not satisfied with that affidavit of means because it is no affidavit of means at all, so they went to the court and obtained an unless order from the court and that is to be seen at p.45 of the bundle where the court ordered that the defendant to comply with order made by the court and serve a proper affidavit of means in the form annexed to the inter partes summons dated 18 June and if the defendant has done that within the time stipulated, then the plaintiff is given leave to file an affidavit in reply. The form annexed to the inter partes summons is the familiar form that one sees in matrimonial proceedings of affidavit of means. The reason why this was required was to ensure that the defendant who claimed she knew no English but with her business background, would be forced her to file a full and complete affidavit of means. What happened? She did not comply with the order at all. Instead she asked her solicitor to put in a short affidavit exhibiting a bank's document at p.164. So there was no compliance with the order and, as there was no compliance with the order, there was no obligation of the plaintiff to file an affidavit in reply. Now faced with that sort of material, I think the master was not only right in the decision but the only thing that the master could do was to dismiss the application. There was no proper material put before the master as to the means of the defendant so as to enable the master to come to a proper decision of what ought to be the proper quantum in lieu of the $16 million. The defendant has totally failed to discharge her obligation and I have no doubt, therefore, the right order was made and the appeal against the order of 13 August 2001 must fail.

8. The appeal of the defendant, accordingly, must be dismissed with costs. I will be disposed to hear an application for gross sum assessment if that is desired by the plaintiff.