XCHRX VISION INTEGRATED COMMUNICATIONS LTD. AND ANOTHER v. LEE YONGDE ANNA AND OTHERS

HCA758/97

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO.758 OF 1997

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D E C I S I O N

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1. I have been provided with skeleton submissions, well prepared by Counsel. Because of unforeseen circumstances - Mr Aiken coming to this case at a late time and also Mr Barlow is fairly new to the case - but they have prepared very good skeleton submission which I have read. I have also read the founding affidavit when the matter went ex parte.

2. This is a double summons for a continuation of an injunction and its discharge. Mr Barlow has a number of points on the application to discharge essentially by saying that there was some material non-disclosure and the conduct or the method by which the founding affidavit was put forward would permit the Court to discharge it.

3. However, I heard first from Mr Aiken, with the parties' agreement, on the continuation. It appeared to me when I read the papers that there was little, if any, evidence as to a real risk of dissipation which is a necessary ingredient in the grant of these injunctions. Courts must be vigilant to ensure that they are only granted when there is clear evidence. However, I bear in mind what was said by Godfrey J.A. when he talked about the commercial morality of a defendant. Mr Aiken basically relies upon the fact that this lady stole money from her employer who were the plaintiff companies. Mr To, the person who really runs it has given a substantial affidavit.

4. What has happened since the grant of the ex parte, was that Deputy Judge Woolley, faced with a very large bundle of documents, was told that criminal proceedings were on hand, and this lady had suddenly gone off to America. It is not surprising that he granted the injunction. Unfortunately, judges often do not have an opportunity to examine all of the matters and have to take a fairly broad brush approach. When it went to Rogers J. (as he then was), it was just to continue with directions being made about some evidence. The real problem here is that the large amount of paper was basically caused by an O.14 application where the plaintiffs wanted summary judgment. It is accepted that unconditional leave to defend should be given, and I have made an order. Therefore, there were a mass of affidavits material, flying backwards and forwards to deal with that.

5. There is no doubt at all that the plaintiffs appear to me to have a good case. The fact that the 1st defendant was acquitted in the District Court is a factor obviously, but there is a different standard of proof there and the standard is, of course, different insofar as this trial is concerned.

6. Whilst I do not consider it a very telling factor, it is important to recognise that the plaintiffs were prepared to allow their O.14 summons to go by the board, the matters obviously have to be litigated and will take a long time. I have to have regard to the fact that it has been in place for a year. Obviously, this injunction will go on for a long time. I cannot find any evidence as to a real risk of likely dissipation of assets. There was a property sold, which is in the name of the 4th defendant, a Robinson Road flat, and the money appears to have gone into some account. The 1st defendant has a 50% shareholding, there are consistent assertions that she has used some of the money she has taken, I cannot find any evidence for that. I think that was all suspicion. I think this is all caused by her going to America. I am told that she has a condominium, which may be her daughter's in America. She clearly has got strong ties. I think the plaintiffs are right when they say in their skeleton argument that she has got strong ties, that may be so. However, that does not mean to say that she would dissipate the assets which are held in Hong Kong.

7. I have to have regard to whether anything has happened in the intervening time. The only thing that has happened of any materiality is the criminal trial where she was acquitted. The judge has made a number of comments and appears to say that he thinks that she would lose the civil case. I do not place any weight really on those remarks. I am in a position myself to judge the strength of the plaintiffs' case. It has to be demonstrated to my satisfaction that there is a real risk of dissipation, but it has not been. I therefore would discharge the injunction.

(R.A.W. Sears)

Judge of the Court of First Instance
High Court