CHUAN WEN SZE v. USINE GARMENT FACTORY LTD AND ANOTHER

Headnote

Leave refused to "amend" incompetent notice of appeal by tardy application to file additional grounds of appeal.

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JUDGMENT

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Sir Derek Cons, Ag. C.J., delivered the judgment of the court:

1. The petitioner seeks to wind up two very closely associated companies. Thus we have two sets of, I think, identical proceedings, save for the name of the company in each. The petitioner owns 25% of the shares in each company. The balance is owned by a gentleman who is her brother-in-law.The claim for winding up the company is under the just and equitable provision of the Companies Ordinance but there is an alternate claim for relief as an oppressed minority.

2. The basis of the petitions, put in blunt terms, is that the brother-in-law is syphoning off the profits of the companies through their office in Germany or via another limited company which he has set up for his own purposes. There is also the suggestion that the petitioner has been forcibly excluded from carrying out her proper duties as a director of the companies.

3. The two petitions were set down for hearing before Nazareth, J., to commence on 19th June, with 14 working days thereafter reserved. Shortly before that date the respondents, i.e. the company itself and the brother-in-law, took out summonses requesting extensive discovery, leave to file further affidavits and for the striking out of both petitions and of parts of the affidavits filed by the petitioner. The summonses eventually came on for effective hearing before Bokhary, J., on 12th June.

4. As we read the judgment that he gave that day he dismissed the applications for striking out. He gave no reasons for doing so, but from a preliminary reading of the documents set before him. it would seem that there was no good reason for striking out in any event. The other questions, i.e. the questions of further discovery and affidavits, and a question which has subsequently been referred to as the "locus" of the petitioner, which appears to be closely connected with the discovery, he reserved to Nazareth,  J., at the coming hearing, a course which he thought more appropriate in the circumstances.

5. The hearing was opened before Nazareth, J., on 21st June. Two days before that the respondents had drafted and signed notices of appeal against the decision of Bokhary, J. These were filed on the 20th. Having regard to those notices, and following three days of submissions, Nazareth, J., adjourned the hearing before him and stayed further proceedings on the petitions pending the determination of the appeals.

6. The notices of appeal that were filed on 20th June are incompetent to achieve their intended purpose. The only ground set out is "that the Order of the learned Judge was wrong". We are told today that the reason they took that form was that they had to be prepared in haste. But we have to observe that, although the reasons given by Bokhary, J., may well not have been reduced to writing until some time later, his reasons were given in open court and we understand that counsel were present at the tine. The only reason given for allowing the notices to remain in that condition for the ensuing four-and-a-half months is that the parties were negotiating. That is put forward now in support of applications to file additional grounds of appeal which would, of course, remedy the defects of the original notices. The petitioner is not willing to consent to those applications.

7. We may say at once and quite firmly that we do not wish to encourage cavalier treatment of the rules or the exploitation of the appellate process as a bargaining tool. If there is a genuine appeal it should be properly pursued. Negotiation between the parties is an irrelevant consideration. In our view the circumstances do not warrant the granting of leave at this stage and the applications are therefore refused.

8. Subject to any further submission that counsel might care to make we propose therefore to strike out the appeals. We do not see that this will cause any injustice to the respondents because in the circumstances, as we have just outlined them, the material questions would not in fact have peen resolved by the determination of the appeals; furthermore they will still be open to be raised before whichever judge in due course comes to hear the petitions. We might add that, in setting the petitions down, it might be wise to bear in mind the indications Nazareth, J., gave as to what he probably would have done when he outlined his reasons for granting the stays of proceedings. We shall also, of course, be pleased to hear counsel as to costs.