HUMMINGBIRD MUSIC LTD v. DINO ACCONCI AND ANOTHER

CACV 40/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 40 OF 2009

(ON APPEAL FROM HCA NO. 836 OF 2007)

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BETWEEN

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J U D G M E N T

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Hon Rogers VP:

1.  This was an appeal from a judgment of Deputy High Court Judge Carlson given on 22 January 2009 after an extensive hearing. The claims before the judge had been for a declaration that various agreements made between the plaintiff and the first and second defendants were binding and enforceable and for damages for breach of those contracts. There were also claims for injunctions. The defendants, for their part, claimed damages for breach of some of the Agreements and, in the alternative, a declaration that they were void and unenforceable. In respect of others of the Agreements the defendants claimed a declaration that the defendants had been induced to enter them by undue influence on the part of the plaintiff. They also claimed that the plaintiff had breached its fiduciary duties; in addition there was a claim for an injunction to restrain the plaintiff from claiming that the plaintiff was the manager of the defendants.

2.  The judge held in the plaintiff’s favour. He awarded damages of $5,058,000 and dismissed the defendants’ counterclaim. At the conclusion of the hearing of this appeal judgment was reserved which we now give.

Background

3.  The principal shareholders of the plaintiff are two brothers, Chang Tan and Wayne Chang Wan. The other significant shareholder was Bernhard Groinig, otherwise known as ‘Lupo’. The Chang brothers apparently came from what the judge described as a well-to-do Macau business family, which has extensive property interests. The brothers had built up a very successful electronic slot machine business which they had been able to sell on to the Melco Corporation for over $200 million. Having obtained his share, Chang Tan decided that he would invest some of his money in the music industry and he founded Concrete Corner Music, the predecessor of the plaintiff. Chang Tan had attended a well-known music academy in Los Angeles where he had been taught music by Lupo Groinig.

4.  The judge described the defendants as talented singers and musicians who also composed much of the material that they performed. They performed under the name Soler. Although they had been interested in music for a long time, they had only reached the level of what the judge called “at best semi-professional”, except for a short period in Italy in the 1990’s when they were contracted to the EMI record company. During that time they had recorded an EP. The defendants had signed agreements dated 7 May 2004 with a company, called Vocanimals Music Company Limited which involved their friend Michael Fong. They were ultimately released from those contracts on payment of $10,000 on 4 March 2005.

5.  Meanwhile, in September 2004 Chang Tan orally agreed to invest $400,000 to enable Soler to make their first album, production of which started the following month with Lupo Groinig as the producer. The plaintiff was renamed, the new name having been suggested by the second defendant, who also designed the plaintiff’s website. The plaintiff and the defendants signed the first Artist Agreement and the first Exclusive Management Agreement on 1 December 2004. These, together with the Exclusive Writer Agreement, were referred to as ‘the First Agreements’. Importantly, the judge described both parties as being relative novices in the music industry and it would appear that the First Agreements were based on Sony record company contracts from Taiwan, adapted in a limited way to suit the parties’ circumstances.

6.  The defendants’ first album was released in July 2005. It seemed to have been relatively successful and in November of that year they were given an award at the Composers and Authors Society of Hong Kong award ceremony. The judge recorded that the defendants claimed that there was an unpleasant incident at that ceremony between Chang Tan and the defendants. That was the first of a number of incidents relied upon by the defendants as justifying putting an end to their relationship with the plaintiff.

7.  There was a second album released in December 2005. The next important event was that the plaintiff arranged for a concert at the Hong Kong Coliseum on 25 April 2006. The concert was called “Let’s Go Crazy”. The judgment records that the concert was a professional success. Nevertheless, two matters arise from that. The first is that in order to fill the Coliseum the organisers had found it necessary to distribute a large number of free tickets. This resulted in the concert not raising as much money as had been anticipated. The defendants claimed that they had been promised $100,000 but in fact they only received $1,300. The defendants also claimed that Lupo Groinig went into the second defendant’s dressing room, when he was getting himself ready for the performance and upon checking his stage outfit, told him that he looked “like a $2 whore”. This was said to have affected the second defendant’s confidence and self-esteem. Lupo Groinig, for his part said that his comment had been intended in a light-hearted way and had been misinterpreted by the defendants. It would appear that the defendants’ relationship with Lupo Groinig was not altogether harmonious, particularly as they regarded him as being an unsympathetic taskmaster.

8.  Despite these events, two days after the “Let’s Go Crazy” concert the parties signed the second Artist Agreement which annexed an Exclusive Management Agreement. Those agreements were collectively referred to as ‘the Second Agreements’. Although the First Agreements would not expire until the end of 2007, the new agreements were expressed to run from 1 January 2007 until 31 December 2010. It was the defendants’ case that they were induced to sign the Second Agreements by the undue influence of the plaintiff. That allegation was made on the basis that the defendants had been unwilling to sign the new agreements and wished to have further time to consider them and to seek independent legal advice. It was said that the plaintiff refused their request. The pleading went on:

“The Plaintiff, knowing that the Defendants had not obtained independent legal advice, insisted and threatened that the Defendants that they must sign the Second Agreements immediately, failing which the Plaintiff would withdraw all existing investments and cease all future investments in the careers of the Defendants.”

9.  From then on it appears that the relations between the plaintiff and the defendants became increasingly worse. The defendants claim that they had been treated in a demeaning and authoritarian manner which they considered both uncalled for and wholly inappropriate. The defendants were also concerned that proper accounts had not been kept of their earnings.

10.  By August 2006 the defendants had not only consulted their solicitors, but were employing a personal assistant and a manager. The personal assistant, Rukhsana Kan, had previously been engaged by the plaintiff. Under her guidance the defendants rejected some engagements which the plaintiff had obtained for them. That, in turn, prompted a letter from the plaintiff’s solicitors. Over the course of the next few months there was what the judge referred to as “an uneasy truce”. That came to an end on 1 February 2007 when a letter from the defendants’ solicitors finally put an end to any cooperation between the parties. The letter referred to the Agreements having been entered into by the defendants under the undue influence of the plaintiff and/or under duress. The writ was issued on 23 April 2007. Both the plaintiff and the defendants sought interlocutory injunctions, but, instead, a speedy trial was ordered.

The judgment below

11.  The judge itemised the issues arising in the action in paragraph 30 of the judgment. The first main issue was the allegation that the Agreements had been in restraint of trade. In respect of that the judge recorded that the plaintiff objected to the defendants taking the point because it had not been sufficiently pleaded. The next main issue was whether there had been undue influence and/or duress and coercion in respect of the Second Agreements. Finally, the defendants raised the defence that the plaintiff had been in repudiatory breach of the Agreements. The defendants, for their part, not only raised the same matters as issues in the counterclaim, but also claimed that the plaintiff had misappropriated or misapplied income from the defendants’ performances, and thus had breached their fiduciary relationship. The judge recorded that that aspect had occupied a significant amount of time at the trial with the quality of the plaintiff’s accounting systems being commented on by accountancy experts on both sides. There were also complaints about the sub-standard quality of the plaintiff’s representation of the defendants. The defendants also raised the question as to whether there had been a conflict of interest in relation to the defendants’ representation in the Mainland.

12.  In paragraph 38, the judge referred to the objection taken by counsel on behalf on the plaintiff to the fact that the allegation that the Agreements were in restraint of trade were unparticularised and that, in those circumstances, the plaintiff was unable to deal with the allegation. In paragraph 42 the judge acknowledged that the plea of restraint of trade was defective for want of necessary particulars. As a matter of indulgence, it would seem, the judge rejected the pleading argument and dealt with the matter and allowed the point to be taken, primarily because he considered that it failed on merit.

13.  The judge thus went on to consider the allegation that the Agreements were in restraint of trade. He cited the case of Lloyds Bank v Bundy [1975] 1 QB 326 and extensively from the speeches in the case of A. Schroeder Music Publishing Co. Ltd v Macaulay [1974] 1 WLR 1308. He also referred to the case of Esso Petroleum v Harpers Garage (Stourport) Ltd [1968] AC 269 and also the decision in the case of Clifford Davis Management Ltd v W.E.A. Records Ltd & Another [1975] 1 WLR 61. Finally, he cited extensively from the judgment of Jonathan Parker J in the case of Panayiotou & Ors v Sony Music Entertainment Ltd [1994] EMLR 229.

14.  The judge considered in particular detail the various clauses relied upon by the defendants as showing that the Agreements were in restraint of trade. In paragraph 118 the judge said:

“I am also satisfied that this was very much a joint venture, in the sense that the Soler project, if I can so describe it, was a joint investment.  I have previously described the elements of this, with the Plaintiff providing the funding and the organisation that is required to promote a pop duo, and the Defendants putting in their considerable musical talents built up over years of practice and performance.”

15.  The judge went on to say that the First Agreements had not been presented to the defendants on a ‘take it or leave it’ basis but that they had showed the contracts to a relative in Hong Kong who was a practising solicitor. The judge also referred to the fact that the Chang brothers were keen to make their own mark in the music business and that their principal vehicle for that success was to be the defendants. They had been prepared to spend liberal quantities of both time and money in order to achieve that success. The judge said in paragraph 122:

“I am satisfied that in this case there was, broadly speaking an equality of bargaining power or, at worst, given the financial disparity, the scales in bargaining power were not so heavily tipped in the Plaintiff’s favour to make any difference.”

16.  It would appear from paragraph 149 of the judgment, although it referred to the First Agreements by cross reference, that the judge considered that the Agreements were not in restraint of trade. In paragraph 134 the judge held specifically in respect of the First Agreements that they were as a package fair overall and this should be upheld.

17.  In respect of the Second Agreements the judge referred to the fact that there was a distinct divergence between the parties as to what was said by Chang Tan and Lupo which led to the defendants signing the Second Agreements. The judge went on to say that he rejected the second defendant’s account of the Second Agreements as being presented to him and his brother in an uncompromising way which, in effect, had bullied them into signing the Agreements. The judge said that it seemed to him that the defendants were perfectly content to sign the Second Agreements, which had been left with the defendants a few weeks before the “Let’s Go Crazy” concert took place. The judge found as a fact that the defendants had not been pressured into signing the Second Agreements. They were signed a few days after the concert. In fact, after they were signed there was a celebration dinner at a Soho restaurant together with Lupo Groinig. After reaching that conclusion the judge considered, briefly, whether the Second Agreements should be set aside on the basis that they were in restraint of trade. The judge had no difficulty in holding that the Second Agreements also were not in restraint of trade. He went on to say that, in any event, they could be justified by the plaintiff as reflecting a proper protection of its legitimate commercial interests.

18.  In respect of the allegation that the plaintiff had repudiated the Agreements, the judge went through the various allegations in paragraphs 26 and 27 of the re-re-amended defence and counterclaim and came to the conclusion that the defendants had failed to demonstrate conduct by the plaintiff which would justify such a finding. Finally, the judge dealt with the allegation that the plaintiff had been in breach of its fiduciary duties. In so far as the matters relied upon by the defendants in respect of these allegations were the same as issues with which the judge had previously dealt, he did not repeat his findings. The remaining allegations related, in the most part, to the plaintiff’s accounting methods. The judge was of the firm conclusion that there was nothing in these allegations, particularly the very serious allegation that there had been misappropriation of proceeds from performances and royalties and other sources of income. The judge concluded that the defendants had failed to show any single substantial breach by the plaintiff.

This appeal

19.  The major point taken by Mr Ho SC on behalf of the defendants on this appeal was that the judge should have held that the Agreements were in restraint of trade. Mr Ho also sought to rely on a new allegation of undue influence in respect of the Second Agreements. He also sought to rely upon the allegation of repudiatory breach, primarily because of what was said to have been a lack of accurate accounts.

Restraint of trade

20.  It became clear immediately that the judge had been correct that the pleading in respect of the allegation of restraint of trade was wholly defective. Whereas in some cases a lack of particulars may not affect the course which proceedings may take, in the present case the lack of proper particulars, which clearly had been the subject of complaint on the part of the plaintiff, was something which, in itself, in my view should have prevented the point being considered any further. Indeed, on this aspect, when asked which clauses of the various Agreements the defendants relied upon as showing that the Agreements were in restraint of trade, counsel proceeded not to specify but to take the court through what was a substantial part of all the Agreements.

21.  It appears to have been Mr Ho’s argument that the Agreements should have been regarded as being in restraint of trade on the simple basis that they restricted the defendants from working for any other manager and from exploiting their works through others than the plaintiff. It appears that it was also the subject of complaint that the copyright in the recordings and musical works created as part of carrying out the Agreements would belong to the plaintiff. The argument then proceeded that the judge had co-mingled his consideration of that aspect with his consideration as to whether the contracts could be considered reasonable. The argument went on that the judge had not properly considered the evidence in respect of reasonableness and, furthermore, in the absence of expert evidence as to what was common and acceptable in the trade, the judge had no basis for considering the Agreements to have been reasonable. Finally Mr Ho proceeded further by saying that the judge had not considered whether the benefit which the defendants might have received under the Agreements was commensurate with the legitimate interests of the plaintiff.

22.  At the outset of his argument Mr Ho sought to suggest that the judgment of Jonathan Parker J in the case of Panayiotou & Ors v Sony Music Entertainment Ltd should be read as somehow altering the approach which had hitherto been developed in the line of cases which may be said to start with Maxim Nordenfelt Guns and Ammunition Co, v Nordenfelt [1894] A.C. 535 and continuing through, in particular, to Esso Petroleum v Harpers Garage (Stourport) Ltd [1968] AC 269 and A. Schroeder Music Publishing Co. Ltd v Macaulay [1974] 1 WLR 1308.

23.  Contrary to the primary argument, I consider that it is clear that a contract is not regarded in law as being in restraint of trade simply because it ties the parties during the continuance of the contract. The law has always favoured free trade. For that reason monopolies were regarded as being void at common law. The doctrine of restraint of trade as it applies to contracts is a corollary of that, but there is useful reference in the cases to the distinction between contracts which are, in effect, in furtherance of trade and those which are in restraint of trade. Once this distinction is appreciated it can be seen that it is not all contracts that contain a restriction as to whom one of the parties may work for that are considered to be in restraint of trade in the sense that they make that legal doctrine applicable. In the Esso case (at p. 331) Lord Wilberforce said:

“The doctrine of restraint of trade (a convenient, if imprecise, expression which I continue to use) is one which has throughout the history of its subject-matter been expressed with considerable generality, if not ambiguity.  The best-known general formulations, those of Lord Macnaghten in Nordenfelt [1894] A.C. 535, 565 and of Lord Parker of Waddington in Adelaide, [1913] A.C. 781, 793-797 adapted and used by Diplock L.J. in the Court of Appeal in the Petrofina case, [1966] Ch. 146, 180 speak generally of all restraints of trade without any attempt at a definition. Often we find the words “restraint of trade” in a single passage used indifferently to denote, on the one hand, in a broad popular sense, any contract which limits the free exercise of trade or business, and, on the other hand, as a term of art covering those contracts which are to be regarded as offending a rule of public policy.  Often, in reported cases, we find that instead of segregating two questions, (i) whether the contract is in restraint of trade, (ii) whether, if so, it is “reasonable,” the courts have fused the two by asking whether the contract is in “undue restraint of trade” or by a compound finding that it is not satisfied that this contract is really in restraint of trade at all but, if it is, it is reasonable.  A well-known text-book describes contracts in restraint of trade as those which “unreasonably restrict” the rights of a person to carry on his trade or profession.  There is no need to regret these tendencies: indeed, to do so, when consideration of this subject has passed through such notable minds from Lord Macclesfield onwards, would indicate a failure to understand its nature.  The common law has often (if sometimes unconsciously) thrived on ambiguity and it would be mistaken, even if it were possible, to try to crystallise the rules of this, or any, aspect of public policy into neat propositions.  The doctrine of restraint of trade is one to be applied to factual situations with a broad and flexible rule of reason.”

24.  Jonathan Parker J in the Panayiotou case analysed the previous judgments in some depth. At heading B2 on page 67 he addressed the question of which contracts would be considered as falling within the legal category of being in restraint of trade as part of a two stage process of the nature alluded to by Lord Wilberforce. The first stage was to draw a line between those contracts which are in restraint of trade whose reasonableness could then be considered and those contracts to which he referred as merely regulating normal commercial relations between the parties and therefore were free of the doctrine. In this connection he found it helpful to cite the following passage from the speech ofLord Pearce in Esso Petroleum v Harpers Garage (Stourport) Ltd [1968] AC 269. At page 328D-329A his lordship said:

“The doctrine does not apply to ordinary commercial contracts for the regulation and promotion of trade during the existence of the contract, provided that any prevention of work outside the contract viewed as a whole is directed towards the absorption of the parties’ services and not their sterilisation.  Sole agencies are a normal and necessary incident of commerce, and those who desire the benefits of a sole agency must deny themselves the opportunities of other agencies.  So, too, in the case of a film-star who may tie herself to a company in order to obtain from them the benefits of stardom (Gaumont-British Picture Corpn., Ltd. v. Alexander [1936] 2 All E.R. 1686); see, too, Warner Bros. Pictures, Inc. v. Nelson [1936] 3 All E.R. 160; [1937] 1 K.B. 209).  Moreover, partners habitually fetter themselves to one another.

When a contract ties the parties only during the continuance of the contract, and the negative ties are only those which are incidental and normal to the positive commercial arrangements at which the contract aims, even though those ties exclude all dealings with others, there is no restraint of trade within the meaning of the doctrine and no question of reasonableness arises. If, however, the contract ties the trading activities of either party after its determination, it is a restraint of trade, and the question of reasonableness arises.  So, too, if during the contract one of the parties is too unilaterally fettered, so that the contract loses its character of a contract for the regulation and promotion of trade and acquires the predominant character of a contract in restraint of trade, in that case the rationale of Young v. Timmins (1831), 1 Cr. & J. 331 comes into play and the question whether it is reasonable arises.”

25.  In my view, those considerations are particularly apposite in the present case. Starting with the premise that the documentation had been based in large part upon standard documentation of a well-known record company, one then turns to the specific agreements themselves. The background to those agreements has already been referred to above. In short, I consider that the judge was perfectly correct that the arrangement between the parties was a type of joint-venture. The judge’s analysis in paragraphs 118-9 of the judgment is, in my view, entirely apposite. It is clear that the plaintiff would be devoting its time and resources to promoting the defendants. There is no suggestion that it would be doing otherwise. The Artist Agreement gave the plaintiff the exclusive right to duplicate recordings of the defendants’ performances and gave the plaintiff the right to the copyright in the recordings that were made under the contract. Looked at in the context of the copyright law that is hardly surprising. Section 11(2)(a) of the Copyright Ordinance Cap. 528 provides that the producer of a sound recording is regarded as being its author and section 14provides that the author is the first owner of the copyright. Then section 198 provides that:

“ “producer” (製作人), in relation to a sound recording or a film, means the person by whom the arrangements necessary for the making of the sound recording or film are undertaken”

26.  That state of affairs is entirely conventional and has been in existence for many years under previous legislation. It is consistent with the various international copyright conventions, which contain almost identical provisions. It has to be remembered, furthermore, that copyright is a jurisdictional matter. If the defendants’ works are to be fully and properly marketed they would have to be sold in jurisdictions other than Hong Kong. It would be unworkable unless the party responsible for arranging those sales had full control of all relevant copyright.

27.  The Exclusive Management Agreement is, once again, a manifestation of the aspect of joint-venture between the parties. It is difficult to see how there could be any complaint at all given the terms of Article 2 of that Agreement which demonstrate the plaintiff’s commitment to the venture. The Exclusive Writer Agreements were entered into a few months after the other two agreements. What is noticeable about the Exclusive Writer Agreements, which were in similar terms to each other, is that they would appear to be extendable automatically for further periods of 12 months when the Agreements or an extension thereof were coming to an end, but only if the defendants did not serve notice of termination.

28.  One further matter can be referred to, namely the thirteenth clause in the second Artist Agreement. During the hearing of the appeal, counsel concentrated on this clause, no doubt, because the court had shown some initial interest when it was first read. That clause reads:

“THIRTEENTH.  MUSIC PUBLICATION

I.  Party B artist shall, at the completion of composition of musical works, immediately notify Party A of the details (title, author, copyright and others) and submit a copy of cassette and music score.

II.  Party A and Party A’s representative have exclusive publishing right of the above-mentioned musical works and are entitled to their management and use as well as income from them.”

29.  The wording of subclause I with reference to details of authorship and ownership of copyright might be taken to signify that that clause was not dealing with works composed by the defendants. Be that as it may, as was pointed out by Mr Li on behalf of the plaintiff, the defendants were still protected by the Exclusive Writer Agreements and were entitled to payments thereunder. Subclause II would be necessary protection, in any event, for a party which would be responsible for the promotion and sales of recordings. It has to be observed that this clause provided some diversion during the hearing of the appeal, but any complaint in respect of it in my view was wholly misplaced. Not only had it not featured either in the pleadings or even in the affidavits filed during the course of the proceedings, but the oral evidence in respect of it was that it had been incorporated into the second Artist Agreement without even the plaintiff realising that that had happened.

30.  In summary, the arguments raised on behalf of the defendants in respect of restraint of trade have no merit.

Undue influence

31.  As already referred to in paragraph 17 above, the defendants sought at trial to raise a case of undue influence based upon the suggestion that they had been “bullied” into signing the various Agreements. That argument was not pursued on appeal. Instead, Mr Ho sought to argue a case of undue influence based on the fact that the defendants had placed trust and confidence in the plaintiff and that that trust and confidence had been abused. Counsel could not avoid admitting that such a case had not been raised below and was not contained in the pleadings. It was made quite clear that in that event this court considered that the point was not open to the defendants on this appeal. It was, furthermore, a point that was totally without merit. It found no basis in any of the evidence. Finally, in respect of this matter, I find it difficult to avoid the observation that the fact that it should have been seen as appropriate or necessary to take such a thoroughly bad point gives rise to the conjecture that it reflects the assessment by those responsible as to the strength, or rather the lack of it, of the defendants’ case in respect of the main point.

32.  The remaining points that had been outlined by counsel at the beginning of the appeal were based on submissions which avoided dealing with the entirety of the evidence. The less said about those submissions the less embarrassing for those responsible for making them. It was suggested that proper accounts had not been prepared. The judgment makes clear that the judge had before him substantial evidence in relation to the accounts and was satisfied that the plaintiff’s accounts had been properly prepared.

33.  In my view this appeal falls to be dismissed. I would make an order nisi of costs in favour of the plaintiff.

Hon Le Pichon JA:

34.  I agree with the judgment of Rogers VP.

Hon Stone J:

35.  I agree with the judgment of Rogers VP.

36.  For my part I should like to add a few words on the pleadings in this case, a subject which usually does not excite much interest in the context of a commercial dispute.

37.  The doctrine of ‘restraint of trade’ is not straightforward. The Vice-President has highlighted the fact that a distinction must be drawn at the outset between a legitimate (or non-illegitimate) contractual restraint, and an illegitimate (and hence unenforceable) restraint that falls within the parameters of a doctrine which has developed within the accumulated case-law since Nordenfelt, op cit., in the late 19^th century; and that it is only when it is decided that a particular contract is one which attracts the operation of the doctrine – a dividing line which is not always easy to define – that there follows an examination of whether the restriction(s) in question can be justified.

38.  It follows, therefore, that restraint of trade is one of those areas in which it is essential to set out in the relevant pleading the very particular matters which are asserted to invoke operation of the doctrine, and thus to apprise the opposing party of the specific reason(s) why it now should be said that the existing contractual obligation is unenforceable as being in restraint of trade.

39.  This desirable state of affairs patently did not occur in this case.

40.  What seems to have happened is that a generalized pleading was thrown into the forensic mix, with the result that it became very difficult for the plaintiff, against whom the doctrine was being invoked, to know the precise case it was required to meet in this regard; as a consequence, as Mr Li for the plaintiff pointed out, in conducting his case at trial he was constrained to try to cover all conceivably relevant matters in the absence of proper particularization of the broad restraint of trade complaint as mounted against his client.

41.  As matters transpired, the learned judge below rejected Mr Li’s objection to the general form of the pleadings as they then stood, and counsel’s resultant application that this allegation should not be permitted to be pursued by the defendants absent proper specificity; indeed the judge allowed the case on restraint of trade to be argued out without any pleading amendment whatever, an option which leading counsel then appearing for the defendants was offered but pointedly declined to take.

42.  Whilst I am instinctively sympathetic to the obviously fair desire of the judge, in what had become an attenuated trial, to permit the parties fully to ventilate their grievances, however tenuously raised, in my view this was a misjudgment in the circumstances; this was one of those relatively rare cases in which a so-called ‘pleading point’ was more than a mere technicality and contained within it an issue of substance.

43.  Because absent proper formulation of which aspects of the Agreements in question allegedly fell foul of the restraint of trade doctrine relied upon by the defendants, proper and accurate analysis of the case was bound to (and in fact did) become problematic; as Mr Li submitted, absent necessary definition of the plea, at trial he was required to hit something of a moving target.

44.  This problem as encountered at first instance manifested equally clearly in the manner in which this appeal was conducted. As Rogers VP has pointed out, when taxed by the court as to the particular contractual aspects which were alleged by the defendants to justify invocation of the doctrine of restraint of trade, Mr Ambrose Ho SC (who did not appear in the court below) sought refuge in quotation of large swathes of the Agreements – ample indication, if such was needed, that the restraint of trade element of this case had not properly been analysed, either here or below.

45.  In a complex area such as this, wherein clarity of thought and presentation is vital, it will not do, in effect, simply to throw in the kitchen sink and hope that one of the arguments as raised will attract judicial approval.

46.  Given the manner in which the defendants were allowed at trial to approach their restraint of trade allegation(s), it is perhaps unsurprising that the treatment of this topic in the very full judgment of the learned judge should have opened itself to vigorous criticism by leading counsel during the course of this appeal.

47.  In the event, I take the view that, at bottom, the conclusions of the learned judge were correct, albeit in his commendable desire to permit all matters to be ventilated, however insufficiently pleaded, to a significant extent he made a rod for his own back, and thus it became no easy task to formulate a judgment wherein the relevant issues were distilled and treated with the clarity which the restraint of trade doctrine demands – in which regard the judgment of Jonathan Parker J in Panayiotou, op cit., (which inevitably attracts the sobriquet of ‘the George Michael case’) provides an object lesson in the careful and sequential analysis which is required in this area of the law.