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Matrimonial Causes1983

WENDY WENTA SENG YUEN v. PHILIP PAK YIU YUEN

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  • CACV99/1984WENDY WENTA SENG YUEN v. PHILIP PAK YIU YUEN

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40115-EN-1985-06-06

WENDY WENTA SENG YUEN v. PHILIP PAK YIU YUEN

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HCMC000018D/1983

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

DIVORCE JURISDICTION

ACTION NO. 18 OF 1983

_________

BETWEEN

WENDY WENTA SENG YUENPetitioner

and

PHILIP PAK YIU YUENRespondent

____________

Coram:    Deputy Judge Nazareth, Q.C. in Chambers

Dates of hearing:    22nd and 31st May 1985

Date of delivery:     6th June 1985

__________

DECISION

__________

1. The respondent in this action disclosed that he had a 70% share in a highly lucrative practice. Subsequently in interlocutory proceedings he mentioned that he then had a 10% share. Alarmed by what appeared to be a very large disposition which could affect her ultimate financial provision, the petitioner applied under section 17 of the Matrimonial Proceedings and Property Ordinance (Cap. 192) for the disposition to be set aside. Upon that application Deputy Judge Barnett on 4th April 1985 ordered that:

1. The petitioner be given leave to file an additional affidavit, if necessary, within 14 days.

2. The respondent do file an affidavit in reply within 30 days.

3. The petitioner to file an affidavit in reply, if necessary, within 14 days.

4.The petitioner's summons dated 26th March 1985 to be heard at the same time as her application for maintenance and other ancillary relief.

2. Affidavits have not been filed by either the petitioner, who only had leave to do so, or by the respondent who was ordered to do so.

3. The respondent now applies for the petitioner's application to be struck out on the grounds that it is frivolous, vexatious and an abuse of the process of the Court; and that consequently the Order of the 4th April be set aside.

4. Miss Leong for the respondent submits first that rule 74 of the Matrimonial Causes Rules (Cap. 179) requires that an application to set aside a disposition shall, unless otherwise directed, be supported by an affidavit by the applicant stating the facts relied on in support of the application. The petitioner's application in this case does not exhibit an affidavit of the petitioner, but instead only an affidavit made by the petitioner's solicitor. Nonetheless, I see no merit in the submission, for as I read the rule, it merely requires a supporting affidavit. There must be numerous cases where the supporting evidence can only come or can best come from persons other than the applicant. Miss Leong has not cited any authority in support of her submission and without clear authority I would not be disposed to accept a technical view, moreover a view which would import a requirement that seems to me to serve no useful purpose but on the contrary to hinder the object of section 17 of the Matrimonial Proceedings and Property Ordinance, which plainly is to enable transactions intended to defeat claims for financial provision to be set aside.

5. Miss Leong also submits that under rule 74(3) of the Matrimonial Causes Rules, the application must be served upon "the person in whose favour the disposition is alleged to have been made". That has not been done in this case. Mr. Rodway for the petitioner says that it is not known who are the persons to whom the disposition was made. Miss Leong responds that one Mr. P. T. Yu has been disclosed as one of the persons to whom the disposition has been made. However that may be I think that point should be decided at the hearing of the application and not at a preliminary stage, particularly as it could be rectified in the meantime. Given that the object of section 17 of the Matrimonial Proceedings and Property Ordinance is to enable dispositions that may reduce financial provision to be set aside, is it right where a disposition is not disputed that difficulty in ascertaining to whom it is made should obstruct the remedy? I think I should be slow to permit that to be done. I do not think the interests of justice or the purposes of section 17 of the Matrimonial Proceedings and Property Ordinance would be served by striking out the application at this stage on the ground that the persons to whom the disposition is alleged to have been made have not been served.

6. I proceed then to Miss Leong's next point which is that section 17 of the Matrimonial Proceedings and Property Ordinance for the purposes of the petitioner's application in this case provides in subsection (1)(b) that the disposition must have been made with the intention of defeating the petitioner's claim for financial relief. That is clearly so, and I need not set out the text of subsection (1)(b). Miss Leong concedes under subsections (3) and (4) of section 17 that since the disposition was made within 3 years, there would be a presumption of such intention if the disposition would reduce the amount of any financial provision. Again that is clearly so and I will also not set out the text of those provisions. But Miss, Leong goes on to submit that there is no possibility in this case of the petitioner securing any further financial provision as she has, upon her own admission, already obtained approximately $40 million from her husband in the course of their marriage. That may well prove ultimately to be the result. It is conceivable that in some circumstances it may be that such a conclusion so obviously .and so clearly excludes the possibility of the contrary, that a Court may deem it proper to strike out an application for setting aside a disposition upon similar grounds at even a preliminary stage. However, on the facts before me I do not think that is the position here. Nor do I regard myself as being in a position to say what might be the maximum amount of financial provision that could be awarded to the petitioner. Moreover, as-Mr. Rodway has very pertinently pointed out, the respondent has claimed that the monies in the possession of the petitioner-are held by her in trust for the family. If that claim is upheld it is not inconceivable that the amount of the petitioner's assets and his. remuneration could prove very material to the financial provision ultimately made to the petitioner. Mr. Rodway has also pointed out that the remaining 10% partnership share not disposed of has apparently produced some $2 million per annum, which demonstrates the significance of the disposition. I am therefore also unable to accept Miss Leong's second submission.

7. Accordingly I dismiss the respondent's application to strike out. Unless counsel wished to be heard on the point, I propose to order that the costs of the application be to the petitioner.

( G. P. Nazareth )
Deputy Judge of the High Court

Representation:

Mr. Gilbert Rodway, Q.C. and Mrs. V. A. Penlington instructed by Messrs. Helen A. Lo for Petitionor

Miss  Jacqueline P. Leong instructed by Messrs. Yu, Tsang & Leong for Respondent

40114-EN-1985-06-06

WENDY WENTA SENG YUEN v. PHILIP PAK YIU YUEN

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HCMC000018C/1983

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

DIVORCE JURISDICTION

ACTION NO. 18 OF 1983

____________

BETWEEN

WENDY WENTA SENG YUENPetitioner

and

PHILIP PAK YIU YUENRespondent

________

Coram: Deputy Judge Nazareth, Q.C. in Chambers

Dates of hearing: 22nd and 31st May 1985

Date of delivery of judgment: 6th June 1985

___________

JUDGMENT

___________

1. These two summonses for discovery, one filed on 11th February 1985 by the petitioner and the other by the respondent on 18th February 1985, were heard together. Both stemm from earlier summonses for discovery filed by each party which came before Power J. on 9th January 1984, when they were adjourned by consent to the following day. On that day Power J. by consent made the following order "There will be orders in terms endorsed on counsel's briefs." Terms were in fact endorsed upon the brief to Mrs. Penlington, the petitioner's counsel, but not upon that of Mr. Stone who appeared for the respondent. In the event it has not been possible precisely to determine or agree all the terms that should have been endorsed. Of particular concern is one item of those term i.e. the production of bank statements from 1st January 1973 to 31st December 1983. Mrs. Penlington's recollection, which is borne out by the record of the agreed terms endorsed upon her brief, is that bank statements were to be provided by each party.

2. The text of her endorsement was sent to Mr. Stone shortly after the 10th January 1984 but for reasons into which I need not enter, it was not until about a year later that Mr. Stone, who has now withdrawn from these proceedings, and Mrs. Penlington were able to meet to try and settle the agreed terms. Mrs. Penlington very fairly informed me from the Bar that Mr. Stone's view was that the bank statements were to be provided subject to their availability. In deference to his seniority Mrs. Penlington included that qualification in the text of a draft order which was submitted to the clerk to Power J. for approval. The clerk to Power J. declined to approve the draft since it purported to detail the terms endorsed upon counsels' briefs, which of course, was not the form of the order made by Power J.

3. On the foregoing it seems to me that the only safe view that can be taken is that the two sides agreed only to produce bank statements subject to their availability. Accordingly, subject to the matters that follow, I consider that the relevant order I should properly make in these applications is for production of such bank statements as are in the parties' hands, and for best endeavours to be used to procure the remainder.

4. In general terms the petitioner has been able to procure most of the bank statements she has been asked to produce. But she says in her affirmation that she is "unwilling" to produce them until the rspondent produces the statements he is required to produce. It is not disputed that the petitioner is under order of this court to produce her bank statements, and her statement in her affirmation that she is unwilling to comply, on the face of it verges on contempt of this Court. But Mr. Rodway submits that reciprocity of production was an implied term of the agreement between the two sides. I will accordingly regard the statement of the petitioner and similar statements in her affirmation as unfortunately phrased and not as contumacy. Mr. Rodway also contrasted the professed inability of the respondent to procure his bank statements, including a statement of an account with a bank of which he is a director. Mr. Rodway submits that, and the retaliatory and disproportionate counter requests for discovery attracted by each application made by the petitioner establish a pattern of delay and obstruction by the respondent. I will only say that the suggested inability of the respondent to procure some of his bank statements, some of which he appears to have had earlier in the proceedings, does cause me unease. However if that be necessary the plaintiff is not without recourse. In the specific context that confronts me it is a matter that can, I think, be satisfactorily resolved by a best endeavours order which will meet any genuine inability to obtain statements. At the same time an averment of inability to obtain the statements should, I think, be verified by affidavit, so as to enable it to be tested by cross-examination.

5. Mr. Rodway has proposed instead that production by the plaintiff be made conditional upon production by the respondent. That, he submits, will avoid the difficulty of exposing the respondent to committal if he is ordered to produce statements which he may in the event be unable to obtain. That course does not commend itself to me. I would not wish to countenance the plaintiff's seeming defiance of the existing order to produce. In addition there does not seems to me to be any implied term in the party's a agreement that production was to be reciprocal. Above all, the purpose of discovery is to enable the cause to be disposed of fairly or to save costs. What is proposed is wholly inconsistent with those objects and will enable either party who wishes to do so, whatever the relative merits, to obstruct production. I would accordingly order production of all bank statements already procured and best endeavours to be used to produce the remainder.

6. That will dispose of the four outstanding items in the petitioner's application and, subject to the matter of joint accounts, also of those items of the respondent's application relating to bank statements.

7. Some of the bank statements sought by the respondent relate to accounts of the parties' son, Peter, but quite properly in the circumstances of this case, it has not been suggested that for that reason they should not be produced.

8. Other accounts are in the joint names of the petitioner and her mother. The petitioner in her affirmation sails she is not able to produce certain deposit slips relating to those joint accounts because her mother will not produce them or give her consent to their production. She adds that her mother may be prepared to do so if . the respondent produces certain statements. Mr. Rodway submits that as the deposit slips are the joint property of the petitioner and her mother, the latter not being a party to these proceedings, their production ought not to be ordered without the consent of the mother. In support he asks me to refer to the judgment of Power J. in this action on 24th February 1984, dealing with the issue of whether the respondent should be ordered to produce the accounts of a partnership of which he is a member. I have studied that judgment and on my reading, at P. 13, Power J. held that there was no general power to order production of jointly owned documents where only one owner was a party, but that there was such a power, although narrowly confined, where the Court was satisfied that the party had access and that the objection to production has the appearance of a contrivance to evade or defeat the jurisdiction of the Court. In this case the manifestly close, rather I should say, excellent, relationship between the petitioner and her mother, and the attempt to make the mother's consent conditional upon the respondent producing certain statements, makes it all too obvious that what we have here probably is a contrivance. However, I need say no more on joint ownership as the petitioner has disclosed that she is the beneficial owner of the joint accounts. There is accordingly, in my view no reason why the deposit slips should not be produced.

9. As to the other particulars and documents sought, I accept that the amounts the petitioner accumulated from monies given to her by the respondent is relevant to the determination of the financial al provision ultimately to be made for the petitioner. That being so, can it be said that the apportionment is to be made only upon consideration of what the parties presently own and not, for instance, of the very large sums of money that it is not disputed the respondent gave to the petitioner? In this context I was informed by Miss Leong for the respondent that the total of sums the petitioner admits she has in her possession is of the order of $40 million; Miss Leong's statement was not disputed. However that may be, I think that the amounts of money paid to the petitioner and the disposal of those monies must in the circumstances be relevant. They, quite clearly, can have a bearing upon the financial provision ultimately to be made for the petitioner. The difficulty is how the discretionary power to order particulars should be exercised. In relation to monies partly used for household expenses it is common ground that under the consent order particulars were to be provided in general terms. And so they were provided, in the most general terms. The respondent has returned to the charge by seeking greater particularity, I think excessive particularity in some respects. I do not think he is entitled to require the petitioner to make guesses and clearly some of the information sought can only be guessed at. Some of the other information sought, for example, household expenses for a very large number of years could only be provided from records which none save the most exceptional housewife would maintain. I would therefore decline to order particulars at which the plaintiff would have to guess, and also those which she could not reasonably he expected now to produce. As to the remainder, it should not be forgotten, which on behalf of the respondent it apparently has, that the particulars were only to be provided in general terms.

10. Proceeding then to production of the other documents and particulars sought in the respondent's summons, the plaintiff says in reference to the audited accounts of Winfair Investment Co. Ltd., that her shares are held in a nominee company and she believes she is therefore not entitled to the accounts. That is no reason for failing to produce. I find no merit in her explanation and will waste no more time on so unmeritorious a response. To avoid errors in the orders sought and hopefully limit latent difficulties, I will now indicate to counsel the terms of the orders I propose to make and hear them upon those and upon costs.

(G.P. Nazareth)
Deputy Judge of the High Court

Representation:

Mr. Gilbert Rodway, Q.C. and Mrs. V.A. Penlington instructed by Messrs Helen A. Lo for Petitioner

MissJacqueline P. Leong instructed by Messrs Yu, Tsang & Leong for Respondent

40113-EN-1985-03-01

WENDY WENTA SENG YUEN v. PHILIP PAK YIU YUEN

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HCMC000018B/1983

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

DIVORCE JURISDICTION

NO. 18 of 1983

____________

BETWEEN

WENDY WENTA SENG YUENPetitioner

 

and

 

PHILIP PAK YIU YUENRespondent

____________

Coram: Deputy Judge Barnett in Chambers.

Date of hearing: 19th February 1985.

Date of delivery of Decision: 1st March 1985.

__________

DECISION

__________

1. In connection with ancillary relief, the Petitioner applied by way of summons for the Respondent to provide further and better particulars of his affidavit of means. After a hearing lasting 3 days, Power J. determined that the only matter which fell to be resolved was whether the Respondent should be required to produce the audited partnership accounts of the firm of solicitors, in which he is a partner, for inspection for the previous 5 years in the face of objection to such production by the other partners.

2. In a judgment in which he closely examined Order 24 and discovery, Power J. decided as follows:

"I am satisfied that where there is an objection by joint owners of a document and where the court is satisfied that there is no contrivance to defeat its powers then the ourt must refuse to order production for inspection. It is however for the Defendant to justify the ground of protection and he will fail to do so if he does not state the exact nature of the joint possession, whether or not he has tried to obtain consent from the joint possessor and why such joint possessor is objecting to the production."

3. After detailing precisely what a partner should state in relation to audited partnership accounts, the learned judge allowed the Respondent the opportunity to furnish an affirmation dealing with all these matters. The Respondent took advantage of the opportunity given to him and filed such an affirmation.

4. The Petitioner was not satisfied with this affirmation and sought further and better particulars. As these were not forthcoming, the Petitioner restored her summons for discovery and gave notice of intention to cross-examine the Respondent upon his affirmation. At the adjourned hearing, the Petitioner indicated that she wished to challenge both the assertion that the Respondent had never had any copy of the documents (that is, the partnership accounts) and does not have such a copy nom, and his assertion that the partners object to the production of such documents. After hearing argument upon the principles relating to cross-examination in interlocutory proceedings, Power J. ruled that the Respondent should attend for cross-examination.

5. The Respondent appealed against that ruling. The appeal was dismissed by the Court of Appeal. The Respondent, therefore, appeared before me and was cross-examined : first, as to whether he has or has had possession of the accounts or copies thereof and secondly, what efforts he had made to obtain his partners' consent to production of the accounts and why the partners objected to production.

6. In relation to his own possession of the accounts or copies, the Respondent, I regret to say, cut a very sorry figure in the witness box. I do not think I have ever seen a more uncomfortable witness. The Respondent was inarticulate in his replies and at times inaudible. He clearly had little confidence in what he was saying. This was hardly surprising because, coming from a man who is a senior partner in a substantial firm of solicitors, his story strained credulity.

7. The Respondent said that the then partnership was dissolved in 1973. There was unhappiness because the wife of one of the partners was making public knowledge of the firm's accounts. That partner retired. The remaining partners who formed a new partnership agreed orally amongst themselves that they should not, in future, have individual possession of the accounts or copies thereof but that they should be kept by the firm's accountant as joint property. Each partner should have access thereto when necessary.

8. The following year more partners joined the firm. Although there was a written memorandum setting out the partners' respective shares in the firm and various other matters, there was no mention of the agreement relating to the accounts. However, the Respondent recalls that the two new partners were told about the oral agreement by one of the existing partners Mr. Yiu. However, he was extremely vague about this and also said that he assumed the existing practice would continue.

9. Subsequently, other partners joined the firm. Again the Respondent assumed that the existing practice in relation to the accounts would continue. He understood some of the new partners to have been advised as to the agreement, although this was hearsay. In relation to other partners he had no knowledge as to whether they knew anything of the agreement.

10. The Respondent contended that the oral agreement first concluded in 1973 is still in force in relation to the partnership accounts. As a result, although he is entitled to access to the accounts or copies thereof, the accounts are all jointly owned by the partners.

11. Until 1982 the Respondent had a 70% share in the firm. Although his share is now reduced to 10%, he is still a senior partner by virtue of the length of time he has been with the firm. Yet he showed an almost total ignorance of and lack of interest in the firm's accounts. According to the Respondent, the firm's accountant deals with the firm's auditors who are a large and reputable company. The Respondent's only real point of contact with the accounts is when the accountant brings the audited accounts and copies to the Respondent for signature. The Respondent was entirely unable to say how many copies to the accounts were sent with the original by the auditors. He said the number varied from year to year. However, under pressure, the Respondent conceded two things:

                "Q. But copies sent by auditors) at some stage include copy for each partner.

A. May be so, yes."

and latex on:

''Q. Auditors would usually produce copy for each partner anyway.

A. Would be common.'"

12. I accept that in 1973 there was an oral agreement between the partners of the firm, as then constituted, that the audited accounts and copies thereof should be kept jointly. However, having regard to the content of the Respondent's evidence and the manner in which it was given, I have no doubt but that the agreement was long ago forgotten. Certainly, none of the Respondent's partners has deposed to its continued existence.

13. It is, I believe, normal accounting practice for auditors to supply sufficient copies of the accounts so that each partner may have one. Certainly, as I have indicated, the Respondent conceded that this is common practice. It is my finding that for many years the Respondent has received a copy of the accounts, each of which was and has remained his personal copy. That these copies may be lodged with the firm's accountant is irrelevant. The accountant, as agent or employee of the Respondent, can be compelled by him to produce them to the Respondent at any time.

14. In the circumstances, the Respondent must produce his copies of the audited partnership accounts as sought by the Petitioner. However, the Petitioner must first give an undertaking that she will not disclose the contents of these accounts to anyone other than her legal advisers.

15. In fairness to the Respondent, I should deal with the other half of cross-examination. I must say at once that the Respondent appeared at ease. He gave his answers clearly and confidently. I have no hesitation in accepting his evidence in relation to the attitude displayed by his partners.

16. The Respondent said he approached each partner individually, explained that he might have to produce the firm's accounts and asked whether they objected. Each partner did object, because he or she did not want their private affairs to be made known. One partner, Mr. Yiu, also objected because of the Petitioner's conduct in relation to the firm.

17. Mr. Rodway said that the Respondent's evidence should not be accepted for three reasons. First, in his affirmation the Respondent said he had spoken to the partners then in the office. This indicated that he had spoken to them all on the same day. Yet in his evidence the Respondent said that he had spoken to three partners on one day and two on a later day when they were available. In my view, there is nothing in this point.

18. Secondly, in his affirmation the Respondent starts paragraph 6 as follows:

"The reasons given by those partners for their objections were as follows:"

and he then goes on to set out the various reasons given. Mr. Rodway said that this is entirely unsatisfactory because it gives the impression that all the partners had similar objections whereas we now know that only Mr. Yiu had objections other than his private affairs becoming known. Again, I do not think much of this point. Whilst it might have been better if the affidavit had read that Mr. Yiu said this, Mr. Chan said that and Mr. Heung said something else, I do not accept that there is an attempt to mislead the Petitioner or the court.

19. Finally Mr. Rodway said that the Respondent's evidence does not disclose any effort to try and obtain the other partners' consents. I confess I find it difficult to conceive what else the Respondent might have done. Having explained the position to each partner and having met with each partner's firm objection, I think it unrealistic to have expected the Respondent to press the matter further.

20. I am satisfied that there is no contrivance between the Respondent and his partners to defeat the powers of this court.

( N.J. Barnett )

Deputy Judge of the High Court

Representation:

Mr. Gilbert Rodway, Q.C. & Mrs. V. Penlington instructed by (Helen A. Lo & Co.) for Petitioner.

Miss Jacqueline Leong instructed by (Yu Tsang Loong) for Respondent.

25586-EN-1984-06-12

WENDY WENTA SENG YUEN v. PHILIP PAK YIU YUEN

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HCMC000018A/1983

IN THE HIGH COURT OF JUSTICE

1983, No.18

DIVORCE JURISDICTION

BETWEEN

WENDY WENTA SENG YUEN

Petitioner

 

AND

 

PHILIP PAK YIU YUEN

Respondent

_________________

Coram: Hon. Power, J.

Dates of Hearing: 18 May 1984

Date of Delivery of Judgment: 12 June 1984

__________

JUDGMENT

__________

               

1. In this matter Wendy Wenta Seng Yuen is seeking a decree of dissolution of her marriage from the Respondent Philip Pak Yiu Yuen. In an earlier application before me the Petitioner asked that the Defendant be ordered to produce the audited accounts of a partnership Yung, Yu, Yuen & Co., solicitors of which he is a member.

2. I held that where a party seeks to claim protection from production for inspection of a document on the ground that it is not his sole property, then the burden will be on him to justify such ground of protection. I was satisfied that where there was an objection by joint owners of a document and where the Court was satisfied by the Defendant that there was no contrivance to defeat its powers then the Court would refuse to order production for inspection.  I stated that I was "satisfied that as regards audited partnership accounts which are relevant to matters in question in an action the party who was a partner must, in order to comply with 0.24, disclose:-

     (i)

 whether he as the originals of those accounts in his possession;

(ii)

if not, whether he has ever had them in his possession, where they are presently kept and by whom;

(iii)

whether he has had a copy of them in his possession;

(iv)

if not, whether he has ever had a copy in his possession;

(v) if the answer to (iv) is Yes, where such copy is presently kept and by whom and whether he is entitled to command its return to him;

(vi) if the answer to (iv) is No, whether copies exist, as to any of which he is entitled to possession;

(vii) if the partners object to the production of the accounts, what effort he has made to obtain their consent and why such objection is taken."

3. The Respondent has now filed an affidavit in which he says that the partnership accounts are audited and drawn up annually by Messrs. Lowe, Bingham & Matthews and are signed by the partners and by himself. He says that in 1973 the partners came to an oral agreement that the audited accounts would be kept by the accountant firm of Mr. Tang Kam Man and that since that time Mr. Tang has kept the audited accounts. He said that he had never had possession of the audited accounts himself although both he and his partners had access to them and that he had never had any copies or the originals of the audited accounts. He said that he has approached his partners and enquired whether they had any objection to production and all of them objected strongly.

4. There were a number of grounds of objection. The principal one was that the partners objected to their private financial affairs being known to anyone outside the firm and its auditors.

5. The Petitioner has sought further and better particulars of the facts set out in the affidavit. The Petitioner, as I understand it, wishes to challenge both the assertion that he has never had any copy of the documents and does not have such a copy now and his assertion that the partners object to the production of such document.

6. Mr. Rodway for the Petitioner now asks to cross-examine on that affidavit. Mr: Stone for the Respondent resists that application saying that, in the circumstances obtaining, it would not be proper for the Court to make any order under 0.38 r. 2(3). This sub-rule states that where evidence has been given by affidavit, "the Court may, on the application of any party, order the attendance for cross-examination of the person making any such affidavit, and where, after such an order has been made, the person in question does not attend, his affidavit shall not be used as evidence without the leave of the Court."

7. Mr. Stone argues that no order should be made unless special circumstances were shown. He referred to Oriental Pacific Mills Ltd. v. Nan Fung Woollen Mills Ltd. (1965) H.K.L.R. 703, Lawson and Another v. Odhams Press, Ltd. and Others. (1948) 2 All E.R. 717 and Terrapin Ltd. v. Builders' Supply Co. (Hayes) Ltd., Taylor Woodrow Ltd. and Swiftplan Ltd. (1960) R.P.C. 128 as authorities for this proposition. None of these cases are cited in the note to 0.38 r.2 in the white Book nor does the notation anywhere suggest that special circumstances must be established before an order requiring attendance for cross-examination will be made. Both Lawson v. Odhams Press and Terrapin Ltd., v. Builders' Supply Co. are, however, cited elsewhere in the White Book as authorities for propositions unconnected with 0.38 r.2.

8. It was the submission of Mr. Rodway that the three cases referred to were concerned with interlocutory injunctions and that the rule that special circumstances are required is one peculiar to such applications. This submission receives support from a note which appears, at 38/2/3, as follows:-

"Cross examination upon affidavits sworn in applications for interlocutory injunctions is very rare".

9. It is true that Tucker L.J. (in Lawson v. Odhams Press Ltd.), was dealing with the requirement that there must be special circumstances before a deponent in interlocutory proceeding will be required to attend for cross-examination. However it seems clear from his judgment, at 719, that the requirement with which he was dealing is one which is limited to applications for interlocutory injunctions in libel cases:

"

Counsel for the plaintiffs has taken us through the authorities on this point and it is not necessary to refer in detail to then. It has now become a matter of practice, and, possibly, a matter of law, that an interrogatory of this kind will not be allowed to be administered to the proprietor or publisher of a newspaper. I do not think it is necessary to go further than Plymouth Mutual Co-operative and Industrial Society, Ltd. v. Traders' Publishing Association, Ltd. (1906) 1 K.B. 403. In that case Vaughan Williams, L.J., after referring to Hennessy v. Wright (1888) 24 Q.B.D. 445 and Hope v. Brash (1897) 2 Q.B. 188 and quoting from them, said (1906) 1 K.B. 415:-

 

'

It seems to me that under these circumstances the question which we have to ask ourselves is whether there are any special circumstances in this case which would justify a departure from the general rule of practice as to not compelling the disclosure of the names of the persons who supplied the information on which the alleged libel was based incases of this kind, where the proprietors of a newspaper or other periodical publication set up a defence such as is here pleaded. I do not find any such special circumstances in this case.'

        That is, as Vaughan Williams, L.J. said, the general rule of practice which had sprung up by 1906 and which was prevailed ever since."

10. Terrapin Ltd. v. Builders' Supply Co. (Hayes) Ltd., Taylor Woodrow Ltd., and Swiftplan Ltd. was another case in which interlocutory injunction was being sought. It is true that in this case the Court of appeal indicated that it was proper to make an order for cross-examination of a witness only because there had been, in the words of  Lord Eurished M.R., at 133, "very special circumstances" and that the narrow rule of practice, upon which the decision in Lawson v. Odhams Press, Ltd. rested, was not relied upon.

11. Sellers L.J., however, in the following the passage, at 144, which was cited by Scholes J. in the Oriental Pacific Mills Ltd. case, made it plain that the Court was only concerned with the propriety of requiring the attendance of a witness for cross-examination when it was being asked so to order in an application for an interlocutory injunction:

"What must be concluded on such an application (an application for an interlocutory injunction), as I apprehend it, is whether the Plaintiffs make out a prima facie application for relief. That depends on a number of circumstances which I will not enumerate fully, but it would depend on whether any conduct on their part or delay or such ground would or would not justify such interlocutory relief, and more particularly whether their case on the face of it appears to be one which has a reasonable chance of success. Unless the Judge gets as far as that, that the case has a reasonable chance of success, I apprehend he would not go on to consider any interlocutory relief. But if the evidence is sufficient, as it clearly was sufficient in this case, to say that the Plaintiffs had an apparent good cause of action so that interlocutory relief could be considered, that is as far as it is necessary to go without making more precise affirmative findings which are germane to the main action." (The words in brackets are mine)

        The above authorities establish:

(i) that where an interlocutory injunction is sought in a libel action against the proprietor of a newspaper, there is a general rule of practice requiring that special circumstances be shown before a witness will be ordered to appear for cross-examination as to the names of the persons who supplied the information upon which the alleged libel was based;

(ii)that, generally, in cases where an interlocutory injunction is being sought the Court will not, unless some special circumstances are shown, be prepared to order attendance for cross-examination of a deponent where that will entail the canvassing of matters that will be in issue at the trial  of the action.

12. I am satisfied that the requirement as to special circumstances is not one of general application when the Court is called upon to decide whether or not a witness should be ordered to attend for cross-examination under 0.38 r.2.

13. The Court will, however, examine any request for attendance for cross-examination with care and will, bearing in mind the unnecessary expense and delay that will be caused if cross-examination is allowed in interlocutory proceedings on matters that should properly be canvassed at the hearing of the action, refuse to make any such order unless good reason is shown therefor.

14. Mr. Stone suggested that the application to cross-examine was being made so that a general attack canvassing wide issues could be made upon the Respondent. He suggested that what the Petitioner was seeking was the opportunity to cross-examine the husband at large about financial matters and to canvass questions which should properly be dealt with at the hearing of the action.  Mr. Rodway strongly denied that this was so and I am not prepared to accord any weight to this suggestion.

15. The Petitioner has made it plain that she desires to see the audited partnership accounts so that an assessment can be made with regard to the ancillary relief she is claiming. These accounts are relevant in those proceedings and will clearly be of assistance to the Petitioner when formulating her claim. This is information which the Respondent will eventually have to disclose and I see no reason to doubt her bona fides when she says that she wants this information as early formulate as possible so as to be able to properly formulate her claim.

16. Mr. Rodway pointed out

(i) that this was not cross-examination upon any issue in the trial but was     cross-examination to determine whether or not objection was properly being taken to the production of a document.

(ii) that this was a self-contained application and that, if the Court refused it, the Petitioner would, whether or not she might obtain the document or knowledge of its content in some other way, be prevented from obtaining the document at this stage of the action by way of discovery.

(iii)that although it was made clear at the time of the original hearing that the bona fides of the partner's objection was a matter in issue the only evidence the Respondent has seen fit to place before the Court in this regard was the evidence from himself.

17. Mr. Rodway referred particularly to the note at 38/2/3 where it reads:-

"Where there is a question of motive or a good faith of deponent, the Court ought not to be asked to act without cross-examination".

18. Mr Rodway relied upon Comet Products v. Hawkex Plastics (1971) 1 All E.R. 1141. In that matter Megaw L.J. said at 1146: -

"In general I think that in interlocutory proceedings, where there is a bona fide application to cross-examine a deponent on his affidavit, that application should normally be granted".

19. He also referred to the statement by Cross L.J. at 1147 where he said:-

"It is, I think, only in a very exceptional case that a judge ought to refuse an application to cross-examine a deponent on his affidavit".

20. Mr. Rodway also relied upon Re Smith and Fawcett (1942) Ch 304. In that case Lord Greene M.R. at 308 said:-

"If it is desired to charge a deponent with having given an account of his motives and his reasons which is not the true account, then the person on whom the burden of proof lies should take the ordinary and obvious course of requiring the deponent to submit himself to cross-examination."

21. This passage is significant as it refers to cross examination of a deponent as an "ordinary and obvious course".

22. In the present circumstances an application is being made to cross-examine a deponent to test his good faith as regards facts sworn to in an affidavit made to resist an application for discovery a matrimonial proceeding. The cross-examination will not involve the canvassing of matters that will be in issue in the trial of the action.  I am satisfied that it is proper to order the deponent to attend for cross-examination. I make an order nisi reserving the costs of the application.

(N.P Power)
Judge of the High Court

Representation:

Mr. Rodway Q.C. with Mrs. Penlington (Helen A. & Lo  Co.) for Petitioner.

Mr. William Stone (Yu, Tsang, Loong) for Respondent.

36892-EN-1984-02-24

WENDY WENTA SENG YUEN v. PHILIP PAK YIU YUEN

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HCMC000018/1983

Production for inspection by a party of partnership documents when other partners are objecting. Court will not order production in face of bona fide objection. Onus lies on party to establish that there is a bona fide objection. Facts which must be disclosed to satisfy that onus.

IN THE HIGH COURT OF JUSTICE
DIVORCE JURISDICTION

1983, No.18

BETWEEN

WENDY WENTA SENG YUENPetitioner
 
AND
 
PHILIP PAK YIU YUENRespondent

________

Coram: Hon. Power, J.

Dates of Hearing: 9, 10 & 11 January 1984

Date of Delivery of Judgment: 24 February 1984

__________

JUDGMENT

__________

1. In this matter Wendy Wenta Seng Yuen (the Petitioner) sought a decree of dissolution of her marriage with Philip Pak Yiu Yuen (the Respondent) in a petition filed on the 25th May 1983. A decree nisi was pronounced on that petition on the 7th June 1983 and the ancillary relief sought therein was transferred to the High Court.

2. The parties came before me on an Inter partes Summons wherein the Petitioner asked that the Respondent be ordered to provide further and better particulars of his affidavit of means and to give answers, documents and details concerning his means as requested by the Petitioner's solicitors in their letter of the 27th October 1983. In that letter the Petitioner's solicitors asked, inter alia, that further and better particulars be provided by the production of audited accounts of the partnership Yung, Yu, Yuen & Co., solicitors of which the Respondent is a member.

3. In the outcome the only matter that fell to be resolved by this Court was whether the Respondent should be required to produce the audited partnership accounts for inspection for the previous five years in the face of objection to such production by the other partners.  I must admit that I had considerable difficulty placing this application in the context of the rules of this Court. There was no dispute that the present application was brought under the Matrimonial Proceedings and Property Ordinance which deals with ancillary relief. There is provision under that Ordinance for the Chief Justice to make rules. None, however, have so far been promulgated thereunder. The matter does not, fortunately, rest there as the Rules of the Matrimonial Causes Ordinance, under which the divorce proceedings were commenced, can be properly applied to these proceedings and they include rules with regard to the preparation for trial.

4. It was formerly provided, by r. 28 of those rules, that the O.24 of the Rules of the Supreme Court, which deals with discovery and inspection of documents, applied to defended causes. However, r.28 was amended and it now states that the provisions of the District Court Civil Procedure Ordinance (General) Rules apply when the Court is dealing with discovery and inspection in defended cases. Rule 39 of those rules provides that the Court may make orders for discovery including the mode of discovery as it may consider necessary or desirable and it applies the provisions of 0.24 r.16 where there has been a failure to comply with any order of the Court. No order for discovery was made by a district court judge before the matter was transferred to the High Court and no order in that regard has ever been made in this Court. Rule 39(2) of the District Court Rules states that "nothing in this rules shall prevent the adoption by any party of the formal procedure prescribed by the Rules of the Supreme Court with reference to discovery". It was not expressly stated by either counsel that the Rules of the Supreme Court had been adopted. However, both seemed,in argument, to proceed upon the basis that those Rules should be adopted.

5. This being so it is necessary to examine the procedure under those Rules with care.   O.24(1) requires discovery after the close of the pleadings by the parties of all relevant documents which are, or have been, in their possession, custody or power. O.24(2) requires that discovery be made without any specific order by exchange of lists within 14 days after the pleadings are deemed to be closed. As I indicated to counsel during the course of argument, one of the difficulties which faced me was that there has never been an exchange of lists. When the hearing commenced I was not aware of the exact basis upon which the Respondent resisted production. Was he saying that he has never had possession of the audited partnership accounts or that he had had possession thereof but that they were now in possession of some other person or was he saying that he presently was in possession of copies of the accounts but was entitled to refuse to produce the copies for inspection as they belonged to the partnership?

6. During the course of the hearing, Mr. Ching, who appeared for the Respondent, handed up an affidavit in which he stated that: "I have spoken to my partners on the issue of the production of any of the audited accounts of the partnership, and .......... my partners have stated that they object to the production of such accounts. I do not possess such accounts in my own right. They are all in the joint legal possession of the partners."   I am not sure exactly what this means. Is the deponent saying that he has a set of accounts but regards them as being "in the joint legal possession of the partners" or is he saying, that he has no set of accounts in his possession at all? I think it should be made clear that Mr. Ching was never contending that the Respondent, if he had his own copy of the accounts, would not be required to discover and produce it.

7. Mr. Ching stated from the bar table that the deponent had meant to convey that he had never been given his own set of accounts. While I, of course, accept that those are Mr. Chin's instructions, it is far from satisfactory that this matter is not spelt out with particularity in an affidavit by the Respondent himself.

8. 0.24 r.3 gives power to the Court to order any party to make and serve on any other party a list of documents which are or have been in his possession, custody or power.Rule 4 allows the Court to order determination of issues before it makes any order under r.2 or r.3. Rule 5 is of particular importance as regards the present application as it provides that "A list ....... must enumerate the documents in a convenient order and as shortly as possible but describing each of them or, in the case of bundles of documents of the same nature, each bundle sufficiently to enable it to be identified". It goes on in sub-rule (2) to state "If it is desired to claim that any documents are privileged from production, the claim must be made in the list of documents with a sufficient statement of the grounds of the privilege". This has, of course, not been done in the present case.

9. 0.24 r.9 requires a party who has served a list, whether under rule 2 or rule 3, to allow the other party to inspect and copy the documents disclosed therein. 0.24 r.11 gives the Court power, in the appropriate case, to order production for inspection of any document to whose production objection has been taken.

10. The process of discovery involves 2 distinct stages. Firstly the party must discover the existence of all documents which have been in his possession, custody or power. He must at this time clearly state his objection to producing any documents which he says are privileged.  Secondly he must produce all other documents for inspection. The Court will upon application rule upon any claim that documents are privileged.

11. Mr. Ching did not seek to argue that the Respondent was not required to discover the documents in question. What he contended was that once it was established that they were partnership documents, i.e. owned and controlled by the partnership, the Court had no power to order inspection.

12. Mr. Ching first referred to the 14th Edition of Lindley on Partnership where it states at p.563 that a person cannot be compelled to produce books which belong to himself and others who are not before the court". Mr. Ching then referred to Murray v. Walter(1) which is cited by Lindley as authority for the proposition set out above. This case, which was heard in 1839 concerned a set of jointly owned documents.

13. Mr. Ching next referred to Reid v. Langlois(2) which, in 1849, approved of and followed the decision in Murray v. Walters The Lord chancellor said at 636, "The authorities referred to, Murray v. Walters (CR. & PH 114), Taylor v. Rundell (CR. & PH 104) showed that where a document is not in the exclusive possession of the Defendant, but in the possession of somebody else jointly with him, the production cannot be ordered. This is a well established rule, and cannot be considered as now open to dispute.

14. In 1870, in Bovill v. Cowan(3) it was accepted that joint ownership was an answer to an application that documents be produced but in this case the Court required a further affidavit to show the "nature of the joint ownership". There can be no doubt then, that in 1870, the rule enunciated in Murray v. Walter was firmly established in the Chancery Courts. This was confirmed in 1872 in Hadley v. McDougall.(4)

15. After the Rules of the Supreme Court appeared as the first schedule to the Judicature Act in 1875 the established, practice in the Chancery Courts, as regards production of documents, continued to be followed. In 1882, in Kearsley v. Philips(5) the Court was called upon to deal with certain muniments of title belonging to the defendant and another person who was not a party to the action. The affidavit of the defendant stated that he objected to produce such documents and the Court held that the affidavit showed sufficient reason for not making an order for inspection. Field J. said at 40 -

"I cannot accede to the suggestion that we should reject the authority of the Chancery cases, because this is an application under Order XXXI. The practice with regard to discovery and production of documents in courts of common law is of comparatively modern date, and, ever since its introduction regard has been had to the equity decisions on the subject, and, even if there was any conflict between the practice in equity and at common law, since the Judicature Act it appears to me that distinction is done away with and the equity practice in this matter must prevail.

 

Field J. further stated, at 40,

 

"The case of Murray v. Walters seems to me to decide this question. As I read the decision it does not depend on any such ground as the want of parties,but on the principle that the Court will not compel a man to disclose another man's deed. It seems to me that the true ground of the decision is that you cannot in an action against a man who has possession, of a deed conjointly with another, that is to say whose possession .there being a joint title, is in law the possession of himself and another, compel production by him of the deed which belongs to another man as well as himself. The case of Reid v. Langlois and that of Edmonds v. Lord Foley, are to the

 

16. It is true that in 1913, in Forbes v. Samuel(6), where a partner was being asked to produce a partnership deed, Scrutton J. held that the partner must produce the deed. He did so, however, upon the basis that each partner has a property in his own copy. These documents are not mere copies of one original. Each copy is executed by all the partners and each is in the "possession of that partner for whom it was executed and to whom it was delivered." Mr. Ching, as I have already indicated, did not seek to argue that if the Respondent had property in his own copy" he could refuse to produce it for inspection. The importance of the above case, for the present purposes, is that Scrutton J., at p.722, affirmed the authority of Kearsley v. Philips and was thereby affirming the line of authority running from Murray v. Walter in 1839.

17. Mr. Ching contended upon the authority of these decisions that where a document is jointly owned by a party and another person not before the Court no order can be made in the face of an objection by that other person requiring the party to produce it for inspection.   He submitted that the charge to the Rules of the Supreme Court in 1962 whereby a party was required to produce documents "in his possession, custody or power" rather than, as was formerly the case, documents "in his possession or power", did not affect the matter.

18. Mr. Rodway submitted that the law upon which Mr. Ching was relying has been swept away both by the change of rules in 1962 and by the modern approach of the courts. He submitted that the cases cited by Mr. Ching, which were heavily influenced by the chancery practice obtaining before the passage of the Judicature Act, had, by reason of the changes in the rules and the modern approach of the courts, lost whatever authority they had. He submitted that the modern approach was set out in Jackson's Matrimonial Finance and Taxation 1980 Edition at 102 where it is stated-

"It is no answer to a request for these documents (in the possession of the other side) to assert that they are confidential, or that they involve information relating to persons who are not involved in the case, or that they involve the disclosure of material relating to partners or a limited company, although in some cases the court will permit parts of documents to be concealed where the court is satisfied that they have nothing to do with the ease in hand. If a reasonable request for further information or for documents is refused, it may well; result in an application to the court, and the party unreasonably refusing will almost 'certainly have to pay the costs of that application (whatever the ultimate result of the matter) and.be ordered by the court to supply the information or disclose the documents requested."

19. I do not find great assistance from this paragraph as the learned author is, to use his own words, talking of "documents in the possession of the other side". It seems to me that the paragraph is doing no more than saying that where there are documents in possession of the other side, it is no answer to a request to produce them for inspection to say that they involve disclosure of material relating to partners.No one would argue with this proposition. It does not, however, go to the problem facing this Court which is whether a Court will order that documents owned by a partnership be produced for inspection against the objection of the partners in circumstances where only one partner is a party to the litigation.

20. Mr. Rodway also relied upon B. v. B.(7). While that case contains clear and helpful general statements as to the right to discovery and inspection in matrimonial matters, it also does not address itself specifically to the problem before this Court.

21. To resolve this matter,we must look firstly at the meaning and function of discovery. In Halsbury's Laws of England, Fourth Edition, Volume 13 at para. 2 it is stated:-

"The term 'discovery" in this title is used to describe the process by which the parties to a civil cause or matter are-enabled to obtain, within certain defined limits, full information of the existence and the contents of all relevant documents relating to the matters in question between them.

 

22. It is clear that discovery and inspection relate only to documents in existence. There is no power to order a person, who does not have a document in his possession, custody, or power to go and obtain copy of document in the possession, custody,or power of another for the purpose of complying with the order. Further, if a document has ceased to exist or passed out of a party's hands, he could not be required, by the rules relating to discovery, to make and produce for inspection a copy thereof.

The learned author of Halsbury goes on to state:-

"Discovery should not be confused with the process of obtaining further and better particulars of a pleading, nor with the process of interrogatories nor the process of obtaining unsworn admissions of fact, but when considering whether Discovery should be sought in any particular case the possibility of using one or more of those other processes in lieu of discovery should be borne in mind. Discovery should also be distinguished from the process of compelling the disclosure of documents at the trial under a subpoena duces tecum, the power to order depositions to be taken before the trial or the power to order the production of documents in aid of a foreign court.

 

23. This passage correctly, in my respectful view, emphasizes the necessity to distinguish discovery from the process of interrogatories and from the process of compelling the disclosure of documents at the trial under a subpoena duces tecum. In the Practice Note 24/1/1A of the Supreme Court Practice 1976, it is stated: -

"The existence and extent of a right of discovery depends upon whether the person from whom it is sought is a party to an action (not being an action for discovery only), a prospective party or a stranger.

 

The note goes on to state that: -

 

"Discovery of documents or facts against a stranger cannot, as a general rule be obtained nor is it proper to join a stranger as a party merely for the purpose of discovery:"

It seems to me clear that if a document is in the possession, custody, or power of a stranger, a party cannot be ordered by the rules relating to discovery to produce that document for inspection. The rules are framed to ensure that each party discloses to the other party all of the relevant documents which are or have been in his possession, custody, or power and produces for inspection those which still are in his possession, custody or power. Books and documents of partnership will normally be in the joint possession, joint custody and joint power of the partners. No partner will have the right to sole possession, or sole custody or have power of control to the exclusion of the other partners over the books or documents. It may be that an objection by the other partners to the production of the books or documents on the grounds of confidentiality will, in the end, prove to have been fruitless because, if they are relevant,the party will be required to reveal their contents in answers to interrogatories or the partners will be forced to produce them under subpoena. This is, however, no ground for suggesting that power to order their production must be somewhere contained in the rules relating to discovery and inspection.

24. One need not look far to see the commonsense and common justice of the rule in Murray v. Walter.If a partner could be ordered to produce books and documents, the property of a partnership, against the objection of the other partners, substantial inconvenience and hardship might well be caused without the objecting partners ever having had the opportunity to be heard on the matter.If, however, the books are produced by way of subpoena duces tecum they can, at the time when they appear before the Court, make plain any objection they have to producing them. The Court might well feel it appropriate to allow sworn copies to be produced so that the originals can be returned and the work of the business continued without interruption. It may be that the partners, having been able to satisfy the Court that the confidential information, to whose disclosure they object, is not really relevant to the proceedings, will be allowed to black out the information before producing the books. I mention these possibilities only to illustrate how important it might be, in certain cases, to allow the partners to appear and make representations.

25. Mr. Ching did not refer to authorities after 1913 however the rule he was contending, for was once again affirmed in 1953 in Chantrey Martin v. Martin(8) at 291 where Jenkins L.J. said -

"Thus a party will not be ordered to produce a document which, though in his actual corporeal or physical possession, belongs wholly to a third party or to a third party jointly with himself: see Kearsley v. Philips.".

26. After the amendment to 0.24, in 1964, the line of authority was again recognized in Crompton Ltd. v. Customs_ and Excise Commissioners(9) at 134 where Lord Denning said –

"If the party had been entrusted by the owner with the original it would clearly be privileged from production simply because it did not belong to him: see Reid v. Langlois and Chantrey Martin & Co. v. Martin."

27. Further the Supreme Court Practice states at 24/1/1; "By the Evidence Act 1851 and the Common Law Procedure Act 1854, the Common Law Courts were given power to order general discovery of documents and to allow interlocutories. Both under these acts and now under the rules made under Judicature Acts, the principles applicable, and powers exercised, in the old court of chancery, generally govern discovery in all divisions of the High Court........."

28. I am satisfied that a Court has no power to order a partner who is a party to an action to produce partnership documents in the face of a bona fide objection by the other partners I will turn shortly to the importance of the requirement that it be a bona fide objection.

29. Mr. Ching contended not only that once a party has established that the documents are partnership documents the Court has no power to order their production but also that, once this has been done, the party is not required to establish, that the partners have refused to consent or even that he has sought their consent. He contended also that if it is shown that the partners have refused to consent, he is not required to state their reasons for refusal.

30. In B. v. B.(7), Dunn J. set out the note under s.24/2/4 to the Supreme Court Practice 1976 pointing out that the terms of that note had been expressly approved by Lord Cross in Alfred Crompton Amusement Machines Ltd. v. Customs and Excise Officers(10) at 429 and that three of their Lordships in that appeal agreed with the speech of Lord Cross. The note reads as follows:-

"Until 1962, there was a distinction between the obligation to give discovery (i.e. to disclose the existence of documents) and the obligation to produce disclosed documents for inspection.  A party was (and still is) obliged to disclose the existence of documents in his possession, etc., even though his possession may not be exclusive or may be only physical custody, e.g. as a servant, the obligation to produce documents was narrower and extended only to documents in the sole legal possession of the party giving discovery ......  Under the present rules the obligation to give inspection extends prima facie to all documents to which the obligation to give discovery extends ......... But the court has a discretion whether to order inspection, and it may be that, in the exercise of such discretion, it will have regard to any prejudice to persons having a right to the documents in question. Moreover, the court will not make an order either for discovery or inspection which is premature or not necessary for disposing fairly of the cause or matter or for saving costs.

 

31. This note recognizes the existence of a discretion as to production which would be properly exercised only after consideration of all of the facts disclosed at the time of discovery.

32. It was implicit in Mr. Ching's argument that there was no discretion in the Court once it was shown that the property was jointly owned by the party before the Court and another person. He submitted that the Court had never had any such discretion and that it could not be given it by a change in the rules such as took place in 1962.  He submitted that the property rights of persons not parties to an action cannot be affected by changes in the rules of court and I would be slow to disagree with this submission. While this may be so, there can be no doubt that the rules of court are binding upon persons who are parties to the action and that such persons must comply with those rules. The Respondent must, therefore, comply with all of the requirements of 0.24 and particularly with the requirements of 0.24 r.5 which requires him, where privilege is claimed, to make a "sufficient statement of the grounds of the privilege".

33. Why, it might be asked, should the Respondent be required to say any more than that the documents are jointly owned if the Court has no power to order production for inspection once that fact has been established. To answer this question one must look at the much-maligned decision in Walburn v. Ingilby(11) which was decided in 1833. I have no hesitation in concurring with Mr. Ching's contention that this case cannot be taken as laying down any general rule that there is a power to order production for inspection of documents in jointly owned by a party and a non-party. In that case the documents, as to which production was sought, which were being held by one Gregson, a solicitor, were the joint property of certain defendants, who were before the court as parties to the application for production, and certain other defendants, who were not before the court in that application. Production was resisted upon the ground that two of the latter class of defendants had refused to give their consent thereto. The Lord Chancellor, Lord Brougham, stated, at 83, -

"If such a defence, or such an arrangement among parties having a common interest in books and papers, were allowed to protect them against production, it is clear that means would never be wanting to evade or to defeat the jurisdiction of the Court. The whole affair has essentially the appearance of a contrivance for this purpose, and it can never be suffered to prevail. One party elects to demur, another thinks it for his advantage to answer; both employ one solicitor in the cause, who holds the documents relation to it for both; but the Defendant, who demurs, employs another solicitor, to give his solicitor in the cause notice not to produce these, and the Defendant who answers says that his Co-defendant, being no longer a party, has, by his private solicitor, given notice to the common solicitor not to produce the papers which are their common property, and to which both have the same title. Such an excuse cannot be admitted. The Court has a right to give whatever access the party himself is entitled to and as Gregson could not refuse access to the Defendants who have answered, so cannot they refuse access, to, the Plaintiffs.With respect to Mr. Gregson, he is quite safe in acting as the order of the Court has called upon his clients to do and to permit.''

 

34. Courts have, I am respectfully satisfied, mislead themselves as to the real ratio of this case by lifting the words "The Court has a right ........ to the Plaintiffs" out of their context. This is, perhaps not surprising as the headnote of the case is guilty of this very error. It states:-

"Where books and papers the joint property of the Defendants and of other persons not before the Court, were admitted, by the answer, to be in the custody of a third party, as the common agent of all, on order was made upon such agent to permit an inspection by the Plaintiff, against the consent of those owners who were not parties, on the principle that the Court has a right to give the Plaintiff whatever access the Defendant himself would be entitled to."

The headnote is stating, without any qualification that,as regards joint owner books and papers, the Court is entitled to give to the Plaintiff whatever access the Defendant himself would be entitled to. In 1839 the then Lord Chancellor, Lord Cottenham, remarked in Murray v. Walter, at 125, that

"The case of Walburn v. Ingilby, as reported,no doubt seems to infringe upon that rule."

i.e. the rule that where jointly owned documents are held by an agent on behalf of the party to an action and another joint owners, the Court will not make an order for their production. This was, I am respectfully satisfied, a wrong reading of what was decided in Walburn v. Ingilby.When the sentence,"The Court has a right...... to the Plaintiffs" is read in context it seems to me clear that what Lord Chancellor Brougham was saying was that, where a party is entitled to access to jointly owned documents, to whose production an objection has been taken by the other joint owners, and where that objection has the appearance of a contrivance to evade or defeat the jurisdiction of the Court, the Court can order the party to produce the documents for inspection if it is satisfied both that the party has access and that the objection has the appearance of a contrivance to evade or defeat the jurisdiction of the Court. I am satisfied as to the existence of this power which, it is true is a limited one which can only be exercised in the narrow confines set out above. I will turn shortly to consider on whom the onus lies when an objection to production is made.

35. The view I have taken above of the decision in Walburn v. Ingilby was that taken by Byrne J. in Williams v. Ingram(12).  On an appeal from that decision the Court of Appeal, (1900) 16 T.L.R. 451, at 451, recognized the "exception from the general rule as in Walburn v. Ingilby."

36. While it may well be that in this regard we are dealing with a question of a limited power rather than a discretion, I am satisfied that for the purpose of deciding whether this power should be exercised 0.24 properly requires that a party fully disclose the circumstances of the joint ownership and the nature of the objection to production.

37. It may be that the Court, once it has been established that there has been an objection by a third party joint owner made in good faith, has no power to order the production.The Court is however entitled to consider whether or not such an objection is being made and whether it is made in good faith. If, for instance, the Court was satisfied that the third party had no real objection but was simply lending his name to the making of an objection to help the party before the court, then the Court might well hold that this was a contrivance to defeat the jurisdiction of the Court. Halsbury, when discussing Production for inspection of documents not in the sole possession of a party",  Volume 13 paragraph 60, uses the word 'discretion' but is clearly referring to the limited power to which I have just referred. This passage reads as follows:-

"In relation to the exercise of such discretion, the former cases may still be relevant in considering whether to make an order for production for inspection in cases where the documents are not in the sole legal possession or are not the sole property of the party giving the inspection, or where that party has joint possession with another person not a party to the action. If a party seeks to claim protection from production for inspection on any of these grounds, he will have to set them up, and the burden will be on him to justify such ground of protection.

 

Thus he should state the nature of the joint possession of the documents by himself and the person not a party to the action, and he should state whether or not he has tried to obtain the consent of the joint possessor to the production, and why such joint possessor is objecting to the production. If the court should refuse production on the ground that the documents are in the joint possession of the deponent and his partner .it may alloy an interrogatory as to their contents and require copies to be exhibited to the answer or may order production of copies in the possession of the party; and where an employee is in possession of copies belonging to his employer toe court still has a discretion whether to order their production in an action by a third party against the employee ."

38. The statement as to the burden and as to the requirements that must be stated by the party claiming protection is in my view correct. I am satisfied that where there is an objection by joint owners of a document and where the Court is satisfied that there is no contrivance to defeat its powers, then the Court must refuse to order production for inspection. It is, however, for the Defendant to justify the ground of protection and he will fail to do so if he does not state the exact nature of the joint possession, whether or not he his tried to obtain consent from the joint possessor and why such joint possessor is objecting to the production.

39. I am satisfied that as regards audited partnership accounts which are relevant to matters in question in an action the party who is a partner must, in order to comply with 0.24, disclose:-

(i) whether he has the originals of those accounts in his possession;

(ii) if not, whether he has ever had them in his possession, where they are presently kept and by whom;

(iii) whether he has had a copy of them in his possession;

(iv) if not, whether he has ever had a copy in his possession;

(v) if the answer to (iv) is Yes, where such copy is presently kept and by whom and whether he is entitled to command its return to him;

(vi) if the answer to (iv) is No, whether copies exist, as to any of which he is entitled to possession;

(vii)if the partners object to the production of the accounts, what effort he has made to obtain their consent and why such objection is taken.

40. Does it lies in the mouth of the Plaintiff to suggest that, as the Defendant in the present has not furnished the above information, he has failed to justify his ground of protection and that an order requiring production for inspection should be made.

41. I am satisfied that it does not. It would in the circumstances obtaining be unfair and wrong to approach the matter upon that basis. I consider the Defendant should be given the opportunity to furnish an affidavit dealing with the matters set out above.I allow the Defendant 14 days to file such an affidavit. When that affidavit has been furnished, I will hear the parties further, if they desire to be heard, as to the application of the law to the facts revealed in the affidavit. I make it plain that it is not my intention to entertain further argument as to the law applicable but only as to how the law, as I have held it to be, should be applied to the facts revealed in the affidavit. Cost reserved.

(N.P. Power)
Judge of the High Court

(1) CR. & PH. 114.

(2) 1 Mac. & G. 627.

(3) (1870) 5 Ch. App. 495.

(4) (1872) Ch. Ap. 312.

(5) (1882) 10 Q.B. D. 36.

(6) (1913) K.B.D. 707.

(7) (1979) Fam. 181.

(8) (1953) 2 Q.B. 286

(9) (1972) 2Q.B. 102

(10) (No.2) (1974) A.C. 405

(11) 1 M.K. 61

(12) (1900) 16 T.L.R. 434

Representation:

Mr. Charles Ching, Q.C., Mr. Kotewall and Mr. Stone instructed by Yu, Tsang and Loong forRespondent.

Mr. Gilbert Rodway, Q.C., and Mrs. Pennington instructed by Helen A. Lo & Co. for Petitioner.