Case Detail

LAU WING YAN AND OTHERS v. CHU KONG AND OTHERS

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[2021] HKCFI 1184-EN-2021-04-22

<br>LAU WING YAN AND OTHERS v. CHU KONG AND OTHERS<br>

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HCA 2562/2014

[2021] HKCFI 1184

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2562 OF 2014

________________________

BETWEEN

	LAU WING YAN	1^st Plaintiff
	SUN MIN	2^nd Plaintiff
	CHANG DAFA	3^rd Plaintiff
	PACIFIC BULK SHIPPING (CAYMAN) LIMITED	4^th Plaintiff
	and
	CHU KONG	1^st Defendant
	LU ZHONG ZHI	2^nd Defendant
	HU MU ZHONG	3^rd Defendant
	JOINT SILVER LIMITED (IN LIQUIDATION)	4^th Defendant
	CENTRAL SHIPPING COMPANY LIMITED (IN LIQUIDATION)	5^th Defendant

________________________

Before: Deputy High Court Judge Winnie Tsui in Chambers

Date of Hearing: 22 April 2021

Date of Decision: 22 April 2021

________________________

D E C I S I O N

________________________

Introduction

1. Today is the seventh day of the trial of the present action. Mr Douglas Lam, SC, appearing with Mr Martin Kok, opened the plaintiffs’ case on day one. Due to some unforeseen circumstance, the plaintiffs called their first witness, Mr Yan Donghai, on day three. Ms Sun Min, the 2^nd plaintiff, was called on day four. She was under cross-examination for just over three days. Immediately after she completed her evidence this morning, Mr Lam, having had an opportunity to confirm instructions from all the plaintiffs, applied to the court for leave to discontinue the action entirely with costs to the defendants. And the plaintiffs also accepted that the injunction granted to them on 17 December 2014, as subsequently continued, should be discharged. In the course of his subsequent submissions, Mr Lam accepted that the injunction would be discharged on the ground of material non-disclosure and the plaintiffs should pay costs of the discharge summons on an indemnity basis.

2. The only remaining issue is the basis of taxation which should apply to the costs of the action. The 1^st defendant, represented by Mr William Wong, SC together with Mr Michael Lok, and the 3^rd defendant, represented by Mr Kevin Hon and Mr Harry Chan, both ask for the indemnity basis. This the plaintiffs oppose.

3. In gist, the plaintiffs’ claim in the present action turns on the existence of two oral agreements alleged by them, referred to in the pleadings as “the First Agreement” and “the Second Agreement” and allegedly concluded between the parties. The defendants deny that the agreements had ever been made.

The approach

4. In considering the proper basis of taxation, I would adopt the following approach. I would take into account the pleadings, the witness statements, the contemporaneous documents referred to in the course of the trial, the oral evidence of Mr Yan, the extensive oral evidence given by Ms Sun, the affirmations filed in respect of, or relevant to, the discharge application, the plaintiffs’ acceptance that the interlocutory injunction should be discharged on the ground of material non-disclosure, and the fact of the application to discontinue the action with costs to the defendants being made on day seven of the trial.

5. I would also take into account the settlement offers made by the plaintiffs over the past three months, with the final offer being the discontinuance of the action with costs to the 1^st and 3^rd defendants in the sum of $3,000,000 for both defendants.

6. I would then decide whether I would come to the view, as put forward by Mr Wong and Mr Hon, that the plaintiffs’ commencement and pursuit of the present action is an abuse of the court’s process on the basis that the two alleged oral agreements never existed and they were concocted by the plaintiffs as a plank on which to apply for the interlocutory injunction back in December 2014.

7. Mr Lam accepts that notwithstanding that the evidence on the oral agreements is not yet complete, when deciding the issue of costs, it is open to me to take the above approach and form a view of the matter on the basis of the materials before me. Mr Lam also accepts that if my overall impression is that the plaintiffs’ pursuit of the present action is an abuse of process, I am quite entitled to order indemnity costs.

8. I should add here that by adopting the above approach, I would not be making any formal factual finding on the issues in dispute in this action.

9. The evidence before me is incomplete. Counsel did not have the opportunity to make full submissions in the way they would at closing if the trial proceeded as scheduled.

10. I am not sure whether in the circumstances, I have the power or am in a position to proceed to make factual findings. But even if I do, I would decline the invitation of Mr Wong to do so, particularly in light of the fact that there are ongoing litigation between the two camps. I would be hesitant to make findings of fact when the evidence had not been fully explored on all the disputed issues when these findings may have the effect of creating issue estoppel against the parties concerned.

Abuse of process

11. Having reflected on the materials before me, I have come to the view that the pursuit of the present action is an abuse of the court’s process and the plaintiffs should pay costs of the action on an indemnity basis.

12. The plaintiffs now accept that the injunction should be discharged by reason of material non-disclosure. What is striking in the present case is that when applying for the injunction on an ex parte basis, the plaintiffs exhibited as part of their evidence emails which had been altered.

13. Objectively speaking, the altered parts have the effect of corroborating the plaintiffs’ case of the two oral agreements. The alteration was subsequently admitted by the plaintiffs. But the admission was not at the first opportunity when they could have done so, that is after the 1^st defendant filed his supporting affirmation in February 2015 pointing out the discrepancies between the exhibited emails and the original emails. The admission was made much later in January 2016 when it must have become clear to the plaintiffs that there was really no plausible or possible way of explaining the discrepancies.

14. In January 2016, Ms Sun put forward what on its face is an utterly unconvincing explanation why the altered emails were put forward to the court as part of her affirmation evidence. She put it down to lack of communication or miscommunication with Mr Yan and the time pressure she was under when the plaintiffs put together the injunction application.

15. The explanation is all the more unconvincing given that in the course of 2015, the discrepancies were pointed out to Ms Sun and the plaintiffs on more than one occasion. See, in particular, the letter from Howse Williams Bowers dated 18 May 2015. The letter was drafted in direct, clear and simple terms. There was no way that its content and hence the 1^st defendant’s position could be misunderstood. Yet the plaintiffs did not see fit to explain then.

16. In the three days of cross-examination, Ms Sun certainly came across as an articulate and careful witness. She has a bachelor’s degree in law and a master’s degree in maritime law. She took care to understand counsel’s questions and answered them at length. She was anxious to make sure that her answer would not get misunderstood. This impression that I have formed (and indeed anyone in the court room would have formed) of her does not sit well at all with her assertion that the altered evidence was used because of lack of communication, miscommunication, or time pressure.

17. The use of altered documents in legal proceedings clearly is an extremely serious matter. The plaintiffs now accept that indemnity costs should be granted for the discharge application. But that is not the end of the matter. It certainly has a bearing on how I evaluate the materials before me when I consider the plaintiffs’ conduct of the present action as a whole.

18. I accept Mr Wong’s submission that when one looks at the substance of the matter, one gains the impression that the injunction obtained back in December 2014 was really the main target of the plaintiffs, as the injunction had the substantive effect of preventing the 4^th defendant from managing and controlling its own ship at that time. The injunction application was launched on the basis of the two oral agreements.

19. But the materials before me do give an impression that there is really no substance in the allegation concerning the oral agreements.

20. None of the plaintiffs could point to a single occasion or conversation where the oral agreements, or some of the terms, were reached. That was the situation before the trial commenced. But, surprisingly, Ms Sun told the court over the past few days, ie more than six years after the event, that she could now recall a meeting on 19 February 2013 where some of the terms were agreed.

21. Furthermore, none of the plaintiffs can point to any contemporaneous documents recording, reflecting or referring to the alleged oral agreements.

22. Some of the oral terms in fact were directly contradictory to the express terms of the contemporaneous documents, such as the facility agreement signed with Credit Suisse.

23. In the course of submissions this morning, all parties agreed that it is open to me in the present context to form a view on the oral agreements and whether they were a fabrication on the part of the plaintiffs.

24. That is indeed the overall impression that I have formed, having considered the materials before me. Needless to say, the pursuit of a legal action based on such fabrication of facts is an abuse of the court’s process.

The settlement offers

25. In the normal course of things, the court would look favourably at settlement offers made by a party in an action. Here, the plaintiffs have made three in the recent months. But the making of such offers must now be seen against the impression that I have formed above. Thus viewed, the weight that I should give to such offers must be considerably diminished.

26. The action was commenced in late 2014. These offers were made in early 2021, in the three months before the trial. They seem to me to be last-minute efforts not to genuinely settle the claim, but to save the plaintiffs from the likely fate of failure at the trial.

27. Had the plaintiffs done what they have done this morning, that is to seek leave to discontinue the action with costs to the other side with no monetary limit imposed, the 11-day trial would very likely have been vacated.

Conclusion

28. For the above reasons, I would order that costs be granted on an indemnity basis, in favour of the 1^st and 3^rd defendants.

[Submissions on form of order]

29. I make the following orders.

30. Upon the plaintiffs’ undertaking not to subsequently revive the plaintiffs’ causes of action in relation to the First and Second Agreements as pleaded in paras 16 and 17 of the amended statement of claim as against all the defendants:-

(1)  The injunction order made by Deputy High Court Judge Wilson Chan dated 17 December 2014 as varied and continued by Chow J on 24 December 2014 (“the Injunction Order”) be discharged on the ground of material non-disclosure;
(2)  Costs of and occasioned by the defendants’ summons dated 11 February 2015 to discharge the Injunction Order be to the 1^st defendant with certificate for two counsel, to be taxed on an indemnity basis if not agreed;
(3)  Leave to the plaintiffs to discontinue this action as against all the defendants, without prejudice to any party’s right to enforce the plaintiffs’ undertaking as to damages pursuant to the Injunction Order;
(4)  Costs of this action (save for the costs of the afternoon of 14 April 2021 and the morning of 15 April 2021, for which there be no order as to costs) be to the 1^st and 3^rd defendants with certificate for two counsel, to be taxed on an indemnity basis if not agreed;
(5)  There be liberty to apply.

	(Winnie Tsui)
	Deputy High Court Judge

Mr Douglas Lam, SC and Mr Martin Kok, instructed by DLA Piper Hong Kong, for the 1^st to 4^th plaintiffs

Mr William Wong, SC and Mr Michael Lok, instructed by Howse Williams, for the 1^st defendant

The 2^nd defendant was not represented and did not appear

Mr Kevin Hon and Mr Harry Chan, instructed by SSW & Associates, for the 3^rd defendant

HCA 2562/2014

[2018] HKCFI 1115

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

HIGH COURT ACTION NO 2562 OF 2014

________________________

BETWEEN
	LAU WING YAN	1^st Plaintiff
	SUN MIN	2^nd Plaintiff
	CHANG DAFA	3^rd Plaintiff
	PACIFIC BULK SHIPPING (CAYMAN) LIMITED	4^th Plaintiff
	and
	CHU KONG	1^st Defendant
	LU ZHONG ZHI	2^nd Defendant
	HU MU ZHONG	3^rd Defendant
	JOINT SILVER LIMITED (IN LIQUIDATION)	4^th Defendant
	CENTRAL SHIPPING COMPANY LIMITED (IN LIQUIDATION)	5^th Defendant

________________________

Before: Mr Registrar K. W. Lung in Chambers

Date of Hearing: 17 May 2018

Date of Decision: 17 May 2018

___________________

D E C I S I O N

___________________

THE APPLICATIONS

1. The following applications are before this Court:

(a) The plaintiff’s summons for leave to the parties to adduce expert evidence on the profits that could have been generated by the 4^th plaintiff from the commercial operation of the vessel as per the terms as set out in the summons; and
(b) The 1^st and the 3^rd defendants’ (“the defendants”) applications for leave to amend their Amended Defence and Defence respectively as per the drafts annexed with the summons.

2. The applications are contested and the parties are legally represented.[1]

3. The parties agree that the applications for amendments to the Defences should be dealt with first as they will affect the determination of expert evidence. I will do so accordingly.

THE AGREED FACTS

4. The parties agree to the facts as set out in the written submissions of the defendants below:

“ (1) D4 was the registered owner of a vessel named Grain Pearl (“Vessel”) since December 2012 until 2015 when the Vessel was sold;
(2) P1, P2 and P3 and D1, D2 and D3 were collectively the “ultimate shareholders of D4” (on Ps’ case) or “beneficial owners of the Vessel” (on D1/D3’s case) while D5 (a BVI company) was the sole shareholder of D4;
(3) At all material times, P4 maintained a relationship with D4 in respect of the Vessel:
(a) Ps contend that P4 was the “commercial manager” of the Vessel; and
(b) D1/D3 contend that P4 was “commercial agent or in house chartering broker” of D4;
(4) In particular, it is Ps’ case that P1, P2, P3 and D1, D2 (being the “ultimate shareholders” or “beneficial owners”) agreed on terms of the “operation and management of the” Vessel in the form of a “First Agreement” and a “Second Agreement”. D1/D3’s case is that no such agreement existed.
(5) In around November 2014, D4 terminated the above relationship between D4 and P4, in relation to which:
(a) Ps contend that this was in breach of the “First Agreement” and the “Second Agreement”; and
(b) D1/D3 contend that D4 was entitled to do so, given, amongst other things, P4’s failure to account to D4 for revenue generated by the Vessel as a result of the Vessel being chartered out to various third parties.
(6) Ps further make a number of allegations against Ds, including that D1 caused D4 to issue a lien notice on 5 December 2014, asserting a lien on certain cargoes in question (“the “Cargoes”).”[2]

DISCUSSION

The amendments applications

5. The plaintiffs take issue with the following:

(a) The proposed “green” amendments in the draft D1’s Re-Amended Defence at §§15.b, 16.d, 16.e.iii, 16.f.iii and 49; and
(b) The corresponding proposed “red” amendments in the draft D3’s Amended Defence, at §§15.b, 16.d, 16.e.iii, §16.f.iii and 49.

6. The proposed amendments at §§15.b, 16.d, 16.e.iii & 16.f.iii amendments relate to the alleged “market practice” and “trade practice”.

7. The proposed amendments at §49 are made for the purpose of adding a new plea of mitigation, in response to P4’s claim for damages.

Paragraph 49

8. It will be convenient to deal with §49 on the new plea of mitigation at this initial stage as this is a short point. The defendants rely upon the authority of Hsu Ming Chi v. Lam Shu Chit and Others (Unreported, HCCL 8/2013, 22 October 2014) at §§14-15 (per Ng J). The court held that if the proposed amendment is bound to fail, no leave should be given, taking the proposed amendment at its highest, following the case of Bank of China v Leigh Hardwick (unrep., HCA 1110/2006, 28 August 2013 per A. Chan J. at §2)

9. I agree with Mr. Wong, S.C. for the plaintiffs that P4 has no duty to sell the vessel. In fact, I do not think it has the authority to do so, the decision being within the province of the beneficial owners themselves.

10. In Mega Yield International Holdings Ltd v Fonfair Co Ltd (unreported, HCA 948/2009, DHCJ Woo, 5 March 2013, §33), the court held on mitigation as follows:

“On mitigation of damage, the relevant law can be found in Chitty on Contracts, 31st Ed, Vol 1 “General Principles” (“Chitty”) paras 26-077 to 26-079. The claimant is to take all reasonable steps to mitigate his loss consequent upon the breach. The onus of proving the claimant’s failure to have taken certain steps to avoid some part of his loss is on the defendant, who must show that the claimant ought as a reasonable man to have taken certain steps to mitigate his loss. However, the claimant is not “under any obligation to do anything other than in the ordinary course of business”; the standard is not a high one, since the defendant is a wrongdoer.”

11. It is the parties’ pleaded case that the authority to sell the vessel remains with the other plaintiffs other than the 4^th plaintiff. It is also agreed in the pleadings that the beneficiaries, including the defendants had argument over the terms of the offer and the sale was not put through. In the circumstances, it is unrealistic to hold the 4^th plaintiff liable for not selling the vessel to mitigate the loss. The defendants submit that they can change the pleading to hold the 1^st to the 3^rd plaintiffs liable for mitigation. But this is not possible because now the claim is between the 4^th plaintiff and the defendants and the defendants themselves are the beneficiaries, who had dispute with the plaintiffs over the offer of sale.

12. The defendants’ proposed amendment of paragraph 49 is bound to fail. As such, the proposed amendment should not be allowed.

Paragraphs 15.b, 16.d, 16.e.iii & 16.f.iii amendments

13. The plaintiffs have raised the grounds of objection of (1) undue and unexplained delay; (2) the terms of “market practice”, “standard practice” or “trade practice” are not particularized and (3) the amendments being defective, irrelevant and/or unnecessary for the fair disposal of the matter.

14. The defendants’ argument is that the proposed amendments are relevant to the issues of whether there were oral agreements and the terms of such oral agreement; there is nothing new about the reliance on ‘market practice’, ‘standard practice’ or ‘trade practice’, which have already been canvassed in existing pleadings and witness statements and this is consistent with the plaintiffs’ witness statements.

15. The plaintiffs rely upon the following authorities in support of their argument:

(a) Raytech Industries Co Ltd v Leung Wai Kit (unreported, HCA 1360/2011, DHCJ Le Pichon, 16 May 2014 at §§16-17, 30-32). In this case, the main emphasis was on the conduct of the defendant. The court found that the defendant was deliberately delaying the matter by taking out specific discovery application, but ultimately withdrew it at the last minute; did not progress through the various Case Management Conferences; if the application for amendment (to plead limitation) were allowed, there would be further delay of two years, causing significant prejudice to the plaintiff[3]. The court also held that “Ultimately it is a question of weighing up the various competing factors. I do not consider that absent the proposed amendment, the real question cannot be tried….” It was on those bases she dismissed the appeal against the Master’s refusal of the defendant’s application for amendment.
(b) Hesson Development Ltd v Tang Ki Fan Tso with Tang Tin Kwai as Manager (unreported, HCA 5584/1998, Chu J. (as she then was) 30 September 2003) where the court required explanation for the delay, otherwise it could not determine whether the amendment was occasioned by genuine mistake or otherwise. [7] As a general principle, pure delay will not be sufficient to bar an application to amend, but this, coupled with the lack of particulars and other factors, the court would refuse to exercise its discretion to allow the application for amendments. [13]

16. The defendants rely upon the authority of

(a) Crema v. Cenkos Securities plc [2011] 1 WLR, 2078 at paras. 42-43 and 45:-
“The Belize case confirms that a court must consider all the background knowledge which would be reasonably available to the parties when deciding whether or not a wholly written contract is to be interpreted so as to contain a term which is implicit. The same must be true of a contract which is partly oral and partly in writing or even wholly oral. Only in that way can a court be put in the position of being what Lord Hoffmann calls the ‘reasonable addressee’ in the Belize case at [18]. It seems to me that it must follow that, in either case, a court will be entitled to receive independent expert evidence of what ‘market practice’ is if that is relevant background knowledge for the purposes of interpreting the terms of the contract, both explicit and implicit. Contrary to the submission of Mr Page, I think that this will be particularly so if there is a dispute about the ‘market practice’ between the rival parties to the litigation.
In my experience, it has been common practice for the Commercial Court to hear evidence of ‘market practice’, which does not amount to evidence of an alleged ‘trade usage or custom’, in order to assist the court with a full understanding of the factual background to the proper construction of a written contract. The landmark decision of the House of Lords in Prenn v Simmonds reminded both judges and practitioners that written contracts were not to be interpreted ‘isolated from the matrix of facts in which they were set and interpreted purely on internal linguistic considerations'. Therefore, evidence of the factual background known to the parties at and before the date of the contract, including evidence of the ‘genesis' and objectively the ‘aim’ of the transaction, but not of negotiations, was admissible.
…
If expert evidence is admissible to provide the background against which to construe a wholly written contract, including the exercise of construction which involves determining whether there is an ‘implied term’ as analysed by Lord Hoffmann in the Belize case, then it seems to me that the same exercise must logically be permissible in the case of construing a partly written and partly oral contract. What the parties agreed, expressly or implicitly, can only be judged against the factual background they knew, which must include practices of any particular market in which they operate and in which the agreement was made” (emphasis added)[4]
(b) Hsu Ming Chi v. Lam Shu Chit and Others (Unreported, HCCL 8/2013, 22 October 2014) at §§14-15 (per Ng J):
“Leave is readily granted to amend before trial unless it can be shown that the new claim based on the proposed amendment is bound to fail. While the court is entitled to have regard to the merits of the case, it should only do so when the merits are readily apparent, and are so apparent as not to require prolonged investigation”
There is no dispute on the legal principles above.

17. Mr. A. Wong, Senior Counsel acting for the plaintiffs argues that the authority of Crema does not assist the defendants because there is no issue of implied terms or construction of written terms on the existing pleadings.

18. The defendants submit that the purpose of this case is to allow the court to have a full picture of the factual circumstances, including the market and trade practices in order to determine the credibility of the plaintiffs’ evidence in relation to the oral agreements. But this is not the ratio decidendi of this case. The ratio is on the circumstances for the court to infer any implied term of the contract.

19. The defendants are insisting that there was no oral agreement between the 4^th plaintiff and the 4^th defendant and the plaintiffs’ pleaded First and Second Oral Agreements are flatly denied.[5] The real issue between the parties is therefore whether there were First Agreement and Second Agreement orally made as alleged by the plaintiffs and pleaded in the Statement of Claim. Since the defendants deny such oral agreements, the issues of the terms or the implied terms of a contract simply do not come into play.

20. If the oral agreements are established by the plaintiffs, there will be question, as can be argued by the defendants, that should such terms be subject to the market and trade practices? If they are, then there has to be expert evidence on what these market and trade practices should be. The plaintiffs have in their written submissions said that their relationship was not of arm’s length. As such, the market and trade practices are not as applicable as they are in the ordinary course of business. On this issue, the defendants have raised no objection in their written submissions.

21. I have to bear in mind what the plaintiffs have submitted to me this morning that the relationship between the 4^th plaintiff and the 4^th defendant is not an ordinary market relationship in that the 4^th plaintiff is the guarantor of the loans made by the bank for the purpose of purchase of the vessel. It has the interest to ensure that the loan is to be repaid to the bank in accordance with the terms of the loan agreement. The defendants have no dispute over this relationship. In the circumstances, as submitted by the plaintiffs’ Senior Counsel, the dealings or agreement between the plaintiffs and the defendants are of special relationship, not an arm’s length as the ordinary market relationship. As such, the so-called market or trade practice has no relevance to the dealings or agreements. In any event, the market or trade practices can be overridden by the parties’ express agreement.

22. As DHCJ Le Pichon said in her Decision in Raytech Industries Co Ltd, “Ultimately it is a question of weighing up the various competing factors. …”, which generally applies to the exercise of the court’s discretion in interlocutory applications, I shall adopt the same approach here.

23. Having taken into consideration of the following factors, I decide to disallow the defendants’ application for the proposed amendments.

(a) The defendants were in breach of Master Au-Yeung’s Order dated 11 September 2017 that they should take out all interlocutory applications on or before 30 October 2017. They took out their application on 7 February 2018.[6]
(b) Not only have the defendants not taken out an application for leave to take out the application out of time, they had not even told this Court the reasons for not being able to comply with Master Au-Yeung’s Order.
(c) Although the defendants may be right to say that they have the witness statements containing market and trade practices, the witness statements cannot take the place of the pleadings. See Hesson Development Ltd. The defendants had not pleaded alternative defence that if the oral agreements are established, the terms are subject to market and trade practices. If they had pleaded this, they have to set out what kind of market and trade practices that should be applicable to their cases. This is necessary in order to limit the scope of argument for the preparation of the evidence for the trial.
(d) The fact that the plaintiffs had mentioned “fairly common practice” and “one of the characteristics of the shipping industry” in their witness statements does not support the defendants’ argument because those terms were said under different context. In any event, they will not entitle the defendants to make the proposed amendments.
(e) The defendants’ defence to the alleged oral agreements is clear. They flatly deny the existence of such oral agreements. The real issue of dispute between the parties is whether or not there was such oral agreements; and if so, what the terms are. The proposed amendments to incorporate the term of “market practice” and “trade practice” is simply not relevant to the issues of dispute, taking into account of their special relationship, which the defendants do not dispute. If the application is allowed, there will be further witness statements and expert evidence will be required. Here in the proposed amendments, there is no particulars on what aspects of the “market practice” and “trade practice” would be relevant to the issues in dispute. If the defendants are genuine in their pleaded cases, they should be able to tell this Court what aspects of such market and trade practices should be involved. The present pleadings will be asking the experts to set out all market and trade practices of this business. This cannot be right. Despite the plaintiffs having raised this issue of lack of particulars in the written submissions, the defendants have not supplied me with the particulars at this hearing.
(f) As such, the proposed amendments will be inconsistent with O.20, r.8 (1A) of RHC, that is, they are necessary either for disposing fairly of the cause of matter or for saving costs. Quite the contrary is true.
(g) Further, in the case of Hui Yin Sang & Another v Tsoi Ping Kwan & Another (unreported, HCA 392/2008, T. Au J., 28 January 2010 §25(9) & (10)), the court held that one of the objectives of O.18, r.12A RHC “is to prevent a party from pleading inconsistent cases in relation to a matter which is plainly within his knowledge, so that there could be no justification for him to put forward inconsistent factual alternatives. The party also simply could not properly verify the pleading as he is now required to do.”
(h) Ultimately, I consider that not allowing the proposed amendments will not affect the real issues of the disputes between the parties to be tried fairly at the trial.

The expert evidence application

24. The defendants have no objection that assessment of damages requires expert evidence. They only ask this Court to incorporate the issues relating to the market and trade practices in the expert evidence.

25. The defendants further submit that even if this Court does not allow the proposed amendments to the pleadings, those proposed mandates for expert evidence should be adopted if the plaintiffs are to assess the damages.

26. The plaintiffs have confirmed that they do not require those proposed mandates as proposed by the defendants because they are irrelevant.

27. It is therefore the defendants’ application for those mandates to be incorporated into the directions for expert evidence. But the defendants have the difficulty because there is no application before me and such application, if made now, is out of time already. But the defendants have no explanation for this.

28. Having considered the submissions of the plaintiffs, I agree that they do not require the defendants’ proposed expert directions. This is very much a matter for the plaintiffs.

29. I shall therefore accede to the plaintiffs’ request on their proposed expert evidence as set out in their summons.

Costs and order

30. As to the costs of the applications, the costs follow the event and as agreed by the defendants, it should be certified for two counsel for the plaintiffs. The plaintiffs have produced a bill of five pages. The defendants ask for time to consider and make paper submissions within 14 days from the date hereof. I agree. No reply is required from the plaintiffs.

31. The court now makes an order in terms as follows:

(a) The defendants’ summons be dismissed;
(b) The plaintiffs’ application for expert evidence is allowed in terms of the summons as amended (paragraph 7 deleted);
(c) The costs of the application be dealt with in accordance with paragraph 30 above.

32. By consent, this Case Management Conference is adjourned to a date to be provided by the Court not before October, 2018 before a Master and the parties shall file and serve the Listing Questionnaires for the hearing. The costs of this Case Management Conference (30 minutes) shall be in the cause.

	(K. W. Lung)
	Registrar, High Court

Mr Anson Wong SC and Mr Peter Chung, instructed by DLA Piper Hong Kong, for the Plaintiffs

Mr William Wong SC and Mr Michael Lok, instructed by Howse Williams Bowers, for the 1^st and 3^rd Defendants

[1] See at the end of this Decision

[2] See written submissions of the 1^st and the 3^rd defendants

[3] paragraph 32

[4] Paragraph 18(2) of the defendants’ written submissions

[5] See defendants’ written submissions at §4(4)

[6] See plaintiffs’ written submissions §§10-12

HCA 2562/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 2562 OF 2014

________________________

BETWEEN
	LAU WING YAN	1st Plaintiff
	SUN MIN	2nd Plaintiff
	CHANG DAFA	3rd Plaintiff
	PACIFIC BULK SHIPPING (CAYMAN) LIMITED	4th Plaintiff
and
	CHU KONG	1st Defendant
	LU ZHONG ZHI	2nd Defendant
	HU MU ZHONG	3rd Defendant
	JOINT SILVER LIMITED	4th Defendant
	CENTRAL SHIPPING COMPANY LIMITED	5th Defendant

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Before: Deputy High Court Judge Kent Yee in Chambers

Date of Hearing: 25 February 2016

Date of Decision: 30 May 2016

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DECISION

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Introduction

1. Mr Chu has made two applications arising from an ex-parte injunction dated 17 December 2014[1] (“the Injunction”). First, by his summons dated 11 February 2015 (“the Discharge Summons”), he seeks to discharge the Injunction. Parties have already filed affirmations in respect of the Discharge Summons. By another summons dated 16 February 2016 (“the X-Exam Summons”), Mr Chu seeks to cross-examine two of the deponents of such affirmations on their contents for the purpose of the determination of the Discharge Summons.

2. Mr Chu says that the cross-examination of one Mr Yan and Ms Sun, the 2^nd plaintiff herein, on their affirmations made on 29 January 2016, is necessary to establish material non-disclosure.

3. Mr McCoy SC (together with Mr Brown) for Mr Chu indicates that he would proceed with the X-Exam Summons only, leaving the Discharge Summons to be determined at a later date prior to the trial of this action. Mr Wong SC (together with Mr Kwong) for the plaintiffs, whilst opposing both applications, no longer insists that this court should forthwith dismiss the Discharge Summons. Instead, he asks this court to adjourn the Discharge Summons to be heard at the trial of this action without any order for cross-examination of the deponents of the affirmations on their contents.

4. It is logical in my view to first determine when and then how (with or without cross-examination) the Discharge Summons is to be resolved.

Background facts

5. The facts of this action are quite complicated but for present purposes, it suffices for me to give the following summary of the relevant background facts leading to the grant of the Injunction. I shall also give an account of the subsequent development thereafter.

6. The subject matter of the Injunction is the cargoes of 60,000 metric tons of US soybeans (“the Cargoes”) on board of a vessel named “MV Grain Pearl” (“the Vessel”). Joint Silver Limited (“JSL”) and was incorporated in Hong Kong for the specific purpose of being used as a corporate vehicle to hold the Vessel on behalf of all the individual parties to this action.

7. JSL is wholly owned by Central Shipping Company Limited (“CSCL”). CSCL is a BVI company and is jointly owned by two BVI companies, namely, Prime Asia Global Limited (“PAGL”) and Fortune Bright Global Limited (“FBGL”).

8. All the individual parties to these proceedings are the shareholders of either PAGL or FBGL. Mr Lau and Mr Chu are the equal shareholders of PAGL. Ms Sun, Mr Chang, Mr Lu and Mr Hu are the equal shareholders of FBGL. By reason of their shareholdings in PAGL and FBGL, all of the individual parties have ultimate interests in JSL and hence the Vessel. They are collectively referred to as “the Ultimate Shareholders” in this Decision.

9. Pacific Bulk Shipping (Cayman) Limited (“Pacific Bulk”) is a limited company incorporated in the Caymans Islands and both Mr Lau and Mr Chu are its equal beneficial owners. Pacific Bulk is engaged in the shipping voyage and time charter businesses involving the Vessel.

10. In or about November 2014, GP was carrying from US ports to PRC ports the Cargoes placed by Orient Sunshine Shipping (Hong Kong) Co., Ltd (“Orient Sunshine”) on a voyage at a freight charge of US$2,454,375 (“the Freight”) pursuant to a charterparty by way of a fixture note/re-cap which Pacific Bulk entered into as the commercial manager of the Vessel.

11. Pacific Bulk entered into another back-to-back fixture note/recap with JSL on identical terms except the rate to the effect that Pacific Bulk would earn 1.25% of the Freight as management fee.

12. The triggering event took place on 5 December 2014 when JSL issued a lien notice (“the Lien Notice”) to the shipper of the Cargoes on board the Vessel CHS Inc. for freight due under the material charterparty in a bid to prevent the Cargoes from being delivered to the consignee.

13. The plaintiffs say that the Lien Notice was wrongfully issued for three reasons. First, Pacific Bulk had already received the Freight on behalf of JSL as commercial manager of the Vessel. Second, the plaintiffs rely on an agreement allegedly made orally among all the Ultimate Shareholders except Mr Chang and JSL in or about March 2013 (“the 1^st Agreement”) whereby it was among other matters agreed that majority vote is required in the management and operation of the Vessel, the use or disposal of the proceeds arising from the commercial operation of the Vessel and the directorship and management of JSL. The plaintiffs complain that in breach of the 1^st Agreement, JSL issued the Lien Notice in the absence of a majority vote.

14. Lastly, the plaintiffs rely on another oral agreement made round about the same time among the same parties (“the 2^nd Agreement”) whereby it was, among other matters, agreed that Pacific Bulk would act as the commercial manager of the Vessel until all the indebtedness of JSL under a facility agreement granted by Credit Suisse AG secured by a guarantee granted by Pacific Bulk had been fully repaid and Pacific Bulk had been fully discharged from all liabilities under the said facility agreement.

15. It was further agreed that Pacific Bulk as the commercial manager would be entitled to a management fee at the rate of 1.25% of the freights or hires received on the Vessel. It would also be entitled to collect, retain and utilize all or any sums relating to the commercial operation of the Vessel to defray all outgoings and expenses incidental to its operation, settle the management fees payable and make full payment to Credit Suisse AG under the said facility agreement.

16. While the indebtedness of JSL under the said facility agreement had not been repaid and hence the liability of Pacific Bulk under the guarantee had not been discharged, the plaintiffs complain that in breach of the 2^nd Agreement, by issuing the JSL interfered with the management of the Vessel and its right to deal with the proceeds arising from its commercial operation including the material charterparty.

17. Prior to the ex-parte application, Pacific Bulk proposed twice to Mr Chu and JSL that pending the resolution of the disputes among the parties, on condition that JSL withdrew the Lien Notice, Pacific Bulk would cause the entire Freight be paid into an escrow account or the court. No response was given to this proposal. This prompted the plaintiffs to make the ex-parte application.

18. Upon the undertaking of Pacific Bulk to pay into the court the entire Freight, the Injunction was granted. In simple terms, by the Injunction, Mr Chu and JSL must withdraw or cause to be withdrawn the Lien Notice and must not claim or caused to claim a lien over the Cargoes. They must not in any way hinder the delivery and release of the Cargoes to the consignee.

19. With the Injunction, the plaintiffs were able to ensure that the Cargoes were duly delivered and discharged to the consignee in late December 2014 and early January 2015.

20. At present, both JSL and CSCL are in liquidation. The Vessel has been liquidated. Mr Tollan for their liquidators indicates to this court that they would take a neutral stance in these applications at this stage and reserve their rights pending further investigation of the affairs of JSL and CSCL.

21. Mr Chu’s pleaded case in respect of the 2^nd Agreement mainly consists of bare denials. His only positive averments are that Pacific Bulk as arranged by him acted as the commercial agent/in-house broker of the Vessel and he accepts that Pacific Bulk would be remunerated for its service as commercial agent/in-house broker at a rate of 1.25% of the freights received by the Vessel as address commissions and not management fees. And that this would be charged by way of a sub-charter arrangement whereby Pacific Bulk would become owner of the Vessel for each voyage and would enter into separate charterparties with third parties in the market. Mr Chu further avers that Pacific Bulk was required to account to JSL for all sums collected into the account of JSL with HSBC, save that Pacific Bulk was entitled to deduct the address commission before doing so.

22. I pause to note that there are other allegations in the Amended Statement of Claim. The subject matter of the Injunction is only however confined to the Lien Notice purportedly issued against the Cargoes for the allegedly wrongful dealing with Freight on the part of Pacific Bulk.

23. In light of the complete disposal of the Cargoes, which were the subject matter of the Injunction, Mr Wong submits that the Injunction now has no practical value and has become spent. I agree. However, it does not follow that this court should sweep any impropriety of the Injunction under the carpet. The allegations of material non-disclosure still raise a live issue.

24. Mr Chu takes grave exception to the Injunction. His discharge application is mainly based on the simple ground that Mr Yan who is General Manager of Pacific Bulk Chartering Limited, an agent of Pacific Bulk, doctored certain emails exhibited to the 1^st Affirmation of Sun Man filed on 17 December 2014 (“Dubious Emails”) in support of the ex-parte application. These Dubious Emails were found to be different from their original copy found in the server materially. Thus, the complaint is that the plaintiffs obtained the ex-parte injunction and hence the Injunction by false evidence and must be discharged as soon as possible.

25. This is particularly the case when the central question identified by the defence is that whether Pacific Bulk was the commercial manager of the Vessel entitling to a commercial management fee or just the commercial agent of the Vessel entitling to an address commission. The defence says that a commercial agent has far more limited powers to charter the Vessel and to collect income including freights on behalf of JSL. The Dubious Emails therefore deceptively lent support to the plaintiffs’ case before the ex parte judge.

Dubious Emails

26. There are altogether three emails under complaint in the 1^st Affirmation of Chu Kong filed on 11 February 2015 in support of the Discharge Summons. The first one was purportedly issued on 14 January 2014 by Ms Susan Ye of Pacific Bulk. It related to the terms of the charterparty of the Vessel between Pacific Bulk and JSL. Such terms included the following references:

address commission: 5% to CHTRS
management fee: 1.25% to CHTRS

27. The corresponding terms in the original email however made reference to address commission only.

28. The 2^nd email was purportedly issued again by Ms Susan Ye dated 3 July 2013. It related to the terms of another charterparty of the Vessel including the following term:

1.25% ADDCOMM + 1..25% Management Fee

29. Mr Chu produced the original copy of the 2^nd email and the relevant term was without any reference to management fee. It merely set out the ADDCOMM to be 2.5%. The parties agree that ADDCOMM stands for address commission.

30. The 3^rd email was issued by Ms Susan Ye dated 17 October 2013. Again it related to a charterparty of the Vessel and it expressly provided for a management fee of 1.25% in addition to a like amount of ADDCOMM. The original of the 3^rd email produced by Mr Chu however provided for ADDCOMM only.

31. The explanation of these differences was only given for the first time in the Affirmation of Mr Yan and the 3^rd Affirmation of Ms Sun both on 29 January 2016, the subject matters of the X-Exam Summons.

Discharge Summons

32. Mr Wong makes detailed submissions on the merits of the Discharge Summons. He submits that Mr Chu is now merely making a mountain out of a molehill in respect of the Dubious Emails. He points out that there was no dispute that Pacific Bulk had been the commercial manager of the Vessel prior to late November 2014 and there is no evidence that the plaintiffs were aware of the fact that the Dubious Emails were produced by alterations. Hence he submits that the plaintiffs could not be guilty of material non-disclosures or having misled the court at the ex parte hearing.

33. I shall not go any further into his comprehensive submissions given the fact that this court is not asked to deal with the Discharge Summons substantively. The only matters calling for my decision are whether it should be dealt with separately prior to the trial of this action and whether cross-examination should be ordered.

34. Concerning the first matter, Mr Wong principally relies on the following dictum of Sir Browne-Wilkinson VC in Dormeuil Freres SA v Nicolian Ltd. [1988] WLR 1362 at 1368H:

“To discover whether an ex parte order has been improperly obtained, the court first has to consider the evidence as it was at the time of the application for the ex parte order and then a mass of evidence designed to demonstrate that that evidence was misleading or failed to make disclosure. The real question at the time of the inter partes hearing should not be what has happened in the past but what should happen in the future. On the hearing of the inter partes motion it is impossible to make any concluded finding of fact, yet the court is being asked to reach a conclusion on the issue of non-disclosure without full knowledge of the circumstances. This attempt involves a minute examination of detailed allegations and counter-allegations, the exact materiality of which may not be clear to the judge in the interlocutory hearing, in circumstances when that is not necessary for the future conduct of the case.” (Emphasis supplied)

35. Sir Browne-Wilkinson VC went on to say this at p.1369H,

“In my judgment, save in exceptional cases, it is not the correct procedure to apply to discharge an ex parte injunction on the grounds of lack of full disclosure at the interlocutory stage of the proceedings. The purpose of interlocutory proceedings is to regulate the future of the case until trial. Where an Anton Piller order has been made ex parte, in the vast majority of cases the order has been executed before the inter partes hearing. Setting aside the Anton Piller order cannot undo what has already been done. As to the injunction contained in the ordinary Anton Piller order, that is directed to last only until the inter partes hearing of the motion. The correct course, as the Court of Appeal decisions show, is to regulate the matter for the future on the basis of the evidence before the judge on the inter partes hearing. The sole relevance of the question “Should the ex parte order be set aside?” is, so far as I can see, to determine the question whether the plaintiff is liable on cross-undertaking in damages given on the ex parte hearing. That is not an urgent matter. It is normally much better dealt with at the trial by the trial judge who knows all the circumstances of the case and is able, after cross-examination, to test the veracity of the witnesses.”

36. I also find the following passage in Gee on Commercial Injunctions (5^th Edition 2004) at §9.027, cited to me by Mr McCoy, apposite:

“Accordingly, it is considered that while it may be appropriate to adjourn an application to discharge fully executed Anton Piller relief on the grounds of non-disclosure until the trial, this is not a general rule of practice, and whether or not it is done must depend on the circumstances of the particular case. The relevant factors to be taken into account will include the following:
(1) Whether the defendant is likely to suffer continuing prejudice to his reputation or commercial standing by reason of the Anton Piller order, or there is some other good reason to deal with the application promptly,
(2) Whether the issue involves questions of the credibility of witnesses or otherwise is likely to require cross-examination of witnesses so that it should be dealt with at the trial,
(3) Whether the issue will involve a detailed review of voluminous evidence,
(4) Whether the issue can conveniently be dealt with at an interlocutory hearing and will not be likely to lead to unnecessary costs,
(5) Whether the issue arises in connection with another application before the court, such as an application to set aside leave granted to serve a defendant with proceedings out of jurisdiction or an application to discharge injunctive relief.”

37. I am aware that the foregoing passage concerns a fully executed Anton Piller order and we are not dealing one here. Nevertheless, I am of the view that given the disposal of the Cargoes, the Injunction has long ceased to have any restrictive effect on any of the defendants, we are in a similar situation here and the considerations set out above are of relevance.

38. Applying the legal principles set out above to the particular circumstances of this matter, for the following reasons, I am of the view that the Discharge Summons should be dealt with at the trial.

39. First, as pointed out by Mr Wong, whether the Dubious Emails are fabricated and false evidence and whether the plaintiffs had any knowledge of such fabrication are a fact-finding exercise involving not just the evidence of Ms Sun and Mr Yan. Mr Chu’s evidence is of key importance too. Mr Yan alleges that Ms Suan Ye had throughout been instructed by Mr Chu not to make any references to management fee for internal accounting purposes in spite of the actual payment of such management fees to Pacific Bulk. Thus when Ms Sun asked him for a copy of the fixtures between Pacific Bulk and JSL for litigation purposes, Mr Yan prepared the Dubious Emails by alteration of the three emails and including management fees to reflect the genuine position without telling Ms Sun. Whether or not Mr Chu caused deliberate omissions of references to management fees paid to Pacific Bulk in the three emails sent by Ms Susan Ye is obviously one of the relevant issues.

40. Ms Sun and Mr Chu are parties to this action and they are expected to testify at the trial. A separate hearing with only the cross-examination of Ms Sun and Mr Yan does not really assist in the fact-finding exercise.

41. Hence, I am not convinced that the issues in the Discharge Summons can be conveniently dealt with at an interlocutory hearing despite Mr McCoy’s reassurance that a short hearing will suffice.

42. I agree with Mr Wong that the issue of the identity of Pacific Bulk at the material time, being the core issue of this action, will be fully canvassed at the trial. All documents relating to this issue including the Dubious Emails will be scrutinized closely. So will the circumstances under which the Dubious Emails were created. Duplicity of proceedings to deal with the same issue should best be avoided. It not only will incur unnecessary costs and cause delay but also may possibly bring about inconsistent judgments: Skillsoft Asia Pacific Pty Ltd v Ambow Education Holding Ltd (unreported, HCCL19/2013, 12.1.2016) per Anthony Chan J at §9.

43. I also opine that there is no urgency to dispose of the Discharge Summons in light of the present state of affairs. The Vessel has been sold and JSL is in liquidation. The Freight is now with the court. The Injunction is spent. There can be no continuing prejudice to the reputation or commercial standing by reason of the Injunction. I do not accept that Mr Chu is really troubled by any stigma associated with being an injuncted party under the Injunction.

44. In the event that the Injunction is set aside, an inquiry as to damages should not be allowed unless the defence can adduce credible evidence that they have suffered loss as the result of the grant of the Injunction: Koman Patel and Ors v Chris Au and Ors (unreported, HCA 183/2014, 4.8.2014) per Zervos J at §23. Mr Wong is right to point out that up till now Mr Chu has failed to meet the threshold and Mr McCoy accepts that there is no evidence of loss suffered by Mr Chu personally. This further convinces me that there is no urgency to dispose of the Discharge Summons prior to the trial.

45. Mr McCoy’s best argument is that the interests of justice demand that an ex parte order procured by false evidence should be discharged without further ado. To my mind, this is not such an open and shut case that the court should discharge the Injunction without hesitation. Full investigation of all the circumstances is required and this should be undertaken at the trial. There has already been a delay of over a year after the issue of the Discharge Summons and the parties should proceed with the main action as soon as possible so that the differences between them including the propriety of the Injunction can be resolved as soon as possible.

46. Mr McCoy also draws my attention to Kras Asia Limited v Rishi Kumar Bhatnagar (unreported, HCA783/1988, 26.5.1988). There, Jones J observed that Dormeuil Freres S.A. had no “no relevance where there had been a failure to disclose material facts within the knowledge where there had been a failure to disclose material facts within the knowledge of the plaintiff upon the ex-party when the order should not have been made.” Jones J went on to point out that in Dormeuil Freres S.A. the parties had agreed that some form of injunction was necessary despite the material non-disclosure.

47. I do not think Dormeuil Freres S.A. laid down any hard and fast rule. Whether or not a discharge application should be disposed of immediately when there is an allegation of material non-disclosure depends very much on the particular circumstances of each individual case. The relevant considerations are set out in the foregoing passage of Gee on Commercial Injunctions. Suffice it to say, the facts of Kras Asia Limited are markedly different from the present case in that the knowledge of the plaintiffs about the alterations of the emails resulting in the Dubious Emails is a hotly contested issue.

48. I then come to the conclusion that the Discharge Summons should be dealt with at the trial.

The X-Exam Summons

49. The X-Exam Summons has to be considered in light of my conclusion on the Discharge Summons though Mr Chu took out the same on the basis that the latter would be dealt with at an interlocutory hearing. The Discharge Summons will be dealt with together with the trial of the main action. An interlocutory order will be made in respect of the Discharge Summons and a final order will be made after the trial of the main action. The affirmations of Mr Yan and Ms Sun are relevant to the disposition of not only the Discharge Summons but also the main action.

50. Therefore, the X-Exam Summons has to be considered in the context of a trial and merely an interlocutory hearing. Ms Sun is a party to the action and Mr Yan may be a witness of the plaintiffs. They may or may not produce their witness statements and testify on behalf of the plaintiffs at the trial. If they are not called to give evidence, their witness statements should normally be excluded from consideration. There is no reason why their evidence by way of their previous affirmations should be admitted if they do not go to the witness box at the trial.

51. I would agree that for the purpose of the Discharge Summons, if the substantive hearing of the same were to take place at an interlocutory hearing where normally affidavit evidence would suffice, Ms Sun and Mr Yan should be cross-examined on their affirmations concerning the purportedly innocuous reasons for alterations of the three emails and the alleged lack of knowledge of such alterations on the part of Ms Sun. Without cross-examination, this court would be unable to resolve the factual disputes on affidavit evidence alone.

52. I however do not think that it would be right form me to order that Ms Sun and Mr Yan be compelled to attend the trial and be cross-examined for the purpose of the Discharge Summons. In view of the controversial nature of their evidence, if either of them does not turn up, the proper sanction is that his/her relevant affirmations should be excluded from consideration and the plaintiffs should take the consequences if their absence could not be satisfactorily explained.

Conclusion and Orders

53. In the circumstances, I cannot accede to Mr Chu’s application by the X-Exam Summons. I should instead order that unless the trial judge otherwise directs, the Affirmation of Mr Yan and the 3^rd Affirmation of Ms Sun dated 29 January 2016 be excluded from consideration if the deponents of such affirmations do not testify at the trial. I add the caveat because I can envisage that there are circumstances that may justify an application to adduce such affirmations as hearsay evidence.

54. In conclusion, I adjourn the substantive hearing of the Discharge Summons to be dealt with together with the main action at the trial.

55. With regard to the X-Exam Summons, for the reasons given above, it falls to be dismissed.

56. I resolve the X-Exam Summons in favour of the plaintiffs and they should be entitled to their costs applying the general rule of costs following the event. However, I take into account the fact that when the X-Exam Summons was taken out, there was no direction given in respect of the Discharge Summons as to when it should be heard. This hearing in other words is in any event necessary for the future conduct of the Discharge Summons. I seized the opportunity to give directions relating to the substantive hearing of the Discharge Summons and turn down Mr Chu’s request for cross-examination by his X-Exam Summons.

57. In the circumstances, it appears to me that an appropriate costs order is that costs of the X-Exam Summons be in the cause of the Discharge Summons with a certificate for two counsel. I thus make a costs order nisi in this term.

58. It remains for me to thank counsel on both sides for their helpful submissions.

(Kent Yee)
Deputy High Court Judge

Mr Anson Wong SC and Mr Alan Kwong, instructed by DLA Piper Hong Kong, for the 1^st, 2^nd , 3^rd and 4^th plaintiffs

Mr Gerard McCoy SC and Mr Toby Brown, instructed by Howse Williams Bowers, for the 1^st defendant

Mr. Richard Tollan of Mayer Brown JSM, for the 4^th and 5^th defendants

[1] Granted by DHCJ Wilson Chan and varied and continued by Chow J on 24 December 2014.