IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF APPEAL
CIVIL APPEAL NO. 45 OF 2007
(ON APPEAL FROM HCA NO. 1944 OF 2005)
Before: Hon Tang VP in Chambers
Date of Hearing: 20 April 2007
Date of Decision: 20 April 2007
D E C I S I O N
1. This is the 1st plaintiff’s application for stay of execution pending appeal. Deputy Judge Gill’s judgment requires the plaintiff to pay the1st defendant a sum of approximately $38.5 million, in return for the transfer of certain shares in the 2nd defendant. The amount of $38.5 million is inclusive of interest.
2. The judge has refused a stay but this is not an appeal from him, and the discretion is mine to exercise. The basis upon which Ishould consider whether a stay should be granted is well known. The starting principle is that the successful party should not bedeprived of the fruits of the judgment in his favour and that a stay should not be granted unless the court is satisfied that thereare good reasons for doing so. Mr Edward Chan, who appears for the plaintiff, has suggested three reasons why a stay should be granted. He also submitted that I should consider them not only singly but also collectively.
3. The first ground is that the plaintiff has strong grounds of appeal. I have to say upon perusal of the judgment and I have perusedthe judgment more than once and the pleadings, I am not satisfied that this is a case where I can say that the 1st plaintiff has strong grounds of appeal. However, I am satisfied that the 1st plaintiff does have arguable grounds of appeal.
4. The second reason is over the question of the stamp duty which would be payable in the event of the specific performance of thepurchase of shares. I do not know the amount of the stamp duty but in comparison with the amount payable, the stamp duty is likelyto be small. In any event, Mr Warren Chan who appears for the 1st defendant is wiling to undertake on behalf of the 1st defendant that in the event of the appeal being successful, and the 1st defendant is required to repay the amount paid to the 1st plaintiff, the 1st defendant would also pay the amount of the stamp duty incurred in the transfer of the shares. So this ceases to be a reason forgranting a stay of execution pending appeal.
5. The third ground Mr Chan only suggests as a ground rather faintly. It is that the 1st defendant has the right of residence in Australia. But it is clear from the evidence of the 1st defendant that his home is in Hong Kong. There are many people in Hong Kong who have a right of abode in foreign lands and thatfact would not normally be sufficient to justify a stay pending appeal.
6. Furthermore, the 1st defendant has voluntarily disclosed that he has liquid assets in Hong Kong in the amount of $27 million, so he is obviously a substantialperson, although I note Mr Edward Chan’s point that these assets could be removed relatively easily from within the jurisdiction. But I am not satisfied in the circumstances of this case that there is an appreciable risk that if the 1st plaintiff were to succeed in the appeal, the appeal would be rendered nugatory because the defendant would not be in a position torepay the amount payable.
7. Mr Edward Chan also informed me that the plaintiff is prepared to pay the amount payable to a stakeholder but that in itself isnot a reason for a stay.
8. In all the circumstances, I do not believe this is a suitable case for a stay pending appeal.
9. The summons is dismissed with costs.
Mr Edward Chan, SC, Ms Linda Chan and Mr Alan Woo, instructed by Messrs S.K. Lam, Alfred Chan & Co., for the 1st Plaintiff (by original action)
Mr Warren Chan, SC and Mr Simon Yip, instructed by Messrs Lau, Kwong & Hung, for the 1st and 2nd Defendants (by original action)