AVCO FINANCIAL SERVICES (ASIA) LTD. v. TOPMA ELECTRONICS LTD. AND OTHERS

HCA003372/1999

HCA 3372/99

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H E A D N O T E

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Even where there is a judgment, an order prohibiting the judgment debtor from leaving Hong Kong is for the purpose of facilitatingthe enforcement of that judgment. It would not be appropriate to make a prohibition order unless prohibiting the judgment debtorfrom leaving Hong Kong is reasonably and properly conducive to the enforcement of the judgment. That is clear from the wording andthe purpose of the section and order containing the power to make prohibition orders, namely section 21B of the High Court Ordinance (Cap. 4) and Order 44A of the Rules of the High Court. It must be remembered that what has to be justified is an order interferingwith a person’s freedom to leave Hong Kong, which is a freedom guaranteed by Article 31 of the Basic Law. There must at least besome evidence that enforcement of the judgement would be impeded in some significant way if no prohibition order were made.

HCA 3372/99

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 3372 OF 1999

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BETWEEN

AVCO FINANCIAL SERVICES (ASIA) LIMITED

Plaintiff

AND

TOPMA ELECTRONICS LIMITED

1st Defendant

TOPMA (HONG KONG) COMPANY LIMITED

2ndDefendant

CHAN SAI CHEUNG

3rd Defendant

CHENG PING SUN

4th Defendant

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Coram : The Honourable Mrs Justice V. Bokhary in Court

Date of Hearing: 17 August 1999

Date of Delivery of Judgment: 17 August 1999

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J U D G M E N T

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1. This is an appeal by a judgment debtor, the 3rd Defendant, against a Master’s refusal on 10th August 1999 to discharge a prohibitionorder obtained against him on 5th August 1999 by the judgment creditor, the Plaintiff, to facilitate enforcement of the judgmentto the extent that it remains partially unsatisfied.

2. What the Master did was to make an order in these terms:

"The 3rd Defendant’s application to discharge the Order dated 5th August 1999 be dismissed and that the prohibition order bedischarged on condition that the statutory demand is issued on or before 24th August 1999 and the costs of the application be tothe Plaintiff to be taxed if not agreed."

The idea appears to have been to keep the 3rd Defendant here long enough for a statutory demand to be served on him. The statutorydemand was issued yesterday and was served on the 3rd Defendant this morning. Accordingly, the prohibition order has been discharged.In practical terms, what the appeal to me now concerns are costs. The 3rd Defendant pursues the appeal in order to obtain the costsof the application before the Master and of the appeal to me.

3. For the 3rd Defendant, Miss Cruden submits that the prohibition order should never have been made, that the Master should have dischargedit with costs, and that this appeal should be allowed accordingly with costs. The Plaintiff resists the appeal.

4. The only evidence filed by the Plaintiff in support of its application for a prohibition order is the affirmation dated 3rd August1999 of Mr Ma Koon Man, the Plaintiff’s collection officer. All that this affirmation says about the 3rd Defendant leaving Hong Kongif not prohibited from doing so is to be found in paragraph 7 where Mr Ma says that he believed that the 3rd Defendant was aboutto leave Hong Kong and would need to travel between the Mainland and Hong Kong frequently in order to take care of his business.

5. In seeking a discharge of the prohibition order, the 3rd Defendant has filed an affirmation dated 9th August 1999 saying this:

"2. I am presently employed by廣州三聯電子移動通訊發展中心supervise a factory in China and earn RMB10,000.00 permonth. There is now produced and shown to me marked "CSC-1" a copy of a letter of confirmation signed by my employer. Ilive with my mother and father in Hong Kong in flat E, 28th Floor, Kin On Mansion, 7 Tai Yu Road, Tai Koo Shing, Hong Kong. I willtravel to China in the mornings and come back to Hong Kong in the evenings 6 days a week. I commenced work with 廣州三聯電子移動通訊發展中心onthe 1st May 1999. However due to the prohibition order dated 5th August 1999 I have not been able to attend work since 7th August1999. I fear that if I do not report back for duty as soon as possible, my job will be in jeopardy because my employer requires someoneto supervise his factory which has a staff of about 500.

3. I have no intention of leaving Hong Kong permanently because I have to look after my mother who is now aged 73 and she has a heartcondition and my father who is aged 77."

6. There is no evidence that the 3rd Defendant would, unless prohibited from leaving Hong Kong, leave Hong Kong permanently or evenfor any period which would prevent or even significantly impede what could otherwise be achieved by way of enforcement of the judgmentdebt if he were kept here for the maximum duration to which a prohibition order can be extended under our law. The most that canbe said is that it may be more convenient for the Plaintiff when seeking to enforce the judgment if the 3rd Defendant were for thatduration never away from Hong Kong for any period at all.

7. The Plaintiff seeks to answer all of this by pointing to section 21B of the High Court Ordinance (Cap. 4) and advancing the argument which is set out in the following terms in its skeleton arguments:

"2. Section 21B(1)(a) is about a judgment against the person for the payment of a specified sum of money. Section 21B(1)(b) is for a judgment or order against the person for the payment of an amount to be assessed. Section 21B(1)(c) concerns a civil claim (other than a judgment).

3. Sections 21B(2) and (3) which set up the mandatory requirements including the probable cause for believing that the person is about to leave HongKong does not apply to our case as it only applies to an application made pursuant to Sections 21B(1)(b) & (c) respectively.

4. As such, the mandatory requirements under Sections 21B(2) and (3) of the High Court Ordinance do not apply in this case. The Plaintiff was entitled to apply and the Court did have jurisdiction to grant the Prohibition Orderagainst the 3rd Defendant purely based on the Judgment dated 8th June 1999 and without requiring other supporting evidence to provethat the 3rd Defendant was about to leave Hong Kong."

8. In my judgment, that is not enough. Even where there is a judgment, an order prohibiting the judgment debtor from leaving Hong Kongis for the purpose of facilitating the enforcement of that judgment. It would not be appropriate to make a prohibition order unlessprohibiting the judgment debtor from leaving Hong Kong is reasonably and properly conducive to the enforcement of the judgment. Thatis in my view clear from the wording and the purpose of the section and order containing the power to make prohibition orders, namelysection 21B of the High Court Ordinance and Order 44A of the Rules of the High Court. If more needs to be said in support of that view, then I would add this. It must beremembered that what has to be justified is an order interfering with a person’s freedom to leave Hong Kong, which is a freedom guaranteedby Article 31 of the Basic Law.

9. It is true that the cases cited by Miss Cruden for the 3rd Defendant, namely the Court of Appeal’s decision Edward Chan v. Technical Waxes (N.Z.) Ltd. HKLR [1980] 526 and the decision of Godfrey J (as he then was) in So Po Tong v. Richard Patterson (unreported) 9th October 1987, A6993/1987, are cases in which judgment had not yet been obtained. But even where, as in the presentinstance, judgment has been obtained, there must at least be some evidence that enforcement of the judgement would be impeded insome significant way if no prohibition order were made. There is no such evidence here. Accordingly, I allow the appeal. In the eventswhich have happened, all that I need to order is that the costs of the application to the Master for discharge and the costs of thisappeal to me be to the 3rd Defendant against the Plaintiff.

10. Although this matter was heard in chambers, I have delivered judgment in open court because of the point taken by the Plaintiff andwhat I have said as to the law in the course of rejecting that point.

 

 

 

(V. Bokhary)

 

Judge of the Court of First Instance,
High Court

 

Representation:

Ms Liza Jane Cruden (inst’d by M/s Lo, Wong & Tsui) for the 3rd Defendant

Ms Lam Tung-ching (of M/s Fairbairn Catley Low & Kong) for the Plaintiff