The High Court has rejected an application for summary judgment of a claim to release money frozen by a bank. This was in the context of an investigation into the alleged use of the account for criminal activity. In its defence, the bank argued that the customer agreement contained an implied term that the bank could act on evidence of suspected fraudulent conduct to suspend operation of the account.
The Court of Final Appeal recently reaffirmed the principles applicable when the courts consider making an enhanced award of costs in favour of the successful party (ie, 'indemnity costs'). The judgment makes it clear that the courts' discretion to award indemnity costs is unrestricted – although, as a basic requirement, such costs should be ordered only when it is appropriate to do so and the receiving party must be able to show that the case has some special or unusual feature.
In re Zadeh v Registrar of Companies, the Court of First Instance held that an application by an overseas company to intervene as a party in existing proceedings in Hong Kong did not expose it to a liability to provide security for costs and that, even if the court did have jurisdiction to order security for costs, it would not have ordered the intervener to do so. Although security for costs against overseas or dubiously solvent plaintiffs is a useful tool in civil litigation, this case demonstrates some of the procedural limits.
In Poon v Poon, the defendant successfully applied to have certain paragraphs excluded from witness statements filed on behalf of the plaintiff on the basis that they referred to without prejudice conversations and meetings. The judgment applies established principles that underpin the protection given to without prejudice communications and demonstrates the court's reluctance to allow a party to 'cherry pick' from parts of wide-ranging discussions that were clearly undertaken on a without prejudice basis.
In Zhang Hong Li & Ors v DBS Bank (Hong Kong) Ltd & Ors, the Court of Final Appeal interpreted a so-called 'anti-Bartlett clause' in a trust deed and held that it excluded the imposition of a "high-level supervisory duty" on the trustee to supervise or review the investment decisions of an investment adviser appointed by the underlying private investment company.
A director who extracted money from a company by way of sham invoices may have a defence to an equitable compensation claim for misappropriation of the company's funds. The facts in this case may test the willingness of the trial court (due to hear the matter later in 2020) to develop the equitable remedies for breach of fiduciary duty.
Representatives of a lender on a board will not automatically impose directors' duties on the lender, but they may apply where a director's specific instructions have led directly to a breach of fiduciary duty. The High Court recently explored this issue in an appeal in the case of Standish v Royal Bank of Scotland.
Following recent case law on the matter, the High Court has found that bitcoin can be 'property' and can therefore be the subject of a proprietary injunction. In reaching its conclusion, the court adopted the detailed analysis of the issue set out in the UK Jurisdictional Task Force's November 2019 Legal Statement on Crypto-Assets and Smart Contracts, thereby providing a far more detailed judicial basis for the finding than found in previous cases.
The Court of Appeal recently confirmed that where a party has covertly obtained confidential information, any dispute as to the information's confidentiality must be resolved before it can be deployed in civil proceedings. Taking this approach preserves the confidentiality of the material and upholds the broad equitable principle that a person who has received information in confidence should not be permitted to take unfair advantage of it.
Concern that current practice in relation to factual witness evidence does not achieve the best evidence at proportionate cost prompted the creation of the Witness Evidence Working Group to consider how the current practice could be improved in the business and property courts. The group's recommendations focus on the more consistent enforcement of existing rules with some limited new measures.