Businessman fails in appeal against Scottish judge’s decision to enforce Hong Kong court ruling

Lord Carloway
Lord Carloway

A businessman who challenged a Scottish judge’s decision to grant a decree ordering him to conform to a Hong Kong High Court ruling that he make a payout to a former associate has had his appeal dismissed.

The Inner House of the Court of Session upheld the decision of the Lord Ordinary that the writ had been personally served on the appellant in Hong Kong and that he was resident there at the material time.

The Lord President, Lord Carloway, sitting with Lord Drummond Young and Lord Malcolm, heard that the pursuer Daniel Zigal and defender Gordon Buchanan had been business associates in Hong Kong. 

The pursuer brought proceedings against the defender in Hong Kong and a writ of summons was issued by the High Court in January 2016 claiming certain sums. 

‘Valid service’

In October 2016 the High Court pronounced a final judgment for the sums claimed in favour of the pursuer, in the defender’s absence, having proceeded on the basis that the writ had been personally served on the defender in Hong Kong on 14 July 2016. 

There were affidavits from the pursuer’s father and from Ravinder Singh Beryar narrating that personal service of the writ had been executed on that day, and there was no challenge to the validity of the service or to the decree in absence in the High Court.

The Lord Ordinary accepted the evidence given by Mr Beryar that, on 14 July 2016, he had gone with the pursuer’s father to the Tonic Bar in Wyndham Street, Hong Kong at about 11.30pm and served the writ on the defender by placing the envelope containing a copy of the writ in the defender’s hand and telling him that he had been served. 

The defender dropped the envelope on the floor saying “I don’t want this”, but he was told by the pursuer’s father that the documents were official court papers, following which the defender left the bar. 

The episode was partially recorded on a mobile phone, images of which were played to the Lord Ordinary, who rejected evidence from the defender that what had happened was that he had been assaulted by five or six men dressed in black and from whom he had subsequently escaped.

The judge noted that the High Court had accepted the personal service described in the affidavits as valid and the defender had failed to discharge the onus, which was on him, to establish that it was not.

Accordingly, his challenge to the jurisdiction of the High Court based on invalid service failed.

The Lord Ordinary went on to consider where the defender had been resident at the material time, and having rejected the evidence of the defender that, by that time, he had returned to live in Glasgow, the judge concluded that he had been resident in Hong Kong.

‘Judge erred’

On appeal, it was argued on behalf of the appellant that the pursuer had “failed to provide sufficient evidence” that the incident at the Tonic Bar, if proved, amounted to a valid service according to the laws of Hong Kong. 

In the absence of evidence of what that law was, the law of Scotland ought to apply, which necessitated “personal service” being effected by officers of the court. 

Secondly, the defender argued that the Lord Ordinary had “erred” in holding that the burden of proof had been on him to prove that he was not resident in Hong Kong at the material time. 

It was submitted that the burden was on the pursuer to prove both the validity of the service and the defender’s residence in Hong Kong. 

The Lord Ordinary had “insufficient evidence” of residence, although the defender accepted that in cross-examination he had said that he had lived in Hong Kong for 14 months after May or June 2015, but he clarified the position later in his evidence.

Thirdly, the defender referred to the existence of new evidence in the form of airline tickets and certain utility bills which, he said, demonstrated his residence in Scotland at the material time.

‘Correct decision’

However, the appeal judges ruled that Lord Ordinary’s decision was “correct”.

Delivering the opinion of the court, the Lord President said: “This court agrees essentially with the reasoning of the Lord Ordinary. It recognises that the judgment of a foreign court, which has jurisdiction over a defender by reason of residence in the foreign country at the material time, may be enforced by decree conform. The onus is on the challenger to demonstrate that the service or decree is not valid.

“This court may, of course, decline to recognise a judgment where the defender has had inadequate notice of the foreign proceedings. 

“In this case, however, there was evidence that what the pursuer had said had happened in the Tonic Bar had indeed occurred. It was not pleaded as a defence to this action, nor was it submitted to the Lord Ordinary, that if what the pursuer said had occurred was proved, that did not amount to valid personal service. 

“In any event, as the pursuer has submitted, the procedural rules of Hong Kong appear to indicate that service of the nature which occurred is valid.

“In relation to the defender’s residence in Hong Kong, again there was evidence before the Lord Ordinary which entitled him to conclude that he was so resident when the action was raised and at the time of service. 

“He himself had said that he had moved to an address in Hong Kong in May or June 2015 and had lived there for a period of 14 months. He submits that this was an error and that he had corrected himself. 

“But the fact is that there was evidence from him, and indeed his presence in Hong Kong at the material time, from which the Lord Ordinary could infer that he was still resident when he was served in July 2016. 

“The defender has submitted that the new evidence, which he has proffered in documentary form and which was not presented to the Lord Ordinary because of certain legal advice which he had been given, shows that he was not so resident. His explanation for not tendering this material at the proof does not provide a sufficient basis for introducing it in the reclaiming motion.

“For all these reasons, the court is satisfied that the Lord Ordinary’s reasoning was correct and that this reclaiming motion must be refused.”

© Scottish Legal News Ltd 2021

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