STEP BY STEP LTD AND OTHERS v. DOROTHY JANE FURNESS AND OTHERS

STEP BY STEP LTD AND OTHERS v. DOROTHY JANE FURNESS AND OTHERS

The appeal was allowed in part: the Masters orders limiting discovery were varied to require disclosure of specified primary transactional documents (cheque books and stubs, deposit slips, withdrawal slips, cash books, telegraphic transfer forms, confirmations, daily sales records, purchase invoices, receipts, petty cash books, contracts) for the 3rd defendant from incorporation to September 2008 and to retain the Masters limitation of audited accounts of the 3rd and 4th defendants to the end of the 2007-2008 financial year; broad audit working papers and open-ended supporting documents were refused for both defendants, and supporting accounting documents for the 4th defendant were...

Citation
STEP BY STEP LTD AND OTHERS v. DOROTHY JANE FURNESS AND OTHERS
Parties
1st Plaintiff: STEP BY STEP LIMITED; 2nd Plaintiff: NEW SUCCESS ENTERPRISES LIMITED; 3rd Plaintiff: STEP UP LIMITED; 1st Defendant: DOROTHY JANE FURNESS; 2nd Defendant: RAPHAEL HOMER ECHALUCE; 3rd Defendant: ENTERTAIN COMPANY LIMITED; 4th Defendant: MAD DOGS WANCHAI PUBLIC HOUSE LIMITED
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
16 September 2009
Case Number
HCMP842/2007
Procedural Posture
Civil Discovery Appeal / Appeal From Master's Decision on Specific Discovery
Outcome
Appeal allowed in part and Master's orders varied as to scope of discovery for the 3rd defendant; other orders affirmed
Legal Topics
Specific Discovery, Relevance and Necessity, Equitable Tracing, Audited Accounts and Audit Working Papers, Fishing Expedition, Admission of Further Evidence on Appeal
Source Language
EN
Civil Procedure Company Law Equity and Trusts Evidence Specific Discovery Relevance and Necessity Equitable Tracing Audited Accounts and Audit Working Papers +2 more

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Parties

STEP BY STEP LIMITED

1st Plaintiff

NEW SUCCESS ENTERPRISES LIMITED

2nd Plaintiff

STEP UP LIMITED

3rd Plaintiff

DOROTHY JANE FURNESS

1st Defendant

RAPHAEL HOMER ECHALUCE

2nd Defendant

ENTERTAIN COMPANY LIMITED

3rd Defendant

MAD DOGS WANCHAI PUBLIC HOUSE LIMITED

4th Defendant

Procedural Posture

Civil Discovery Appeal / Appeal From Master's Decision on Specific Discovery

Legal Issues

  1. 1 Whether the documents sought were relevant and necessary for fair disposal or saving costs
  2. 2 Whether extensive audit working papers and supporting documents should be ordered or constitute fishing
  3. 3 Whether discovery should extend beyond the audited year end to date

Ratio Decidendi

The appeal was allowed in part: the Masters orders limiting discovery were varied to require disclosure of specified primary transactional documents (cheque books and stubs, deposit slips, withdrawal slips, cash books, telegraphic transfer forms, confirmations, daily sales records, purchase invoices, receipts, petty cash books, contracts) for the 3rd defendant from incorporation to September 2008 and to retain the Masters limitation of audited accounts of the 3rd and 4th defendants to the end of the 2007-2008 financial year; broad audit working papers and open-ended supporting documents were refused for both defendants, and supporting accounting documents for the 4th defendant were...

Court Disposition

Appeal allowed in part and Master's orders varied as to scope of discovery for the 3rd defendant; other orders affirmed

Orders

  • Order that audited accounts for the 3rd and 4th defendants remain limited to the end of their financial year 2007-2008
  • Order that the 3rd defendant must disclose specified classes of primary transactional documents from incorporation to September 2008: cheque books and stubs, cash/cheque deposit slips, account withdrawal slips, cash books, telegraphic transfer application forms and confirmations, deposit records for daily sales...