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

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

Further evidence on appeal was admitted on special grounds; the Master's orders were varied to permit targeted discovery limited to specific classes of primary transactional banking and accounting records for the 3rd defendant from incorporation to September 2008, while audited accounts for both 3rd and 4th defendants were limited to the financial year ending 2007–2008; broad non‑exhaustive auditor working papers and supporting documents were refused and supporting accounting documents for the 4th defendant were refused as unnecessary and constituting fishing.

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
HCMP845/2007
Procedural Posture
Civil Discovery / Equitable Tracing / Appeal From Master's Order on Specific Discovery
Outcome
Appeal allowed in part; Master's orders varied
Legal Topics
Specific Discovery, Relevance and Necessity, Audited Accounts and Supporting Working Papers, Tracing Misappropriated Funds, Fishing and Proportionality
Source Language
EN
Civil Procedure Discovery Company Law Equity Tracing Specific Discovery Relevance and Necessity Audited Accounts and Supporting 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 / Equitable Tracing / Appeal From Master's Order on Specific Discovery

Legal Issues

  1. 1 Whether requested audited accounts and supporting working papers are relevant and necessary for fair disposal or saving costs
  2. 2 Whether further evidence should be admitted on appeal under Order 58 r 1(5)
  3. 3 Scope and limits of discovery given voluminous records and risk of fishing

Ratio Decidendi

Further evidence on appeal was admitted on special grounds; the Master's orders were varied to permit targeted discovery limited to specific classes of primary transactional banking and accounting records for the 3rd defendant from incorporation to September 2008, while audited accounts for both 3rd and 4th defendants were limited to the financial year ending 2007–2008; broad non‑exhaustive auditor working papers and supporting documents were refused and supporting accounting documents for the 4th defendant were refused as unnecessary and constituting fishing.

Court Disposition

Appeal allowed in part; Master's orders varied

Orders

  • Further evidence admitted on appeal (Order 58 r 1(5) special grounds)
  • Discovery ordered for the 3rd defendant limited to specified classes of 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; daily deposit records for sales income; daily...