HKCFI 921
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
HIGH COURT ACTION NO 590 OF 2020
||SHIH MEI LING (施美伶)
formerly known as SHIH MEI LING (施美玲)
||CHUNG & KWAN (a firm)
Before: Deputy High Court Judge Alexander Stock, SC in Chambers
Dates of Hearing: 15 May 2020
Date of Decision: 4 June 2020
D E C I S I O N
1. On 8 May 2020, the plaintiff (“P”) issued a writ against the defendant law firm (“D”), claiming breach of a duty of confidence, and seeking an injunction to restrain D from continuing to represent or advise P’s sister, Shih Mei Ki (施美琪) (the “Sister”) in HCA 797 of 2018. On the same date, P issued a summons (the “Summons”) pursuant to Order 29 rule 1 RHC, seeking an interlocutory injunction to the same effect.
2. In essence, P’s complaint is that a solicitor who previously acted for her in HCA 797 of 2018 (the “Action”) subsequently moved to D, which is a law firm representing the opposing party in the Action, namely the Sister; and that accordingly, injunctive relief is required to protect P’s confidential information.
3. The Summons came before me on 15 May 2020, by which time D had filed opposing evidence. At the hearing, P indicted (by counsel Ms Dora KH Chan) that she did not wish to file reply evidence.
4. The parties agreed that the hearing should be treated as the substantive hearing of the Summons, seeking interlocutory injunctive relief pending any trial.
5. In the Action, P is the plaintiff and the Sister is the defendant. Very broadly, the Action concerns a dispute as to the beneficial ownership in a property and the proceeds of its sale. Pleadings have been filed, and the Sister recently issued a summons for directions.
6. P initially instructed Messrs Ko & Chow (“K&C”) to represent her in the Action. According to P, her case was handled by a solicitor (“Mr Cheung”) of K&C, who was supervised by a partner.
7. P’s evidence is that she had five meetings with Mr Cheung (some attended by counsel), and numerous telephone and email exchanges with him. She gave to him detailed instructions about her case, her personal and financial circumstances, intricacies of family relationships, and her assessment of the strengths and weaknesses of the litigation.
8. According to P, Mr Cheung well knew that the Sister was represented by D in the Action, and Mr Cheung had various telephone conversations with the solicitor (“Mr Lam”) at D who was handling the case. In May and June 2018, Mr Cheung negotiated directly with Mr Lam of D on potential settlement of the Action, but without success. For these purposes, P had informed Mr Cheung of her preferred terms of settlement and “bottom line”.
9. P says that in June 2018, she gave Mr Cheung detailed instructions regarding a request for Further and Better Particulars of the Statement of Claim, and gave him all documentary evidence in the Action. Around the end of July 2018, P tried but failed to contact Mr Cheung, and was told by partner of K&C at the start of August, that Mr Cheung had left that firm.
10. In November 2018, P retained Messrs Joseph CT Lee & Co (“JCTL”) in the Action, in place of K&C, and thereafter heard nothing of Mr Cheung.
11. On 18 March 2020, says P, she received from JCTL a letter in relation to the Action on D’s letterhead, from which she happened to notice that Mr Cheung was listed as an associate of D.
12. This resulted in correspondence between JCTL and D, by which D inter alia: (i) indicated that Mr Cheung had joined D as a associate in September 2018; (ii) stated that the Action has only been handled by Mr Lam and has never been discussed with Mr Cheung; (iii) offered to provide declarations from Mr Cheung and Mr Lam that they have not discussed the Action and/or would undertake not to do so.
13. P was not satisfied by these offers and assurances, resulting in the commencement of the present proceedings (following also, certain correspondence with the Law Society).
14. D filed affidavit evidence from: (i) the senior partner of D; (ii) Mr Lam; (iii) Mr Cheung; and (iv) the Sister. That evidence included the following matters.
15. Mr Cheung was admitted as a solicitor in 2015. His evidence was that at K&C, he worked under the supervision of the managing partner (“Mr Ko”), when handling the Action. He accepted that in relation to the Action: (i) he had attended some meetings and conferences with P (and Mr Ko) for taking instructions and giving advice; (ii) he had telephone and email exchanges with P; and (iii) he (together with Mr Ko) had correspondence and negotiations with a Mr Lam of D. However, Mr Cheung’s evidence was to the effect that, given the lapse of over 20 months, he did not have a clear or specific recollection of the details of such discussions and correspondence.
16. D comprises four partners, four consultants, and five associates.
17. Mr Cheung was interviewed by partners of D in about June 2018. On this occasion, he mentioned his involvement in Action, and was reminded by the partners that if he were to join D, he should not discuss the case with anyone in the firm, in accordance with firm policy.
18. In mid-June 2018, Mr Cheung resigned from K&C. In accordance with usual practice, he passed all files and documents to K&C, does not retain any documents in relation to the Action, and no longer has access to his email account from K&C. He also mentioned to Mr Ko that he might join a firm where there would be potential conflict of interest. Mr Ko reminded him that he should not handle anything to do with the Action, and could not bring P with him as a client.
19. From 25 June 2018, Mr Cheung vacationed away from Hong Kong, and thereafter joined D on 17 September 2018. On his first day of work, Mr Cheung again told the partners of D that he had had involvement in the Action. The partners informed him of a “Chinese Wall” policy, under which it would be strictly forbidden for him to accept instructions from P, he must not handle any matter in relation to the Action, and he must not discuss the Action with Mr Lam. Mr Cheung agreed this approach, and followed it. The partners indicated that they would inform Mr Lam.
20. Mr Lam is an consultant of D with over 28 years’ litigation experience. In general, consultants at D have a free hand to run their own cases, without reporting to or supervision by partners. This applied to the Action, which was solely handled by Mr Lam since he first received instructions from the Sister in April 2018.
21. The filing system is such that Mr Lam’s cases, including the Action, had a specific prefix assigned at the outset, showing that the case was handled by Mr Lam alone. No other person would have access to or supervise such files. Every solicitor at D has a separate computer and email account with its own password, and a personal file in the internal computer network, so there was no risk of inadvertent leakage of information.
22. Mr Cheung’s work at D mainly involves probate, administration, succession, wills and building management matters, as allocated by supervising partners. He does not handle civil litigation. He does not work for consultants, and accordingly does not work with Mr Lam on any matters.
23. Ds’ evidence was that Mr Cheung and Mr Lam never discussed the Action, that it was impossible for Mr Cheung to access documents regarding the Action by accident, and that Mr Cheung had never met with the Sister. Mr Cheung undertook not to be involved in the Action in any way or to communicate with anyone on it, unless with P’s consent or under court order.
24. The substantive principles applicable to claims such as the present were considered by the English Court of Appeal in Koch Shipping Inc v Richards Butler (a firm)  EWCA Civ 1280.
25. Koch Shipping Inc (“Koch”) sought an injunction to restrain a law firm (“RB”) from continuing to act for Ariadne Maritime Limited against Koch in an arbitration. The basis was that Koch’s solicitors in the arbitration were Jackson Parton, and a partner of that firm who had acted for Koch in the arbitration, had moved to RBs as a consultant (though with no involvement in the arbitration). The injunction was granted at first instance, but overturned by the Court of Appeal, following a detailed consideration of the facts including various measures taken by RB (in terms of information barriers) to prevent potential mis-use of Koch’s confidential information.
26. The English Court of Appeal considered the applicable principles derived from the case law, most notably the judgments of the House of Lords in Prince Jefri Bolkiah v KPMG  2 AC 222, and summarised the principles as follows (at §24 per Clarke LJ):
“(1) The court's jurisdiction to intervene is founded on the right of the former client to the protection of his confidential information …
(2) The only duty to the former client which survives the termination of the client relationship is a continuing duty to preserve the confidentiality of information imparted during its subsistence …
(3) The duty...