Key takeaways
- With effect from 17 July 2023, parties who are in need of urgent interlocutory relief shall comply with Practice Direction 11.1. If it is in the context of insolvency or shareholders’ disputes, parties should also observe Practice Direction 3.7.
- Legal representatives for the applicants should make sure that there is sufficient basis of urgency and/or secrecy in order to justify any urgent application, especially if it is made on an ex parte basis.
- The new Practice Direction has designated that Judges should be responsible to hear urgent applications in their lists, and only when they are not available would the applications be referred to other Judges or the Duty Judge as the last resort.
In more detail
Urgent interlocutory application to a Judge under Practice Direction 11.1
Before the implementation of the updated Practice Direction 11.1, when a litigant (i.e., the applicant) needs to take out an urgent interlocutory application before a Judge, such as applying for an ex parte mareva injunction in order to prevent dissipation of assets, the litigant’s legal representatives had to contact the Clerk to the Duty Judge for directions regarding the hearing.
However, the latest Practice Direction now requires that the first point of contact during the opening hours of the Registry would be the Clerk of Court, who will then direct the application to a suitable Judge.
The applicant’s legal representatives should inform the Clerk of Court of the nature of the ongoing or anticipated proceedings and the application so that the Clerk of Court will be able to direct the application to the suitable Judge. Subject to the Judges’ availability, the Companies Judge, Commercial Judge, Admiralty Judge and Intellectual Property Judge will normally be in charge of the applications in their own list of cases. If the Judges in a particular list are not available and there is real urgency, the Clerk of Court may refer the application to a Judge who is familiar with the subject matter, or to the Duty Judge as the last resort.
Urgent application to the Companies Judge under Practice Direction 3.7
The new Practice Direction 3.7 is applicable to most of the urgent applications in the context of insolvency and shareholders’ disputes. The following urgent applications should be made to the Companies Judge:
- Applications relating to a matter of the Winding-up and Bankruptcy List, including the following:
- An injunction restraining the presentation or advertisement of a winding-up petition
- An appointment of provisional liquidators
- Recognition and assistance of foreign provisional liquidators and liquidators
- A validation order
- Applications in ongoing or anticipated proceedings involving any matter relating to the internal management of companies, including the following:
- An injunction to restrain the holding of meeting of directors or shareholders of a company
- An injunction to restrain any person from acting in the capacity of director of a company
- An appointment of receiver and/or manager of a company
- An application relating to the issuance of new shares, transfer of shares or registration of transfer of shares in a company
- An application in which the standing of a party or intending party to make an application for remedies under Part 14 Division 4 of the Companies Ordinance (Cap. 622) (“CO”) (i.e., statutory derivative action) or common law derivative action is or may be in issue
- An injunction under Sections 728-729 of the CO (e.g., restraining any act in contravention of the CO)
The Court is particularly concerned about ex parte applications (with or without notice), which should only be made with a real need for secrecy or urgency. Practice Direction 3.7 expressly provides that the Court may dismiss an ex parte application without any hearing, among other circumstances, if the applicant fails to justify the exceptional course of application in the absence of the other party. In practice, even if the Court does not dismiss the ex parte application outright, the Court may adjourn the application to be heard inter partes at the following summons day if it is of the view that the defendant should be given notice on the said application.
Both the applicants and their legal representatives should therefore be extremely conscious in making a decision as to whether an application should be made ex parte or inter partes as not only does it have cost consequences, but also the requirement on full and frank disclosure will inevitably kick in.