Identifying the Wrongdoer in Hong Kong before the Lawsuit Commences

There has been a wrongful transfer of funds, but you are unsure who is responsible and what has happened with those assets, except that a Hong Kong party may have information. Under the well-established principle developed in Norwich Pharmacal Co. v. Customs and Excise Commissioners (1974) AC 133, the whereabouts of property can be located and wrongful parties can be identified. The House of Lords in Norwich Pharmacal found that where a third party had become involved in unlawful conduct, they were under a duty to assist the person suffering damage by giving them full information and disclosing the identity of wrongdoers. This Norwich Pharmacal relief has been commonly used to identify the proper defendant and is typically, although not limited, to relief against banks or others to whom stolen or misappropriated funds have been transferred. This relief can also be made against an internet service provider for disclosure of names and addresses of the users of IP addresses.

The Norwich Pharmacal order is an equitable order and will only be granted where “necessary” in the interests of justice. The Hong Kong court will exercise its discretion if:

• There are cogent and compelling evidence to demonstrate serious wrongful activities have taken place.
• The order will or will very likely reap substantial and worthwhile benefits for the plaintiff.
• The discovery sought must not be unduly wide.

The applicant has the burdensome duty to make full and frank disclosure of material facts, especially if the application is made ex-parte and without notice. An applicant will be required to give certain undertakings, including one in damages.

Under normal circumstances, the applicant does not want the wrongdoers to know of the investigation and the assets being investigated dissipated. Therefore, the order includes a “gag” refraining the respondent, for a specified period of time, from informing anyone (including the wrongdoer) about the application or the fact that information is being provided to the applicant. Similarly, an “anonymity order” keeps the parties name in secret to help ensure that the wrongdoer will not be forewarned of the application.

Norwich Pharmacal relief is an effective pre-judgment tool for victims in Hong Kong to gather the information necessary to identify the wrongdoers and to eventually freeze their assets.