Texan Management Ltd & Ors v Pacific Electric Wire & Cable Company (Rev 2)

[2009] UKPC 46
Privy Council Appeal No 0018 of 2009

JUDGMENT

(1) Texan Management Limited
(2) All Dragon International Limited
(3) Blinco Enterprises Limited
(4) Patagonia Limited
(5) Shareholders of All Dragon International Limited

v

Pacific Electric Wire & Cable Company Limited

From the Eastern Caribbean Court of Appeal
(British Virgin Islands)

before

Lord Hope
Lord Scott
Lord Carswell
Lord Brown
Lord Collins

JUDGMENT DELIVERED BY

LORD COLLINS

ON

26 November 2009

Heard on 24 and 25 June 2009

Appellant
Stephen Smith QC
(1^st - 4^th appellants)

Jack Husbands
(1^st & 2^nd appellants)

Paul Webster QC
Kerry Anderson
(3^rd & 4^th appellants)

(Instructed by Glovers Solicitors LLP)

Respondent
Richard Lissack QC

(Instructed by Charles Russell LLP)

LORD COLLINS:

Introduction

It has often been said that, in the pursuit of justice, procedure is a servant and not a master. This is a case, if the Court of Appeal for the Eastern Caribbean is right, where the law of procedure prevents the appellants from invoking a power which is designed to ensure that the litigation is centred in the court "in which the case may be tried more suitably … for the ends of justice," in the words of Lord Kinnear in Sim v. Robinow (1892) 19 R 665, 668, adopted as part of English law in Spiliada Maritime Corp v Cansulex Ltd [1987] AC 460, 474, per Lord Goff of Chieveley.

Until it was de-listed as a result of the events which form the background to these proceedings, the claimant, and respondent on this appeal, Pacific Electric Wire & Cable Co Ltd ("PEWC"), was one of the largest listed companies on the Taiwan Stock Exchange, with over 300,000 shareholders. Its core business is in wire and cable products, but it has expanded into other businesses, including property, telecommunications, electronics, engineering, and financial services.

In 2003 trading in its shares was suspended following a write-off in its accounts of US$291 million. PEWC claims that in the period 1990 to 1997 three of its directors, its former Chairman (Tung Yu Jeh), President (Sun Tao Tsun) and Chief Financial Officer (Hu Hung Chiu) ("the three directors"), were guilty of breach of fiduciary duty (inter alia) by using its funds to acquire investments for themselves. PEWC says that the investments were never reported to the board of PEWC and were not reflected in its financial statements, which were therefore incomplete, false and misleading.

PEWC has commenced proceedings in Hong Kong, Singapore, Beijing, the United States, and the BVI to recover or preserve the assets which it claims were purchased from its funds. The commercial purpose of one of the actions in Hong Kong and the action in the BVI is to obtain control of shares in a Bermuda company called PacMos Technologies Ltd ("PacMos"), which is listed on the Hong Kong Stock Exchange (but now suspended) and was formerly called PCL Enterprises Ltd and then Win Win International Holdings Ltd.

The three directors are said to have…

JUDGMENT

26 November 2009

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