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THURSDAY, JUNE 11, 1987
"NEVERTHELESS, THE EXERCISE OF PRUDENTIAL SUPERVISION WOULD BE MADE VERY DIFFICULT IF THE COMMISSIONER HAD TO BE CONCERNED AT ALL TIMES ABOUT POSSIBLE LAW SUITS. THIS DECISION REMOVES THAT UNCERTAINTY BUT, OF COURSE, UNDERLINES THE GOVERNMENT'S DETERMINATION TO PROVIDE ADEQUATE SUPERVISION TO PROTECT DEPOSITORS AND THE GENERAL INTEGRITY OF BANKING IN HONG KONG."
IN DISMISSING THE APPEAL, THE PRIVY COUNCIL ADVISED THAT "THE ISSUES IN THE APPEAL RAISE IMPORTANT ISSUES OF PRINCIPLE, HAVING FAR- REACHING IMPLICATIONS AS REGARDS THE POTENTIAL LIABILITY IN NEGLIGENCE OF A WIDE VARIETY OF REGULATORY AGENCIES CARRIED ON UNDER THE AEGIS OF CENTRAL OR LOCAL GOVERNMENT AND ALSO TO SOME EXTENT BY NON-GOVERNMENTAL BODIES. SUCH AGENCIES ARE IN MODERN TIMES BECOMING AN INCREASINGLY FAMILIAR FEATURE OF THE
FINANCIAL, COMMERCIAL, INDUSTRIAL AND SOCIAL SCENE.
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THE APPELLANTS ALLEGED THAT THEY HAD DEPOSITS 1N A COMPANY KNOWN AS THE AMERICA AND PANAMA FINANCE CO LTD WHICH WERE LOST WHEN THE COMPANY WENT INTO LIQUIDATION ON FEBRUARY 25, 1983.
THEY BROUGHT AN ACTION IN THE HIGH COURT ALLEGING THAT THE COMMISSIONER FOR DEPOSIT-TAKING COMPANIES HAD BEEN NEGLIGENT AND/OR IN BREACH OF STATUTORY DUTY IN HIS SUPERVISION OF THAT COMPANY AND THAT HE WAS THEREFORE LIABLE TO REIMBURSE THE APPELLANTS THEIR LOST DEPOSITS.
THE ATTORNEY GENERAL APPEARED ON BEHALF OF THE COMMISSIONER IN THE HIGH COURT BEFORE MR JUSTICE JONES ON AN APPLICATION TO STRIKE OUT THE PROCEEDINGS ON THE GROUNDS THAT THERE WAS NO CAUSE OF ACTION. MR JUSTICE JONES ACCEPTED THE ARGUMENT AND STRUCK OUT THE PROCEEDINGS.
COURT THE APPLICANTS APPEALED TO THE COURT OF APPEAL AND WHEN THE APPEAL DISMISSED THE APPEAL, TO THE PRIVY COUNCIL.
OF
THE APPELLANTS HAVE THROUGHOUT THE PROCEEDINGS BEEN REPRESENTED BY COUNSEL INSTRUCTED BY THE LEGAL AID DEPARTMENT.
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