Read the full judgment text of HCA 1861/2016 on BabelCite. This Court of First Instance judgment was delivered on 4 August 2021 before Deputy High Court Judge Jin Pao SC.
Contract law – oral finder's fee agreement – whether binding agreement concluded on 9 August 2015 and varied on 28 August 2015 – finder introducing purchaser for controlling stake in GEM-listed company – BWHL shares sold by Magic Ahead (Defendant's BVI company) to China Merit (BVI company owned by one of the alleged finders, Lawrence) for HK$280,000,000 – Plaintiffs (Rabo and John) claiming two-thirds share of finder's fee of HK$26,867,344 – evaluation of oral agreements and witness credibility in commercial litigation – whether alleged agreement existed in terms pleaded on a balance of probabilities – commercial common sense test – absence of contemporaneous written record – inconsistency between contemporaneous documents (Internal Notices) – credibility findings against Plaintiff Rabo as evasive witness and prepared to lie – first two demand letters (Baker & McKenzie 28 April 2016 and Dechert 20 May 2016) not referring to alleged 9 August 2015 agreement – Draft Writ first mentioning such agreement – formula requiring valuation over HK$350,000,000 to trigger fee – commercial implausibility of seller capping upside at HK$350,000,000 without negotiation – Plaintiffs' subsequent conduct in seeking commission from the buyer's side (Lawrence) – evidence of unreliability of human memory (Gestmin) – adverse inference for non-disclosure of WeChat messages declined – illegality defence under section 114 of the Securities and Futures Ordinance (Cap 571) not determined but court indicated it would not have been established because Plaintiffs did not need to rely on alleged illegal conduct and the 'carrying on as a business' requirement was not properly pleaded – Tinsley v Milligan approach to illegality – Plaintiffs' claims dismissed with costs nisi against Plaintiffs.
Legal issues: Whether a binding oral finder's fee agreement was reached on 9 August 2015 between Rabo and Kelvin · Whether the alleged finder's fee agreement was varied on 28 August 2015 to include John and Lawrence as finders and add 3% of BWHL shares · Whether the alleged finder's fee agreement was illegal and unenforceable under section 114 of the Securities and Futures Ordinance (Cap 571)
Outcome: Plaintiffs' claims dismissed.
Cited by 42 cases · Cites 6 cases