Cheung Hau Chun v. To Suet Chun and Others
Read the full judgment text of HCA 1259/2015 on BabelCite. This High Court CFI judgment was delivered on 7 February 2023.
1. The trial of this action took place from 3 to 6 November 2020. In the Main Judgment, this Court gave judgment for P in the following terms:
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HCA 1259/2015 [2023] HKCFI 347 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE ACTION NO 1259 OF 2015 ________________________ BETWEEN
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________________________ J U D G M E N T ________________________ 1.The trial of this action took place from 3 to 6 November 2020. In the Main Judgment, this Court gave judgment for P in the following terms:
2.Pursuant to the directions given by this Court, D1-D4 filed and served their verified accounts and produced documents relevant to the accounts and inquiries. The only primary documents produced by D1-D4 relevant to the accounts and inquiries are:
3.All the AFS were audited by Messrs. Richard S K Chan & Co, the auditors of Tai Dou (“Auditors”), who opined that the AFS gave a true and fair view of the state of affairs of Tai Dou as at the date they were made up to. 4.The taking of accounts and making of inquiries was heard on 22 June 2022 before Master Benny Lo. In his judgment dated 16 September 2022 [2022] HKCFI 2761 (“Judgment on Accounts”), the learned Master made the following findings: (1) The 2011 AFS, 2012 AFS and 2013 AFS correctly reflected the financial position of Tai Dou (i.e. Partnership) in particular, the “asset” figures reflected the “credit and assets belonging to the Partnership”, while the “liability” figures reflected the “debts and liabilities of the Partnership” as at the end of the relevant financial periods[2]; and (2) D4 had not received any sums in respect of the Partnership’s business, credit, assets or capital[3]. 5.The learned Master directed P to seek further directions from this Court as regards the assessment of any sums payable to him as he considered such question falls outside the scope of the accounts and inquiries[4]. 6.By summons dated 15 December 2022 (“Summons”), P applies for “Interlocutory Judgment to be entered for the Plaintiff against the 1st, 2nd and 3rd Defendants for damages to be assessed”, and leave to fix a hearing before a Master “for assessment of damages and determination of the amount of money to be payable [sic] by the 1st, 2nd and 3rd Defendants to the Plaintiff”, and other consequential relief. 7.The Summons is misconceived. Final judgment was given by this Court on 2 February 2021. The taking of accounts and making of inquiries was also completed. The only outstanding matter is the precise amount which D1-D3 are liable to pay to P taking into account the findings in the Main Judgment and the Judgment on Accounts. 8.As stated above, the learned Master found that the 2011 AFS, 2012 AFS and 2013 AFS of Tai Dou correctly reflected the financial position of the Partnership. On the basis of this finding, the net assets of the Partnership as at 31 March 2013 was as follows:
9.As D1-D4 failed to produce any other documents or accounts of Tai Dou, the court can only make a rough and ready apportionment of the profits made by the Partnership for the period from 1 April 2012 to 15 August 2012 (4.5 months) based on the profits made by the Partnership for the year ended 31 March 2013. According to the 2013 AFS, the profits for the year ended 31 March 2013 was $145,780.62. As P ceased to be a partner on 15 August 2012, he is not entitled to share the profits made by the Partnership during the period from 15 August 2012 to 31 March 2013 (7.5 months) and the same should be deducted from the net assets of Tai Dou as at 31 March 2013. The apportioned profits for the 7.5 months is $91,112.89. 10.The amount which D1-D3 are liable to account to P is therefore $1,879,791.91 (“Judgment Sum”), calculated as follows:
11.As D1-D3 act in person after the handing down of Main Judgment and have not filed any evidence or submissions in respect of the Summons or the relief sought by P, this Court caused a letter dated 18 January 2023 to be sent to all parties informing them (1) the preliminary view of this Court on the amount payable by D1-D3 (as stated in §§8-10 above), which had not taken into account any evidence or submissions from D1-D3; and (2) the Court is prepared to consider any submissions from D1-D3 at the hearing on 20 January 2023. 12.D1-D3 did not attend the hearing. Nor did they make any submissions to the Court. 13.At the hearing, Mr Victor Cheung, counsel for P, referred to the interest claimed in §18 of the SOC and asked the Court to award interest on the Judgment Sum from the date of the writ at judgment rate to the date of payment. 14.As the question of interest is only raised by P at the hearing, it seems to me that D1-D3 should be given a further opportunity to consider the issue and, if appropriate, make submissions on the question of interest by 12 noon on 3 February 2023. By letter dated 20 January 2023, D1-D3 were informed of their right to make submissions in respect of the Summons, and that judgment will be given on 7 February 2023. 15.No submissions have been made by D1-D3 on the question of interest. 16.In my view, P is entitled to interest as claimed in the SOC as he has been kept out of pocket of the Judgment Sum since the cessation of the Partnership (on 15 August 2012). As P only seeks interest on the Judgment Sum from the date of the writ (instead of the date of cessation of the Partnership), it is appropriate to order D1-D3 to pay interest on the Judgment Sum from the date of the writ (9 June 2015) to the date of this judgment at HSBC prime lending rate plus 1% and, thereafter, at judgment rate. 17.As for costs, there is no reason why costs should not follow the event. D1-D3 are ordered to pay the costs of and occasioned by the Summons to P. 18.In the statement of costs submitted by P, he only seeks costs at the modest sum of $45,101. Notwithstanding my view that the Summons is misconceived, it seems to me that in light of the learned Master’s direction, an application has to be made to this Court to ascertain the precise amount payable by D1-D3 and costs were incurred by P for such purpose. The time and costs claimed by P are reasonable and commensurate with the nature of the application. I make a preliminary assessment on the costs of the Summons at $45,000. The assessment will become absolute within 14 days of this Judgment.
Mr Victor CF Cheung, instructed by Joseph P. K. Pang & Co., Solicitors & Notaries LLP, for the plaintiff The 1st – 3rd defendants are not represented and absent [1] Unless otherwise stated, the abbreviations used in the Judgment dated 2 February 2021 [2021] HKCFI 264 (“Main Judgment”) are adopted. [2] Judgment on Accounts §§22-27 [3] Judgment on Accounts §§28-30 [4] Judgment on Accounts §35 |
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