Rainier International Bank v. Chevy Chase Ltd and Another

HCA004005A/1983

IN THE HIGH COURT OF JUSTICE

BETWEEN

Coram: Hon. Mantell J. (In Chambers)

Date of Hearing: 4th May, 1984.

Date of Delivery of Judgment: 4th May, 1984.

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JUDGMENT

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1. This is an application by the Rainier International Bank as plaintiff to strike out the defence of the 1st defendant. The claim is simply for the repayment of money advanced under a mortgage deed with interest in relation to premises in Tai Cheong Street, there having been default made under the terms of the agreement.  There has never been an issue in the case about the non-payment. At one stage, the plaintiff obtained summary judgment against the 1st defendant. On appeal, judgment was set aside and leave given to defend on condition that further security be provided in the form of an additional charge over certain other property. Ms. Justice Clough who heard the appeal on 9th December 1983 and delivered judgment on 16th January 1984 gave leave on the basis of what he found to be a shadowy defence. And if I read the judgment correctly,he only gave leave with reluctance. The shadowy defence to which he referred is eventually reproduced in paragraph 7E of the Defence of the 1st defendant. I summarize its effect. Having previously set out the background it is alleged that an employee of the plaintiff was prevailed upon to say that the plaintiff would not seek repayment of the money due from the 1st defendant so long as other persons continued to pay mortgage instalments due under a separate mortgage and so long as the 1st defendant as plaintiff in a quite separate proceeding continued that proceeding with diligence. That other proceeding was an action by the 1st defendant against various parties including its own solicitors in relation to the property in Tai Cheong Street, the subject of the mortgage. It was an action in which the plaintiff alleged, amongst other things, negligence on the part of its own solicitors and misrepresentation on the part of the vendors and the vendor's solicitor and, quite coincidentally, that action came on before me for hearing. The hearing continued for several weeks, if memory serves me five in all, and in so doing went beyond the original estimate for time. Prior to that hearing, security had been ordered against the plaintiff by reason of its lack of assets in which others beside myself, again if I remember correctly, had a hand. When the period upon which security had been based expired, application was made to me for further security on the ground that the case would now last for at least a further ten working days and I did order further security and in due course, when the terms of my order had not been complied with, I made an "unless order" which extended the time in which security could be provided. The terms of that order were not complied with also and the unless other took effect in consequence of which the action by the plaintiff was dismissed against all parties. Time for appealing the unless order has expired though there may be some question of there being time to run in the case of an appeal against the entering of final judgment. But I am told by Miss Wong, who appears today on behalf of the 1st defendant, that she has no instructions at present to pursue such an appeal nor has she any instructions to oppose the application now made before me to strike out the 1st defendant's defence. For the avoidance of doubt, I make it plain that I do not understand Miss Wong to be saying that she is consenting to any order which I might make in this case or to the application with which I have to deal.

I am satisfied that I have jurisdiction to entertain this application even though leave to defend has previously been given by a court of co-ordinate jurisdiction because what has to be considered is whether the ground of the application is properly established at the time that the application is heard. Circumstances have changed since Mr. Justice Clough was concerned with the appeal against the Master's decision to give Order 14 judgment. The position now is that the action by the 1st defendant has been dismissed and it seems probable that any time for appealing has run out and even if that is not right, there seems on the information I nave before me no prospect of an appeal being pursued. Therefore, I am prepared to accept that there is no defence, shadowy or otherwise, remaining to the 1st defendant in this case and that therefore this application succeeds. The defence of the 1st defendant will be struck out and I give judgment for the plaintiff against the 1st defendant in the terms of the prayer of the reamended Statement of Claim with costs.

Representation:

Benjamin Yu instructed by Kao, Lee & Yip for plaintiff.

Miss Carcy Wong of Tsang, Chau & Shuen for 1st defendant.