Camel Technology (HK) Co Ltd v. Rocom Electric Co Ltd

HCMP 2507/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO. 2507 OF 2005

(ON AN INTENDED APPEAL FROM DCCJ NO. 7602 of 2002)

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BETWEEN

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Before : Hon Yeung and Tang JJA in Court

Date of Hearing : 22 February 2006

Date of Judgment : 22 February 2006

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J U D G M E N T

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Hon Tang JA:

1.This action was commenced on 9 December 2002 and the defence was filed on the 12 March 2003.  The claim is for goods sold and delivered in the sum of about $380,000.

2.On 2 March 2004, the plaintiff applied for summary judgment in the sum of $310,000.  The $310,000 is said to be the net cost of the goods sold.  The lower figure applied for was adopted presumably on the basis that the defence was that the prices for the goods had been inflated by about 20%.  And that is because of the fraud or breach of fiduciary duty on the part of a Mr Chan, who was said to be behind the plaintiff, in the sense that he either owned or controlled the plaintiff, or that the plaintiff was one of the corporate vehicles adopted by him to carry out his fraud.

3.It is the defence that Mr Chan and others had defrauded the defendant of some $10 million.  That is the subject matter of a separate action brought by the defendant against Mr Chan and others in the High Court.

4.It is against such background that District Judge H C Wong granted the defendant conditional leave to defend.  The plaintiff is not satisfied, and now seeks leave to appeal from us, having been refused leave by the judge and a single judge of this court.

5.I would refuse leave.  I can see no basis of on which this court can interfere with the exercise of discretion by the District Judge.

6.If the defendant’s allegation are substantiated, its defence to the plaintiff’s claim, or its counter-claim, may not be confined to the mere overcharging of the price.  And if the plaintiff was a corporate vehicle adopted by Mr Chan to carry out his fraud or in furtherance of a conspiracy, the fact that the plaintiff was incorporated after most of the alleged fraud had been perpetrated, would not be a complete defence.

7.The defendant, it appears on the papers before me, that the defendant wishes to have this action heard together with the High Court Action.  No application has been made to put that into effect, and it may be that the pleadings would have to be amended so that the true basis of the defendant’s claim can be more clearly seen.

8.But I have no doubt that this is not a case for judgment in favour of the plaintiff now, so I would refuse leave to appeal.

Hon Yeung JA:

9.I, too, would refuse leave to appeal.

Mr Simon H W Lam, instructed by Messrs Henry Wan & Yeung, for the Plaintiff (Applicant).