CHENG KA YAN AND OTHERS v. GRAND XI INVESTMENTS PTE LTD AND OTHERS

CHENG KA YAN AND OTHERS v. GRAND XI INVESTMENTS PTE LTD AND OTHERS

On the evidence the court found no credible contemporaneous support for the plaintiffs' core allegations (no reliable disclosure of the OMCL indebtedness pre-contract, no credible collateral non-enforcement agreement, and no proven deliberate withholding of consents by the lender). Grand XI had a solid basis for serving default notices and appointing receivers; the plaintiffs had obstructed receivers and failed to present a serious issue to be tried. Accordingly the receivers' application was allowed and leave granted to file the draft affirmations de bene esse.

Citation
[2023] HKCFI 886
Parties
1st Plaintiff: Cheng Ka Yan; 2nd Plaintiff: Hou Qin; 3rd Plaintiff: Liu Zhaolu; 1st Defendant (lender/agent): Grand XI Investments Pte. Ltd.; 2nd Defendant (receiver): Peter James Greaves; 3rd Defendant (receiver): Yat Kit Jong; 4th Defendant (applicant; Borrower in Receivership): Gold Topmont Limited; 5th Defendant: Billion Trend Development Limited; 6th Defendant: Perfect Elite Ventures Limited; 7th Defendant (security Agent): Serica Agency Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
31 March 2023
Case Number
HCA1607/2022
Procedural Posture
Civil Action for Interlocutory Injunction Arising From Enforcement of Facility Agreement and Receivership / Substantive Interlocutory Hearing of Summons (decision on Interlocutory Application Reserved and Handed Down)
Outcome
Application granted in favour of the receivers/4th defendant; order in terms of the summons made and leave granted to file the draft affirmations de bene esse
Legal Topics
Interlocutory Injunction, Events of Default Under Loan Facility, Appointment and Duties of Receivers, Collateral Agreement and Oral Representations, Good Faith in Exercise of Consent, Sales of First Hand Residential Properties, Admissibility of Late Evidence
Source Language
EN
Civil Procedure Injunctions Security Enforcement Receivership Contract Law Property Law Company Law Interlocutory Injunction +6 more

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Parties

Cheng Ka Yan

1st Plaintiff

Hou Qin

2nd Plaintiff

Liu Zhaolu

3rd Plaintiff

Grand XI Investments Pte. Ltd.

1st Defendant (lender/agent)

Peter James Greaves

2nd Defendant (receiver)

Yat Kit Jong

3rd Defendant (receiver)

Gold Topmont Limited

4th Defendant (applicant; Borrower in Receivership)

Billion Trend Development Limited

5th Defendant

Perfect Elite Ventures Limited

6th Defendant

Serica Agency Limited

7th Defendant (security Agent)

Procedural Posture

Civil Action for Interlocutory Injunction Arising From Enforcement of Facility Agreement and Receivership / Substantive Interlocutory Hearing of Summons (decision on Interlocutory Application Reserved and Handed Down)

Legal Issues

  1. 1 Whether there is a serious issue to be tried on the plaintiffs' challenge to removal and appointment of receivers
  2. 2 Whether events of default under the Facility Agreement occurred warranting enforcement and receivers' appointment
  3. 3 Whether there existed a collateral agreement or representation by the lender not to enforce (the "Representation")

Ratio Decidendi

On the evidence the court found no credible contemporaneous support for the plaintiffs' core allegations (no reliable disclosure of the OMCL indebtedness pre-contract, no credible collateral non-enforcement agreement, and no proven deliberate withholding of consents by the lender). Grand XI had a solid basis for serving default notices and appointing receivers; the plaintiffs had obstructed receivers and failed to present a serious issue to be tried. Accordingly the receivers' application was allowed and leave granted to file the draft affirmations de bene esse.

Court Disposition

Application granted in favour of the receivers/4th defendant; order in terms of the summons made and leave granted to file the draft affirmations de bene esse

Orders

  • Order in terms of the Form 86 summons in favour of the receivers (relief sought in the summons)
  • Leave granted for the filing of the draft affirmations exhibited to the late summonses (to be read de bene esse)