CHINA METAL RECYCLING (HOLDINGS) LTD AND ANOTHER v. CHUN CHI WAI AND OTHERS

CHINA METAL RECYCLING (HOLDINGS) LTD AND ANOTHER v. CHUN CHI WAI AND OTHERS

Cheung Fat deliberately and in bad faith failed to give the full, good faith disclosure required by the Mareva-related disclosure and unless orders; relief from the sanction was refused (out of time and substantively unjustified) and therefore the sanction in the unless order took effect resulting in striking out of Cheung Fat's defence and counterclaim and debarment from defending; however judgment against Cheung Fat was declined because the fraud allegations underpinning liability required trial proof.

Citation
CHINA METAL RECYCLING (HOLDINGS) LTD AND ANOTHER v. CHUN CHI WAI AND OTHERS
Parties
1st Plaintiff (in Provisional Liquidation): CHINA METAL RECYCLING (HOLDINGS) LIMITED; 2nd Plaintiff: CENTRAL STEEL (MACAO COMMERCIAL OFFSHORE) LIMITED; 1st Defendant: CHUN CHI WAI; 2nd Defendant: LAI WUN YIN; 3rd Defendant: LANE TONE (H.K.) MATERIAL LIMITED; 4th Defendant: JASON METAL RECYCLE CORP; 5th Defendant: CHEUNG FAT METAL RECYCLING COMPANY LIMITED; 6th Defendant: QI LE METAL RECYCLING CO; 7th Defendant: METALKLURGICAL INDUSTRY LIMITED; 8th Defendant: HOI CHEUNG METAL RECYCKING LIMITED; 9th Defendant: CHAK KWAN METAL RECYCLING LIMITED; 10th Defendant: PACIFIC METAL RECYCLE LIMITED; 11th Defendant: HEALTHY WORLD TRADING LTD; 12th Defendant: GOLD DRAGON INTERNATIONAL LOGISTICS LTD; 13th Defendant: WELLRUN LIMITED
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
25 June 2014
Case Number
HCA1412/2013
Procedural Posture
Civil Proceedings Involving Mareva Injunction, Disclosure Orders, Sanction and Strike Out Applications / Chamber Hearing on Sanction Summons, Relief From Sanction and Strikeout Summons; Substantive Decision Given
Outcome
Sanction enforced: defence and counterclaim of 5th defendant struck out and defendant debarred from defending; relief from sanction refused; strikeout summons by 5th defendant dismissed; judgment against 5th defendant not entered; costs to plaintiffs on an indemnity basis (order nisi).
Legal Topics
Mareva Injunction, Disclosure Orders and Tracing, Relief From Sanctions (order 2 R 4), Strike Out of Defence (order 18 R 19), Bank Disclosure Under S 21 Evidence Ordinance, Entry of Judgment in Fraud Allegations
Source Language
EN
Civil Procedure Injunctions Company Law Insolvency Fraud Evidence Mareva Injunction Disclosure Orders and Tracing +4 more

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Parties

CHINA METAL RECYCLING (HOLDINGS) LIMITED

1st Plaintiff (in Provisional Liquidation)

CENTRAL STEEL (MACAO COMMERCIAL OFFSHORE) LIMITED

2nd Plaintiff

CHUN CHI WAI

1st Defendant

LAI WUN YIN

2nd Defendant

LANE TONE (H.K.) MATERIAL LIMITED

3rd Defendant

JASON METAL RECYCLE CORP

4th Defendant

CHEUNG FAT METAL RECYCLING COMPANY LIMITED

5th Defendant

QI LE METAL RECYCLING CO

6th Defendant

METALKLURGICAL INDUSTRY LIMITED

7th Defendant

HOI CHEUNG METAL RECYCKING LIMITED

8th Defendant

CHAK KWAN METAL RECYCLING LIMITED

9th Defendant

PACIFIC METAL RECYCLE LIMITED

10th Defendant

HEALTHY WORLD TRADING LTD

11th Defendant

GOLD DRAGON INTERNATIONAL LOGISTICS LTD

12th Defendant

WELLRUN LIMITED

13th Defendant

Procedural Posture

Civil Proceedings Involving Mareva Injunction, Disclosure Orders, Sanction and Strike Out Applications / Chamber Hearing on Sanction Summons, Relief From Sanction and Strikeout Summons; Substantive Decision Given

Legal Issues

  1. 1 Whether the 5th defendant (Cheung Fat) complied with Mareva disclosure orders
  2. 2 Whether relief from sanctions under Order 2 rule 4 should be granted despite delay and alleged bad faith
  3. 3 Whether the defence and counterclaim of the 5th defendant should be struck out for non-compliance

Ratio Decidendi

Cheung Fat deliberately and in bad faith failed to give the full, good faith disclosure required by the Mareva-related disclosure and unless orders; relief from the sanction was refused (out of time and substantively unjustified) and therefore the sanction in the unless order took effect resulting in striking out of Cheung Fat's defence and counterclaim and debarment from defending; however judgment against Cheung Fat was declined because the fraud allegations underpinning liability required trial proof.

Court Disposition

Sanction enforced: defence and counterclaim of 5th defendant struck out and defendant debarred from defending; relief from sanction refused; strikeout summons by 5th defendant dismissed; judgment against 5th defendant not entered; costs to plaintiffs on an indemnity basis (order nisi).

Orders

  • Defence and counterclaim of Cheung Fat struck out pursuant to unless order
  • Cheung Fat debarred from defending the proceedings