UNISTRESS BUILDING CONSTRUCTION LTD v. HUMPHREYS ESTATE (FORRESTADALE) LTD

UNISTRESS BUILDING CONSTRUCTION LTD v. HUMPHREYS ESTATE (FORRESTADALE) LTD

The court has an unfettered discretion under Order 73 rules 11‑18 to allow payment out after the arbitration has commenced and the two‑day period has expired; in exercising that discretion the court must consider whether the defendant has shown a substantial change in the risks since payment — Humphreys failed to discharge that burden — therefore Unistress was entitled to take out the $3.3m and Humphreys' application to reduce the payment was dismissed.

Citation
UNISTRESS BUILDING CONSTRUCTION LTD v. HUMPHREYS ESTATE (FORRESTADALE) LTD
Parties
Plaintiff and Defendant (cross Suits): Unistress Building Construction Ltd; Defendant and Plaintiff (cross Suits): Humphreys Estate (Forrestdale) Ltd
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
16 March 1992
Case Number
HCMP3268/1991
Procedural Posture
Arbitration (originating Summonses Concerning Payment Into Court) / Chambers Hearing — Judgment on Cross Summonses
Outcome
Unistress permitted to take out the $3,300,000 paid into court; Humphreys' application to reduce the payment to $2,719,582.20 dismissed; costs orders made in favour of Unistress as agreed between the parties.
Legal Topics
Payment Into Court, Order 73 Rules 11 18, Jurisdiction to Grant Payment Out, Change of Circumstances Test for Reducing Payments, Procedure for Reducing Payment Into Court
Source Language
EN
Arbitration Civil Procedure Contract Costs Payment Into Court Order 73 Rules 11 18 Jurisdiction to Grant Payment Out Change of Circumstances Test for Reducing Payments +1 more

Case Brief

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Parties

Unistress Building Construction Ltd

Plaintiff and Defendant (cross Suits)

Humphreys Estate (Forrestdale) Ltd

Defendant and Plaintiff (cross Suits)

Procedural Posture

Arbitration (originating Summonses Concerning Payment Into Court) / Chambers Hearing — Judgment on Cross Summonses

Legal Issues

  1. 1 Whether the court has jurisdiction to permit payment out after arbitration has commenced and the 2‑day acceptance period expired
  2. 2 Whether the defendant's consent is a prerequisite to payment out once the arbitration has begun
  3. 3 Whether there has been a substantial change in risks or circumstances justifying reduction or withdrawal of a payment into court

Ratio Decidendi

The court has an unfettered discretion under Order 73 rules 11‑18 to allow payment out after the arbitration has commenced and the two‑day period has expired; in exercising that discretion the court must consider whether the defendant has shown a substantial change in the risks since payment — Humphreys failed to discharge that burden — therefore Unistress was entitled to take out the $3.3m and Humphreys' application to reduce the payment was dismissed.

Court Disposition

Unistress permitted to take out the $3,300,000 paid into court; Humphreys' application to reduce the payment to $2,719,582.20 dismissed; costs orders made in favour of Unistress as agreed between the parties.

Orders

  • Leave granted to Unistress to withdraw and take out the sum of $3,300,000 paid into court
  • Application by Humphreys to reduce their payment into court to $2,719,582.20 dismissed