LIEU TSENG VAN v. JIUZHOU DEVELOPMENT CO LTD

LIEU TSENG VAN v. JIUZHOU DEVELOPMENT CO LTD

The court dismissed the injunction application: the confidentiality/set-off claim lacked sufficient particularity and evidence to show damages likely exceeded the earnest money at the time of Receiver appointment; some contractual points (entitlement to demand repayment under clause 3.2.1 and related triable issues) and revocation arguments were triable but did not sustain interlocutory relief; the Registrar correctly accepted the Receivers' filings under s.348 as not manifestly unlawful; King & Wood lacked shown authority for Super Cruise filings and those documents were struck out; certain pleaded background assurances were legally ineffective and were struck from the pleadings.

Citation
LIEU TSENG VAN v. JIUZHOU DEVELOPMENT CO LTD
Parties
Plaintiff (original Action); Applicant (for Joinder): Lieu Tseng Van; Defendant (original Action); Plaintiff (by Counterclaim): Jiuzhou Development Company Limited; 2nd Defendant (by Counterclaim): Chen Siu Ling; 3rd Defendant (by Counterclaim); Applicant (hcmp 1893/2009): Super Cruise Limited; 4th Defendant (by Counterclaim): Van Shipping Company Limited; Respondent (hcmp 1893/2009): Registrar of Companies; Receivers Appointed Under Share Charge: Joint Receivers (Borrelli Walsh Limited)
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
17 June 2010
Case Number
HCA1645/2009
Procedural Posture
Civil Actions and Related Originating Summons (hca 1645/2009; HCMP 1893/2009) / Interlocutory Applications Heard and Decided (applications for Injunction, Striking Out, Registrar Relief, Joinder/intervention and Want for Authority)
Outcome
Interlocutory applications dismissed in part and granted in part as follows: Injunction Summons dismissed; Want for Authority documents struck out; Striking Out Summons partly granted (specific paragraphs struck) and otherwise dismissed; Joinder and Intervening Summons granted; Originating Summons dismissed.
Legal Topics
Receivership, Share Charge Enforcement, Interim Injunction (american Cyanamid), Confidentiality Undertaking and Damages/set Off, Forfeiture of Deposit/earnest Money, Revocation of Undated Documents, Companies Ordinance S348 Registration, Authority to Instruct Solicitors, Striking Out Pleadings, Costs
Source Language
EN
Company Law Contract Law Equity and Trusts Civil Procedure Receivership Share Charge Enforcement Interim Injunction (american Cyanamid) Confidentiality Undertaking and Damages/set Off +6 more

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Parties

Lieu Tseng Van

Plaintiff (original Action); Applicant (for Joinder)

Jiuzhou Development Company Limited

Defendant (original Action); Plaintiff (by Counterclaim)

Chen Siu Ling

2nd Defendant (by Counterclaim)

Super Cruise Limited

3rd Defendant (by Counterclaim); Applicant (hcmp 1893/2009)

Van Shipping Company Limited

4th Defendant (by Counterclaim)

Registrar of Companies

Respondent (hcmp 1893/2009)

Joint Receivers (Borrelli Walsh Limited)

Receivers Appointed Under Share Charge

Procedural Posture

Civil Actions and Related Originating Summons (hca 1645/2009; HCMP 1893/2009) / Interlocutory Applications Heard and Decided (applications for Injunction, Striking Out, Registrar Relief, Joinder/intervention and Want for Authority)

Legal Issues

  1. 1 Whether JZD validly exercised rights under the Share Charge and validly appointed Receivers
  2. 2 Whether the plaintiff's alleged breach of confidentiality gives unliquidated damages sufficient to set off and extinguish the earnest money before Receivers appointed
  3. 3 Whether the Framework Agreement or conduct gave rise to a right of forfeiture of the earnest money

Ratio Decidendi

The court dismissed the injunction application: the confidentiality/set-off claim lacked sufficient particularity and evidence to show damages likely exceeded the earnest money at the time of Receiver appointment; some contractual points (entitlement to demand repayment under clause 3.2.1 and related triable issues) and revocation arguments were triable but did not sustain interlocutory relief; the Registrar correctly accepted the Receivers' filings under s.348 as not manifestly unlawful; King & Wood lacked shown authority for Super Cruise filings and those documents were struck out; certain pleaded background assurances were legally ineffective and were struck from the pleadings.

Court Disposition

Interlocutory applications dismissed in part and granted in part as follows: Injunction Summons dismissed; Want for Authority documents struck out; Striking Out Summons partly granted (specific paragraphs struck) and otherwise dismissed; Joinder and Intervening Summons granted; Originating Summons dismissed.

Orders

  • Injunction Summons dismissed; order nisi that JZD's costs of the Injunction Summons be in the cause
  • Strike out paragraphs 14, 15 and 31(v) of the Amended Statement of Claim (Court's own motion under O.18 r.19(1))