HUEN WAI KEI AND ANOTHER v. CHOY KWONG WA CHRISTOPHER AND ANOTHER

HUEN WAI KEI AND ANOTHER v. CHOY KWONG WA CHRISTOPHER AND ANOTHER

Order (2) for specific performance was set aside because the Security & Set-Off Agreement (which gave rise to the Memorandum, Supplemental Agreement and S&P) lacked consideration and the S&P operated as security/a sham rather than a genuine sale; accordingly specific performance was inappropriate and the remedies were cumulative (debt plus security) not an alternative conveyance without payment.

Citation
HUEN WAI KEI AND ANOTHER v. CHOY KWONG WA CHRISTOPHER AND ANOTHER
Parties
1st Plaintiff: HUEN WAI KEI; 2nd Plaintiff: CHINA GAIN CORPORATION LIMITED; 1st Defendant: CHOY KWONG WA CHRISTOPHER; 2nd Defendant: RAKING LIMITED
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
8 August 2014
Case Number
HCMP1799/2014
Procedural Posture
Civil Appeal (court of Appeal) / Judgment on Appeal From High Court; Consolidated Proceedings
Outcome
Allow defendants' appeal in part; set aside paragraph (2) of the High Court judgment order; dismiss plaintiffs' appeal and decline supplemental orders.
Legal Topics
Specific Performance, Consensual Security (sham), Consideration and Pleading, Alternative Vs Cumulative Remedies, Set Off, Supplemental Orders, Rectification, Damages Assessment
Source Language
EN
Contract Equity Property Civil Procedure Mortgage Appeal Specific Performance Consensual Security (sham) +6 more

Case Brief

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Parties

HUEN WAI KEI

1st Plaintiff

CHINA GAIN CORPORATION LIMITED

2nd Plaintiff

CHOY KWONG WA CHRISTOPHER

1st Defendant

RAKING LIMITED

2nd Defendant

Procedural Posture

Civil Appeal (court of Appeal) / Judgment on Appeal From High Court; Consolidated Proceedings

Legal Issues

  1. 1 Whether the Security & Set-Off Agreement was enforceable and if consideration was pleaded
  2. 2 Whether the Agreement for Sale and Purchase (S&P) was a genuine sale or a sham/consensual security
  3. 3 Whether specific performance of the S&P should have been ordered as an alternative remedy

Ratio Decidendi

Order (2) for specific performance was set aside because the Security & Set-Off Agreement (which gave rise to the Memorandum, Supplemental Agreement and S&P) lacked consideration and the S&P operated as security/a sham rather than a genuine sale; accordingly specific performance was inappropriate and the remedies were cumulative (debt plus security) not an alternative conveyance without payment.

Court Disposition

Allow defendants' appeal in part; set aside paragraph (2) of the High Court judgment order; dismiss plaintiffs' appeal and decline supplemental orders.

Orders

  • Set aside paragraph (2) of the judgment order (order for specific performance of the S&P Agreement).
  • Dismiss the plaintiffs' appeal (CACV 159/2014) against the Decision of 10 July 2014.