ALWAYS NEW LTD. v. CHOW CHI NANG AND ANOTHER

ALWAYS NEW LTD. v. CHOW CHI NANG AND ANOTHER

On the evidence the plaintiff was a shelf company with no apparent assets, nominal share capital and directors/shareholders resident at the same address, the court reasonably inferred the plaintiff would likely be unable to pay the defendants' costs; exercising its discretion under s.357 Companies Ordinance the...

Source-derived case information.

Citation
ALWAYS NEW LTD. v. CHOW CHI NANG AND ANOTHER
Parties
Plaintiff: ALWAYS NEW LIMITED; 1st Defendant: CHOW CHI NANG; 2nd Defendant: LEE KIN WING; 3rd Defendant: FUNG KWOK WING, EDWARD
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
23 October 2000
Case Number
HCA12994/1997
Procedural Posture
Company Action (security for Costs) / Interlocutory Application (pre Trial)
Outcome
Application for security for costs granted
Legal Topics
Security for Costs, Shelf Company, Stay of Proceedings, Counterclaim, Court Discretion
Source Language
en
Company Law Civil Procedure Property Law Costs Security for Costs Shelf Company Stay of Proceedings Counterclaim +1 more

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Parties

ALWAYS NEW LIMITED

Plaintiff

CHOW CHI NANG

1st Defendant

LEE KIN WING

2nd Defendant

FUNG KWOK WING, EDWARD

3rd Defendant

Procedural Posture

Company Action (security for Costs) / Interlocutory Application (pre Trial)

Legal Issues

  1. 1 Whether the plaintiff company will be unable to pay the defendants' costs if defendants succeed
  2. 2 Whether the court should exercise its discretion under s.357 to order security for costs
  3. 3 Whether the application is being used to stifle a bona fide claim

Ratio Decidendi

On the evidence the plaintiff was a shelf company with no apparent assets, nominal share capital and directors/shareholders resident at the same address, the court reasonably inferred the plaintiff would likely be unable to pay the defendants' costs; exercising its discretion under s.357 Companies Ordinance the court ordered security of HK$150,000 and stayed proceedings until it was provided.

Court Disposition

Application for security for costs granted

Orders

  • Judgment for the applicants on the summons for security for costs.
  • The plaintiff shall, within 30 days from the date of this order (September 2000), give security for the applicants' costs in this action up to the end of trial in the sum of HK$150,000 by way of (a) payment of the said sum into court; or (b) a bank guarantee to be agreed between the parties and failing agreement, to...