ASIA-PAC INFRASTRUCTURE DEVELOPMENT LTD AND OTHERS v.SHEARMAN & STERLING (a firm) AND OTHERS

ASIA-PAC INFRASTRUCTURE DEVELOPMENT LTD AND OTHERS v.SHEARMAN & STERLING (a firm) AND OTHERS

The court held each Deed of Assignment champertous and void because the claimed commercial interests were not genuine or pre-existing: the July 2009 transactions creating shareholdings and debt assignments were unexplained, likely engineered to evade security for costs, lacked evidence of payment or valuation, and therefore constituted assignments of a bare right to litigate contrary to public policy.

Citation
[2021] HKCFI 1380
Parties
1st Plaintiff: ASIA-PAC INFRASTRUCTURE DEVELOPMENT LIMITED (in creditor’s voluntary liquidation) (on behalf of itself and as assignee of Asia-Pac Infrastructure Finance Limited; Asia-Pac Group Investments Limited; & Greater Beijing Region Expressways Limited); 2nd Plaintiff: ASIA-PAC INFRASTRUCTURE FINANCE LIMITED; 3rd Plaintiff: ASIA-PAC GROUP INVESTMENTS LIMITED; 4th Plaintiff: GREATER BEIJING REGION EXPRESSWAYS LIMITED (on behalf of itself and as assignee of Greater Beijing First Expressways Limited (in Liquidation)); 1st Defendant: SHEARMAN & STERLING (a firm); 2nd Defendant: SHEARMAN & STERLING LLP (a firm, formerly known as SHEARMAN & STERLING); 3rd Defendant: ANTONIA E. STOLPER; 4th Defendant: DOUGLAS P. BARTNER; 5th Defendant: ANDREW V. TENZER; 6th Defendant: HSIAO-CHIUNG LI; 7th Defendant: MATTHEW D. BERSANI; 8th Defendant: EDWARD L. TURNER III; 9th Defendant: HERBERT SMITH (a firm)
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
18 May 2021
Case Number
HCA806/2006
Procedural Posture
Civil Action for Professional Negligence and Breach of Duty; Challenge to Validity of Assignments (maintenance and Champerty) / Trial of a Preliminary Issue (validity of Deeds of Assignment)
Outcome
Each of the Assignments is declared champertous and void; relief granted to the Shearman Defendants and Herbert Smith; costs nisi to Defendants with certificates for two counsel.
Legal Topics
Assignment of Causes of Action, Champerty, Maintenance, Security for Costs, Issue Estoppel, Pre Existing Commercial Interest, Discovery, Burden of Proof
Source Language
EN
Civil Procedure Tort (negligence) Company Law Maintenance and Champerty Security for Costs Proceedings Assignment Law Assignment of Causes of Action Champerty +5 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 5 Authorities cited 16 Party arguments 2 Amounts and remedies 9
Sign in to unlock

Parties

ASIA-PAC INFRASTRUCTURE DEVELOPMENT LIMITED (in creditor’s voluntary liquidation) (on behalf of itself and as assignee of Asia-Pac Infrastructure Finance Limited; Asia-Pac Group Investments Limited; & Greater Beijing Region Expressways Limited)

1st Plaintiff

ASIA-PAC INFRASTRUCTURE FINANCE LIMITED

2nd Plaintiff

ASIA-PAC GROUP INVESTMENTS LIMITED

3rd Plaintiff

GREATER BEIJING REGION EXPRESSWAYS LIMITED (on behalf of itself and as assignee of Greater Beijing First Expressways Limited (in Liquidation))

4th Plaintiff

SHEARMAN & STERLING (a firm)

1st Defendant

SHEARMAN & STERLING LLP (a firm, formerly known as SHEARMAN & STERLING)

2nd Defendant

ANTONIA E. STOLPER

3rd Defendant

DOUGLAS P. BARTNER

4th Defendant

ANDREW V. TENZER

5th Defendant

HSIAO-CHIUNG LI

6th Defendant

MATTHEW D. BERSANI

7th Defendant

EDWARD L. TURNER III

8th Defendant

HERBERT SMITH (a firm)

9th Defendant

Procedural Posture

Civil Action for Professional Negligence and Breach of Duty; Challenge to Validity of Assignments (maintenance and Champerty) / Trial of a Preliminary Issue (validity of Deeds of Assignment)

Legal Issues

  1. 1 Whether the Deeds of Assignment constituted assignments of a bare right to litigate and were therefore champertous and void
  2. 2 Whether the Assignments were supported by a genuine and pre-existing commercial interest
  3. 3 Whether the July 2009 transactions were engineered to evade security for costs

Ratio Decidendi

The court held each Deed of Assignment champertous and void because the claimed commercial interests were not genuine or pre-existing: the July 2009 transactions creating shareholdings and debt assignments were unexplained, likely engineered to evade security for costs, lacked evidence of payment or valuation, and therefore constituted assignments of a bare right to litigate contrary to public policy.

Court Disposition

Each of the Assignments is declared champertous and void; relief granted to the Shearman Defendants and Herbert Smith; costs nisi to Defendants with certificates for two counsel.

Orders

  • Declarations that the Deeds of Assignment dated 3 August 2009 are champertous and void
  • Relief granted in favour of the 1st–8th Defendants (Shearman Defendants) and 9th Defendant (Herbert Smith) as sought in para 85 of skeleton submissions (with modification to include HB)