BANGY CO LTD v. E. WAH REALTY LTD AND ANOTHER

BANGY CO LTD v. E. WAH REALTY LTD AND ANOTHER

Defendants produced detailed, contemporaneous and prima facie reliable evidence (affirmations, solicitor drafts and letters) raising triable issues of fact and law—principally the existence of an oral agreement of 13 January 1983 and related issues of lender consent and possible agency/alter ego—which made summary determination under Order 14 inappropriate; accordingly unconditional leave to defend was granted.

Citation
BANGY CO LTD v. E. WAH REALTY LTD AND ANOTHER
Parties
Plaintiff: Bangy Co. Ltd.; 1st Defendant (hca No.9605): E. Wah Realty Ltd.; 2nd Defendant (hca No.9605): Cheung Kung Hai; 1st Defendant (hca No.9604): Aik San Realty Ltd.; 2nd Defendant (hca No.9604): Chung Ming Fai
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
6 March 1984
Case Number
HCA9605/1983
Procedural Posture
Summary Judgment Application Under Order 14 / Application Heard; Unconditional Leave to Defend Granted (order 14)
Outcome
Summary judgment refused; unconditional leave to defend granted to Defendants in the Order 14 applications
Legal Topics
Assignment and Novation, Oral Agreement to Transfer Shares and Liabilities, Confession and Avoidance Defence, Alter Ego/agency of Corporate Group, Summary Judgment (order 14) Practice, Consent of Lenders to Transaction
Source Language
EN
Company Law Contract Law Guarantee Law Civil Procedure Agency Law Corporate Veil/piercing Assignment and Novation Oral Agreement to Transfer Shares and Liabilities +4 more

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Parties

Bangy Co. Ltd.

Plaintiff

E. Wah Realty Ltd.

1st Defendant (hca No.9605)

Cheung Kung Hai

2nd Defendant (hca No.9605)

Aik San Realty Ltd.

1st Defendant (hca No.9604)

Chung Ming Fai

2nd Defendant (hca No.9604)

Procedural Posture

Summary Judgment Application Under Order 14 / Application Heard; Unconditional Leave to Defend Granted (order 14)

Legal Issues

  1. 1 Whether an oral agreement of 13 January 1983 existed by which non‑defaulting shareholders agreed to purchase the defaulting shareholders' shares and assume their liabilities including the Guarantee
  2. 2 Whether the Defendants raised a genuine defence of confession and avoidance sufficient to defeat summary judgment under Order 14
  3. 3 Whether Bangy (assignee of lenders) is effectively the agent or alter ego of Sun Hung Kai such as to affect enforcement of the Guarantee (lifting the corporate veil)

Ratio Decidendi

Defendants produced detailed, contemporaneous and prima facie reliable evidence (affirmations, solicitor drafts and letters) raising triable issues of fact and law—principally the existence of an oral agreement of 13 January 1983 and related issues of lender consent and possible agency/alter ego—which made summary determination under Order 14 inappropriate; accordingly unconditional leave to defend was granted.

Court Disposition

Summary judgment refused; unconditional leave to defend granted to Defendants in the Order 14 applications

Orders

  • Unconditional leave to the Defendants to defend granted in both actions
  • Proceed to trial on the triable issues raised by the Defendants' defence