STANDARD CHARTERED BANK (HONG KONG) LTD v. EASE KEEN INTERNATIONAL LTD AND OTHERS

STANDARD CHARTERED BANK (HONG KONG) LTD v. EASE KEEN INTERNATIONAL LTD AND OTHERS

The court held that the mortgage originating summonses should be converted into writ actions and tried together with the writ action because the FX derivative disputes were sufficiently linked to SCBHK's banking facilities and their resolution was necessary before the extent of indebtedness under the mortgages could be crystallised; borrowers are not precluded from raising equitable set-off or cross-claims and proceeding with the mortgage actions before resolving the writ action would risk prejudging core issues.

Citation
STANDARD CHARTERED BANK (HONG KONG) LTD v. EASE KEEN INTERNATIONAL LTD AND OTHERS
Parties
1st Plaintiff (hca 1622/2016): CLH Group (HK) Limited; 2nd Plaintiff (hca 1622/2016); 2nd Defendant (hcmp 2687/2016): Hunter Socks & Apparel International Limited; 3rd Plaintiff (hca 1622/2016): Wu Wing Che Deven; 4th Plaintiff (hca 1622/2016): Wu Tik Yan Terence; 5th Plaintiff (hca 1622/2016); 1st Defendant (hcmp 2687/2016 and HCMP 2688/2016): Ease Keen International Limited; 1st Defendant (hca 1622/2016) (london Bank): Standard Chartered Bank; 2nd Defendant (hca 1622/2016); Plaintiff (hcmp 2687/2016 and HCMP 2688/2016): Standard Chartered Bank (Hong Kong) Limited; 3rd Defendant (hcmp 2687/2016): Hunter Socks Knitting Factory (H.K.) Limited; 3rd Defendant (hcmp 2688/2016): Chong Luen Hing Garments Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
6 November 2017
Case Number
HCMP2688/2016
Procedural Posture
Civil: Writ Action for Rescission/damages (fx Derivatives) and Mortgage Enforcement Actions / Interlocutory Application for Consolidation and Conversion of Originating Summonses; Directions Given (conversion Ordered and Trial Directions)
Outcome
Interlocutory relief granted: mortgage originating summonses converted into writ actions and all actions to be tried before the same trial judge; directions issued for pleadings; order nisi for costs in the cause.
Legal Topics
Consolidation, Conversion of Originating Summons to Writ, Equitable Set Off, Mortgage Enforcement, Misrepresentation in Sale of Financial Products, Summary Determination, Trial Directions
Source Language
EN
Contract Banking Equity Property Civil Procedure Misrepresentation Consolidation Conversion of Originating Summons to Writ +5 more

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Parties

CLH Group (HK) Limited

1st Plaintiff (hca 1622/2016)

Hunter Socks & Apparel International Limited

2nd Plaintiff (hca 1622/2016); 2nd Defendant (hcmp 2687/2016)

Wu Wing Che Deven

3rd Plaintiff (hca 1622/2016)

Wu Tik Yan Terence

4th Plaintiff (hca 1622/2016)

Ease Keen International Limited

5th Plaintiff (hca 1622/2016); 1st Defendant (hcmp 2687/2016 and HCMP 2688/2016)

Standard Chartered Bank

1st Defendant (hca 1622/2016) (london Bank)

Standard Chartered Bank (Hong Kong) Limited

2nd Defendant (hca 1622/2016); Plaintiff (hcmp 2687/2016 and HCMP 2688/2016)

Hunter Socks Knitting Factory (H.K.) Limited

3rd Defendant (hcmp 2687/2016)

Chong Luen Hing Garments Limited

3rd Defendant (hcmp 2688/2016)

Procedural Posture

Civil: Writ Action for Rescission/damages (fx Derivatives) and Mortgage Enforcement Actions / Interlocutory Application for Consolidation and Conversion of Originating Summonses; Directions Given (conversion Ordered and Trial Directions)

Legal Issues

  1. 1 Whether HCMP 2687/2016 and HCMP 2688/2016 (mortgage originating summonses) should be converted into writ actions
  2. 2 Whether the mortgage actions should be stayed or consolidated/triable with HCA 1622/2016 (writ action)
  3. 3 Whether disputes arising from FX derivative agreements are inextricably linked to SCBHK banking facilities such that consolidation is necessary

Ratio Decidendi

The court held that the mortgage originating summonses should be converted into writ actions and tried together with the writ action because the FX derivative disputes were sufficiently linked to SCBHK's banking facilities and their resolution was necessary before the extent of indebtedness under the mortgages could be crystallised; borrowers are not precluded from raising equitable set-off or cross-claims and proceeding with the mortgage actions before resolving the writ action would risk prejudging core issues.

Court Disposition

Interlocutory relief granted: mortgage originating summonses converted into writ actions and all actions to be tried before the same trial judge; directions issued for pleadings; order nisi for costs in the cause.

Orders

  • HCMP 2687/2016 converted into a writ action
  • HCMP 2688/2016 converted into a writ action