THE YERRID LAW FIRM v. QIANSBAIZI TRADING LIMITED AND ANOTHER

THE YERRID LAW FIRM v. QIANSBAIZI TRADING LIMITED AND ANOTHER

The Court of Appeal allowed the appeals and set aside the default judgment and garnishee order conditionally because Tin Tat had demonstrated arguable factual prospects of establishing that it received the funds as a receiving agent and the legal issue of whether statutory or common law illegality defeats its restitutionary defences was not appropriate for summary determination; accordingly conditional relief (payment into court) was ordered rather than dismissing the applications on illegality grounds.

Citation
[2023] HKCA 788
Parties
Plaintiff (judgment Creditor): The Yerrid Law Firm; 1st Defendant: qiansbaizi trading limited; 2nd Defendant (judgment Debtor): tin tat TRADING co., limited; Garnishee: china citic bank international limited
Court
Court of Appeal
Jurisdiction
Hong Kong
Judgment Date
21 June 2023
Case Number
CACV313/2021
Procedural Posture
Civil Appeal (interlocutory) / Court of Appeal Decision on Appeals to Set Aside Default Judgment and Garnishee Order
Outcome
Appeals allowed; default judgment and garnishee order set aside conditionally
Legal Topics
Default Judgment, Setting Aside, Garnishee Order, Illegality Doctrine, Ministerial Receipt, Bona Fide Purchaser, Change of Position Defence, Anti‑money Laundering and Counter‑terrorist Financing Ordinance (cap 615) S40, Constructive Trust
Source Language
EN
Civil Procedure Restitution Agency Law Administrative/regulatory Law Banking Law Default Judgment Setting Aside Garnishee Order +6 more

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Parties

The Yerrid Law Firm

Plaintiff (judgment Creditor)

qiansbaizi trading limited

1st Defendant

tin tat TRADING co., limited

2nd Defendant (judgment Debtor)

china citic bank international limited

Garnishee

Procedural Posture

Civil Appeal (interlocutory) / Court of Appeal Decision on Appeals to Set Aside Default Judgment and Garnishee Order

Legal Issues

  1. 1 Whether the default judgment and garnishee order should be set aside
  2. 2 Whether breach of s40 Cap 615 (use of unnotified bank account) renders Tin Tat unable to rely on restitutionary defences
  3. 3 Whether Tin Tat was an agent/receiving agent entitled to plead ministerial receipt or bona fide purchaser for value without notice

Ratio Decidendi

The Court of Appeal allowed the appeals and set aside the default judgment and garnishee order conditionally because Tin Tat had demonstrated arguable factual prospects of establishing that it received the funds as a receiving agent and the legal issue of whether statutory or common law illegality defeats its restitutionary defences was not appropriate for summary determination; accordingly conditional relief (payment into court) was ordered rather than dismissing the applications on illegality grounds.

Court Disposition

Appeals allowed; default judgment and garnishee order set aside conditionally

Orders

  • Default judgment and garnishee order set aside upon Tin Tat paying into court US$200,000 within 28 days, with liberty to apply
  • Costs before the Master to the plaintiff