LAM MAN LAI AND ANOTHER v. OJ VC LTD AND OTHERS

LAM MAN LAI AND ANOTHER v. OJ VC LTD AND OTHERS

The applications by the Company and Mr Hui to be joined and to set aside the default judgment were refused. Although there was arguable merit that the Deed might prohibit creation or transfer of beneficial interests and thus might have affected the entitlement to declaratory relief, the applicants (particularly the Company via its controlling mind Mr Hui) had knowledge and opportunity to intervene earlier, Mr Hui had settled and ceased to be a party, and the balance of factors (finality, prejudice to plaintiffs, unexplained non-participation) meant the court in its discretion would not set aside the default judgment; joinder was therefore not justified and costs were ordered against the...

Citation
[2020] HKCFI 2495
Parties
1st Plaintiff: Lam Man Lai; 2nd Plaintiff: Hui Po Woon; 1st Defendant: OJ VC Limited; 2nd Defendant: Wong Chung Mang Jonah; 3rd Defendant: Hui Ha Lam; Intended 4th Defendant: SEMK Products (Holdings) Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
25 September 2020
Case Number
HCA985/2019
Procedural Posture
Civil Action Concerning Trusts, Equity and Company/share Disputes / Chambers Decision on Summons to Set Aside Default Judgment and Application for Joinder; Stay Application Considered
Outcome
Applications to set aside the Decision and for joinder of SEMK Products (Holdings) Limited and re-joinder of Mr Hui refused; limited stay continued pending any application to Court of Appeal; costs ordered against Mr Hui and the Company on a joint and several basis (nisi).
Legal Topics
Default Judgment, Setting Aside Judgment, Declaratory Relief, Joinder, Contractual Interpretation, Assignment Clause, Constructive Trust, Tracing
Source Language
EN
Trusts Equity Contract Civil Procedure Company Law Default Judgment Setting Aside Judgment Declaratory Relief +5 more

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Parties

Lam Man Lai

1st Plaintiff

Hui Po Woon

2nd Plaintiff

OJ VC Limited

1st Defendant

Wong Chung Mang Jonah

2nd Defendant

Hui Ha Lam

3rd Defendant

SEMK Products (Holdings) Limited

Intended 4th Defendant

Procedural Posture

Civil Action Concerning Trusts, Equity and Company/share Disputes / Chambers Decision on Summons to Set Aside Default Judgment and Application for Joinder; Stay Application Considered

Legal Issues

  1. 1 Whether proceedings are still extant such that judgment may be set aside
  2. 2 Whether a non-party/third party (the Company) or former defendant (Mr Hui) has locus to apply to set aside a default judgment
  3. 3 Whether the Deed's non-assignment/consent provisions and shareholders' agreement render the Declaration of Trust ineffective or void

Ratio Decidendi

The applications by the Company and Mr Hui to be joined and to set aside the default judgment were refused. Although there was arguable merit that the Deed might prohibit creation or transfer of beneficial interests and thus might have affected the entitlement to declaratory relief, the applicants (particularly the Company via its controlling mind Mr Hui) had knowledge and opportunity to intervene earlier, Mr Hui had settled and ceased to be a party, and the balance of factors (finality, prejudice to plaintiffs, unexplained non-participation) meant the court in its discretion would not set aside the default judgment; joinder was therefore not justified and costs were ordered against the...

Court Disposition

Applications to set aside the Decision and for joinder of SEMK Products (Holdings) Limited and re-joinder of Mr Hui refused; limited stay continued pending any application to Court of Appeal; costs ordered against Mr Hui and the Company on a joint and several basis (nisi).

Orders

  • Applications by the Company and Mr Hui to be joined and to set aside the Decision refused
  • Re-joinder of Mr Hui refused