CHINA FINANCE & ASSETS MANAGEMENT LTD v. LAFE PROPERTIES (HONG KONG) LTD

CHINA FINANCE & ASSETS MANAGEMENT LTD v. LAFE PROPERTIES (HONG KONG) LTD

The court found on objective construction of the agreement and contemporaneous documents that the contracting party identified by company number 4650 was China Finance Samoa, not the plaintiff, and rejected the plaintiff's late, uncorroborated claim of a clerical mistake; extrinsic oral evidence attempting to place the cheque in escrow or to vary its unconditional nature failed the parol evidence rule or was not proved; statutory and unconscionability defences also failed; because the plaintiff was not the payee the action on the dishonoured cheque was dismissed and counterclaims failed.

Citation
CHINA FINANCE & ASSETS MANAGEMENT LTD v. LAFE PROPERTIES (HONG KONG) LTD
Parties
Plaintiff (original Action): China Finance & Assets Management Limited; Defendant (original Action): Lafe Properties (HK) Limited; Defendant (by Counterclaim): Carlos Chan; Defendant (by Counterclaim): Simon Choi
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
18 February 2015
Case Number
HCA526/2010
Procedural Posture
Action on Dishonoured Cheque / Judgment (trial)
Outcome
Claim dismissed; counterclaims dismissed
Legal Topics
Dishonoured Cheque, Identity of Payee, Conditional Delivery/escrow, Parol Evidence Rule, Construction and Rectification of Contracts, Implied Terms, Money Lenders Ordinance S.27(3), Conspiracy, Warranty of Authority
Source Language
EN
Commercial Law Contract Law Bills of Exchange/negotiable Instruments Statutory Interpretation Equity (unconscionability) Dishonoured Cheque Identity of Payee Conditional Delivery/escrow +6 more

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Parties

China Finance & Assets Management Limited

Plaintiff (original Action)

Lafe Properties (HK) Limited

Defendant (original Action)

Carlos Chan

Defendant (by Counterclaim)

Simon Choi

Defendant (by Counterclaim)

Procedural Posture

Action on Dishonoured Cheque / Judgment (trial)

Legal Issues

  1. 1 Whether the plaintiff was the named/payee party to the cheque and underlying agreement
  2. 2 Whether delivery of the cheque was conditional/held in escrow and thus not immediately enforceable
  3. 3 Admissibility of extrinsic/oral evidence to vary or qualify a cheque (parol evidence rule)

Ratio Decidendi

The court found on objective construction of the agreement and contemporaneous documents that the contracting party identified by company number 4650 was China Finance Samoa, not the plaintiff, and rejected the plaintiff's late, uncorroborated claim of a clerical mistake; extrinsic oral evidence attempting to place the cheque in escrow or to vary its unconditional nature failed the parol evidence rule or was not proved; statutory and unconscionability defences also failed; because the plaintiff was not the payee the action on the dishonoured cheque was dismissed and counterclaims failed.

Court Disposition

Claim dismissed; counterclaims dismissed

Orders

  • Action on dishonoured cheque dismissed
  • Counterclaims for conspiracy and breach of warranty of authority dismissed