HONG JING CO LTD v. ZHUHAI KWOK YUEN INVESTMENT CO LTD

HONG JING CO LTD v. ZHUHAI KWOK YUEN INVESTMENT CO LTD

The court held that the defendant was liable as a constructive trustee and therefore accountable for all unauthorised profits/commissions (amount to be assessed at quantum); the plaintiff lost the chance to acquire the Debts and Properties and that loss is 100%, so contractual damages are assessed on a 100% loss of chance basis; and the appropriate valuation reference date for the Properties is 1 October 2009. The court also has jurisdiction to clarify its prior findings post-judgment.

Citation
HONG JING CO LTD v. ZHUHAI KWOK YUEN INVESTMENT CO LTD
Parties
Plaintiff: Plaintiff; Defendant: Defendant
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
23 February 2012
Case Number
HCA156/2006
Procedural Posture
Civil Breach of Contract and Fiduciary Duty / Post Judgment Clarification Application (application for Directions/orders After Liability Judgment)
Outcome
Application granted in part: further declarations and orders made clarifying liability and assessment approach.
Legal Topics
Constructive Trust, Fiduciary Duties, Loss of Chance, Valuation Date for Damages, Jurisdiction to Clarify Judgment
Source Language
EN
Contract Law Equity and Trusts Private International Law Civil Procedure Damages Law Constructive Trust Fiduciary Duties Loss of Chance +2 more

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Parties

Plaintiff

Plaintiff

Defendant

Defendant

Procedural Posture

Civil Breach of Contract and Fiduciary Duty / Post Judgment Clarification Application (application for Directions/orders After Liability Judgment)

Legal Issues

  1. 1 Whether the defendant is accountable as a constructive trustee for all unauthorised profits/commissions including an introduction fee of $171.99 million
  2. 2 Whether damages should be assessed on a loss of chance basis and, if so, the percentage chance lost by the plaintiff
  3. 3 The proper reference date for valuation of the Properties for assessment of quantum

Ratio Decidendi

The court held that the defendant was liable as a constructive trustee and therefore accountable for all unauthorised profits/commissions (amount to be assessed at quantum); the plaintiff lost the chance to acquire the Debts and Properties and that loss is 100%, so contractual damages are assessed on a 100% loss of chance basis; and the appropriate valuation reference date for the Properties is 1 October 2009. The court also has jurisdiction to clarify its prior findings post-judgment.

Court Disposition

Application granted in part: further declarations and orders made clarifying liability and assessment approach.

Orders

  • The defendant is liable to the plaintiff as a constructive trustee for all unauthorised profits/commissions received; the amount to be assessed at the quantum stage of the trial.
  • Damages for breach of the Memorandum of Understanding dated 11 November 2005 to be assessed on the basis that the plaintiff lost the chance of acquiring the Properties and the chance lost is 100%.