XU SHENGHENG AND ANTOHER v. CHEUNG KWAN

XU SHENGHENG AND ANTOHER v. CHEUNG KWAN

The court exercised its discretion under Order 15 r6 to dismiss the plaintiffs' application to strike out or separately try the counterclaim because the counterclaim raises issues connected with the main dispute and necessary for effectual and complete determination; striking out or severing would cause multiplicity, duplication, inconvenience and risk of inconsistent findings and plaintiffs had delayed in seeking relief; accordingly joinder and the counterclaim were permitted and costs were ordered nisi against the plaintiffs.

Citation
XU SHENGHENG AND ANTOHER v. CHEUNG KWAN
Parties
1st Plaintiff: Xu Shengheng; 2nd Plaintiff: Ever Sincere Investment Limited; Defendant (1st Defendant by Original Action; 1st Plaintiff by Counterclaim): Cheung Kwan; 2nd Plaintiff by Counterclaim: Financial International Holdings Limited; Defendant by Counterclaim: Aggarwal; Defendant by Counterclaim: Chan; Defendant by Counterclaim: Soo
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
22 July 2013
Case Number
HCA291/2009
Procedural Posture
Civil Claim for Repayment (money Had and Received) With Extensive Counterclaim Concerning Loans, Share Transactions and Alleged Commissions / Interlocutory Application to Strike Out Counterclaim / to Order Separate Trial Under Order 15 R5 and R6; Application Dismissed (decision of 22 July 2013)
Outcome
Application dismissed; counterclaim retained and joinder permitted
Legal Topics
Striking Out, Joinder, Counterclaim, Oral Agreement, Misjoinder, Order 15 R6, Costs
Source Language
EN
Civil Procedure Contract Law Company Law Securities Law Equity Striking Out Joinder Counterclaim +4 more

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Parties

Xu Shengheng

1st Plaintiff

Ever Sincere Investment Limited

2nd Plaintiff

Cheung Kwan

Defendant (1st Defendant by Original Action; 1st Plaintiff by Counterclaim)

Financial International Holdings Limited

2nd Plaintiff by Counterclaim

Aggarwal

Defendant by Counterclaim

Chan

Defendant by Counterclaim

Soo

Defendant by Counterclaim

Procedural Posture

Civil Claim for Repayment (money Had and Received) With Extensive Counterclaim Concerning Loans, Share Transactions and Alleged Commissions / Interlocutory Application to Strike Out Counterclaim / to Order Separate Trial Under Order 15 R5 and R6; Application Dismissed (decision of 22 July 2013)

Legal Issues

  1. 1 Whether a non‑party may be joined as co‑plaintiff to a counterclaim against an existing plaintiff
  2. 2 Whether a counterclaim that lacks a cross‑claim is a genuine counterclaim and should be struck out
  3. 3 Whether the counterclaim should be tried separately to avoid prejudice or delay to the plaintiffs' claim

Ratio Decidendi

The court exercised its discretion under Order 15 r6 to dismiss the plaintiffs' application to strike out or separately try the counterclaim because the counterclaim raises issues connected with the main dispute and necessary for effectual and complete determination; striking out or severing would cause multiplicity, duplication, inconvenience and risk of inconsistent findings and plaintiffs had delayed in seeking relief; accordingly joinder and the counterclaim were permitted and costs were ordered nisi against the plaintiffs.

Court Disposition

Application dismissed; counterclaim retained and joinder permitted

Orders

  • Application by the plaintiffs to strike out or order separate trial of the counterclaim dismissed
  • Plaintiffs to pay the costs of this application to Cheung and Financial with certificate for two counsel (costs nisi)