CHINACAST EDUCATION CORPORATION AND OTHERS v. CHAN TZE NGON AND OTHERS

CHINACAST EDUCATION CORPORATION AND OTHERS v. CHAN TZE NGON AND OTHERS

The application for leave to issue third party notices was dismissed because the 2nd defendant failed to show a useful or proper purpose for joinder given the plaintiffs' pleaded claim focuses on conspiracy and dissipation of assets rather than audit compilation errors; the notice lacked the mandatory particulars required by O.16 r.2 and did not adequately plead reliance on the Contribution Ordinance or demonstrate the requisite causal link and "same damage"; joinder would cause disproportionate delay, cost and multi‑jurisdictional complication and therefore the Court exercised its discretion to refuse leave.

Citation
CHINACAST EDUCATION CORPORATION AND OTHERS v. CHAN TZE NGON AND OTHERS
Parties
1st Plaintiff: CHINACAST EDUCATION CORPORATION; 2nd Plaintiff: CHINACAST TECHNOLOGY (BVI) LIMITED; 3rd Plaintiff: CHINACAST TECHNOLOGY (SHANGHAI) LIMITED; 4th Plaintiff: YUPEI TRAINING INFORMATION TECHNOLOGY LIMITED; 5th Plaintiff: CHINACAST (BEIJING) EDUCATION TECHNOLOGY LIMITED; 1st Defendant: CHAN TZE NGON; 2nd Defendant: ANTONIO SENA; 3rd Defendant: MA JIM LOK JIM; 4th Defendant: JIANG XIANGYUAN; 5th Defendant: FU WAI FAN; 6th Defendant: WONG DORA WING MAY; 7th Defendant: KWOK SHUK YIN; 8th Defendant: CHIN SWE DEE; 9th Defendant: THRIVING BLUE LIMITED; 10th Defendant: BEST DESTINY LIMITED; 11th Defendant: ISTHOCH ASSETS LIMITED; 12th Defendant: CAST GREAT LIMITED; 13th Defendant: NEW SHANGHAI INVESTMENTS LIMITED
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
9 October 2014
Case Number
HCA1062/2012
Procedural Posture
Civil Action High Court (interlocutory Application) / Application for Leave to Issue Third Party Notice (o.16 R.1/r.2) Interlocutory
Outcome
Application dismissed
Legal Topics
Third Party Notice, Order 16 R.1 and R.2, Civil Liability (contribution) Ordinance Cap 377, Pleading and Particulars, Delay and Proportionality
Source Language
EN
Civil Procedure Company Law Commercial Fraud Contribution and Indemnity Third Party Notice Order 16 R.1 and R.2 Civil Liability (contribution) Ordinance Cap 377 Pleading and Particulars +1 more

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Parties

CHINACAST EDUCATION CORPORATION

1st Plaintiff

CHINACAST TECHNOLOGY (BVI) LIMITED

2nd Plaintiff

CHINACAST TECHNOLOGY (SHANGHAI) LIMITED

3rd Plaintiff

YUPEI TRAINING INFORMATION TECHNOLOGY LIMITED

4th Plaintiff

CHINACAST (BEIJING) EDUCATION TECHNOLOGY LIMITED

5th Plaintiff

CHAN TZE NGON

1st Defendant

ANTONIO SENA

2nd Defendant

MA JIM LOK JIM

3rd Defendant

JIANG XIANGYUAN

4th Defendant

FU WAI FAN

5th Defendant

WONG DORA WING MAY

6th Defendant

KWOK SHUK YIN

7th Defendant

CHIN SWE DEE

8th Defendant

THRIVING BLUE LIMITED

9th Defendant

BEST DESTINY LIMITED

10th Defendant

ISTHOCH ASSETS LIMITED

11th Defendant

CAST GREAT LIMITED

12th Defendant

NEW SHANGHAI INVESTMENTS LIMITED

13th Defendant

Procedural Posture

Civil Action High Court (interlocutory Application) / Application for Leave to Issue Third Party Notice (o.16 R.1/r.2) Interlocutory

Legal Issues

  1. 1 Whether leave should be granted to issue third party notices against Tseung and Deloitte under O.16 r.1/r.2
  2. 2 Whether the 2nd defendant complied with the mandatory particulars requirements of O.16 r.2
  3. 3 Whether the Contribution Ordinance Cap 377 was pleaded and applicable and whether the "same damage" requirement is satisfied

Ratio Decidendi

The application for leave to issue third party notices was dismissed because the 2nd defendant failed to show a useful or proper purpose for joinder given the plaintiffs' pleaded claim focuses on conspiracy and dissipation of assets rather than audit compilation errors; the notice lacked the mandatory particulars required by O.16 r.2 and did not adequately plead reliance on the Contribution Ordinance or demonstrate the requisite causal link and "same damage"; joinder would cause disproportionate delay, cost and multi‑jurisdictional complication and therefore the Court exercised its discretion to refuse leave.

Court Disposition

Application dismissed

Orders

  • Application by 2nd defendant for leave to issue third party notices dismissed
  • Costs of the application (including reserved costs and hearing) awarded to the plaintiffs to be assessed under O.62 r.9A RHC at HKD 180000 to be paid by the 2nd defendant within 14 days from date of decision