WAN MING SUN v. WONG HOI KWAN AND ANOTHER

WAN MING SUN v. WONG HOI KWAN AND ANOTHER

Clause 5 was a condition and, being time‑bound under Clause 20, defendants repudiated the PASP by failing to deliver company documents; plaintiff validly accepted the repudiation on 8 May 2023; Clause 16(b) is not a penalty and is enforceable; plaintiff is entitled to return of deposits, liquidated damages equal to the deposits and a lien on the company shares; costs follow the event.

Citation
[2025] HKCFI 394
Parties
Plaintiff: Wan Ming Sun; 1st Defendant: Wong Hoi Kwan; 2nd Defendant: Cheng Sze Wai
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
21 January 2025
Case Number
HCMP1408/2023
Procedural Posture
Originating Summons (contract for Sale of Company Shares) / Judgment (court of First Instance)
Outcome
Judgment for plaintiff; PASP terminated for repudiation by defendants; plaintiff awarded return of deposits, liquidated damages and lien; costs to plaintiff
Legal Topics
Repudiation, Termination, Liquidated Damages, Penalty Clause, Lien, Due Diligence, Affirmation and Waiver
Source Language
EN
Contract Property Company Law Equity Repudiation Termination Liquidated Damages Penalty Clause +3 more

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Parties

Wan Ming Sun

Plaintiff

Wong Hoi Kwan

1st Defendant

Cheng Sze Wai

2nd Defendant

Procedural Posture

Originating Summons (contract for Sale of Company Shares) / Judgment (court of First Instance)

Legal Issues

  1. 1 Whether defendants repudiated the Provisional Agreement for Sale and Purchase (PASP) by failing to provide company documents pursuant to Clause 5
  2. 2 Whether the plaintiff affirmed or waived the breach or himself repudiated by non-payment of a further deposit
  3. 3 Whether Clause 16(b) is a penalty clause and unenforceable

Ratio Decidendi

Clause 5 was a condition and, being time‑bound under Clause 20, defendants repudiated the PASP by failing to deliver company documents; plaintiff validly accepted the repudiation on 8 May 2023; Clause 16(b) is not a penalty and is enforceable; plaintiff is entitled to return of deposits, liquidated damages equal to the deposits and a lien on the company shares; costs follow the event.

Court Disposition

Judgment for plaintiff; PASP terminated for repudiation by defendants; plaintiff awarded return of deposits, liquidated damages and lien; costs to plaintiff

Orders

  • Declaration that defendants repudiated the Provisional Agreement for Sale and Purchase dated 11 March 2023
  • Declaration that plaintiff validly accepted the repudiation by letter dated 8 May 2023 and is entitled to the return of the deposit in the total sum of HK$7,777,600