HCA392/2020 ESSILOR MANUFACTURING (THAILAND) CO., LTD v. G. DOULATRAM AND SONS (HK) LTD AND OTHERS - LawHero
HCA392/2020
高等法院（民事訴訟）Deputy High Court Judge Le Pichon3/9/2020[2020] HKCFI 2357
HCA392/2020
A A
HCA 392/2020
B [2020] HKCFI 2357 B
IN THE HIGH COURT OF THE
C C
HONG KONG SPECIAL ADMINISTRATIVE REGION
D COURT OF FIRST INSTANCE D
E ACTION NO 392 OF 2020 E
_____________
BETWEEN
F F
ESSILOR MANUFACTURING (THAILAND) CO., LTD Plaintiff
G G
and
H H
G. DOULATRAM AND SONS (HK) LIMITED 1st Defendant
I FUSION INTERNATIONAL TRADING GROUP 2nd Defendant I
CO., LIMITED
J J
rd
TCL OVERSEAS MARKETING LTD 3 Defendant
K K
HONG KONG CHUNTAI METAL PRODUCT 4th Defendant
LIMITED
L L
KG TEXTILES LTD 5th Defendant
M (Discontinued) M
N VGOVGO CO LTD 6th Defendant N
EVEREST AND COMPANY 7th Defendant
O O
KAMO TECHNOLOGY LIMITED 8th Defendant
P P
th
HONG KONG TAI JIA CO LIMITED 9 Defendant
Q (Discontinued) Q
SHANGHAI GENERAL PRODUCTS 10th Defendant
R R
IMP & EXP CO LIMITED (Discontinued)
S JIANPENG INTERNATIONAL 11th Defendant S
TRADING (HK) LTD (Discontinued)
T T
RENCHUN TRADING CO LIMITED 12th Defendant
U U
LONGRUN LED HK CO LIMITED 13th Defendant
V V
- 2 -
A A
YEKALON HK LIMITED 14th Defendant
B B
th
CHANGHONG (HONG KONG) TRADING LTD 15 Defendant
C C
RUCAS TECHNOLOGY CO LIMITED 16th Defendant
D THAKAR INTERNATIONAL LIMITED 17th Defendant D
(Discontinued)
E E
th
ALLIANCE TELECOM LIMITED 18 Defendant
F (Discontinued) F
CHINA SHANDONG GROUP LIMITED 19th Defendant
G G
(Discontinued)
H SHA YANG HONG KONG INDUSTRY 20th Defendant H
LIMITED (Discontinued)
I I
st
YANGYANG DOT NET LIMITED 21 Defendant
J J
JACKSON ENG LIMITED 22nd Defendant
(Discontinued)
K K
CHINA YIDA INVESTMENT CO LTD 23rd Defendant
L L
KRISHIV INTERNATIONAL LIMITED 24th Defendant
M
(Discontinued) M
DRAGON WOVEN INDUSTRIAL CO LTD 25th Defendant
N N
th
CONCORDIA TEXTILE TRADING LTD 26 Defendant
O (Discontinued) O
YAT SHING TEXTILE LIMITED 27th Defendant
P P
HONG KONG IVPS INTERNATIONAL 28th Defendant
Q LIMITED (Discontinued) Q
R BEST HORIZON GROUP LIMITED 29th Defendant R
(Discontinued)
S S
SHAOXING BIEN TEXTILE CO LIMITED 30th Defendant
(Discontinued)
T T
U U
V V
- 3 -
A A
WORLD EQUIPMENT (HONG KONG) 31st Defendant
B COMPANY LIMITED (Discontinued) B
C VMD. DAYA INTERNATIONAL 32nd Defendant C
CO., LIMITED (Discontinued)
D D
WISTON TECHNOLOGY LIMITED 33rd Defendant
E NKD COMPANY LIMITED 34th Defendant E
F SHANGHAI WELCOME TRADING CO LTD 35th Defendant F
YORK ENTERPRISE LTD 36th Defendant
G G
(Discontinued)
H HONG KONG RICHFUL TRADE LIMITED 37th Defendant H
I SHERAV (H.K.) LIMITED 38th Defendant I
(Discontinued
J J
NAGRANI (HK) LTD 39th Defendant
(Discontinued)
K K
TOP PARTS LIMITED 40th Defendant
L L
ACEMARK DISTRIBUTORS LIMITED 41st Defendant
M
(Discontinued) M
YIWU NERA TRADING COMPANY LIMITED 42nd Defendant
N (Discontinued) N
O LUEN FAT DEVELOPMENT LIMITED 43rd Defendant O
(Discontinued)
P P
SUNLOYAL INTERNATIONAL CO LIMITED 44th Defendant
(Discontinued)
Q Q
_____________
R R
Before: Deputy High Court Judge Le Pichon in Chambers
S Date of Hearing: 4 September 2020 S
Date of Decision: 4 September 2020
T T
Date of Reasons for Decision: 7 September 2020
U U
V V
- 4 -
A A
___________________________________
B B
REASONS FOR DECISION
C ___________________________________ C
D D
1. This is the application by Essilor Manufacturing (Thailand)
E E
Co Ltd (“the plaintiff”) for judgment in default of defence against Vgogo
F Co Ltd. (“D6”), pursuant to RHC Order 19, rule 7. At the conclusion of F
the hearing, judgment was entered for the plaintiff with reasons to be
G G
handed down on 7 September 2020.
H H
Background facts
I I
J
2. The plaintiff is a company incorporated in Thailand. It is a J
subsidiary of the Essilor Group, a leading manufacturer of spectacle
K K
lenses.
L L
3. This action arises in respect of a fraud perpetrated against
M the plaintiff by its employees, (in particular, Ms Phetporee, the Finance M
and Accounting Manager,) and other unknown persons who appear to
N N
have acted in concert with Ms Phetporee (collectively, “the fraudsters”).
O O
4. D6 is one of 44 defendants to the action brought by the
P P
plaintiff on 27 March 2020.
Q Q
5. The plaintiff’s claim against D6 is set out in its statement of
R claim dated 4 May 2020: R
S S
(1) The plaintiff is the holder of a US dollar bank account with
T JP Morgan Chase Bank NA in New York (“the JPM T
Account”).
U U
V V
- 5 -
A A
(2) Between 15 October and 11 December 2019, Ms Phetporee
B B
effected 87 fraudulent transfers (“First Layer Transfers”) of
C in total in excess of US $135 million from the JPM Account C
into bank accounts in Singapore held by fictitious vendors
D D
she had set up. Of that sum, approximately US $12 million
E was transferred by 5 of the fictitious vendors (“the First E
Layer Recipient(s)”) to the defendants in this action.
F F
(3) Drifa Pte Ltd (“Drifa”) was one of the First Layer Recipients
G G
holding a bank account with Oversea Chinese Banking Corp
H
Ltd (“OCBC”) in Singapore and into which account an H
I
aggregate sum of US $20,300,000 (being part of the stolen I
funds) was transferred between 16 October 2019 and
J J
11 December 2019.
K K
(4) Some of the stolen funds were then transferred by the First
L Layer Recipients (including Drifa) out of the Singaporean L
accounts to bank accounts held in Hong Kong (“the Second
M M
Layer Transfers”) of the defendants in this action (“Second
N Layer Recipients”). D6 is a Second Layer Recipient. N
O O
(5) Transfers of US $250,000 each were made from Drifa’s
P
bank account in Singapore to the HK bank account of D6 on P
8 November 2019 and 9 December 2019 respectively.
Q Q
(6) The plaintiff never authorised any of the First and/or Second
R R
Layer Transfers and does not know and never had any
S business, commercial or other dealings with any of the First S
and/or Second Layer Recipients.
T T
U U
V V
- 6 -
A A
(7) The plaintiff claims against D6 are for unjust enrichment and
B B
in constructive trust arising as a result of fraud.
C C
(8) The relief sought are the following:
D D
(a) declaratory relief to the effect that
E E
(i) the plaintiff is the owner of and has a
F proprietary interest over the 2 sums of F
US $250,000 each transferred to D6;
G G
(ii) the plaintiff is entitled to trace the said sums;
H H
and
I I
(iii) D6 holds the said sums on constructive trust for
J J
the plaintiff; and
K K
(b) an order for payment of the said sums to the plaintiff,
L
accounts and enquiries, costs and interest. L
M Procedural history M
N N
6. On 27 March 2020, Madam Justice Wong granted an
O
ex parte proprietary injunction over the plaintiff’s money which was paid O
into the defendants’ accounts and an ex parte Mareva injunction over the
P P
assets of the defendants in Hong Kong.
Q Q
7. The injunctions were continued by DHCJ Whitehead SC on
R 24 April 2020, pending the substantive hearing of the plaintiff’s R
continuation summonses which, in the case of D6, is fixed for hearing on
S S
11 September 2020.
T T
U U
V V
- 7 -
A A
8. The writ of summons was served on D6 on 27 March 2020.
B B
Solicitors for D6 filed a notice to act on 9 April 2020 and an
C acknowledgement of service on 22 April 2020. C
D 9. The statement of claim was served on 4 May 2020. D
E E
10. On 6 July 2020, the solicitors for D6 filed a consent
F summons. Master Anthony HK Chan made an order in terms on 7 July F
2020. The order made which was an “unless order” imposed a deadline of
G G
31 July 2020 for D6 to file (a) its defence and counterclaim; and (b) its
H evidence in opposition to the continuation of the injunction, failing which H
D6 would be debarred from filing the same and the plaintiff at liberty to
I I
apply for judgment to be entered against D6 with costs.
J J
11. On 21 July 2020, the plaintiff obtained default judgment
K K
against Drifa in the High Court of the Republic of Singapore including
L
declarations that L
M (1) the plaintiff is the owner of and, accordingly, has a M
proprietary interest over the sum of US$20,300,000
N N
transferred from the JPM Account into Drifa’s bank account
O held with OCBC; O
P P
(2) the plaintiff is entitled to trace the said sum and recover the
Q
same; and Q
R (3) Drifa holds the said sum on constructive trust for the R
plaintiff.
S S
T 12. D6 has not filed its defence and counterclaim nor any T
evidence in opposition to the continuation of the injunction.
U U
V V
- 8 -
A A
13. On 14 August 2020, the plaintiff’s summons for judgment
B B
pursuant to Order 19, rule 7 and its notice of intention to enter judgment
C in default of defence pursuant to Order 19, rule 8A were served on D6’s C
solicitors.
D D
14. On the same day, D6’s solicitors advised by letter that they
E E
have no further instructions to act for D6 in this action.
F F
This application
G G
15. The plaintiff’s case against D6 is that it is the recipient of an
H H
aggregate sum of US $500,000 through the perpetration of the fraud.
I
Details of the fraud and the tracing exercise undertaken by the plaintiff’s I
J
solicitors are set out in the 1st affirmation of Doris L’Henoret Ep J
Marcellesi dated 1 April 2020.
K K
16. The evidence shows that D6 received 2 payments of
L L
US $250,0001 on 8 November 2019 and 9 December 2019 respectively
M from the account held by Drifa with OCBC. Those payments were made M
by OCBC into D6’s bank account held with the Bank of China (Hong
N N
Kong) Limited (“BOC”).
O O
17. It is plain from the procedural history that despite having had
P P
legal representation since 9 April 2020, D6 has chosen not to file any
Q
defence nor any affirmation in opposition to the present application. Its Q
solicitors who are still on the record are in attendance but have no further
R R
instructions to act for D6.
S S
T T
1
As at 3 March 2020, there was a balance of US $174,954 in the BOC account.
U U
V V
- 9 -
A A
18. In the circumstances, having regard to the plaintiff’s pleaded
B B
case, I saw no reason why the court should not exercise its discretion
C under Order 19, rule 7 in the plaintiff’s favour. C
D 19. In addition to an order for payment of the aggregate sum of D
US $500,000 to the plaintiff, accounts and enquiries, interests and costs,
E E
2
declaratory relief sought by the plaintiff was also granted.
F F
20. The power to enter judgment under Order 19, rule 7 is
G G
discretionary. While it is not the normal practice of the court to make a
H declaration without a trial, it is a rule of practice which may be departed H
from when the plaintiff shows a genuine need for the declaratory relief
I I
and justice would not be done if such relief were denied: see HKCP 2020
J at 19/7/20; Lai Wai Kuen v Wong Shau Kwong [2004] 4 HKC 528, §6. J
K K
21. That approach was adopted in Mesirow Financial
L
Administrative Corporation v Best Link Industrial Co Ltd, unreported, L
HCMP 1846/2015, 25 January 2016, a case involving email fraud and
M M
most recently in the Decision dated 3 September 2020 of DHCJ Rachel
N
Lam SC in this action, granting default judgments against 8 other N
defendants.
O O
22. In those cases, declaratory relief was granted to secure the
P P
plaintiff’s proprietary (as distinct from a merely personal) claim since an
Q order for payment, without more, would only put the plaintiff in the Q
position of an unsecured judgment creditor.
R R
S 23. As the plaintiff is asserting proprietary claims and remedies S
in respect of any transfers from D6’s bank account of the plaintiff’s funds
T T
2
See §5(9) above.
U U
V V
- 10 -
A A
to third layer recipients or into substitute assets, there is clearly a genuine
B B
need for declaratory relief in order to earmark the funds received by D6
C as the plaintiff’s property. C
D Order D
E E
24. Accordingly, an order in terms of the plaintiff’s summons
F was made and the hearing of the summons to continue the injunction F
fixed for 11 September 2020 vacated.
G G
25. The plaintiff sought costs of the default summons against D6
H H
as well as a 1/44th share of the costs of the action, such costs to be
I I
summarily assessed. The court was referred to the costs order made in the
J
Decision dated 3 September 2020. J
K 26. Having perused the statement of costs, the aggregate costs of K
the default judgment summons including a 1/44th share of the costs of the
L L
action were summarily assessed at $150,000. The difference is accounted
M for by the fact that in the present case the costs of the default judgment is M
borne by D6 alone rather than being shared by a number of defendants.
N N
O O
P P
Q Q
(Doreen Le Pichon)
R Deputy High Court Judge R
S S
Mr Sebastian Hughes, instructed by Herbert Smith Freehills, for the plaintiff
T Mr Christopher Ho, of ONC Lawyers, for the 6th defendant T
U U
V V
ESSILOR MANUFACTURING (THAILAND) CO., LTD v. G. DOULATRAM AND SONS (HK) LTD AND OTHERS
A A
HCA 392/2020
B [2020] HKCFI 2357 B
IN THE HIGH COURT OF THE
C C
HONG KONG SPECIAL ADMINISTRATIVE REGION
D COURT OF FIRST INSTANCE D
E ACTION NO 392 OF 2020 E
_____________
BETWEEN
F F
ESSILOR MANUFACTURING (THAILAND) CO., LTD Plaintiff
G G
and
H H
G. DOULATRAM AND SONS (HK) LIMITED 1st Defendant
I FUSION INTERNATIONAL TRADING GROUP 2nd Defendant I
CO., LIMITED
J J
rd
TCL OVERSEAS MARKETING LTD 3 Defendant
K K
HONG KONG CHUNTAI METAL PRODUCT 4th Defendant
LIMITED
L L
KG TEXTILES LTD 5th Defendant
M (Discontinued) M
N VGOVGO CO LTD 6th Defendant N
EVEREST AND COMPANY 7th Defendant
O O
KAMO TECHNOLOGY LIMITED 8th Defendant
P P
th
HONG KONG TAI JIA CO LIMITED 9 Defendant
Q (Discontinued) Q
SHANGHAI GENERAL PRODUCTS 10th Defendant
R R
IMP & EXP CO LIMITED (Discontinued)
S JIANPENG INTERNATIONAL 11th Defendant S
TRADING (HK) LTD (Discontinued)
T T
RENCHUN TRADING CO LIMITED 12th Defendant
U U
LONGRUN LED HK CO LIMITED 13th Defendant
V V
- 2 -
A A
YEKALON HK LIMITED 14th Defendant
B B
th
CHANGHONG (HONG KONG) TRADING LTD 15 Defendant
C C
RUCAS TECHNOLOGY CO LIMITED 16th Defendant
D THAKAR INTERNATIONAL LIMITED 17th Defendant D
(Discontinued)
E E
th
ALLIANCE TELECOM LIMITED 18 Defendant
F (Discontinued) F
CHINA SHANDONG GROUP LIMITED 19th Defendant
G G
(Discontinued)
H SHA YANG HONG KONG INDUSTRY 20th Defendant H
LIMITED (Discontinued)
I I
st
YANGYANG DOT NET LIMITED 21 Defendant
J J
JACKSON ENG LIMITED 22nd Defendant
(Discontinued)
K K
CHINA YIDA INVESTMENT CO LTD 23rd Defendant
L L
KRISHIV INTERNATIONAL LIMITED 24th Defendant
M
(Discontinued) M
DRAGON WOVEN INDUSTRIAL CO LTD 25th Defendant
N N
th
CONCORDIA TEXTILE TRADING LTD 26 Defendant
O (Discontinued) O
YAT SHING TEXTILE LIMITED 27th Defendant
P P
HONG KONG IVPS INTERNATIONAL 28th Defendant
Q LIMITED (Discontinued) Q
R BEST HORIZON GROUP LIMITED 29th Defendant R
(Discontinued)
S S
SHAOXING BIEN TEXTILE CO LIMITED 30th Defendant
(Discontinued)
T T
U U
V V
- 3 -
A A
WORLD EQUIPMENT (HONG KONG) 31st Defendant
B COMPANY LIMITED (Discontinued) B
C VMD. DAYA INTERNATIONAL 32nd Defendant C
CO., LIMITED (Discontinued)
D D
WISTON TECHNOLOGY LIMITED 33rd Defendant
E NKD COMPANY LIMITED 34th Defendant E
F SHANGHAI WELCOME TRADING CO LTD 35th Defendant F
YORK ENTERPRISE LTD 36th Defendant
G G
(Discontinued)
H HONG KONG RICHFUL TRADE LIMITED 37th Defendant H
I SHERAV (H.K.) LIMITED 38th Defendant I
(Discontinued
J J
NAGRANI (HK) LTD 39th Defendant
(Discontinued)
K K
TOP PARTS LIMITED 40th Defendant
L L
ACEMARK DISTRIBUTORS LIMITED 41st Defendant
M
(Discontinued) M
YIWU NERA TRADING COMPANY LIMITED 42nd Defendant
N (Discontinued) N
O LUEN FAT DEVELOPMENT LIMITED 43rd Defendant O
(Discontinued)
P P
SUNLOYAL INTERNATIONAL CO LIMITED 44th Defendant
(Discontinued)
Q Q
_____________
R R
Before: Deputy High Court Judge Le Pichon in Chambers
S Date of Hearing: 4 September 2020 S
Date of Decision: 4 September 2020
T T
Date of Reasons for Decision: 7 September 2020
U U
V V
- 4 -
A A
___________________________________
B B
REASONS FOR DECISION
C ___________________________________ C
D D
1. This is the application by Essilor Manufacturing (Thailand)
E E
Co Ltd (“the plaintiff”) for judgment in default of defence against Vgogo
F Co Ltd. (“D6”), pursuant to RHC Order 19, rule 7. At the conclusion of F
the hearing, judgment was entered for the plaintiff with reasons to be
G G
handed down on 7 September 2020.
H H
Background facts
I I
J
2. The plaintiff is a company incorporated in Thailand. It is a J
subsidiary of the Essilor Group, a leading manufacturer of spectacle
K K
lenses.
L L
3. This action arises in respect of a fraud perpetrated against
M the plaintiff by its employees, (in particular, Ms Phetporee, the Finance M
and Accounting Manager,) and other unknown persons who appear to
N N
have acted in concert with Ms Phetporee (collectively, “the fraudsters”).
O O
4. D6 is one of 44 defendants to the action brought by the
P P
plaintiff on 27 March 2020.
Q Q
5. The plaintiff’s claim against D6 is set out in its statement of
R claim dated 4 May 2020: R
S S
(1) The plaintiff is the holder of a US dollar bank account with
T JP Morgan Chase Bank NA in New York (“the JPM T
Account”).
U U
V V
- 5 -
A A
(2) Between 15 October and 11 December 2019, Ms Phetporee
B B
effected 87 fraudulent transfers (“First Layer Transfers”) of
C in total in excess of US $135 million from the JPM Account C
into bank accounts in Singapore held by fictitious vendors
D D
she had set up. Of that sum, approximately US $12 million
E was transferred by 5 of the fictitious vendors (“the First E
Layer Recipient(s)”) to the defendants in this action.
F F
(3) Drifa Pte Ltd (“Drifa”) was one of the First Layer Recipients
G G
holding a bank account with Oversea Chinese Banking Corp
H
Ltd (“OCBC”) in Singapore and into which account an H
I
aggregate sum of US $20,300,000 (being part of the stolen I
funds) was transferred between 16 October 2019 and
J J
11 December 2019.
K K
(4) Some of the stolen funds were then transferred by the First
L Layer Recipients (including Drifa) out of the Singaporean L
accounts to bank accounts held in Hong Kong (“the Second
M M
Layer Transfers”) of the defendants in this action (“Second
N Layer Recipients”). D6 is a Second Layer Recipient. N
O O
(5) Transfers of US $250,000 each were made from Drifa’s
P
bank account in Singapore to the HK bank account of D6 on P
8 November 2019 and 9 December 2019 respectively.
Q Q
(6) The plaintiff never authorised any of the First and/or Second
R R
Layer Transfers and does not know and never had any
S business, commercial or other dealings with any of the First S
and/or Second Layer Recipients.
T T
U U
V V
- 6 -
A A
(7) The plaintiff claims against D6 are for unjust enrichment and
B B
in constructive trust arising as a result of fraud.
C C
(8) The relief sought are the following:
D D
(a) declaratory relief to the effect that
E E
(i) the plaintiff is the owner of and has a
F proprietary interest over the 2 sums of F
US $250,000 each transferred to D6;
G G
(ii) the plaintiff is entitled to trace the said sums;
H H
and
I I
(iii) D6 holds the said sums on constructive trust for
J J
the plaintiff; and
K K
(b) an order for payment of the said sums to the plaintiff,
L
accounts and enquiries, costs and interest. L
M Procedural history M
N N
6. On 27 March 2020, Madam Justice Wong granted an
O
ex parte proprietary injunction over the plaintiff’s money which was paid O
into the defendants’ accounts and an ex parte Mareva injunction over the
P P
assets of the defendants in Hong Kong.
Q Q
7. The injunctions were continued by DHCJ Whitehead SC on
R 24 April 2020, pending the substantive hearing of the plaintiff’s R
continuation summonses which, in the case of D6, is fixed for hearing on
S S
11 September 2020.
T T
U U
V V
- 7 -
A A
8. The writ of summons was served on D6 on 27 March 2020.
B B
Solicitors for D6 filed a notice to act on 9 April 2020 and an
C acknowledgement of service on 22 April 2020. C
D 9. The statement of claim was served on 4 May 2020. D
E E
10. On 6 July 2020, the solicitors for D6 filed a consent
F summons. Master Anthony HK Chan made an order in terms on 7 July F
2020. The order made which was an “unless order” imposed a deadline of
G G
31 July 2020 for D6 to file (a) its defence and counterclaim; and (b) its
H evidence in opposition to the continuation of the injunction, failing which H
D6 would be debarred from filing the same and the plaintiff at liberty to
I I
apply for judgment to be entered against D6 with costs.
J J
11. On 21 July 2020, the plaintiff obtained default judgment
K K
against Drifa in the High Court of the Republic of Singapore including
L
declarations that L
M (1) the plaintiff is the owner of and, accordingly, has a M
proprietary interest over the sum of US$20,300,000
N N
transferred from the JPM Account into Drifa’s bank account
O held with OCBC; O
P P
(2) the plaintiff is entitled to trace the said sum and recover the
Q
same; and Q
R (3) Drifa holds the said sum on constructive trust for the R
plaintiff.
S S
T 12. D6 has not filed its defence and counterclaim nor any T
evidence in opposition to the continuation of the injunction.
U U
V V
- 8 -
A A
13. On 14 August 2020, the plaintiff’s summons for judgment
B B
pursuant to Order 19, rule 7 and its notice of intention to enter judgment
C in default of defence pursuant to Order 19, rule 8A were served on D6’s C
solicitors.
D D
14. On the same day, D6’s solicitors advised by letter that they
E E
have no further instructions to act for D6 in this action.
F F
This application
G G
15. The plaintiff’s case against D6 is that it is the recipient of an
H H
aggregate sum of US $500,000 through the perpetration of the fraud.
I
Details of the fraud and the tracing exercise undertaken by the plaintiff’s I
J
solicitors are set out in the 1st affirmation of Doris L’Henoret Ep J
Marcellesi dated 1 April 2020.
K K
16. The evidence shows that D6 received 2 payments of
L L
US $250,0001 on 8 November 2019 and 9 December 2019 respectively
M from the account held by Drifa with OCBC. Those payments were made M
by OCBC into D6’s bank account held with the Bank of China (Hong
N N
Kong) Limited (“BOC”).
O O
17. It is plain from the procedural history that despite having had
P P
legal representation since 9 April 2020, D6 has chosen not to file any
Q
defence nor any affirmation in opposition to the present application. Its Q
solicitors who are still on the record are in attendance but have no further
R R
instructions to act for D6.
S S
T T
1
As at 3 March 2020, there was a balance of US $174,954 in the BOC account.
U U
V V
- 9 -
A A
18. In the circumstances, having regard to the plaintiff’s pleaded
B B
case, I saw no reason why the court should not exercise its discretion
C under Order 19, rule 7 in the plaintiff’s favour. C
D 19. In addition to an order for payment of the aggregate sum of D
US $500,000 to the plaintiff, accounts and enquiries, interests and costs,
E E
2
declaratory relief sought by the plaintiff was also granted.
F F
20. The power to enter judgment under Order 19, rule 7 is
G G
discretionary. While it is not the normal practice of the court to make a
H declaration without a trial, it is a rule of practice which may be departed H
from when the plaintiff shows a genuine need for the declaratory relief
I I
and justice would not be done if such relief were denied: see HKCP 2020
J at 19/7/20; Lai Wai Kuen v Wong Shau Kwong [2004] 4 HKC 528, §6. J
K K
21. That approach was adopted in Mesirow Financial
L
Administrative Corporation v Best Link Industrial Co Ltd, unreported, L
HCMP 1846/2015, 25 January 2016, a case involving email fraud and
M M
most recently in the Decision dated 3 September 2020 of DHCJ Rachel
N
Lam SC in this action, granting default judgments against 8 other N
defendants.
O O
22. In those cases, declaratory relief was granted to secure the
P P
plaintiff’s proprietary (as distinct from a merely personal) claim since an
Q order for payment, without more, would only put the plaintiff in the Q
position of an unsecured judgment creditor.
R R
S 23. As the plaintiff is asserting proprietary claims and remedies S
in respect of any transfers from D6’s bank account of the plaintiff’s funds
T T
2
See §5(9) above.
U U
V V
- 10 -
A A
to third layer recipients or into substitute assets, there is clearly a genuine
B B
need for declaratory relief in order to earmark the funds received by D6
C as the plaintiff’s property. C
D Order D
E E
24. Accordingly, an order in terms of the plaintiff’s summons
F was made and the hearing of the summons to continue the injunction F
fixed for 11 September 2020 vacated.
G G
25. The plaintiff sought costs of the default summons against D6
H H
as well as a 1/44th share of the costs of the action, such costs to be
I I
summarily assessed. The court was referred to the costs order made in the
J
Decision dated 3 September 2020. J
K 26. Having perused the statement of costs, the aggregate costs of K
the default judgment summons including a 1/44th share of the costs of the
L L
action were summarily assessed at $150,000. The difference is accounted
M for by the fact that in the present case the costs of the default judgment is M
borne by D6 alone rather than being shared by a number of defendants.
N N
O O
P P
Q Q
(Doreen Le Pichon)
R Deputy High Court Judge R
S S
Mr Sebastian Hughes, instructed by Herbert Smith Freehills, for the plaintiff
T Mr Christopher Ho, of ONC Lawyers, for the 6th defendant T
U U
V V