GERMAN POOL (HK) LTD v. CHUEN KWONG HONG LTD

HCA 207/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 207 OF 2008

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D E C I S I O N

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1.  The plaintiff sued the defendant on the cause of action of passing off certain range hoods products which the plaintiff said they have the original copyright. 

2.  The issue before me is not whether there was a passing off.  The defendant was saying that they got the wrong person and therefore the summons should be dismissed.  The plaintiff however submitted that the summons should be adjourned to the trial with costs in the cause.  The defendant obviously said it could not agree and therefore the hearing today is not vacated and the defendant is now submitting that the plain and obvious case is the plaintiff got the wrong defendant.

3.  The plaintiff employed two investigators by the names Ada Chow and Edmond Chan.  On 23 January 2008 Ada Chan visited the defendant at the ground floor of 470G Reclamation Street in Kowloon and found that the premises was locked with a sign posted outside which said that the defendant had moved to the 2/F.  They went to the 2/F, the sign board had the company name “Chuen Kwong Hong”(全光行), and of course the defendant’s company was “Chuen Kwong Hong Limited”.  According to the defendant, Chuen Kwong Hong Limited was incorporated from the Chuen Kwong Hong Company which was apparently an unincorporated company. 

4.  The investigator was greeted by one Edmond Chuen Siu Man.  She purchased a sample range hood and got a written quotation from Edmond Chuen.  The quotation bears the name of Chuen Kwong Hong.  It was stamped with a chop of Sunny Eternal Limited and, when the investigator enquired further, Edmond Chuen said the investigator could regard Chuen Kwong Hong Limited and Sunny Eternal Limited as the same company.  She was told that Sunny Eternal Limited was only responsible for handling importation of range hoods from the Mainland whereas the defendant company was responsible for sales and distribution. 

5.  The papers before me revealed certain facts as follows ：Chuen Kwong Hong (Brothers) Trading Limited was incorporated on 26 July 2007 and Sunny Eternal Limited was incorporated on 25 October 2007.  There was a fax message received by customers of the defendant from three persons by the surname of Chuen, and they are Edmond Chuen Siu Man, Chuen Siu Fai and Chuen Siu Hung.  This document in Chinese said :

「對於近月本公司不幸發生之股權爭拗，我們三人(全少雄、全少輝、全少文)深感遺憾。現此事已交由律師磋商尋求解決，惟對各客戶做成之不便，深感抱歉。

若有任何疑問，可隨時致電：[——電話號碼]……」

That is a new telephone number which is not the stated telephone number of the defendant for the previous Chuen Kwong Hong.  The letterhead in Chinese was “全光行有限公司” and the English was just “Chuen Kwong Hong”, and the address was G/F, 470G Reclamation Street, Kowloon. 

6.  Apparently Mr Hui, counsel for the plaintiff submitted that although the Company Registry did not reveal any shareholdings of these three Chuens and the fact that the court was just told through Mr Lam, counsel for the defendant that these three Chuens were brothers and they were brothers of Chuen Tak, the owner of the defendant company; there was apparently a power struggle and dispute among the brothers and the three Chuens then formed Chuen Kwong Hong (Brothers) Trading Limited and Sunny Eternal Limited. 

7.  Be that as it may, the defendant had on 4 and 5 February 2008 published a notice in the Oriental Daily and Apply Daily, saying :

(1)  some companies were selling products similar to the defendant’s;

(2)  the defendant had not formed any “brother company” and the defendant is not related to a company situated in Reclamation Street;

(3)  the defendant had moved to Kwai Chung;

(4)  the defendant’s shop on G/F of Reclamation Street had already been closed since 5 December 2007; and

(5)  a telephone number was there and then stated.

8.  As a further complication, the evidence of the defendant revealed that, at page 314 of the exhibit bundle, Chuen Kwong Hong (Brothers) Trading Limited applied to register a trade mark of “Gastar” on 5 September 2007 and the application was published on 9 November 2007.  Shortly afterwards it was opposed by the defendant on 29 November 2007, their opposition was that they manufactured and sold cooking stove and gas cartridge and marketed the same under the brand name “GASTAR” in the mid-1980s — see page 446 of the 2^nd exhibit bundle.

9.  The investigator said the registered address of the defendant at the time of the investigation in January 2008 was still the Reclamation Street address but then at the time of issuing the writ on 5 February 2008 the address had been changed to one in Kwai Chung. 

10.  Mr Lam for the defendant informed me from the Bar table that that was wrong and in fact his instructions are that the registered address of the defendant had already been changed on 31 December 2007.  That dispute was not clearly revealed from document before me but, anyway, as submitted by Mr Hui, the relationship between Chuen Tak for the defendant company and the three Chuens for the Chuen Kwong Hong (Brothers) Trading Limited and Sunny Eternal are so enmeshed together.  The plaintiff would not be expected to know the exact relationship and even up to the time of Chuen Tak’s affidavit, Chuen Tak did not disclose the actual relationship or what is apparently on record is different from what the three Chuens are saying, and apparently the three Chuens, as I have said before, had certain beneficial interest in the share of the defendant. 

11.  This is not the time to resolve their dispute and, in fact, the three Chuens and Chuen Tak now involve in another piece of litigation.  To my mind it is not plain and obvious that the three Chuens in the name of Chuen Kwong Hong (Brothers) and Sunny Eternal were passing off the defendant as their company, and it is not plain and obvious that Edmond Chuen, when he was selling the sample range hood to the private investigator, he was not doing the same for and on behalf of the defendant company. 

12.  I would like to add some further points to support my ruling.  The papers also revealed that Sunny Eternal and Chuen Kwong Hong had their registered address at 2/F 470G Reclamation Street.  The 1/F is the address of a director of Sunny Eternal since 1 February 2008, and also the residential address of one Chuen Pui Tei and I was told by Mr Lam from the Bar table that that is the daughter of Chuen Tak, whereas Chuen Tak himself was reported to be residing at an address at Cornwall Street, Kowloon Tong.  I was told again by Mr Lam from the Bar table that that was only the correspondence address of Chuen Pui Tei.  In other words, if she was not residing there, why that was used as the correspondence address and why she did not state her actual residential address.  All these will remain to be seen at the trial.  The 1/F is the address of one of the directors of Sunny Eternal and the 26/F is possibly, I cannot put it any higher, owned by the defendant.

13.  Chuen Tak stated that the three Chuens were not Chuen Tak’s brothers but were only employees of the defendant and they were dismissed by the defendant when a notice was given to that effect on 14 November 2007. 

14.  Also, according to the plaintiff, the address of G/F in Reclamation Street, as printed on the brochures, can also be found in the defendant’s own website as of and up to, at least by 18 February 2008, and that is after the issuance of the present proceedings.  This is a contention which has to be tested at the trial.  All in all, I think the best course is to adjourn the summons to the trial.

Costs

15.  There was, as I have said, enmeshed relationship amongst the four brothers, and I agree with the plaintiff’s counsel that in relation to the present summons, the order should be costs in the cause.  That was the original offer and, of course, the usual order is to follow the event.  But it is not unreasonable for Mr Lam to raise all these points this morning and I propose to make an order of costs in the cause.  

16.  The summons is therefore adjourned to the trial with costs in the cause.