CHATWIN ENGINEERING LTD. v. EXPERT GLORY DEVELOPMENT LTD. AND ANOTHER

HCMP 1898/98

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1898 OF 1998

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J U D G M E N T

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1. I have read the papers which have been filed in court.

2. I am satisfied that there is a contract between the Plaintiff as "Contractor" and the 1st and 2nd Defendants as "Employers", and I am further satisfied that the Defendant companies (although they have not appeared today) have had adequate notice of these proceedings. I refer to the various affirmations of service filed on behalf of the Plaintiff's solicitors and to an undertaking given by Miss Cheng, counsel for the Plaintiff, that those instructing her will file a confirmatory affirmation within 2 days to the effect that the Annual Returns of these companies show that their registered office remain at the place where the process server has left the documents filed in court.

3. In relation to Clause 30 (4)(a), I accept Miss Cheng's submission that the Employer is obliged to set up a trust account in favour of the contractor. I refer to the cases of Rayack . v. Lampeter Meat Company Ltd. [1979] 12 BLR 30 which was applied and followed by Rhind J. in Concorde Construction Company Limited v. Colgan Company Limited [1984] 29 BLR 120. In the absence of any insolvency on the part of the Employers (and there is no evidence that these employers are insolvent), it is clear that the Contractor is entitled to have such a trust fund set up and to have these moneys deposited therein.

4. Accordingly, I would make an order in terms of the Re-amended Originating Summons save that the word "thereto" should be deleted from paras.1 and 2 and the word "Plaintiff's" in para.5 should be substituted by the word "Plaintiff".