PACIFIC FOUNDATION SECURITIES LTD v. SUCCESS SEVEN LTD

HCMP 1201/2021

[2023] HKCFI 1816

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1201 OF 2021

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BETWEEN

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JUDGMENT

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INTRODUCTION

1.  This is the plaintiff’s application to enforce a charging order over the securities owned by the defendant and held in the securities account(s) maintained by the defendant with Spring Securities Limited, namely, 192,324,703 shares of Zhong Ji Longevity Science Group Limited (formerly known as Asia Pacific Silk Road Investment Company Limited) (“the Securities”).

BACKGROUND

2.  On 7 April 2020, the plaintiff commenced an action (HCA 401/2020 (“the HCA Action”)) and sued the defendant (as the 1^st defendant therein) and a Mr Jiang Jianhui (“Mr Jiang”) (as the 2^nd defendant therein) in connection with the breach of a loan agreement entered into between the plaintiff and the defendant herein on 10 October 2019, which resulted in loss and damage to the plaintiff.

3.  On 1 March 2021, the plaintiff obtained Judgment against the defendant and Mr Jiang in the HCA Action (“the Judgment”). Under the Judgment, the defendant and Mr Jiang were obliged to pay the plaintiff a sum of $13,059,424 together with interest thereon at the rate of 8% per annum from 6 April 2020 to 1 March 2021 and thereafter at Judgment rate until payment, together with fixed costs of $11,545.

4.  To enforce the Judgment against the defendant, the plaintiff obtained a Charging Order Absolute on 14 July 2021 to impose a charge on the legal and beneficial interest of the defendant in the Securities.

5.  By this action, the plaintiff seeks an order for sale of the Securities.

SERVICE OF THE COURT DOCUMENTS ON THE DEFENDANT

6.  Pursuant to the Order of Master Dick Ho on 8 September 2022, leave was granted to the plaintiff to issue Concurrent Originating Summons (“the Concurrent OS”) in these proceedings against the defendant.

7.  It is evident that the Concurrent OS was subsequently served on the defendant at its registered office in Cayman Islands.

8.  Despite the aforesaid service, no acknowledgment of service of the Concurrent OS has been entered for the defendant.

9.  I am also satisfied that the defendant has been duly notified of this hearing.

DISCUSSION

10.  Pursuant to Order 50 rule 9A of the Rules of the High Court (“RHC”), an application for an order for sale to enforce a charging order should be brought by originating summons pursuant to Order 88 of the RHC.

11.  This procedure has been followed herein, and I am satisfied that the other requirements imposed by virtue of Order 88 rule 5A(2) have been complied with.

12.  Since the defendant has failed to satisfy the Judgment, I consider that it is just to make the order for sale sought by the plaintiff.

ORDER

13.  I therefore make an order in terms of the Concurrent OS.

COSTS

14.  I order that the costs of these proceedings be to the plaintiff.  Such costs are assessed at $140,000, and shall be paid out of the sale proceeds of the Securities pursuant to paragraph 4(ii) of the Concurrent OS.