DRAGONRIDER OPPORTUNITY FUND LP v. LAM FUNG AND ANOTHER

HCA 752/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 752 OF 2012

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J U D G M E N T

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1. There are two matters before the court. The first, HCA 752 of 2012, is an application under Order 86 by the plaintiff Dragonrider Opportunity Fund LP (“Dragonrider”) against the defendant Lam Fung (“Mr Lam”) for summary judgment in an action for specific performance of a put option contained in clauses 16.1 (b) and a 16.2 of the Investment Agreement dated 2 October 2007 (as amended by the Supplemental Agreement dated 12 November 2007) (the “Agreement”).

2. The second, HCMP 839 of 2012, is an originating summons for the enforcement of a Share Charge dated 12 October 2007 whereby Mr Lam charged his present and future rights in the Charged Portfolio by way of first fixed charge in favour of Dragonrider to secure due performance by him of material obligations under the Agreement.  In the event, the court’s determination of HCA 752 will also determine the outcome in HCMP 839 since a breach of the put option is the “event of default” relied on as triggering the Share Charge.

3. At the conclusion of the hearing judgment in both matters was reserved which I now give.

HCA 752 OF 2012

Background facts

4. In outline, Mr Lam owned interests in a molybdenum mining business and sought capital injections from investors with a view ultimately to securing a listing for that business.  Dragonrider agreed to become an investor on the basis that it would have the option of sharing the investment with further private investors pending listing.  If there was no listing, the investors would be entitled to require Mr Lam to repurchase shares under a put option exercisable during the option period as defined in the Agreement.

5. The Agreement was made between Mr Lam as “Vendor”, Fabulous Way (“the Company”) and Dragonrider as “Investor”.  Dragonrider agreed to purchase 230,700 ordinary shares representing approximately 23.07% of the issued share capital of the Company from Mr Lam in three tranches (the sale shares) and the total consideration payable was US$52.63 million.  The Agreement is governed by Singapore law.

6. Under clause 5.2, the shares were to be delivered in favour of “the Investor and/or its nominee(s) or assignees (the “Investor Nominees”), and/or such other person(s) as may be directed by the Investor (“Other Investors”)”.  Pursuant to that provision, upon completion, the sale shares came to be held by Dragonrider and 4 other investors, namely, Angel Wise (“Angel Wise”), Stark Moly Ltd (“Stark Moly”), SIG China Investments One Ltd (“SIG”) and Addgood Holdings Ltd (“Addgood”) who together (but excluding Dragonrider) will hereafter be referred to as “the Other Investors”.  Their respective holdings are:

3,397 shares	0.3397%	Dragonrider
87,033 shares	8.7033%	Angel Wise
87,669 shares	8.7669%	Stark Moly
32,876 shares	3.2876%	SIG
19,725 shares	1.9725%	Addgood
230,700 shares	23.07%

7. The key provisions of the Agreement for present purposes are the following:

“5.7 For the avoidance of any doubt, each of the Investor Nominees and/or Other Investor shall have the same obligations and rights as Dragonrider under this Agreement as if it is a party to this Agreement and may enjoy the benefit of or enforce the terms of this Agreement in accordance with the provisions of the Contracts (Rights of Third Parties) Act, Chapter 53B of Singapore. The Vendor and the Company agree that the Investor Nominees and the Other Investors, shall be entitled to exercise the rights over Ordinary Shares registered under their names, through Dragonrider.

...

16.1 Put Option

(a) In consideration of the sum of US $1.00 by the Investor (the sufficiency and receipt of which the Vendor hereby acknowledges), the Vendor hereby irrevocably grant to the Investor a right to require the Vendor to purchase all or part of the Ordinary Shares (“Put Option Shares”) held by the Investor at the Option Consideration on the terms and subject to the conditions of this Agreement (the “Put Option”) ...

(b) On the exercise of a Put Option by the Investor, the Vendor will become bound to purchase the Put Option Shares, and the Investor will become bound to complete, or to procure the completion of, the sale of the Put Option Shares on the Transfer Terms.

(c) Subject to Clause 16.1 (d), the Put Option may be exercised by the Investor in respect of all or part of the Ordinary Shares held by him by serving on the Vendor the Put Option Notice by facsimile or by registered post or by hand only during the Option Period ... failing which it will lapse and cease to have any further effect. The Put Option Notice shall not be served on the Vendor in the event that a Listing has occurred.

...

(f) For the avoidance of doubt, the Put Option shall be exercisable by the Investor for such number of times as he may desire during the Option Period ... subject always to the provisions of Clause 16.1 (a) to (e).

(g) For the avoidance of doubt, notwithstanding anything to the contrary herein, the Put Option shall lapse and cease to have any further effect upon a Listing occurring.

16.2 The Option Completion shall take place at such place as the Parties may agree on the date falling fourteen (14) days after the Exercise Date ... or such other date as the Investor and the Vendor may agree. On Option Completion: -

(a) the Investor shall deliver to the Vendor the share certificate(s) together with valid share transfer forms in respect of the Put Option Shares or otherwise procure the delivery of the Put Option Shares; and

(b) the Vendor shall deliver to the Investor cash, cheque or any other means as may be agreed between the Vendor and the Investor, payable to the Investor, and/or its nominee(s), for the full amount of the Option Consideration.

...”

8. The put option was exercisable during the put option period.  It is common ground that the put option period was extended on three occasions, by letters dated 30 December 2009, 30 January 2010 and 26 February 2010 signed, inter alia, by Mr Lam on behalf of himself and as authorised director of the Company.  The put option period expired on 31 March 2010.

9. On 3 December 2009, SIG served a put option notice dated 1 December 2009 on Mr Lam in respect of its holding of the sale shares (“the SIG shares”).  On 30 December 2009 Stark Moly also served a put option notice on Mr Lam in respect of its holding of the sale shares (“the Stark Moly shares”).  For convenience, the notices served by SIG and Stark Moly will hereafter be referred to as “the prior notices”.

10. Under the terms of clause 16.2 of the Agreement, completion was due 14 days after service of the relevant put option notice, absent any agreement between the Investor and the Vendor that it should occur on some other date.  There is no evidence of any such agreement.  Completion of the put options exercised by SIG and Stark Moly did not take place on 17 December 2009 and 13 January 2010 respectively, being the dates on which completion should have place pursuant to clause 16.2 of the Agreement.

11. Stark Moly commenced proceedings (HCA 1581/2010) against Mr Lam on 21 October 2010 seeking specific performance of the put option it had exercised.  Reyes J granted specific performance against Mr Lam on 2 August 2011.  SIG also commenced proceedings (HCA 219/2011) against Mr Lam on 2 February 2011 for specific performance of the put option it had exercised.  The master granted summary judgment against Mr Lam on 14 December 2011.  Mr Lam’s appeal was dismissed by Poon J on 16 March 2012.

12. Meanwhile, on 30 March 2010, Dragonrider faxed a put option notice (“the Dragonrider notice”) to Mr Lam.  The Dragonrider notice read:

“PUT OPTION NOTICE

We refer to the Investment Agreement dated 2 October 2007 between (1) the Vendor (as defined in the Agreement), (2) the Company (as defined in the Agreement), (3) and ourselves, as amended by the Supplemental Agreement dated 12 November 2007 (collectively, the “Agreement”) and the letters from inter alia the Vendor to ourselves dated 30 December 2009, 30 January 2010 and 26 February 2010.

Terms defined in the Agreement shall have the same meanings in this Put Option Notice unless the context requires otherwise. References to a Clause are to a clause of the Agreement.

We hereby notify you pursuant to Clauses 5.7 and 16.1 (c) of the Agreement that we wish to exercise the Put Option granted under Clause 16.1 of the Agreement to require you to buy 230,700 Ordinary Shares¹ at US$82,660,962, per calculation in the footnote below.²

Yours faithfully,

ASIASONS PRIVATE EQUITY INC

For and on behalf of

DRAGONRIDER OPPORTUNITY FUND L.P.

[Signature]

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JARED LIM CHIH LI

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¹ The 230,700 Ordinary Shares comprise of the 3,397, 87,033, 87,669, 32,876 and 19,725 Ordinary Shares registered in the names of Dragonrider Opportunity Fund L. P., Angel Wise Limited, Stark Moly Limited, SIG China Investments One, Ltd and Addgood Holdings Limited respectively.

² Principal Amount = US$52,630,000

18% IRR compounded monthly= 1.5% per month

Assuming that Option Completion occurs on 13 April 2010 (14 days after Exercise Date pursuant to Clause 16.2 of the Investment Agreement)

No. of months elapsed from the Completion Date of Tranche Sale Shares (3 October 2007) to Option Completion Date (13 April 2010) = 30.32

  Option Consideration = US 52,630,000 x (1.015)^ 30.32”

13. Mr Lam having failed to complete pursuant to clause 16.2, Dragonrider made a demand on 2 April 2012 under the Share Charge and on 30 April 2012 took out an originating summons (HCMP 839 of 2012) to enforce the Share Charge.  It then commenced HCA 752 on 9 May 2012 and on 14 June 2012 took out this summons (under Order 86) for specific performance of the Dragonrider put option.

14. Stark Moly intervened by summons dated 30 November 2012 in HCA 752.  It had advanced a loan to Angel Wise on 12 November 2007 secured by a share charge.  Angel Wise was placed in liquidation on 19 March 2012 by order of the court of the BVI.  By an order of Master Kwang dated 3 December 2012, Stark Moly was joined as the 2^nd defendant in HCA 752 and the Order 86 summons regarding Angel Wise’s shares was hived off to be heard together with Stark Moly’s summons.

15. Accordingly, the Order 86 application is now only pursued in respect of the shares held in the name of Dragonrider and Addgood.  Dragonrider has expressly stated that in this application it does not seek specific performance in relation to the Stark Moly shares and the SIG shares.

The issues

16. Mr Lam challenged the validity of the Dragonrider notice on 2 grounds: (1) that Dragonrider did not have the requisite authority to issue the notice; and (2) the put option was not validly exercised as construed in accordance with Singapore law.

17. The expert evidence on Singapore law before the court consisted of (1) the expert opinion of Professor Tan dated 23 August 2012; (2) the expert opinion of Mr Lim of Aequitas Law LLP dated 28 December 2012; and (3) the supplemental expert opinion of Professor Tan dated 14 January 2013.

Authority

18. Mr Kwok, counsel for the defendant, submitted that as a matter of Singapore law, for the Dragonrider notice to be valid, there had to be authority from the other investors at the time the Dragonrider notice was faxed.  Mr Kwok’s submission does not appear to be an entirely accurate statement of Singapore law.  Both Professor Tan (at § 3.8(a) of his expert opinion) and Mr Lim (at § 23(b) of his expert opinion) considered subsequent ratification as sufficient.

19. Be that as it may, in his defence as well as his affirmation in opposition, Mr Lam alleged that Dragonrider did not have authority to act for Stark Moly and Angel Wise.  In the case of Stark Moly, reliance was placed on a letter dated 24 September 2010 from the solicitors then acting for Stark Moly which asserted that the Dragonrider notice was invalid, inter alia, because of clause 2.3(a) of a Co-Investment Agreement which provided that the co-investor’s written consent had to be obtained before Dragonrider could exercise rights on its behalf.  By way of answer, Dragonrider exhibited e-mail correspondence exchanged between Stark Moly’s agents and Asiasons Equity LLP (“Asiasons”) which manages and controls Dragonrider.  In the last of the e-mails dated 29 December 2009, Dragonrider was expressly authorised to include Stark Moly’s holding in its put option notice because Stark Moly considered that there was some ambiguity as to who should issue the put option notice.

20. In the case of Angel Wise, the defendant’s objection was founded on Angel Wise’s liquidation and the absence of consent from its liquidators.  This is not a live issue in these proceedings because of the hiving off of the Angel Wise shares.  However, factually, Mr Lam is wrong because there is a board resolution of Angel Wise dated 1 March 2010 (which pre-dates its being placed in liquidation) conferring the requisite authority on Dragonrider.

21. Accordingly, so far as any objection based on the absence of authority from Stark Moly and Angel Wise is concerned, it has no merit and falls to be rejected.

22. In addition to the particularised objections in Mr Lam’s affirmation, in § 7.3 of the skeleton argument of Mr Kwok, it was contended that the exercise of the put option by Dragonrider was without authority and hence invalid, citing the absence of evidence of authority from Addgood as a reason.  Then, in his oral submissions at the hearing, Mr Kwok raised for the first time the absence of evidence of authority from SIG as another reason why the Dragonrider notice was invalid.

23. No reference to the absence of authority from Addgood and SIG can be found in either the defence or Mr Lam’s affirmation.  The absence of authority from Addgood was apparently raised orally before the master at the first hearing of the Order 86 summons on 3 December 2012.  The master took the view that since it was not a matter that the defendant had raised in evidence, Dragonrider did not have to answer it.  There was no application from Mr Lam to put in evidence.  Nevertheless, Mr Kwok’s stance in these proceedings was that the master was wrong and that it was a matter for Dragonrider to bring forward evidence which it has failed to do and, as matters stand, there is no evidence before the court.

24. In proceedings for summary judgment, it is incumbent on the defendant to show that there is a triable issue or an arguable defence “by affidavit or otherwise”.  In practice, an affidavit is generally required.  Further, it is trite law that the defendant’s affidavit must “condescend upon particulars”, stating clearly and concisely what the defence is and what facts are relied on to support it.  The plaintiff is accorded the opportunity to answer the defendant’s affidavit and to show that there is no issue to try or that the evidence of the defendant is not reasonably capable of belief.  See Hong Kong Civil Procedure 2013 at 14/4/3-14/4/4; 14/4/6.

25. The defendant did “condescend upon particulars” in relation to authority from Stark Moly and Angel Wise (see §§ 19 and 20 above) but failed to do so in relation to Addgood and SIG.  I agree with Ms Ismail who appeared for Dragonrider that it is now too late for the defendant to raise any absence of authority point in relation to Addgood and SIG.  I reject the submission that there is a triable issue based on the absence of authority.

Validity or otherwise of the Dragonrider notice

26. The defendant contended that the Dragonrider notice was not a valid notice for two reasons:

(a) The Dragonrider notice which exercised the put option in respect of the entire holding of 230,700 shares was not severable such as to render it valid in respect of part only of those shares (“the severability issue”).

(b) Insofar as the Dragonrider notice purported to exercise the put option in respect of the Stark Moly shares and the SIG shares, it was invalid because by reason of the prior notices there was no longer any subject matter over which the put option in respect of those shares could be exercised.

(a) The severability issue

27. Professor Tan does not consider that any issue of severability arises.  In his view, what needs to be considered is whether the Dragonrider notice was valid, being a notice not only in respect of Dragonrider’s own holding of the sale shares but extending to the shares of the Other Investors.  If, as is his view, it may validly subsist with the prior notices, enforcement for non-performance by Mr Lam is a separate matter.

28. Mr Lim takes a different view and considers that there is a severability issue.  Nevertheless, the experts are agreed that should there be an issue, the matter would then be one of interpretation - whether the Dragonrider notice related to an indivisible holding of shares or otherwise.

29. The experts disagree on the interpretation of the Dragonrider notice but do not disagree as to the applicable principles of Singapore law on the interpretation of contracts.  Ms Ismail cited the principles encapsulated in the majority and minority judgments of the Court of Appeal of Singapore in Yamashita Tetsuo v See Hup Seng Ltd [2009] 2 SLR(R) 265 at §§ 60-65 (the majority judgment) and §§ 18-21 (the minority judgment).  Mr Lim expressed substantially similar principles in § 21 (i) of his expert opinion.

30. The relevant principles may be summarised as follows:

(i) the Court’s fundamental task is to ascertain the objective intention of the parties;

(ii) the contextual approach (which requires construing a document in the context of its factual matrix or surrounding circumstances) rather than the literal approach is to be adopted and, in appropriate cases, the contextual approach involves a consideration of the commercial purpose of the contract in question; and

(iii) extrinsic evidence may be admissible if it is relevant, reasonably available to all contracting parties and relates to a clear or obvious context.

31. Questions of contractual interpretation are matters for the court rather than the experts.

32. It is common ground that the Dragonrider notice was issued within the option period in the form and manner prescribed for the exercise of the put option.  The only issue is the objective intent of the Dragonrider notice.

33. Mr Kwok stressed the importance of clause 16.1 (b) since the Vendor (i.e. Mr Lam) will become bound to purchase the put option shares.  It was said that the Vendor must know precisely the put option shares that were the subject of the notice because he becomes obligated to perform the contract.  (As an aside, it is to be observed that performance of contractual obligations is hardly the first priority of Mr Kwok’s client.)  On its face, the Dragonrider notice extended to the entire holding of 230,700 shares at the price of US$82,660,962.  All that, it was submitted, pointed to the put option being exercised in respect of an indivisible or inseparable holding.

34. I do not agree.  With respect, the approach of Mr Kwok is a literal approach rather than a contextual approach which would not be consonant with the applicable principles of Singapore law.  In my view, fairly read and read as an entire document, the Dragonrider notice gives clear notice to the addressee of the notice that the put option was being exercised by Dragonrider itself and all the Other Investors through Dragonrider in respect of their respective holdings or blocks of shares as particularized in footnote 1 to the Dragonrider notice.  No ambiguity arises nor is any thereby created.  Nor do I consider the statement of the total consideration payable decisive.  Footnote 2 explains the calculation that gives effect to the consideration provided for in the Agreement and the consideration payable for each block of sale shares is only a matter of arithematic.

35. The Dragonrider notice has to be viewed in the context of facts known to the parties at the time.  It does not exist in a vacuum.  By the date of the Dragonrider notice, the prior notices had already been served but produced no tangible results because as Mr Kwok frankly admitted, his client simply did not pay so completion could not take place.

36. Objectively viewed, there is nothing that renders the Dragonrider notice a notice in respect of an inseparable or indivisible block of shares.  The reading advocated by Mr Kwok is not the natural reading and must be rejected.

(b) Lack of subject matter

37. The experts are agreed that under Singapore law, the first sentence of clause 5.7 has the effect of enabling each of the Other Investors to exercise the put option in respect of any or all of the shares held in its name.  The second sentence gives each of the Other Investors the option of exercising the put option in respect of the shares held in its name through Dragonrider.  So an investor such as Stark Moly and SIG may exercise the put option by serving a notice in its own name (as they have done) or exercising it through Dragonrider.

38. As I understand it, Mr Kwok’s submission is that because of the prior notices of Stark Moly and SIG, their respective put options had been ‘spent’ by the time of the Dragonrider notice.  Mr Kwok made the further submission that the lack of subject matter vis-à-vis the Stark Moly and SIG shares had the effect of invalidating the Dragonrider notice. But that would only be so if the Dragonrider notice pertained to an inseparable block of shares, an interpretation that I have already rejected.

39. In this connection, §3.6 (c) of Professor Tan’s opinion is instructive:

“In my opinion, if Dragonrider was authorized by all the Investor Nominees and Other Investors to issue the Put Option Notice, such Put Option Notice is valid even if SIG and Stark Moly had issued Put Option Notices of their own in relation to the Ordinary Shares in their names. I am of the view that all the Put Option Notices may validly subsist together. The purpose of the Put Option Notices is to enable Dragonrider, the Investor Nominees and the Other Investors to exercise their rights to sell the Ordinary Shares back to Mr Lam. I can see nothing under Singapore law that would preclude a person giving notice personally and at the same time authorizing an agent to give the same notice on the said person’s behalf so long as this does not impose any additional obligations on the obligor …”

40. The defendant’s expert did not comment on this aspect of Professor Tan’s expert opinion.  Had Mr Lim taken a different view of Singapore law, no doubt he would have said so.  He did not.  Significantly, Mr Lim made no reference to any ‘lack of subject matter’ as such or an option being ‘spent’ once it has been exercised in respect of a particular block of shares.  All Mr Lim said (at § 21(h) of his expert opinion) was that it was a matter of interpretation of the Dragonrider notice as to whether its validity is affected by the prior notices and, if so, the extent to which it is so affected.  That of course turns on the severability issue considered above.

41. Mr Lim then opined (at § 21 (m) and (n) of his expert opinion) that if the Dragonrider notice relates to the exercise of a put option for the severable put option rights of each of the respective shareholders named in footnote 1 to the Dragonrider notice, that notice would remain valid whether it should be construed as the exercise of a put option for all the shareholders named in footnote 1 (thereby incorporating a fresh put option notice for SIG and Stark Moly) or the exercise of a put option only in relation to the shares held by Dragonrider, Angel Wise and Addgood.

42. The evidence in relation to the Stark Moly authority showed that Stark Moly was adopting a ‘belt and braces’ approach concerning the exercise of the put option as it considered that there was some doubt whether it was entitled to exercise it in its own name.  So if the first notice was invalid for whatever reason, the Dragonrider notice would salvage the situation.  As regards SIG, no issue as to Dragonrider’s authority arises for the reasons explained earlier.

43. I am satisfied that under Singapore law the prior notices per se did not and could not invalidate the Dragonrider notice.  Further, absent evidence of intent on the part of SIG and Stark Moly that the Dragonrider notice should supersede the prior notices, there is no reason to infer or impute any intention on their part that the Dragonrider notice should replace the prior notices which, after the date of the Dragonrider notice, have been held to be valid notices and in respect of which orders for specific performance have been obtained.  Mr Kwok’s absence of subject matter argument has no apparent legal basis and is to be rejected.

Conclusion

44. For the reasons stated, Dragonrider and Addgood are entitled to specific performance of clause 16.1 (b) and 16.2 of the Agreement with interest on the option consideration at judgment rate from the date of this order until payment.  I also make an order nisi of costs in favour of Dragonrider.  Agreed minutes of order should be submitted for approval.

HCMP 839 OF 2012

Background facts

45. As earlier noted, on 12 October 2007, 10 days after entering into the Investment Agreement, Mr Lam executed a Share Charge by way of a first fixed charge over the Charged Portfolio in favour of Dragonrider to secure performance of his obligations under the Agreement.  At that date, Mr Lam owned 100% of the Company which in turn was the 100% owner of Wiseking Mining Investment Company Ltd (“Wiseking”), a company owning mining interests in the PRC.  After the date of the Agreement, Mr Lam held 71.93% of the shares in the Company with Dragonrider and the Other Investors holding 23.07%.

46. Under the Share Charge, made between Mr Lam as legal and beneficial owner of the Charged Portfolio and Dragonrider as Security Agent, Mr Lam charged all his present and future rights, title and interest in the Charged Portfolio in favour of Dragonrider as security trustee for itself and the Other Investors by way of first fixed charge.  The Charged Portfolio comprised (1) 55% of the shares in the share capital of the Company held by, to the order or on behalf of Mr Lam (“the Shares”) and (2) ”Related Assets” defined as meaning “all dividends, interest and other monies paid or payable in respect of the Shares and all other rights, benefits and proceeds in respect of or derived from the Shares (whether by way of redemption, bonus, preference, option, substitution, conversion or otherwise)”.

47. Mr Lam warranted that he was and would all times be the sole, absolute, legal and beneficial owner of the Charged Portfolio.  Prior to an Event of Default (which as defined includes the default by Mr Lam in the due performance of any material obligation under the Agreement where such default was not remedied within 7 days of it arising), Mr Lam was entitled, inter alia, to receive all income from the Charged Portfolio.

48. By Clause 5.4, at any time after the occurrence of an event of default, Mr Lam was required upon demand by Dragonrider to (a) procure the transfer of the Charged Portfolio into the name of Dragonrider or its nominee(s), agents or such purchasers as directed and (b) do all such things as Dragonrider may require to facilitate realisation of the Charged Portfolio.  The Security Charge is governed by Singapore law.

49. Prior to 25 February 2009, Mr Lam transferred part of his holding in the Company to Full Harbour International Ltd whose sole shareholder is Mr Lam’s son.  On or about 25 February 2009, Wiseking was restructured.  As a result, Dragonrider and the Other Investors held 22.8393% of the issued share capital of Wiseking with the remaining 0.2307% held by the Company on trust for Dragonrider and the Other Investors while Mr Lam and Full Harbour respectively held 51% and 20.93% of Wiseking.

50. On 2 April 2012, Dragonrider made a demand on Mr Lam pursuant to clause 5.4 requiring the latter to transfer or procure the transfer of the Charged Portfolio into Dragonrider’s name within 7 days.  The event of default relied on was Mr Lam’s failure to comply with the Dragonrider notice and purchase the put option shares.  The letter identified the Charged Portfolio as comprising 55% of the shares in the Company and 550,000 shares in Wiseking held in the name of Mr Lam and Full Harbour.  The 55% shareholding in Wiseking held by Mr Lam and Full Harbour after 20 February 2009 resulted from the 55% shareholding in the Company held by, to the order of or on behalf of Mr Lam.  Accordingly, 550,000 shares in Wiseking constitutes “Related Assets”.  That is recognised by Mr Lam as appears from his letter dated 30 December 2009 at § 6.

The relief sought

51. The originating summons was issued on 30 April 2012.  Stark Moly was granted leave to intervene by order dated 28 November 2012.  By order dated 27 February 2013 made on a consent summons, it was ordered that if an order is made on the originating summons in favour of Dragonrider, then a proportion of the shares in the Company and Wiseking be transferred, or damages in lieu, which are attributable to Stark Moly’s investment be transferred or paid to Stark Moly.

52. The relief Dragonrider seeks turns on one question only as Mr Kwok did not seek to take any other point.  That question is whether an event of default has occurred.  That, in turn, depends on the validity of the Dragonrider notice.  That has been decided in HCA 752.  Accordingly, there having been an event of default, Dragonrider is entitled to the relief it seeks.

Order

53. In view of the order dated 27 February 2013, agreed minutes of order should be submitted for approval with an order nisi of costs in favour of Dragonrider.