XCHRX BANQUE WORMS v. SINCERELY (ASIA) LTD. and KLOCKNER EAST ASIA LTD. (Third Party)

HCA 19061/1998

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 19061 OF 1998

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J U D G M E N T

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1. This is an application by a bank for summary judgment for the amount (USD794,944.27) of a draft supplied by the bank at the request of the defendant in favour of the third party, and duly honoured by the bank. The bank originally accepted instructions from the defendant not to honour the draft but subsequently accepted that it was bound to do so. In my judgment the bank was right to do so.

2. By an agreement dated 29 May 1998, the plaintiff agreed with the defendant that, after 30 July 1998, the draft could be released to the third party "for its own use and retention absolutely". When the third party presented the draft so released to it on 7 October 1998, the bank was entitled and bound to honour it. The draft was given for good consideration, that is to say, the entry by the third party into the agreement of 29 May 1998, and the defendant has no defence to the action. I will give judgment for the bank for the full amount claimed, with interest and costs.