ESSILOR MANUFACTURING (THAILAND) CO, LTD v. CHAO FENG CHU (17th Defendant) and 44 others

HCA 159/2020

[2021] HKCFI 770

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 159 OF 2020

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BETWEEN

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D E C I S I O N

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1.  The writ was endorsed with a claim against, amongst others, D17 for an order that D17 to pay US$360,000 and US$480,000 purportedly transferred by the Plaintiff to the account of D17 (“the Deposits”), as money had and received or on the ground of unjust enrichment.  There is also a claim for interests under sections 48 and 49 of the High Court Ordinance, Cap 4.

2.  This is the Plaintiff’s summons for judgment in default of notice of intention to defend against D17 pursuant to Order 13, rule 1 of the Rules of the High Court, Cap 4A.  As it appears that a substantial amount of the 2 sums paid into D17’s account has been frozen, the Plaintiff is content, for commercial reasons, to only seek money judgment and abandons other claims against him based on constructive trust or reliefs in tracing and declarations.

3.  The summons has to come before a judge because the Plaintiff seeks continuation of an injunction for the purpose of facilitating enforcement of the default judgment.

Default judgment

4.  Pursuant to a substituted service order granted by Master SP Yip dated 4 June 2020, the writ was served on D1 by a Taiwanese attorney-at-law engaged by the Plaintiff, by inserting into the letterbox at D17’s address in Taiwan.

5.  The present summons and notice of today’s hearing have been served by the same mode at the same address of D17.

6.  The affirmations of Ru-Ming Lee (certified Taiwan attorney-at-law) show that such service was accepted within Taiwanese law.

7.  D17 has not acknowledged service or taken any step in these proceedings.  As I am satisfied as to service, I thus proceed in D17’s absence.

8.  This is a case of fraud, whereunder D17 was one of the first layer recipients into whose account the Deposits were made.  The transactions involved were fictitious and the monies were paid out in breach of the fiduciary duties of the Plaintiff’s then Finance and Accounting Manager and authorized signatory of the Plaintiff’s bank accounts in USA and Thailand.

9.  The Plaintiff did not have any business, commercial or other dealings with D17.  It did not have any knowledge of and did not consent to or authorize each of the First Layer Transfers.

10.  Due to the fictitious transactions and unauthorized payments, (i) D17 was enriched by the Deposits; (ii) the enrichment was at the Plaintiff’s expense; and (iii) the Plaintiff transferred the Deposits under an unjust factor (fraud and/or mistake).  It would be unjust for D17 to retain the money.  See Shanghai Tongji Science & Technology Industrial Co Ltd v Casil Clearing Ltd (2004) 7 HKCFAR 79, §67 (Ribeiro PJ).

11.  I am satisfied that the Plaintiff is entitled to judgment for the sums claimed against D17.

12.  Pre-judgment interest shall be at prime plus 1% per annum: Chow How Yeen Margaret v WEX Pharmaceuticals [2018] 3 HKLRD 163, CA, §§45 & 59.

13.  I therefore give judgment in the sums of US$360,000 and US$480,000 with interest at P+1% per annum from 4 December and 10 December 2019, respectively, until judgment and thereafter at judgment rate until payment. There be fixed costs of HK$11,045 to the Plaintiff to be borne by D17 in respect of the action.

Continuation of injunction

14.  To facilitate enforcement, the interim interim injunction granted by Lam VP on 20 March 2020 on the same terms as the injunction orders granted by Campbell-Moffat J on 24 January 2020 and continued as amended by order of Anthony Chan J on 24 April 2020 be continued against D17 for 6 months or until satisfaction of the judgment debt against D17, whichever is the earlier.

15.  I thank Mr Hughes for his assistance.