ZHANG JINSONG AND ANOTHER v. ZHANG JING AND OTHERS

HCA 1569/2023

[2026] HKCFI 676

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1569 OF 2023

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J U D G M E N T

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A.  Introduction

1.  This is the assessment of interest and damages following: (1)  a Judgment entered against the 1^st to 7^th Defendants on 10 July 2024 (“D1-D7 Judgment”); and (2)  an Interlocutory Judgment entered against the 8^th and 9^th Defendants on 13 February 2025 (“D8-D9 Judgment”).  

2.  In short, the Plaintiffs’ claims relate to a loan made by the 1^st Plaintiff (“P1”)  to the 1^st Defendant (“D1”)  and the share charges provided by the 2^nd to 4^th Defendants (“D2”, “D3” and “D4” respectively)  in favour of the 2^nd Plaintiff (“P2”)  as security for the loan.  D1 had failed to repay the loan.  P’s case is that D2-D4 had acted in breach of the share charges by transferring the charged shares away to the 5^th and 6^th Defendants (“D5” and “D6” respectively), and that there was a conspiracy amongst all the Defendants to do so.

3.  The Defendants, having filed respective acknowledgements of service, have not thereafter participated in the proceedings.  As a result, judgments in default of defence were entered against the Defendants, being the D1-D7 Judgment and the D8-D9 Judgment. 

4.  The D1-D7 Judgment was based on the Statement of Claim dated 18 March 2024 (“SOC”).  The Judgment provided:

4.1  D1 do pay P1 the principal sum of HK$35,886,000, together with interest to be assessed.

4.2  D2-D4 do pay damages to P2 in respect of the breach of the terms of their respective Share Charges (defined below), with the amount to be assessed.  

4.3  D5 and D6 do transfer any part of the Charged Shares (defined below)  as held by each of them, including the proceeds thereof, into P2’s name. 

4.4  An order of account and enquiries against D5 and D6 in respect of any assets and/or monies which have been derived from the Charged Shares and/or the proceeds thereof, and all necessary directions and orders for the payment and delivery up of what is found due.  

4.5  D1 to D7 do jointly and severally pay damages in conspiracy to P1 and P2, with the amount to be assessed.  

4.6  The costs of and occasioned by these proceedings including all costs reserved and the costs of the Summons of Ps filed on 27 June 2024 be paid by D1 to D7 jointly and severally to Ps, to be taxed if not agreed.  

5.  The D8-D9 Judgment was based on the Amended Statement of Claim dated 9 October 2024 (“ASOC”)  which added certain pleas in respect of D8 and D9.  The D8-D9 Judgment provided that D8 and D9 do pay P1 and P2 damages to be assessed with costs to be taxed.  

6.  This hearing is held to assess the interest and damages awarded under paragraphs 4.1, 4.2, 4.5 and 5 above. 

7.  The Defendants did not take part in the assessment process and did not file any evidence.  D1 to D6, D8 and D9 did not attend the hearing. 

8.  In the morning of the hearing of the assessment, a Notice to Act was filed on behalf of D7, and solicitors and counsel appeared for D7 at the hearing.  Ms Tse, counsel for D7, informed me that D7 only learned of the hearing in the morning and intended to take out applications to set aside the default judgment.  Ms Tse confirmed that this would not affect the conduct of the assessment hearing and D7 had no application to make and no other position as to the assessment.  As a result, I proceeded with the assessment. 

B.  Background and P’s case as pleaded

9.  According to the authorities cited to me by Mr Leung, counsel for Ps, where default judgment on liability has been granted, in the subsequent assessment of quantum, the default judgment would be conclusive on the issue of the defendant’s liability, and the statement of claim would in effect be a proxy for the judgment, setting out the basis of liability.  A defendant cannot go behind any issues on liability, save that he/she can raise any issue which is not inconsistent with the judgment on liability. See the discussion at Symes v St George’s Healthcare NHS Trust[2014] EWHC 2505 (QB)  at §§35-46.   

10.  The following is a summary of the objective background facts and Ps’ case as pleaded in the SOC / ASOC. 

B1.  The Loan Agreement

11.  By a Loan Agreement entered into in May or June 2021 between P1 (as lender)  and D1 (as borrower), P1 agreed to make available to D1 a loan facility of HK$35,886,600 (“Loan Agreement”).

12.  Under the Loan Agreement, D1 was obliged to repay the loan by 31 December 2021 (Clause 6).  Interest at 8% per annum for the loan is payable on the repayment date (Clauses 5.2 & 5.4).  

13.  It was provided in the Loan Agreement that the proceeds of the loan shall be used to finance D2 to D4’s subscription of 197 million new shares in China Smartpay Group Holdings Ltd (“China Smartpay”), a Cayman company whose shares are listed on the Hong Kong Stock Exchange (code: 08325)  (Clause 2.2). 

14.  It was pleaded that the subscription took place on 30 June 2021, and D2, D3 and D4 respectively subscribed for 37 million, 80 million and 80 million shares in China Smartpay (ASOC §19). These shares were then transferred to the securities account in D2, D3, D4’s respective names at GLAM Capital Ltd (“GLAM”). 

B2.  The Share Charges

15.  By respective Deeds of Share Charges entered into by D2 to D4 (“Share Charges”)  which are in materially identical terms, D2 to D4 charged the respective China Smartpay shares held in their names (collectively the “Charged Shares”)  in favour of P2 as security agent for both P1 and P2. 

16.  Under the Share Charges, each of D2 to D4:

16.1  covenanted as primary obligors to pay on demand the “Secured Obligations” when they fall due for payment (Clause 2.1).  “Secured Obligations” are defined to include all present and future moneys, liabilities and obligations owed by any “Obligor” (ie D1 and D2 / D3 / D4, as the case maybe)  under, arising out of or in connection with each “Finance Document” (which includes the Loan Agreement and the Share Charges);

16.2  charged by way of first fixed charge all their rights, title and interests in the China Smartpay shares held in their respective names and deposited in the “Securities Account” in favour of P2 as security for the payment of the Secured Obligations (Clauses 3.2 and 1.1).  “Securities Account” is defined as the securities account in the name of D2 / D3 / D4 maintained with GLAM. 

17.  The Share Charges provided that:

17.1  P2 may exercise various rights or powers upon an “Event of Default”, including the power to transfer the charged shares into the name of its nominee, the powers and rights exercisable by the legal or beneficial owner of the securities in the Securities Account (ie the charged shares), and the power of sale (see Clauses 7.3.3, 8.4 and 10.1). 

17.2  Upon the occurrence of an “Event of Default”, the security created by the Share Charges is immediately enforceable and P2 may without notice to the chargor or prior authorisation from any court, and in its absolute discretion, enforce the security and take possession of and hold or dispose of the charged shares (Clause 9.1). 

17.3  “Event of Default” is defined in Clause 1.1 as including the failure by an “Obligor” to “pay in accordance with the terms of any Finance Documents any sum thereunder when due.”

18.  There are various provisions in the Share Charges which required D2-D4 (as chargor)  to maintain the security and not take steps to prejudice the same:

18.1  Clause 5.2 provides that the chargor shall take all such action as may be necessary for the purpose of the protection or maintenance of any security conferred on P2 by or pursuant to the Share Charge. 

18.2  Clause 6.2 provides that the chargor undertakes that, during the subsistence of the Share Charge, it shall not agree to, sell, assign, transfer, or otherwise dispose of any “Charged property” or withdraw any “Charged Property” from the Securities Account, unless with the written consent of P2 and except pursuant to the Loan Agreement or in compliance with applicable listing rules.

18.3  Clause 6.3 provides that the chargor undertakes that it shall not, at any time during the subsistence of the Share Charge, cause the conversion or materialisation of any of the “Charged Property” into non-scripless securities.

18.4  Clause 8.2 provides that the chargor shall ensure that all of the “Charged Property” that is in the form of scripless securities shall be held in the Securities Account or other accounts with P2’s prior written consent.

18.5  Clause 8.3 provides that when any “Secured Obligations” are or may become outstanding, the chargor shall not be entitled to withdraw or otherwise transfer any securities, amount or other asset standing to the credit of any Securities Account, except with the prior written consent of P2.

18.6  Clause 18.3 provides that the chargor shall not take or omit to take any action which might prejudice the value of the “Charged Property”, or P2’s rights in respect of the “Charged Property”.

B3.  D1’s drawdown and default

19.  On 10 June 2021, D1 drew down on the loan and P1 advanced a total sum of HK$35,886,000 to D1.  There is a “支票簽收單” dated 10 June 2021 signed by a representative of D1’s nominees acknowledging receipt of the amount. 

20.  Pursuant to Clauses 5 and 6 of the Loan Agreement, D1 was to repay the principal and interest of the loan on or before 31 December 2021.  This D1 failed to do.  Such failure constituted an “Event of Default” under the Share Charges.  

B4.  The transfer away of the Charged Shares

21.  As a result of D1’s default in repaying the loan under the Loan Agreement, Ps decided to enforce the Share Charges, and contacted GLAM to arrange for this on around 1 February 2023.  Ps were then informed by GLAM that the Charged Shares had been withdrawn and transferred away from the Securities Account (ASOC §§27-29).  

22.  Ps’ pleaded case is as follows (see ASOC §§23-32):

22.1  The 7^th Defendant (“D7”)  (who was employed in China Smartpay as “Supervisor”: ASOC §8.1): (1)  instructed GLAM to convert all the Charged Shares from scripless to physical form; (2)  withdrew all the Charged Shares from the Securities Account; and (3)  transferred away 90,000,000 of the Charged Shares to the 5^th Defendant (“D5”)  and 104,800,000 of the Charged Shares to the 6^th Defendant (“D6”)  (ASOC §23).  D5 is the younger sister of D1 (ASOC §5).  D6 is a company incorporated in the British Virgin Islands (ASOC §6). 

22.2  According to GLAM, the withdrawal of the Charged Shares from the Securities Account took place on 17 January 2023 (ASOC §30).  

22.3  D7 procured the aforesaid conversion, withdrawal and transfer of the Charged Shares on the instructions of D1.  D7 admitted to this when asked for an explanation by Ps (ASOC §§23, 31). 

22.4  D2 to D4 enabled and/or facilitated the aforesaid conversion, withdrawal and transfer of their respective Charged Shares by giving the requisite consent and/or approval as account holders and/or signatories of their respective Securities Accounts in which the Charged Shares were held (ASOC §24). 

22.5  The 8^th and 9^th Defendants (“D8” and “D9”)  assisted in the aforesaid conversion, withdrawal and transfer of the Charged Shares, in that D8 and D9 were at the material time the only directors and shareholders of D6 (ASOC §6)  and would have to execute the relevant share transfer instruments for the shares transferred to D6 (ASOC §26A).  It is also pleaded that they were accustomed to act in accordance with the instructions of D1, D1’s son and D1’s boyfriend / business partner (ASOC §7).  

23.  Of the 197,000,000 Charged Shares, there were another 2,200,000 shares that were withdrawn from the Securities Account but not transferred to D5 or D6.  It is the evidence of Ps that Ps still have no knowledge as to their whereabouts after they had been converted and withdrawn from the Securities Account, and are unable to enforce against them (Witness Statement of Zhang Jinsong §40). 

B5.  Ps’ pleaded claims against D1-D9

24.  In the SOC / ASOC, Ps pleaded the following claims against D1-D9.  

25.  As against D1, it is pleaded that D1 failed to repay the principal amount of HK$35,886,000 loan and the interest under the Loan Agreement by 31 December 2021, and that D1 was liable for such principal sum and interest (ASOC §§34-36).  There is also a plea for default interest on the overdue sum at 48% per annum pursuant to Clause 12 of the Loan Agreement (ASOC §37).  

26.  As against D2-D4, it is pleaded that by reason of the matters pleaded in ASOC §§23-26 (namely their acts in transferring away the Charged Shares: see paragraphs 22.1-22.4 above)  , they were in breach of Clauses 5.2, 6.2, 6.3, 8.2, 8.3 and 18.3 of the Share Charges, and that Ps suffered the loss of being deprived of the security for the payment and discharge of the “Secured Obligations”, including D1’s liability under the Loan Agreement (ASOC §§38-39). 

27.  As against D1-D9, it is pleaded that (ASOC §42):

27.1  D1-D9 (or any two or more of them together)  wrongfully and with intent to injure Ps combined together and conspired to divert or misappropriate the Charged Shares from P2.

27.2  The means of carrying this out was to cause the Charged Shares to be converted and withdrawn from the Securities Account at GLAM, and 194,800,000 of the Charged Shares transferred to D5 and D6, without Ps’ prior knowledge or consent.  

27.3  Such means were unlawful in that they involved D2-D4’s breach of the terms of the Share Charges, and the misappropriation of P2’s security interest or equitable ownership in the Charged Shares.

27.4  The following acts were carried out pursuant to and in furtherance of the aforesaid conspiracy:

(a)  D1 instructed D7 to instruct GLAM to convert the Charged Shares from scripless to physical form, withdraw them, and to transfer 194,800,000 of the Charged Shares to D5 and D6.  D7 did so.

(b)  D2-D4, as holder and/or signatories of their respective Securities Accounts at GLAM, gave the requisite consent or approval of the aforesaid conversion, withdrawal and/or transfer.

(c)  D5 and D6 received 194,800,000 of the Charged Shares and supplied their share certificates to D7.

(d)  D8 and D9, being the two directors of D6, knowingly took steps to cause or procure or approve or authorise D6 to receive 104,800,000 of the Charged Shares and to supply the share certificates to D7.

27.5  As a result, Ps suffered loss and damage from being deprived of the security for the payment and discharge of the “Secured Obligations” under the Share Charges, including D1’s liability under the Loan Agreement.

28.  I now turn to deal with the various heads of claims advanced by Ps which are relevant for this assessment.  

C.  D1’s liability for interest under the Loan Agreement

29.  In the case of D1, she was already ordered to repay the principal sum of HK$35,886,000 under the Loan Agreement to P1 in the D1-D7 Judgment.  What remains to be assessed is interest (dealt with in this section)  and damages for conspiracy (dealt with in Section E below). 

30.  As submitted by Ps, D1 is firstly liable for contractual interest under the Loan Agreement:

30.1  According to Clause 5.1 of the Loan Agreement, D1 was to pay interest on the “Advance” by reference to the “Interest Period”.  The “Advance” is defined to mean the loan facility made available under the Loan Agreement in the amount of HK$35,886,000.  The “Interest Period” means a period of 12 months beginning on the date of the Advance, which was made on 10 June 2021. 

30.2  According to Clause 5.2, the applicable interest rate is 8% (simple interest)  per annum.  

30.3  According to Clause 5.3, the interest shall accrue from day to day and be calculated on the basis of the actual number of days elapsed and a 365-day year. 

30.4  According to Clause 5.4, D1 was to pay interest on the “Interest Payment Date”, which is the same as the “Repayment Date”, which is 31 December 2021.  

30.5  There are in total 205 days between 10 June 2021 and 31 December 2021.  

30.6  Thus, the total amount is HK$1,612,412.05 (being HK$35,886,000 x 8% x 205/365). 

31.  D1 is also liable for pre-judgment interest:

31.1  For the principal sum of HK$35,886,000, pre-judgment interest should accrue from the day following the repayment date (ie 1 January 2022)  to the date of the D1-D7 Judgment. 

31.2  For the interest on the principal sum of HK$1,612,412.05 (see paragraph 30.6 above), pre-judgment interest should accrue from the day following the repayment date (ie 1 January 2022)  to the date of this judgment.

31.3  The rate should be the conventional 1% above the prevailing HSBC prime rate. 

32.  Mr Leung has confirmed that Ps are abandoning the pleaded claim for default interest of 48% under Clause 12 of the Loan Agreement.  

33.  D1 would also be liable for post-judgment interest at judgment rate from the date of the respective judgments (ie the D1-D7 Judgment and this judgment)  until payment in full.  

D.  D2-D4’s liability under the Share Charges

34.  There are two aspects of D2-D4’s liability in relation to the Share Charges. 

35.  First, Ps seek to hold D2-D4 liable as primary obligor under the respective Share Charges.  

36.  Ps have pleaded Clause 2.1 of the Share Charges which provided that D2-D4 are primary obligors to pay on demand the “Secured Obligations”.  However, the SOC did not plead any claim against D2-D4 in debt arising from this clause. 

37.  Crucially, the D1-D7 Judgment, which is the judgment on liability, does not find any liability on the part of D2-D4 in debt to pay the principal sum under the Loan Agreement.  As explained in Carbopego-Abastecimento de Combustiveis SA v AMCI Export Corporation [2006] 1 Lloyd’s Rep 736 at §14 (cited at Symes at §42), where a judgment in default has been granted on the question of liability, a claimant cannot raise a new claim or a new way of putting the same claim in the proceedings to assess damages.  It is therefore not open to Ps now to seek to hold D2-D4 liable in debt as primary obligors. 

38.  At the hearing, Mr Leung tried to get around this difficulty by submitting that the Court can hold D2-D4 liable in damages for breach of Clause 2.1.  While paragraph 2 of the D1-D7 Judgment provides for D2-D4’s liability in damages “in respect of the breach of the terms of their respective [Share Charges]”, which is in literal terms wide enough to cover such a claim, the problem remains that no such claim of breach of Clause 2.1 was pleaded in the SOC.  The only plea in the SOC for damages for breaches of the Share Charges by D2-D4 is a plea by reference to D2-D4’s acts in the transfer away of the Charged Shares, and the clauses that are said to be breached are Clauses 5.2, 6.2, 6.3, 8.2, 8.3 and 18.3, and the loss pleaded is the loss of being deprived of the security over the Charged Shares (see paragraph 26 above).  

39.  For these reasons, it is not open to Ps to try to introduce these new heads of liability by reference to Clause 2.1 of the Share Charges in the present assessment stage.  

40.  Second, D2-D4’s acts in transferring away the Charged Shares held in their respective names were clear breaches of the Share Charges – these acts involved the conversion of the Charged Shares from scripless to physical form, the withdrawal of the Charged Shares from the securities account at GLAM, and the transferring away of the Charged Shares, thereby defeating P2’s security. These would amount to breaches of Clauses 5.2, 6.2, 6.3, 8.2, 8.3 and 18.3 (see paragraph 18 above).

41.  There is no question that P2 did suffer a loss from such breaches, by reference to the value of the Charged Shares held by D2-D4 respectively – by reason of these acts of D2-D4, Ps were deprived of the Charged Shares as security for the liability of D1 under the Loan Agreement.  Since D1 failed to make repayment of the principal sum and the interest accrued (see paragraph 20 above), and especially since Ps were going to take steps to enforce the security (see paragraph 21 above), Ps were prevented from realising the Charged Shares to satisfy D1’s liability under the Loan Agreement.  If the Share Charges had been enforced and the Charged Shares realised, P2 would have got the value of the Charged Shares.  

42.  It is well-established that damages should generally be assessed as of the time of breach: Chitty on Contracts Vol. 1 (36^th ed, 2025)  at §30-016.  There is no question of mitigation since it is the defendant’s burden to raise and prove the point.  

43.  The evidence shows, and I find, the Charged Shares were transferred away from the securities account on 17 January 2023 (and thus this would be the date of breach):

43.1  In the WeChat messages between Mr Ray Chu of GLAM and Mr Deng Xufan (a representative of Ps)  in early February 2023, Mr Ray Chu told Mr Deng that the Charged Shares were transferred away from the securities account at GLAM on 17 January 2023. 

43.2  Although this is hearsay evidence, I have no reason to doubt the correctness of what was stated by Mr Ray Chu in those messages or to discount their weight.  

44.  Accordingly, the loss suffered by P2 is the value of the Charged Shares as at 17 January 2023, which is assessed as follows:

44.1  The evidence shows that the closing price of China Smartpay’s shares on the Hong Kong Stock Exchange on 17 January 2023 was HK$0.051 per share.  This is the best evidence of the value of these publicly traded shares.

44.2  Since D2 held 37,000,000 of the Charged Shares, D2 should be liable for HK$1,887,000 (37,000,000 x HK$0.051). 

44.3  Since D3 held 80,000,000 of the Charged Shares, D3 should be liable for HK$4,080,000 (80,000,000 x HK$0.051).

44.4  Since D4 held 80,000,000 of the Charged Shares, D4 should be liable for HK$4,080,000 (80,000,000 x HK$0.051).

45.  However, I understand Ps’ position to be that since Ps’ claim under this head would be smaller in amount compared to their claim in conspiracy, this head of liability will be subsumed under the conspiracy claim and there is no need for a separate provision in the judgment for this head of liability.  

E.  D1-D9’s liability for damages in conspiracy

46.  As for D1-D9’s liability for conspiracy, their respective liability as pleaded in the SOC (for D1-D7)  and the ASOC (for D8 and D9)  (see paragraph 27 above)  have been established by the default judgments, and the only issue now is quantum. 

47.  Prima facie, participation in conspiracy makes all conspirators jointly liable for the loss caused thereby.  There is no rule that a conspirator should not be liable for loss which would have been caused whether or not he joined the conspiracy.  This is because an after the event attempt to analyse the working of a conspiracy to allocate causative responsibility for a particular loss between conspirators could be a difficult and incongruous exercise: see Grupo Torras SA v Al Sabah[1999] CLC 1469 at 1635D-E (Mance J).

48.  There are also discussions in the authorities as to the extent of a conspirator’s liability for losses caused before he joined the conspiracy or after he left the conspiracy: see Grupo Torras at 1635E-G.  However, since on Ps’ pleaded case all the defendants were part of the same conspiracy to divert or misappropriate the Charged Shares from P2, which involved a closely related series of acts in the conversion and withdrawal and transfer of the Charged Shares, all taking place within a short period of time, this issue does not arise.  

49.  Damages for unlawful means conspiracy should put the innocent party back in the financial position he was in before he sustained the wrong: Chan Shu Chun v Dr Kung Yan Sum [2023] HKCFI 840 at §218.

50.  In the present case:

50.1  The loss suffered by Ps as a result of the conspiracy is the loss of all 197,000,000 of the Charged Shares, ie the 194,800,000 shares transferred to D5 and D6, as well as the 2,200,000 shares that are unaccounted for.

50.2  As a result, Ps were deprived of the Charged Shares as security for the liability of D1 under the Loan Agreement.  Since D1 failed to make repayment of the principal sum and the interest accrued (see paragraph 20 above), and especially since Ps were going to take steps to enforce the security (see paragraph 21 above), Ps were prevented from realising the Charged Shares to satisfy D1’s liability under the Loan Agreement.  If the Charged Shares had been realised as per the Share Charges, P2 would have got the value of the Charged Shares and P1’s outstanding claim against D1 under the Loan Agreement would be partially satisfied. 

50.3  As I found above, the Charged Shares were transferred away from the securities account on 17 January 2023 and the closing price of China Smartpay’s shares on the Hong Kong Stock Exchange on that day was HK$0.051 (see paragraphs 43 and 44 above). 

50.4  Ps’ loss is therefore HK$10,047,000 (197,000,000 shares x HK$0.051), and D1-D9 should be jointly and severally liable for the same.

F.  Costs

51.  Ps should be entitled to the costs of this assessment.

52.  In his written opening submissions and the draft order submitted, Mr Leung only asked for costs on the standard basis.  At the hearing, Mr Leung orally submitted that Ps should be entitled to costs on the indemnity basis against D1-D4.

53.  As against D1, Mr Leung relied on Clause 13.1 of the Loan Agreement which provided that:

“Miscellaneous Indemnities. The Borrower shall on demand indemnify the Lender against any loss which it may sustain or incur as a result of… (4)  any payment not being made on the due date and in accordance with clause 14…”

54.  It is not at all clear to me that such a clause would entitle a party to recover legal costs of legal proceedings to recover the amount outstanding, and no authorities have been cited to me to support this.  Further, there is in fact an express clause governing legal costs in the Loan Agreement, being Clause 16.2, which provided that:

“Enforcement Expenses. The Borrower shall pay to the Lender on demand all costs and expenses (including but not limited to legal fees on a fully indemnity basis)  incurred in or in connection with the preservation and/or enforcement of any of its rights under the Financing Agreements.”

“Financing Agreements” is defined to include the Loan Agreement and the Share Charges.

55.  It seems to me that the fact that Clause 16.2 was drafted to expressly cover legal costs of recovery proceedings would suggest that Clause 13.1 was not intended to cover the same.

56.  While Clause 13.1 was pleaded in the ASOC, Clause 16.2 was not.  Thus, Ps cannot rely on the latter clause.

57.  In the case of D2-D4, there is in the Share Charges Clause 23.1, which provided that:

“The Chargor shall, on demand of the Security Agent, reimburse the Security Agent on a full indemnity basis for all costs and expenses (including legal fees and any value added tax)  incurred by the Security Agent in connection with… (b)  the perfection or enforcement of the security constituted by this Deed… together with interest from the date such costs and expenses were incurred to the date of reimbursement of the same by the Chargor, calculated in accordance with the provisions of the Finance Documents.”

58.  Again, this clause was not pleaded and Ps cannot rely on it.

59.  For these reasons, I would not order costs against D1-D4 on the indemnity basis.

G.  Disposition

60.  For the above reasons, I make the following orders:

60.1  The 1^st Defendant do pay to the 1^st Plaintiff:

(a)  The sum of HK$1,612,412.05 (being interest due under the Loan Agreement).

(b)  Interest on the sum of HK$35,886,000 at 1% above the prevailing HSBC prime rate from 1 January 2022 to 10 July 2024, and thereafter at judgment rate until full payment.

(c)  Interest on the sum of HK$1,612,412.05 at 1% above the prevailing HSBC prime rate from 1 January 2022 to the date of this judgment, and thereafter at judgment rate until full payment.

60.2  The 1^st to 9^th Defendants do jointly and severally pay to the 1^st and 2^nd Plaintiffs damages for conspiracy in the sum of HK$10,047,000.

60.3  Costs of this assessment of damages be paid by the 1^st to 9^th Defendants to the 1^st and 2^nd Plaintiffs including all costs reserved, to be taxed if not agreed. 

61.  Lastly, I thank Mr Leung for his assistance.