FUBON BANK (HONG KONG) LTD v. CHAN PING CHE AND OTHERS

HCA 858/2025

[2025] HKCFI 4844

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 858 OF 2025

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BETWEEN

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REASONS FOR DECISION

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1.  By summons dated 6 June 2025 (the “Summons”), Fubon Bank (Hong Kong) Limited (the “Bank”) seeks summary judgment against Chan Ping Che (“D1”) for $354,417,659.19 (being the outstanding sum owed to the Bank as of 5 June 2025), interest and costs under a Deed of Guarantee dated 17 June 2021 (the “Guarantee”). D1 signed the Guarantee as personal guarantor of the liabilities of Fidelity Insurance Company Limited (the “Borrower”) arising from, inter alia, 1^st, 2^nd and 3^rd Facility Letters signed by D1 as its sole director.

2.  At the conclusion of the hearing, I made an order in terms of the Summons. My reasons appear below.

Factual background

3.  It is common ground that the Borrower is in default of its obligations to the Bank. D1 is a well-known business tycoon, and experienced property developer nicknamed the “King of Cassettes”. Recently, D1 has been experiencing financial difficulties and has publicly acknowledged his indebtedness of $350 million to the Bank.

4.  On 24 July 2025 and 2 September 2025, the Bank obtained default judgments for the same relief as in the Summons against The Center Ventures Limited (“D2”) and Chingsum Inc. (“D3”) of which D1 is the sole shareholder and director. They remain unsatisfied.

5.  There are related Order 88 proceedings in respect of the property mortgaged to the Bank in respect of which the parties have submitted a consent summons which is pending approval.

This application

6.  In response to the Bank’s application for summary judgment (supported by the affidavit of Tsang Hin Chi Jeremy filed on 6 June 2025 (Tsang 1^st)), D1 filed his affirmation in opposition on 26 June 2025. He did not deny that the Borrower is in default but denied that he is liable, raising 2 defences, namely, (1) non est factum, and (2) misrepresentation.

7.  In reply, Tsang 2^nd was filed on 6 August 2025 highlighting, inter alia, the fact that D1 has been or is a current director of over 100 other companies incorporated and/or registered in Hong Kong, D1’s extensive experience and familiarity with legal or statutory documents (many of which were primarily in English), having signed over 100 of them in his capacity or as director of various companies, and exhibiting the Bloomberg News report in May 2025 to the effect that D1, rather than the Borrower, owes the Bank $350 million, thus publicly confirming and acknowledging his liability under the Facility Letters and the Guarantee.

8.  In addition, the Bank’s staff responsible for the 1^st, 2^nd and 3^rd Facility Letters and the Guarantee and their execution have filed affirmations describing the Bank’s General Practice in that regard and that such practice was followed in relation to the execution of those documents.

Non est factum

9.  Mr Jonathan Lee, counsel for the Bank, submitted that there is a world of difference between someone who says he did not understand what he signed and a plea of non est factum.

10.  The legal requirements are set out in the Court of Appeal’s judgment in in Soshila Keswani v Motiram Keswani [2022] 2 HKLRD 822 at §34:

“For the defence of non est factum to apply, it has to be established that (i) the defendant was under a disability, whether permanent or temporary; (ii) the document he signed was fundamentally different from what he thought he was signing; (iii) he was not careless in appending his signature to the document: Saunders v Anglia Building Society [1971] AC 1004. The defendant bears a heavy burden of proof and he must establish each of the three components.”

11.  D1’s affirmation at §7 reads:

“Further, the [Bank]’s Staff said that the 1^st Facility Letter was not in any way connected to the personal guarantee as the [Bank] would provide another document for me to sign as a guarantor.”

12.  Having regard to D1’s own evidence, he knew exactly the nature of the document he would be asked to sign. In other words, D1 is unable to discharge the burden on him to establish the 2^nd legal requirement stated above: there is no fundamental difference between the Guarantee and what he thought he would be signing.

13.  In so far as D1 suggests that he was unsure about the extent of his potential liability under the Guarantee or its details, a mistake as to the legal effect of the document is irrelevant: it does not constitute non est factum. D1’s case is indistinguishable from that of Xiao Zhiyong v Asia Equity Value Limited, unrep., HCSD 46/2016, 14 July 2017 where Au-Yeung J explained at §85 that:

“The plea of non est factum is not available to a person whose mistake was really a mistake as to the legal effect of the document. There must be a radical or fundamental difference between what he signed and what he thought he was signing. See: Saunders v Anglia Building Society [1971] AC 1004 at 1016F, 1017C; Kincheng Banking Corp v Kao Yu Kuei [1986] HKC 212, 214 H-I.”

Misrepresentation

14.  §14 of D1’s affirmation reads:

“However, the [Guarantee] was a document in English. The [Bank]’s Staff did not explain or interpret the contents of the [Guarantee] to me. As I did not understand English, I simply did not understand the contents of the [Guarantee]. The [Bank]’s Staff said that the signing of the [Guarantee] was just a usual procedure to ‘allow’ the [Bank] to grant loan to the borrower but failed to advise me of the risks involved in executing the [Guarantee] and to take independent legal advice before the execution of the same.”

15.  Focusing on the second half of §14, D1’s complaint is the lack of legal advice. However, the lack of legal advice is immaterial where there is no misrepresentation.

16.  D1’s evidence is that on the same day as the execution of the 1^st Facility Letter, Bank’s staff provided him with a Guarantee shortly after he had signed the 1^st Facility Letter for and on behalf of the Borrower. Nothing in D1’s affirmation is to the effect that but for a particular statement made to him at the time, he would not have signed the Guarantee. Silence does not give rise to any misrepresentation save in exceptional circumstances. Plainly, D1 is unable to show reliance given the absence of any misrepresentation.

17.  D1’s allegation in the opening sentence of §14 is to the effect that the Guarantee was a document in English. However, that is controverted by the Bank’s evidence[1] that the Guarantee is a bilingual document.

18.  Given D1’s background, the notion that he did not understand what the Guarantee meant is risible.

Disposition

19.  As D1 has failed to show that he has an arguable defence to the Bank’s claim or that there are triable issues, the Bank is entitled to enter judgment against D1. Accordingly, I made the following Order:

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

(a) The sum of HKD 354,417,659.19.

(b) Interest on the sum of:

(i) HKD 300,000,000.00 at the rate of 10.98661% per annum; and

(ii) HKD 45,704,562.40 at the rate of 10.98661% per annum.

2. Costs of this action, including costs of this application, be on an indemnity basis, such costs with certificate for counsel be summarily assessed and payable forthwith.

20.  As D1 has been served with Bank’s statement of costs, I direct that (1) D1 do have leave to file his list of objections (limited to 2 pages) within 7 days of these Reasons; and (2) summary assessment shall take place in Chambers.