FOREIGN EXCHANGE & INVESTMENT LTD v. LIU CHONG HING BANK LTD

C.L. No. 80 of 1984

IN THE SUPREME COURT CF HONG KONG

HIGH COURT

(Former High Court Action No. 566 of 1984)

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BETWEEN

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JUDGMENT

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1. At all material times, Mr. Chow Cham Leung ("Mr. Chow") ran an export/import firm known as Hong Kong Oriental Corporation (Oriental). That firm exported an assortment of household goods and foodstuffs from Hong Kong to various customers it had in Venezuela. One of those customers was Casa Hong Kong SRL of Maracaibo ("Casa").

2. Mr. Chow's main banker was the Defendant, Liu Chong Hing Bank Limited ("Liu Chong Hing Bank"). Mr. Chow had various accounts with Liu Chong Hing Bank - some in his own name and some in the name of his firm, Oriental.

3. One such account was a current account in the name of Oriental. Besides enjoying an overdraft limit of HK$300,000 on that current account, Oriental was also entitled to avail itself of other banking facilities operated through that current account. Those associated facilities were in the form of letters of credit to the extent of HK$2.5 million; D/A bills to the extent of HK$1.25 million; and D/P bills to the extent of HK$1.25 million.

4. There was also Mr. Chow's personal current account which had an overdraft limit of HK$1 million and his instalment loan account.

5. In respect of some of Mr. Chow's sales to Venezuela, he availed himself of the export guarantee insurance scheme offered by the Hong Kong Export Credit Insurance Corporation ("H.K.E.C.I.C."). The Hong Kong scheme is similar to the one operated by the Export Credits Guarantee Department in England (as to which, see Chapter 24 of Benjamin's Sale of Goods, 2nd. Edn.). Mr. Chow had been insuring his exports to Casa since 1969. This insurance was done by means of H.K.E.C.I.C.'s standard Comprehensive Shipments Policy.

6. The policy with which the present case is concerned is the one which Mr. Chow took out with H.K.E.C.I.C. to cover exports of goods from Hong Kong to Casa during the period from 1st July 1982 to 30th June 1983. The Credit Limit originally set under the policy in respect of exports to Casa was HK$1.2 million and by the terms of the policy, Mr. Chow's firm, Oriental, was entitled to be paid 90% of the Credit Limit for losses arising from the risks covered by the policy. Those risks included not only the insolvency of Casa but also the operation of any laws in Venezuela which prevented the export of hard currencies.

7. One way for an exporter enjoying the benefit of a Comprehensive Shipments Policy to raise finance is to assign his benefits under the policy. Such an assignment can be made by means of the standard form of irrevocable Letter of Authority furnished by H.K.E.C.I.C. That Letter of Authority, which is copied from the form used by the Export Credits Guarantee Department in England, operates as an assignment by way of charge. See Paul & Frank Ltd. v. Discount Bank (Overseas) Ltd. [1966] 2 All E.R. 922.

8. Even before the insurance period 1st July 1982 - 30th June 1983 had begun to run, Mr. Chow's firm, Oriental, had assigned its interest under the policy to Liu Chong Hing Bank by means of H.K.E.C.I.C.'s standard Letter of Authority, dated 24th June 1982. Written notice of such assignment was immediately given to H.K.E.C.I.C.

9. I now set out the text of that Letter of Authority :

10. The first transaction coming within the ambit of the policy occurred on the 31st July 1982. On that date, Oriental exported goods worth US$43,151 to Casa on a D/P basis. Mr. Chow was not financed by Liu Chong Hing Bank in respect of that transaction. Instead, he got his finance from the Bank of America. The Bank of America was in no way concerned with Mr. Chow's H.K.E.C.I.C. Policy, the Bank of America's security being a mortgage of some of Mr. Chow's property.

11. The next relevant export occurred on the 31st August 1982. On that occasion, Oriental sent Casa goods worth US$113,859.16. This was a D/A sale, with the bill of exchange due to mature on 8th February 1983. Liu Chong Hing Bank purchased that bill from its customer, Oriental, on the 10th September 1982, debiting Oriental with the sum of HK$659,686.57 being the Hong Kong Dollar equivalent of the amount of the U.S.$ bill.

12. Oriental was due to make another export of goods from Hong Kong to Casa on the 15th September 1982. This time, the amount involved in the transaction was US$119,357.52. Shortly before the 15th September 1982, Mr. Chow had asked Liu Chong Hing Bank to finance this latest transaction, but it had refused, saying that Oriental had already reached its overdraft limit. Mr. Chow told Liu Chong Hing Bank that he would have to raise finance by negotiating the bill with another bank or finance company, a course to which Liu Chong Hing Bank consented. Even if Liu Chong Hing Bank had not consented, it is hard to see how it would have made any difference, for Mr. Chow was fully entitled to sell the bill to whomsoever he chose.

13. Whilst the goods relating to the transaction of which I am presently speaking were exported on the 15th September 1982, the bill relating to them drawn on Casa was dated the 29th September 1982. The Plaintiff, Foreign Exchange & Investment Limited, which is a finance company ("the Finance Company"), agreed with Mr. Chow before the 29th September 1982 to buy that bill. On the 29th September 1982, Liu Chong Hing Bank gave Oriental a statement in the following terms:-

14. That statement was handed by Oriental to the Finance Company on the 29th September 1982 whereupon the Finance Company purchased that bill of US$119,357.52.

15. It can be noted at this stage that beyond the bare furnishing of the statement (Agreed Bundle at p. 105), Liu Chong Hing Bank did nothing. Apart from asserting by the statement (Agreed Bundle p. 105) that it had purchased one bill for HK$659,686.57, Liu Chong Hing Bank made no representations, whether direct or indirect, to the Finance Company or anybody else in relation to Liu Chong Hing Bank's position under the policy. In particular, I am unable to spell out any representation, whether express or implied, by Liu Chong Hing Bank that it was prepared to forego any rights accruing to it by virtue of the letter of Authority (Agreed Bundle p. 126). On the material before me, there was nothing to suggest that Liu Chong Hing Bank had any direct communication with the Finance Company before the Finance Company bought the bill on the 29th September 1982; nor was there anything to suggest that Liu Chong Hing Bank had authorised Mr. Chow to make any representations on its behalf, beyond the bare representation embodied in the statement (Agreed Bundle p. 105) of the 29th September 1982. Perhaps, the Finance Company deluded itself into believing that if it purchased the bill dated the 29th September 1982, it would be entitled to the balance of the insurance monies under the policy after Liu Chong Hing Bank was paid the sum of HK$659,686.57 but nothing had happened which in law would justify the Finance Company in holding that belief.

16. There was a fourth transaction to which the policy could apply. This was Oriental's export to Casa on the 5th October 1982 of goods to the value of US$124,988.69. The Finance Company purchased that bill from Oriental on the 11th November 1982.

17. Between the 29th September 1982 and the 11th November 1982, several legally significant events had occurred. On 29th October 1982, Oriental wrote to H.K.E.C.I.C. as follows :-

Mr. Chow took that letter to Liu Chong Hing Bank, and requested it to consent to Oriental transferring the benefit of the policy in respect of Case from Liu Chong Hing Bank to the Finance Company. Liu Chong Hing Bank agreed to this and endorsed on the letter :- "We confirm up to end of Sept., 1982 the outstanding bill drawn on Casa Hong Kong SRL for HK$659,686.57". Oriental then forwarded that letter to H.K.E.C.I.C. together with a Letter of Authority in favour of the Finance Company in respect of the period from 1st October 1982 to 30th June 1983.

18. On 10th November 1982, H.K.E.C.I.C. approved Oriental's application to assign the benefit of the Policy from Liu Chong Hing Bank to the Finance Company for the period from 1st October 1982 to 30th June 1983, but at the same time also sent the following letter to the Finance Company : -

"CONFIDENTIAL

37 Floor Connaught Centre,

Connaught Road C.,

Hong Kong.

Attn : Outward Bills Dept.

Dear Sirs,

We have pleasure in enclosing the duplicates of the above 2 Letters of Authority duly signed by us.

The above company has been our policyholder since 1969 July 2. Since the credit limits which we agree on overseas buyers apply retroactively to shipment made from the first day of cover i.e. 1969 July 2 the credit limits could have been wholly or partly utilised to the extent of value of goods shipped up to 1982 September 30 but not yet settled by the buyers concerned. In this connection, you may, if you wish, refer to the policyholder for details of any outstanding bills on the buyers listed in the captioned 2 Letters of Authority.

You will appreciate that should circumstances arise whereby we may have to consider a claim relating to the shipment made before 1982 October 1 the payment involved will not be made to your bank.

We will be sending to your bank for retention all relevant credit limit decisions approved by the corporation on and after 1982 November 10.

As regards credit limit decision already issued and despatched to the policyholder, you may wish to refer to them for details if necessary. If you have any query on the credit limits, please feel free to contact us at any time.

Encl.

c.c. Hong Kong Oriental Corporation

24. I have already mentioned how on the 11th November 1982 the Finance Company purchased Casa's bill for US$124,988.69 in respect of the shipment of the 5th October 1982. On the 11th November 1982, Oriental had obtained another statement from Liu Chong Hing Bank to the effect that up to 11th November 1982, the outstanding bill drawn on Casa and purchased by Liu Chong Hing Bank from Oriental was still for HK$659,686.57. The letter proclaiming that on 11th November 1982 was as follows:-

''Dear Sirs,

We confirm up to this date of writing the outstanding bill drawn on Casa Hong Kong SRL for HK$659,686.57.

26. Before Liu Chong Hing Bank gave that letter of 11th November 1982 to Oriental, Mr. Chow had informed Liu Chong Hing Bank that Oriental needed such confirmation to prove to the Finance Company how much of the Credit Limit covered by the Policy had up till then been utilized by bills purchased by Liu Chong Hing Bank.

27. There had also been another development meanwhile. On the 27th October 1982, Oriental applied to H.K.E.C.I.C. to have the Credit Limit increased in respect of Casa. As the result of that request, H.K.E.C.I.C. approved an increase in Casa's Credit Limit from HK$1.2 million to HK$1.4 million on the 2nd November 1982.

28. On or about the 22nd February 1983, the Venezuelan Government imposed a foreign exchange control measure prohibiting the sending of United States Dollars out of the country. This meant that Casa could not honour the outstanding bills when they fell due, and brought into play the provisions of the policy.

29. Towards the end of August 1983, H.K.E.C.I.C. invited Oriental to make a claim under the policy for Casa's outstanding bills. This Oriental did on the 1st September 1983, employing H.K.E.C.I.C.'s standard Claim Form (see Agreed Bundle at p. 53). That Claim Form showed a summary of the debts due by Casa as follows :-

"

The total amount claimed on the four outstanding bills came to US$401,356.

30. Under paragraph D(d) of the Claim Form, Oriental made the following declaration : -

The final part of the Claim Form read:-

Under the heading ASCERTAINMENT AND PAYMENT OF LOSS in the policy proviso (c) of Clause 2 is as follows : -

"(c)     The Corporation (H.K.E.I.C.) shall not be under any liability to pay any loss in respect of any contract unloss either : -

 

31. As part of the processing of Oriental's Claim, H.K.E.C.I.C. wrote to the Finance Company on the 1st October 1982 (see Agreed Bundle at p. 57). That letter was in effect pursuant to proviso (c)(ii) of Clause 2 of the policy. The letter referred to the assignment made in the Finance Company's favour, and informed the Finance Company that Oriental was making a claim under the policy in respect of Casa's draft for US$124,988.69 which related to the goods exported on 5th October 1982. H.K.E.C.I.C. requested the Finance Company to give an undertaking that, in the event of H.K.E.C.I.C. making a payment in respect of the claim specified in the letter, the Finance Company would not make any claim whatsoever to any recoveries subsequently received in respect of the loss other than such claim as it might be entitled to make to the proportion of the recoveries reserved to the policy holder under the terms of the policy. The Finance Company duly gave H.K.E.C.I.C. that undertaking on 7th October 1983 (Agreed Bundle at p.59).

32. The same standard form of letter was sent by H.K.E.C.I.C. to Liu Chong Hing Bank in its capacity as assignee on 6th October 1983 (Agreed Bundle at p. 62). That related to the claim being made by Oriental against H.K.E.C.I.C. under the policy in respect of the following three bills accepted by Casa : -

33. Liu Chong Hing Bank duly gave H.K.E.C.I.C. the standard form of undertaking in respect of payments on the 8th October 1983 (Agreed Bundle at p. 64).

34. The maximum amount which H.K.E.C.I.C. stood to pay out under the Policy in respect of exports to Casa was HK$1.26 million, being 90% of the Credit Limit of HK$1.4 million under the Policy. That whole amount of HK$1.26 million was paid by H.K.E.C.I.C. to Liu Chong Hing Bank on the 12th October 1983, whereas the Finance Company got nothing. I now set out the texts of the letters dated 12th October 1983 whereby H.K.E.C.I.C. communicated its decision to Liu Chong Hing Bank and the Finance Company, respectively :-

"

24 Des Voeux Road,

Central,

Hong Kong.

Attn. Outward Bills Dept.

Dear Sirs,

POLICY NO          :    144980/1

POLICYHOLDER :    HONG KONG ORIENTAL CORPORATION

BUYER                  :     CASA HONG KONG SRL, VENEZUELA

               (1)    In accordance with the Letter of Authority (Specific Buyer/s) jointly executed by the above policyholder and yourselves on 1982 July 9, we now have pleasure in enclosing our cheque for HKD1,260,000,00 in full and final settlement of the policyholder's claim under the transfer delay cause of loss in respect of the D/P shipment and under the default cause of loss in respect of the 3D/A 90 days shipments of the Policy.

                (2)    The amount of HKD1,260,000.00 was arrived at as follows :-

                (3)   We also have pleasure in enclosing a copy of our letter to our policyholders of even date and invite your particular attention to paragraph (2) thereof.

                (4)   Please be advised that we have deducted a 5% agent's commission from the gross invoice value of the shipments in accordance with paragraph 28(i)(b) of the Policy.

                (5)   We thank you for your attention and should be grateful if you would acknowledge receipts of our cheque in due course.

Encls.

EL:il

copy to HONG KONG ORIENTAL CORP.

= = = = =

"                                                                                                                 "

37 Floor Connaught Centre,

Connaught Road, Central,

Hong Kong.

Attn : Outward Bills Dept.

Dear Sirs,

POLICY NO.                  144980/1

POLICYHOLDER    :     HONG KONG ORIENTAL CORPORATION

BUYER                    :      CASA HONG KONG SRL, VENEZUELA

                (1) We refer to your duly signed and returned copy of particulars of claim of 1983 October 1.

                (2) In line with our letter of 1982 November 10 and in view of the over-shipment of the credit limit, we regret to advise that no claim payment is due to you.

                (3) We take this opportunity in enclosing copies of the above-mentioned letter and our letter to the policyholder of even date for your reference.

                (4) We thank you for your kind attention.

Encls.

EL:il

copy to HONG KONG ORIENTAL CORPORATION

= = = = =

38. At the time when Liu Chong Hing Bank received that payment of HK$1.26 million from H.K.E.C.I.C. on the 12th October 1983, Mr. Chow owed Liu Chong Hing Bank more than that sum in respect of the amounts overdrawn on the accounts he had in his own name and in the name of Oriental.

39. On 13th October 1983, the Finance Company wrote to Liu Chong Hing Bank in the following terms : -

"

The Manager

Liu Chong Hing Bank Ltd.

Hong Kong.

Dear Sir,

Re : ECIC Policy No. 144980/1 for Policyholder : Hong Kong Oriental Corp.

Buyer : Casa Hong Kong SRL, Venezuela

Your outstanding bill amount for HK$659,686.57                  

We refer to the abovementioned ECIC Policy.

On 29th October 1982, the policyholder, Hong Kong Oriental Corp. requested to transfer the assignment of the "Letter of Authority" from you to us to which you agreed but declared an outstanding bill amount of HK$659,686.57 (details as per photocopy of said letter attached).

At present, the Hong Kong Export Credit Insurance Corporation is settling the claims lodged by the policyholder on 1st September 1983 (details as per photocopy of said Claim Form attached). You are only entitled to compensation of 90% on the aforesaid outstanding bill at the rate indicated by the Hong Kong Export Credit Insurance Corp.

Hong Kong Oriental Corporation requested ECIC to pay the balance direct to us, but for policy reasons they where unable to comply and requested us to contact you direct.

We would appreciate it if you would send us your cheque for the difference.

Yours faithfully,

for and on behalf of

FOREIGN EXCHANGE AND INVESTMENT LTD.

42. Previously, Liu Chong Hing Bank had not been aware of what Oriental's intention might have been. In this context, I quote from the Statement of Agreed Facts :-

"Oriental had also put in thereto the claim for the bill purchased by Bank of America for US$43,151.00 to show that such bill was outstanding and had not been paid by Casa Hong Kong. Oriental did not want to lose the right to claim under the said policy the benefit thereto even though the same was at all times intended to be deferred subject to payment due to bills purchased by the Defendant and the Plaintiff. It was the intention of Oriental all along to assign the benefit of HK$659,686.57 to the Defendant and US$119,357.52 and US$124,988.69 to the Plaintiff up to the limit of the policy and subject to default of payment of the bills. Any surplus from the claim should then be reverted back to Oriental for its benefit. The Defendant was not aware of such intention until receipt of Plaintiff's letter (with a copy of the Oriental claim form) dated the 13th October 1983 (p.88 Of the Bundle)."

43. Despite the following letter dated 12th November 1983 from Oriental to Liu Chong Hing Bank, Liu Chong Hing Bank refused to hand over any part of the insurance monies to the Finance Company :-

44. It was not till 23rd November 1983 that Liu Chong Hing Bank actually credited Oriental's account with the HK$1.26 million received from H.K.E.C.I.C. As at the 23rd November 1983, Oriental owed Liu Chong King Bank in excess of that sum of HK$1.26 million.

45. By the present proceedings, the Finance Company seeks to recover the sum of HK$666,282.10 from Liu Chong Hing Bank. How that sum is calculated can be discerned from Oriental's letter of 12th November 1983 which is set out above. Alternatively, the Finance Company contends that, at the very least, it is entitled to recover the sum of HK$180,000 being 90% of the figure of HK 200,000 by which Casa's Credit Limit was increased by H.K.E.C.I.C. on 2nd November 1982.

46. As I see the position, the big problem for the Finance Company on its present claim is establishing any privity between itself and Liu Chong Hing Bank. I have sought to select only the facts which have a bearing on the relationship between the Finance Company and Liu Chong Hing Bank. The subjective intentions of either the Finance Company or Oriental are by themselves of no relevance. The Finance Company has pleaded its case on the basis either of money had and received or else on the basis of a trust. Only facts which show that Liu Chong Hing Bank undertook some sort of obligation to the Finance Company are of any relevance.

47. It is only if the money was impressed with an obligation at the time when Liu Chong Hing Bank received it on the 12th October 1983 that the Finance Company will have any entitlement to recover. Mr. Chow's and Oriental's efforts on the Finance Company's behalf subsequent to the 12th October 1983 were simply of no legal significance. As debtors of Liu Chong Hing Bank, Mr. Chow and Oriental were in no position to tell Liu Chong Hing Bank to divert funds to a third party such as the Finance Company. The cases (Foxton v. Manchester & Liverpool District Banking Co. (1881) 44 L.T. 406; Greenhalgh v. Union Bank of Manchester (1924) 2 K.B. 153; and Barclays Bank v. Quistclose Investments (1970) A.C. 567) and passages cited to me from the Ninth Edition of Pagets Law of Banking and the Third Edition of Holders Law and Practice of Banking on the topic of appropriating monies to different accounts with a bank were of no relevance to the situation in the present case. It was only if Liu Chong Hing Bank was under a pre-existing obligation to pay the Finance Company that Liu Chong Hing Bank needed to pay any heed to requests from Mr. Chow or Oriental to pay the Finance Company. As soon as Liu Chong Hing Bank got the money from H.K.E.C.I.C., it enjoyed a lien as far as Mr. Chow and Oriental were concerned because of their indebtedness.

48. Mr. Chow and Oriental had been equally powerless to prevent H.K.E.C.I.C. from paying Liu Chong Hing Bank the money due in respect of Casa under the policy. Oriental's purported direction to H.K.E.C.I.C. in the Claim Form dated 1st September 1982 to make payment in respect of only one bill to Liu Chong Hing Bank and the balance in respect of the three other bills to the Finance Company was of no legal consequence. In the face of the clear wording of the Letters of Authority (see Agreed Bundle p. 31 and 126), that purported direction was a thing writ in water which could do nothing to create any obligation on the part of Liu Chong Hing Bank towards the Finance Company.

49. I do not see how the Finance Company can bring itself within the legal concepts of money had and received or a trust on the facts of the present case.

50. It is all very well for the Finance Company to plead money had and received, but such a plea by itself is not very helpful, as the law does not recognise any generalized right to restituion. The Finance Company has to show that it comes within one of the categories where the law recognises there has been unjust enrichment giving rise to a restitutionary claim. For the purposes of legal classification, the Finance Company is in the position of saying that the Defendant, Liu Chong Hing Bank, has received a benefit from a third party, H.K.E.C.I.C. The limited opportunities for recovery in such a situation are described in Goff's Law of Restitution (2nd edn.) at p. 44. (Also relevant are some of the observations at p. 3 and 24.) The matter is dealt with more fully in section 2 of the book which is headed "WHERE THE DEFENDANT HAS ACQUIRED FROM A THIRD PARTY A BENEFIT FOR WHICH HE MUST ACCOUNT TO THE PLAINTIFF''. The only hope for the Finance Company on a "had and received" basis would be if it could show that in some way Liu Chong Hing Bank had made an attornment to it. A perusal of Chapter 26 quickly reveals, however, that the Finance Company cannot satisfy the conditions required to establish an attornment.

51. For the Finance Company, it was submitted that Oriental had somehow set up a trust for the Finance Company, with Liu Chong Hing Bank acting as trustee in respect of the monies received from H.K.E.C.I.C. If anywhere, the intention to set up such a trust is said to arise as a matter of inference from the direction given by Oriental to H.K.E.C.I.C. in the Claim Form dated 1st September 1983 to pay the insurance monies in respect of the bill for US$113,859.16 to Liu Chong Hing Bank and the balance to the Fina ce Company. Such a contention cannot stand up to legal analysis. Oriental simply lacked the power to give any effective direction to H.K.E.C.I.C. in the face of the Letter of Authority in Liu Chong Hing Bank's favour. A slightly more technical objection peculiar to the law of trusts is that because the purported direction was not expressed to be irrevocable, it was not effective to constitute a trust. Moreover, there is nothing in that Claim Form to show that Oriental was seeking to appoint Liu Chong Hing Bank as its trustee.

52. What then of the Finance Company's alternative claim for $180,000, being 90% of the $200,000 by which Casa's Credit Limit was increased by H.K.E.C.I.C. on 2nd November 1982? That fares no better. Perhaps there was less justification for H.K.E.C.I.C. disregarding Oriental's request by paying this money to Liu Chong Hing Bank, since it related to a Credit Limit increase occurring within the period from 1st October 1982 to 30th June 1983 covered by the Letter of Authority (Agreed Bundle at page 31) in the Finance Company's favour. However, H.K.E.C.I.C. is not a defendant in the present proceedings, and the Finance Company still cannot overcome the problem of privity which stands in the way of its mounting a claim directly against Liu Chong Hing Bank. The concepts of money had and received or the trust still take the Finance Company no further in the alternative claim for $180,000 against Liu Chong Hing Bank than they did in the primary claim for $1.26 million.

53. Both as regards that primary claim and the alternative claim, the doctrine which might have come closest to affording the Finance Company some sort of salvation is that know as proprietary estoppel. That form of estoppel is capable of operating positively so as to confer a right of action. How it operates is described in Snell's Principles of Equity 28th Edn. at P. 558 - 563. I can see some scope for arguing that the Finance Company might have been encouraged to act to its detriment by representations made by Liu Chong Hing Bank at the time the Finance Company was contemplating negotiating the bill for US$124,988.69 in respect of the shipment made on 5th October 1982. Liu Chong Hing Bank knew that Oriental required confirmation that Liu Chong Hing Bank had purchased just the one bill from Oriental to prove to the Finance Company how much of the Credit Limit under the Policy had been utilized by bills purchased by Liu Chong Hing Bank. It might have been possible to argue from that to the effect that Liu Chong Hing Bank encouraged the Finance Company to act to its detriment by buying the bill in respect of the export on 5th October 1982. There was no point in the Finance Company seeking Liu Chong Hing Bank's confirmation if Liu Chong Hing Bank was already entitled to all the proceeds of the Policy. It might have been arguable that Liu Chong Hing Bank led the Finance Company to believe that it would only claim under the Policy in respect of the bill for US$113,859.16. However, estoppel was not pleaded and particularised so there is no point in speculating further on whether it might have succeeded

54. The impression I am left with is that, quite frankly, Liu Chong Hing Bank has behaved rather badly, but is, nonetheless, entitled to succeed in this action. Liu Chong Hing Bank was not prepared to finance its customer, Oriental. Yet now Liu Chong Hing Bank has received an advantage without having taken any corresponding risk. Liu Chong Hing Bank finishes up in a position where it has received a "windfall", from which it cannot be parted. On the other hand, the Finance Company, which did something positive to help a Hong Kong exporter, is left to walk away empty-handed. It is a result that I do not like, but one that I cannot avoid. As epilogue, I cite the comfortless words of Lord Justice Romer in Hand v. Blow [1901] 2 Ch. 721 at 737 : -

"As to the argument that there is something in the nature of honesty and common justice requiring the Court to interfere, that is only a plea ad misericordiam which cannot be supported by any legal or equitable right."

55. Somewhat reluctantly, I dismiss the Finance Company's claim.