CHUNG OI YUNG t/a MING HONG WEAVING FACTORY v. INTERNATIONAL TEXTILES CO

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JUDGMENT

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Kempster, JA:

1. This is an appeal, by leave, from a judgment given by HH Judge Wong in Chambers in the District Court on 22nd October 1990 in favour of the plaintiff, Madam Chung Oi Yung, on her application for summary judgment. The sum adjudged due from the defendant firm, International Textiles Co., was HK$100,000, being the amount of a countermanded cheque, together with interest.

2. According to the affirmations of Mr Lee Ming and Mr Poon Lok Rocky, for the plaintiff and defendants respectively, the cheque in question, payable to bearer, had been delivered by the defendants, post-dated, to one Yeung Chun Fuk conditionally upon his delivery to them of certain goods; a condition which was not fulfilled. Yeung had delivered the cheque to the plaintiff's general manager who had received it in the course of her business as part payment for other goods and, according to the affirmation of Mr Lee Ming, without notice of any defect in Yeung's title. It is contended before us, however, as doubtless it was below, that Mr Poon's affirmation inferentially suggests that the plaintiff, by Lee Ming, had notice of defects in the instrument.

3. The defendants' difficulty, as Mr Chung on their behalf has recognised, derives from the terms of paragraph 10 of Mr Poon's  affirmation which reads:

This is quite consistent with the facts deposed to by Mr Lee Ming. Paragraph 10 goes on:

and then, adopting a paragraph in the Defence:

4. On that evidence the judge was entitled to find and indeed, in my view, could only have found that when the cheque was received on behalf of the plaintiff there was no notice of any defect but that suspicions had subsequently arisen leading to a succession of telephone conversations. In such circumstances and by reason of the definition of "delivery" in section 2 and of the terms of sections 21, 27(2), 29(1), 30(2) and 31(2) of the Bills of Exchange Ordinance (Cap 19), the cheque had been negotiated when possession was transferred from Young to the plaintiff who was not only deemed to be but was "holder for value" and "in due course".

5. By the terms of section 38 the plaintiff was entitled to sue on the bill in her own name free of any defences available as between the defendants and Yeung.

6. In the course of his researches Mr Chung discovered and has cited to us a number of cases in support of submissions going beyond the terms of the Ordinance by which we are bound. One such authority referred to a situation where an uncommunicated acceptance was revoked and held to be of no effect. Cox v. Troy (1822) 5 B. & ALD 474. At p 481 Best J emphasised that in relation to what had transpired "Nobody can be injured by it". In essence Mr Chung seeks to draw an analogy with section 21(2) which reads:

I say "analogy" because the provision just read deals with property rather than possession.

7. With the best will in the world and after the most sympathetic consideration of the. argument addressed to us I am satisfied that neither Judge Wong's reasoning nor his determination can be faulted. Accordingly I would dismiss this appeal.

Sir Derek Cons, V-P:

8. I agree with my Lord and I, too, would dismiss the appeal.

Nazareth, J:

9. I agree.