ETTORE MASSIMILIANO NASSETTI v. IP KIN HANG JACKY

DCCJ6595/2004

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 6595 OF 2004

D E C I S I O N

1.  The Plaintiff applies for Order 14 summary judgment against the Defendant for the return of a loan of $150,000 under a loan agreement between the plaintiff and the defendant entered on 30 November 2001.

2.  The Plaintiff’s defence is that the $150,000 was the initial capital injected by the Plaintiff into a joint venture business to be incorporated in 2001, and a company was incorporated in the British Virgin Islands known as Gamenet (Asia) Company Limited  Eventually, in January 2002, a company by the same name was incorporated in Hong Kong.

3.  The Defendant produced a shareholder’s agreement entered some time in January 2002, without naming the exact date on the agreement, between the Defendant, one Mr Andy Li of a British Virgin Island company called Capital Metro Assets Limited, which the Defendant claimed is a BVI company controlled by the Plaintiff, and finally a company called Croydon Associates Limited, owned by one Mr Allan Kwok, who the Defendant claimed to have been the person who introduced the Plaintiff to the Defendant.

4.  It is not disputed that company Gamenet (Asia) Company Limited was financed mainly through the Plaintiff’s BVI company, Capital Metro Assets Limited, this company was referred to in the shareholder’s agreement as Investco in short.  It is the Defence case that that was because Capital Metro Assets Limited was indeed the investor which would inject funds into the Hong Kong Gamenet (Asia) Company Limited.  The Defendant further produced vouchers prepared by him of the monthly expenditures of the Hong Kong Gamenet (Asia) Company Limited in support of his claim that this loan was for the purposes of Gamenet and not for his own benefit.

5.  The Plaintiff disagreed with the Defendant’s allegations.  In particular, the Plaintiff disagreed that BVI incorporated companies such as the BVI Gamenet (Asia) could not open a bank account in Hong Kong, which was the reason the Defendant gave for failure to open a bank account in Hong Kong until the Hong Kong company was incorporated, and meanwhile the money was paid to him.  The Plaintiff alleged that the Defendant borrowed the money from the Plaintiff to support his and his family’s daily expenses and it was a personal loan.

6.  The Plaintiff exhibited a statement of Gamenet (Asia)’s personal loan and capital investment account, signed by the Defendant and the Plaintiff’s representative Miss Cathy Ho, as evidence of the Defendant’s acknowledgement of the loan as a personal one as opposed to the capital investment by the Plaintiff into the Hong Kong Gamenet Company.

7.  The Plaintiff alleged the vouchers and accounts produced by the Defendant were prepared by the staff working under the Defendant, and no verifications could be made because no documents had been produced to support these so-called vouchers.  On the other hand, the Defendant alleged that the Plaintiff had kept the records of Hong Kong Gamenet (Asia) because, at a later stage of the events, the Defendant was ousted from the company and therefore it is the Defendant’s claim that the Plaintiff should have possession of all the documents of accounts.  It is the Defendant’s claim that the true state of the affairs of the Hong Kong Gamenet (Asia) could not be ascertained.

8.  Finally, the Plaintiff further alleged that the Defendant has been charged by the police for theft and false accounting.  It is not disclosed by Miss Cathy Ho in her affirmations if these charges had anything to do with the present affairs or the affairs of Hong Kong Gamenet (Asia).  This was raised probably to discredit the assertions and evidence of the Defendant.

9.  On the basis of the cross-allegations of falsehood of accounting and destroying of documents, and the complications of the affairs of Hong Kong Gamenet (Asia), I do not think the matter should be decided in a summary manner.  The Defendant had raised sufficient doubts through his defence to show an arguable defence case.

10.  On the basis of the complicated allegations from both parties, it is not a suitable matter to be decided summarily.  I am satisfied, therefore, the matter should go to trial.  On the aforesaid basis I grant unconditional leave to defend and the costs of the application and the hearing to be in the cause, to be taxed if not agreed.  I would also grant certificate for counsel.