LOUIS VUITTON MALLETIER S.A. v. MARCO LEATHER GOODS, LTD AND OTHERS

HCA1511/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1511 OF 2009

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BETWEEN

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R U L I N G

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1.  The background to this is a well-drawn Tomlin order made by the learned judge on 12 May this year.

2.  Essentially, it provided for the payment by the defendants to the plaintiff for very substantial amounts of money, but accommodation was given within the terms of the Tomlin order to the effect that a number of valuable properties, which are the subject of the order itself, would be sold and, in that way, there is a delay mechanism for the payment of these considerable amounts of money.

3.  It had been agreed that if the properties were not realised, then the keys to the properties would be handed over by 1 September.  That date, of course, has come and gone; today is 30 September.  

4.  Unsurprisingly, the plaintiff has come with this summons and Mr Lau is forced to say that - he appearing for the relevant defendants - if given more time, that they will be in a position to do what was contemplated, albeit somewhat later than was agreed to by the defendants.

5.  Obviously, I have a discretion as to what I can do today.

6.  At one end of the scale, I can do as Miss Tam has urged me to do, which is to make an order in terms of her summons.  The effect of it would be that the sale of these properties would fall into the hands of the plaintiff who would then arrange for the properties to be auctioned.

7.  At the other end of the scale, to give the defendants much longer than they agreed to in the first instance, going forward to

8.  I have decided this is obviously a large case: there is a lot of money at stake and there are valuable properties at stake.

9.  I think the defendants ought to be given just a little bit more time in the circumstances to try and achieve a reasonable price.  If the matter were to go to auction, Miss Tam tells me there would be no reserve price, so there is a real risk that some bidder may get away with a price which really represents far less than anything approaching true market value.

10.  In order to try and achieve an orderly sale, I am going to give the defendants four weeks from today, that is to 28 October.  The order today will be in terms of an unless order, that unless they deliver to the plaintiff signed and binding contracts for the sale of these properties, then there will be an order in terms of Miss Tam’s summons, so it is to

(Clarification and discussion re costs)

11.  It strikes me that in these circumstances where the plaintiffs are completely blameless, the original order, in what is after all a commercial matter, contemplated, and the defendants agreed to this, that they would be given the period between the making of the order on

12.  The summons was issued; nothing further has happened.  They have had another month since then. I have given them a further month, with a further two weeks tagged on at the end for completion, and the plaintiffs have been put in the position of having to come to court.

13.  I think that there should be a taxation on an indemnity basis.