XCHRX EASTLITE INDUSTRIES LTD. v. WILLIAM HUNG YU YANG

HCA2224/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO.2224 OF 2000

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J U D G M E N T

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1. This is an appeal by the defendant from an order of the master where the master gave final judgment to some $5.8 million and conditional leave to the balance of the sum claimed by the plaintiff in this action. The claim of the plaintiff is for the total sum of some $8.8 million arising under a guarantee, which is called the Second Guarantee, dated 21 March 1994. There was an earlier guarantee of 5 March 1990, called the First Guarantee. There is no dispute at the hearing that the defendant signed both guarantees.

2. The dispute of the defendant is that both guarantees were said, at the time of the signing, not to be relied upon and would never be called upon. The circumstances of the signing of the guarantee and the content of the guarantees show that these were elaborate legal documents prepared by lawyers and signed in the presence of lawyers and under seal.

3. I have no doubt that even with the elaborate arguments and affidavits filed by the defendant at various late stages of the proceeding, there is no credible defence raised. It is to be noted that the original defence filed, dated 3 April 2000, said not a single word about the present defence that the guarantees were signed with a clear understanding that they would not be relied upon. I have no hesitation, therefore, in coming to a view that the story of the defendant is not credible. The proper order that should be made is that there should be judgment to the plaintiff in the sum ordered by the master with conditional leave to defend on the balance as ordered. I think the master was quite right in the order he made.

4. The appeal is therefore dismissed with costs.