Kung Shiu Cheong v Wong Suet Man And Others

CourtDistrict Court (Hong Kong)
Judgement NumberDCCJ5423/2006
Subject MatterCivil Action
DCCJ005423/2006 KUNG SHIU CHEONG v. WONG SUET MAN AND OTHERS

DCCJ5423/2006

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 5423 OF 2006

______________________

BETWEEN

KUNG SHIU CHEONG Plaintiff
and
WONG SUET MAN 1st Defendant
CHAU CHI SUM 2nd Defendant
LEUNG WING FAI 3rd Defendant

______________________

Coram : H H Judge Lok in Chambers

Date of Hearing : 11 October 2007

Date of Decision : 11 October 2007

______________________

D E C I S I O N

______________________

1. This is an application by the 3rd Defendant to set aside the judgment obtained against him on 27 December 2006.

2. The Plaintiff’s claim is for the sum of $240,000 against all 3 Defendants for misrepresentation. According to the Statement of Claim, the 1st Defendant was the sole proprietor of a noodle shop known as “Noodle House”. In or about December 2005, to induce the Plaintiff to acquire one-third of the interest of the business of the Noodle House (“the Business”), the 2nd and the 3rd Defendants, under the authority of the 1st Defendant, represented to the Plaintiff that the Business was being operated by a company with issued share capital jointly held by the Defendants. It is claimed that the said representation was false in that such company did not exist. Relying on the said representation, the Plaintiff agreed to purchase and the 2nd and the 3rd Defendants agreed to sell one-third of the share capital of the said company at a total consideration of $240,000. After the Plaintiff discovered the said untrue representation, the Plaintiff repudiated the agreement. Further, the Plaintiff claims that the consideration for the payment of $240,000 had wholly failed and the Defendants are liable to the Plaintiff for the said sum of $240,000 on the ground of misrepresentation or mistake.

3. In support of his claim, the Plaintiff relies on the Share Transfer Agreement and the Memorandum of Receipt of the Purchase Money for the Share signed by the 2nd and 3rd Defendants dated 23 and 24 January 2006 respectively.

4. There is no issue that the judgment obtained against the 3rd Defendant is a regular one. The 3rd Defendant explains that he had all along relied on the 2nd Defendant to conduct the proceedings, and he himself had not filed a defence in the present case. The 3rd Defendant knew about the default judgment in mid-January 2007. As the 2nd Defendant applied for legal aid by that time, he believed that he could benefit from the conduct of the defence by the 2nd Defendant. After the 2nd Defendant’s legal aid application was refused in April 2007, the 2nd Defendant instructed solicitors to defend his case. After the 2nd Defendant’s solicitors ceased to act for the 2nd Defendant in late June 2007, the...

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