A A

B CACV 101/2014 B

C IN THE HIGH COURT OF THE C

HONG KONG SPECIAL ADMINISTRATIVE REGION

D D
COURT OF APPEAL
E CIVIL APPEAL NO. 101 OF 2014 E

(ON APPEAL FROM HCA NO. 925 OF 2010)

F F

G BETWEEN G

H
CHEUNG HING Plaintiff H
And
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WONG CHOR CHEUNG 1st Defendant
J BEST CENTURY HOLDINGS LIMITED 2nd Defendant J

K
WAH FUNG FOREST RESOURCES LIMITED 3rd Defendant K

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Before: Hon Kwan JA
M Date of Decision: 2 January 2015 M

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DECISION

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1. On 4 December 2014, the Court of Appeal (Kwan JA and Poon J)
P made an order for the 1st and 3rd defendants (Wong and WF Forest), P

the appellants in CACV 101/2014, to provide security for costs of appeal

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of $442,420 within 28 days. The last day for complying with the order
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falls on 2 January 2015. The order also provided that the court may

S
extend time to comply with the order for special reasons. S

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B 2. On 23 December 2014, the defendants issued a summons to extend B

time to give security to 25 February 2015 with an affirmation of Wong in

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support.
D D

3. I gave directions on 24 December for this application to be dealt with

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on paper.
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4. The plaintiff did not file evidence or submission in opposition
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pursuant to the directions given on 24 December. Instead, his solicitors

H
wrote to the court on 30 December 2014 stating his position that he is H
prepared to consent to extend time to 25 February 2015 subject to 7
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undertakings to be given by Wong and other parties.

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5. As the defendants would not agree to give the proposed undertakings,
K the matter has to be determined by the court. K

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6. The grounds put forward by the defendants for extending time are that
M Wong proposed to sell the Chi On Property and use the proceeds to pay M

the security ordered by the court. He exhibited a provisional agreement

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for sale and purchase made by the registered owner, Landford Enterprise
O Ltd (Landford), dated 18 December 2014 for the consideration of O

$3,680,000. A formal sale and purchase agreement is to be signed on 18

P P
January 2015 and completion is to take place on 18 February 2015.
Q Q
7. Wong had deposed in an earlier affirmation that the entire issued
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capital of Landford is held by his son John Wong on trust for him. He

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exhibited a letter dated 23 December 2014 from John Wong to the S
handling solicitors giving an irrevocable letter of authorisation to
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release all the sale proceeds to Wong.

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B 8. Wong also deposed that the encumbrances on the property are an B

outstanding loan to Hong Kong Finance Co Ltd of $2.3 million and a

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charging order of the Inland Revenue Department of $367,776.93. And
D since the property is to be sold for $3,680,000, the net sale proceeds D

should be sufficient to pay the security ordered.

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F 9. I have considered the undertakings sought by the plaintiffs solicitors. F

The first three undertakings are said to be necessary to confirm the

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beneficial interest of Wong in the property as alleged by him. I do not
H consider this necessary in light of the evidence adduced by Wong. H

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10.The fourth and fifth undertakings are said to prevent Landford and

J Wong from diminishing the value of the property by creating any further J
encumbrance to ensure that the net proceeds would be sufficient to pay
K K
the security ordered by the court. I will impose a condition but in limited

L terms. L

M 11.The sixth undertaking is to be provided by the handling solicitors to M

ensure that the necessary amount from the proceeds of sale will be used
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for paying the security for costs. I do not find this necessary in view of
O the irrevocable authorisation given to the solicitors to release the sale O

proceeds to Wong.
P P

Q 12.The seventh undertaking is to cater for the contingency that the sale Q

should fall through prior to completion. I think it appropriate to provide

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for this in the order I am to make.
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13.The order I make is in the following terms:
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(1) The time provided by the order of 4 December 2014 for
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giving security for the plaintiffs costs of the appeal in

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B CACV 101/2014 be extended to 25 February 2015, subject B

to the terms in (2) and (3) hereof. Save as aforesaid, all

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other terms of the order of 4 December 2014 shall remain
D unchanged. D

E (2) Within seven days hereof, the 1st defendant is to give a E

F
personal undertaking to the court in writing and to procure a F
similar undertaking in writing from Landford not to create
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any further encumbrance against the Chi On Property prior

H
to completion of the sale and purchase so as to reduce the net H
proceeds of sale below $442,420.
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(3) In the event the purchaser of the Chi On Property should fail
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to pay the further deposit by 18 January 2015, the

K 1st defendant is to give notice in writing to the Registrar and K

to the solicitors for the plaintiff (such notice is to be given
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within two days of the event), in which case the 1st and
M 3rd defendants are to give security as ordered within seven M

days of the event.

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(4) The 1st and 3rd defendants are to pay the plaintiffs costs of
O O
this application in any event.
P P

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B B

C C
(Susan Kwan)
D Justice of Appeal D

E E
Cheung Wong & Associates for the Plaintiff (Respondent)
F W K To & Co for the 1st and 3rd Defendants (Appellants) F

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H H

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J J

K K

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M M

N N

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P P

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