Our Chans advice/191 reported a Hong Kong High Court’s case concerning a shipping company’s restitution claim against its former deputy general manager (Mr Ma) for HK$387,655,303.70. The latest development of this case is: the Hong Kong High Court issued a Judgment on 1/2/2018 and a Decision on 9/2/2018 holding that Mr Ma was in contempt of Court as a result of his breach of a Mareva Injunction Order and that he be committed to prison for 4 months. [HCMP1115/2017] [2018 HKCFI176] [2018 HKCFI328]
Background
Mr Ma used to work for the shipping company. He first joined the shipping company in 1992 as an Accounts Clerk. He was promoted gradually and became its Deputy General Manager (Accounting). That was Mr Ma’s post when he was summarily dismissed on 4 March 2016. At that time, he was earning a monthly salary of HK$37,900.
It was the case of the shipping company that, between 2009 and 2016, Mr Ma caused a total sum equivalent to HK$387,655,303.70 (Sum), which involved 262 transactions, to be wrongfully transferred from his employer’s accounts to his own accounts. The shipping company asserted, inter alia, a proprietary claim over the Sum.
In Mr Ma’s Amended Defence, the money which made up the Sum was transferred with the knowledge, consent and authorization of the shipping company pursuant to an Agreed Arrangement devised to overcome foreign exchange control of the Mainland. Such Arrangement was required due to the need of the shipping company to make payments to service providers in the Mainland.
The shipping company said that the Agreed Arrangement was entirely a fiction created by Mr Ma.
The matter was reported to the police by the shipping company. There was an Indictment against Mr Ma containing 2 counts of theft. He was on bail pending the trial of his case in the High Court.
The Order
On 10 March 2016, upon the shipping company’s ex parte application, the court granted the Order against Mr Ma in the Main Action. The Order, inter alia, enjoined Mr Ma from dealing with his assets up to the value of HK$322,345,743 (Restriction on Disposal of Assets); included the usual ancillary disclosure order; and made provisions for monetary exceptions in respect of Mr Ma’s ordinary and proper expenses (HK$9,000 per week) and legal costs (HK$100,000). The Order was endorsed with a Penal Notice and was served personally on Mr Ma on 11 March 2016. The Order was subsequently varied on 18 March 2016, 14 April 2016, 26 August 2016 and 3 February 2017. The amendments included revising the limit of the Order to the Sum.
The subject matters of complaint
Subsequent to the granting of the Order, on 25 May 2016, Mr Ma opened 5 accounts with Citibank (Hong Kong) Limited (May Accounts). At the material times, Mr Ma had 2 American Express credit cards (Credit Cards), respectively a Platinum Card and a Centurion Card.
According to Mr Ma’s evidence, the following sums were deposited into the May Accounts. Firstly, a total sum of HK$2,988,082.44 which was realized from the termination of 6 insurance policies (Insurance Policies). Secondly, a total sum (by way of 26 deposits from 2 June to 2 September 2016) of HK$916,950 was deposited by Mr Ma’s friends pursuant to a Reimbursement Arrangement (see below). These payments added up to HK$3,905,032.44 (Deposited Sum).
According to Mr Ma’s explanation, the Deposited Sum was transferred out of the May Accounts for the following purposes. These transfers added up to precisely the Deposited Sum :
(1) Mortgage payments in the total sum of HK$275,728; (2) Payments for the Credit Cards in the total sum of HK$1,539,916.08; (3) Expenses permitted under the monetary exceptions of the Order in the total sum of HK$543,000; (4) Other personal and property expenses in the total sum of HK$1,546,388.36.
In the committal proceedings, the court was invited by the shipping company to focus on the complaints relating to the breaches of the Restriction on Disposal of Assets which arose from the transactions carried out with the May Accounts and the Credit Cards. By an Originating Summons filed on 16 May 2017 (OS), the shipping company sought a committal order against Mr Ma for breaches of the Mareva Injunction Order (Order) made in HCA 619 of 2016 (Main Action). Leave to commence these proceedings was granted on 4 May 2017 pursuant to an O.52, r.2(2) Statement filed on 14 March 2017. The breaches of the Order concerned undisclosed assets of Mr Ma and the dissipation of the same.
Law
The applicable principles are settled and not in dispute. The proper approach of the court involves a three-stage test :
“There was no dispute that the proper approach in committal for civil contempt by reason of breach of a court order is essentially a three-stage test, namely: (1) first, the relevant court order must be construed to ascertain its meaning and operation; (2) secondly, it must be determined whether the defendant has in fact complied with the order as so construed; and (3) thirdly, it must be determined whether any failure to comply was accompanied by the state of mind necessary to establish punishable contempt.” Effiscient Ltd v Edward Eugene Lehman [2013] 3 HKC 300, §14 per Fok JA
No order will be enforced unless it can be shown that the terms are clear and unambiguous. The burden is on the plaintiff to prove the defendant’s contempt beyond reasonable doubt: Hao Xiaoying v Wong Yiu Lam William & Ors, HCMP 1968/2014, 2 March 2015, §34.
In establishing the requisite state of mind, it is enough to show that the conduct itself was intentional without being contumacious. A mistaken believe as to the legitimacy of the act is not a defence: Suzanne Ruth Henderson v Scott Henderson, HCMP 2016/2014, 14 July 2015, §§16-17.
Issues
The issues for the court were as follows :
(1) Whether on the proper construction of the terms of the Order, the shipping company could prove beyond a reasonable doubt that Mr Ma was in breach of the terms (Issue 1); (2) For each alleged breach, whether the shipping company could prove beyond a reasonable doubt that the failure of Mr Ma to comply was accompanied by a state of mind necessary to establish punishable contempt. In other words, whether Mr Ma acted in wilful disobedience of the terms of the Order (Issue 2); and (3) Whether the court should exercise its discretion to order any alternative directions or conditions in lieu of committal.
The requisite state of mind to establish contempt is that (a) the contemnor knew the facts which are said to make his act or omission a contempt and (b) such act or omission was not accidental (see Hong Kong Civil Procedure 2018, vol 1, rubric 52/1/17). This is meant by “wilful disobedient”.
Credit Card Payments
During a period of about 5 months from March to July 2016, Mr Ma had incurred expenditures with the Centurion Card in the total sum of HK$3,882,688.44 and HK$634,090.10 in respect of the Platinum Card. These Cards were terminated by the issuer in July 2016.
Platinum Card
The lion share of the Platinum Card expenses HK$550,306 was paid to CSL for the upkeep and/or termination of Mr Ma’s mobile phone plans. Mr Ma’s evidence was that he had acquired a large number of auspicious mobile phone numbers from CSL. The substantial amount paid to CSL was the result of the pre-mature termination of over 100 service contracts required to keep these mobile phone numbers. With the Order in place, Mr Ma was unable to continue to pay the monthly fees under the contracts. To avoid the accumulation of outstanding monthly fees, he terminated the contracts before their expiration. It was contended that such step was reasonable and necessary.
Centurion Card
A Reimbursement Arrangement alleged by Mr Ma was highly relevant to much of the expenditures incurred with the Centurion Card. Mr Ma explained the Reimbursement Arrangement as follows. As a Centurion cardholder and VIP member of various establishments, Mr Ma was entitled to various benefits and privileges. It was his practice “for several years” to help his friends to purchase various goods and services by using his Centurion Card so as to enjoy the benefits and privileges associated with it and/or his VIP memberships. Such friends would subsequently reimburse Mr Ma for the expenses that he had incurred on their behalf. A total of HK$3,597,031.79 was said to have been incurred under the Reimbursement Arrangement.
In respect of the nature of the Centurion expenses, the Judge agreed with the shipping company that they demonstrated an extraordinary lavish lifestyle. Very substantial sums were spent on personal services like massage parlours and night clubs. One particular night club bill was in the sum of HK$500,000. On a number of occasions, huge amounts were spent on Chanel boutique.
Payments made to the Card issuer
The total payment made for the Credit Cards to their issuer amounted to about HK$1.54 million. The statements showed that the total payment made for the Centurion Card and the Platinum Card was respectively HK$1,242,417.80 and HK$357,498.28. Hence, there were unpaid outstanding balances in respect of which legal proceedings had been issued against Mr Ma by the Card issuer.
It is important to distinguish between making a “payment” to a shop with a credit card and payment made to the card issuer for having made purchases with the credit card. The former cannot be regarded as dissipation of assets.
The legal nature of credit card transactions was explained In re Charge Card Services Ltd [1989] 1 Ch 497, 509C-F, per Browne-Wilkinson VC (as he then was). It was held that a credit card transaction comprises two separate contracts, one between the card company and the seller to accept the card in payment, and the second contract between the card company and the cardholder which enables the latter to use the card for payment in consideration of his agreement to pay the card company in full. It follows that each payment by credit card merely represents the increase of an existing debt to the card company.
Mr Ma’s case was that the entirety of the HK$1.54 million was attributable to the Reimbursement Arrangement. Given that his friends had repaid him HK$916,950, there was an outstanding balance of HK$622,966.08 which his friends were willing to repay after the Chinese New Year.
Other spending
Mr Ma’s evidence was that these transactions involved purchases of consumer goods and services for himself to maintain the high standard of living which he was accustomed to.
Analysis
As regards the purchases of consumer goods and services, Mr Ma accepted that these expenditures constituted breaches of the Restriction on Disposal of Assets. Mr Ma had expressed remorse and he was apologetic for such conduct. In short, the liability for breach of the Order was admitted. The remaining issue was the appropriate punishment.
In respect of the credit cards’ payments, it was contended by Mr Ma that the sum of HK$916,950 (which came from his friends under the Reimbursement Arrangement) was not his asset or subject to the Restriction on Disposal of Assets, and that payment of the HK$916,950 out of the May Accounts did not amount to dissipation of his assets or any breach of the Order.
On the other hand, there was no dispute that the sum of HK$622,966.08 was Mr Ma’s asset and the payment of that sum to settle the debts owed under the Credit Cards constituted breaches of the Restriction on Disposal of Assets. The remaining issue was the appropriate penalty.
The Reimbursement Arrangement
The dispute over the Credit Card payments was therefore confined to the amount of HK$916,950 (HK$1,539,916.09 – HK$622,966.08). Whether the payment of HK$916,950 was in breach of the Restriction on Disposal of Assets depended on whether it was part of Mr Ma’s assets and the credibility of the evidence on the Reimbursement Arrangement.
The Judge was unable to accept the Reimbursement Arrangement as true. The evidence was nothing but a bare assertion. No particulars whatsoever had been provided. There was no information even on the number of “friends” involved. Further, the Reimbursement Arrangement did not stand up to simple scrutiny. First, it made no sense that all the Card payments (the entirety of the HK$1.54 million) were made under the Arrangement because Mr Ma had to be present to sign the bills for his friends. It was inconceivable that none of the expenses was attributable to him, eg, the night club expenses and those incurred for food and beverage. There was no suggestion that under the Arrangement Mr Ma’s friends would absorb his share of the expenses. Secondly, over HK$350,000 of the payments, which went to the Platinum Card account, were mainly for the CSL expenditures. The Judge failed to see why Mr Ma’s friends had anything to do with such expenses. Furthermore, despite the committal proceedings, there was no suggestion that Mr Ma had attempted to press his friends for the outstanding payment (HK$622,966.08) or to produce any evidence from any of them to support the Reimbursement Arrangement.
Having rejected the Reimbursement Arrangement story, the court was left in no doubt that the HK$916,950 was Mr Ma’s asset. Firstly, the money was in his bank account. Normally, such funds belonged to the account holder, and there was no credible evidence to the contrary. Secondly, Mr Ma was free to use the money as he pleased. Therefore, the only reasonable inference was that the money belonged to him. In the premises, there was no doubt that Mr Ma had breached the Restriction on Disposal of Assets in respect of the payment of HK$916,950, and Issues 1 and 2 were both satisfied.
Conclusions
The Judge found that Mr Ma was in breach of the Restriction on Disposal of Assets imposed in the Mareva Injunction Order (Order) granted against him on 10 March 2016. He was therefore in contempt of court.
Committal
The shipping company referred the court to the authority of AO Smith Holdings (Barbados) SRL v Zhang Dacheng, HCMP 1132/2011, 1 June 2012, §§58 to 62, where the court agreed with the English Court of Appeal that deliberate and substantial breach of a Mareva injunction should be met with an immediate custodial sentence measured in months, unless the contempt has been purged and the assets recovered. The court was also referred to a number of similar or comparable cases where immediate custodial sentences ranging from 3 to 6 months were imposed: Banca Popolare Di Vicenza Soc Coop v Alutech (Far East) Co Ltd, HCA 1973/2007, 11 September 2008, §§9-10 (6 months); A O Smith Holdings, §70 (3 months); GE Transportation (Shenyang) Co Ltd v Lu Jinxiang, HCMP 1792/2013, 22 January 2014, §§55-56 (3 months); Suzanne Ruth Henderson v Scott Henderson, HCMP 2016/2014, 14 April 2016, §23 (3 months).
There was little which could be said in mitigation for Mr Ma. The breaches of the Order could not be regarded as anything but serious and deliberate infringements which took place over a long period of time. There was no good or acceptable explanation for the infringements. The only substantive matter in Mr Ma’s favour was his apology. On the other hand, it was of no comfort to the shipping company and did not mitigate the effect of the breaches.
The court was informed that Mr Ma was 44 years old. He had a son aged 6 years and was of clear criminal record.
Taking the most lenient view for Mr Ma’s benefit, the Judge ordered that Mr Ma be committed to prison for 4 months.
Please feel free to contact us if you have any questions or you would like to have a copy of the Judgment and Decision.
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Without even knowing, we have published including this one 200 issues of the Chans Advice. As this is a monthly bulletin, 100 issues took more than 8 years and 200 issues took 17 years to run.
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In Chans advice/215, we reported that the Hong Kong High Court refused Changhong Group’s application to stay the Hong Kong proceedings; and in Chans advice/234, we reported that the Court of Final Appeal dismissed Changhong Group’s application for leave to appeal. On 7 April 2022, the Hong Kong High Court issued a Decision dealing with Changhong Group’s action to re-litigate its stay application. [HCAJ 3/2018] [2022 HKCFI 920]
Following the issue of Chans advice last month, we would like to report the latest decision issued by the court over this theft case. On 17 January 2023, the Hong Kong High Court dismissed Mr Ma’s application to withdraw HK$1.5 million out of his frozen assets for paying the legal costs for his appeal against conviction in theft. [HCA 619/2016] [2023 HKCFI 197]
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In Chans advice/191 and Chans advice/206, we reported a case relating to a shipping company’s claim against its former deputy general manager (Mr Ma) over the alleged theft of the company’s money. The Hong Kong High Court on 16 December 2020 sentenced Mr Ma to 15 years’ imprisonment. [HCCC 20/2018] [2021 HKCFI 195]
SMIC has finally jumped on the bandwagon of the cyber media rush by its presence on the Facebook. We would have done this for a long time had it not been for the daily chores and that we were then not too convinced of its value in the commercial world. Thereafter, it becomes obvious that more and more firms are capitalizing on this new media; and unlike the old economies where information flow was imperfect, consumers of the new economies tend to prefer looking up for information by themselves from the web, or augmenting information they are given.
We mentioned in our Chans advice/225 that the limit of liability under the Montreal Convention for carriage of cargoes was increased from 19 SDR/kg to 22 SDR/kg of the gross weight of the cargoes effective on 28 December 2019. We have recently received some forwarders’ request asking us to talk about the major terms in the Montreal Convention. We in this issue would like to introduce the Montreal Convention’s major provisions as follows:
The High Court of Hong Kong issued a Decision on 21/9/2017 dealing with the principles in respect of the real risk of dissipation of assets in a case of Mareva Injunction involving a shipowner and a charterer. [HCMP 1010/2017]
The Hong Kong Court of Appeal’s Judgment dated 11/4/2008 explained some legal principles relating to whether indemnity claims are allowed by in rem legal actions against vessels. [CACV 257/2007]
We refer to our Chans advice/251 last month reporting the Hong Kong High Court’s decision to sentence Mr Ma (Hyundai Hong Kong’s former deputy general manager) to 15 years’ imprisonment. The High Court issued another Judgment on 27 April 2022 holding Mr Ma liable to compensate HK$387,655,303.70 to Hyundai Hong Kong. [HCA 619/2016] [2022 HKCFI 1153]
The Hong Kong District Court issued a Decision on 30 April 2021 dealing with a personal injury case in relation to a container terminal. [DCPI 110/2020] [2021 HKDC 463]
We reported in our Chans advice/252 that the Hong Kong High Court held Hyundai Hong Kong’s ex-Deputy General Manager (Mr Ma) liable to compensate HK$387,655,303.70 to Hyundai Hong Kong in the case of his theft of his employer’s money. On 23 December 2022, the Hong Kong High Court issued a decision ordering a sum of HK$500,000 (which was deposited by Mr Ma as bail money) to be released to Hyundai Hong Kong in partial satisfaction of Mr Ma’s judgment debt. [HCA 619/2016] [2022 HKCFI 3798]
The Court of Appeal of Hong Kong issued a judgment on 28 March 2019 dealing with a matter concerning the sale pendente lite of an oil tanker Brightoil Glory. [CAMP49/2019][2019HKCA395]
The Hong Kong High Court issued a Judgment on 16 January 2019 dealing with the appeal of the wasted costs’ case reported by our Chans advice/214. [HCA1919/2016] [2019HKCFI127]
What is the difference between a straight bill of lading and an order bill of lading? This can be illustrated in the Wuhan Maritime Court’s Judgment dated 17 September 2019 concerning a cargo misdelivery claim of US$89,838.
The Hong Kong High Court issued a Judgment on 11 January 2019 dealing with a dispute of US$335,858.31 between a bunker supplier and a ship agent. [HCA119/2015] [2019HKCFI57]
The Hong Kong District Court issued a Judgment on 26 April 2022 dealing with a case concerned with transfer of business and lifting the corporate veil, and held a forwarder and its shareholder and director jointly and severally liable for a debt of HK$975,733.71. [DCCJ 2104/2019] [2022 HKDC 289]
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The Hong Kong High Court issued a Judgment on 13 August 2021 holding a forwarder liable to pay nominal damages of HKD1,000 to a shipper in a cargo misdelivery claim case of USD1,299,189.87. [HCA 937/2016] [2021 HKCFI 2310]
In the issue of our Chans advice last month, we talked about the major provisions of the Montreal Convention (which is for the international carriage of goods by air). In this issue, we would like to discuss the major terms of an equally important international convention for the international carriage of goods by sea, viz. the Hague Visby Rules.
The United States District Court (Southern District of New York) issued an order on 29 November 2021 to deny a shipping company’s motion to rely on the Singapore jurisdiction clause in its bill of lading. [1:19-cv-5731-GHW-RWL]
In Chans advice/14 dated 28/2/2002, we discussed this topic 15 years ago. In its Judgment dated 16/10/2017, the District Court of New South Wales in Australia had to deal with, inter alia, a malpractice that a forwarder issued its own house B/Ls but signed off with as agent for China Ocean Shipping, Pacific International Lines, Mitsui O.S.K. Lines Limited or Orient Overseas Container Line without authority. [2017 NSWDC 279]
We have received a lot of cargo claims from our forwarder clients in the recent months. In this issue, we would like to discuss in general how the forwarders should handle the cargo claims.
The High Court of Hong Kong issued a Decision on 31/8/2018 concerning a feeder company’s claim against a shipping company’s lawyer for wasted costs. [HCA1919/2016] [2018HKCFI1879]
The Hong Kong High Court issued a judgment on 21/4/2016 and disallowed a cargo owner’s application for summary judgment against a forwarder in connection with a cargo (a diamond) missing claim of US$900,000. [HCCL 10/2015]
On 12/4/2017, the Hong Kong High Court dismissed an application made by a cargo owner for stay of proceedings commenced by two forwarders in relation to an uncollected cargo case. [HCA 1927/2016]
The High Court of Hong Kong issued a Judgment on 22/5/2017 holding that the District Court has jurisdiction to determine bill of lading and bailment cases. [HCAJ 150/2014]
We recently have received a lot of uncollected cargo claim cases from our forwarder clients, which have kept our 6 claim handlers very busy. We would like to take this opportunity to talk about this troublesome problem of uncollected cargoes. Actually, the forwarders have been facing this real headache in at least these two decades.
To continue our recent series of loss prevention articles, we would like to discuss in this issue the major provisions of the PRC Maritime Code as far as the international carriage of goods by sea is concerned.
The Hong Kong Court of Appeal issued a Judgment [CACV144/2017] [2018HKCA299] on 29/6/2018 upholding the High Court’s Judgment dated 2/6/2017 (which was reported in our Chans advice/201).
In the last issue of Chans advice, we reported the case that the Hong Kong Court of Appeal rejected the mortgagee’s appeal against the High Court’s order of granting a stay until 24 April 2019 for the sale of the Vessel Brightoil Glory. On 17 May 2019, the Court of Appeal issued another judgment refusing the shipowners’ appeal in respect of their application for a further stay of the sale of the Vessel until 22 May 2019. [CAMP81/2019] [2019 HKCA 561]
The Hong Kong High Court issued a Decision on 2 October 2024 dismissing a shipping company’s application to strike out a forwarder’s third party indemnity claim in a cargo (frozen beef) damage case. [HCAJ 9/2023, HCAJ 22/2023, 2024 HKCFI 2708]
In our Chans advice/244, we reported the Hong Kong High Court case [HCA937/2016] [2021 HKCFI 2310] that the forwarder was held liable to pay nominal damages of HKD1,000 to the shipper in the cargo misdelivery claim of USD1,299,189.87. On 20 October 2021, the Hong Kong High Court issued a Decision on Costs holding the shipper liable to pay the costs of the forwarder. [2021 HKCFI 3021]
The Hong Kong Court of Appeal issued a Judgment on 20 September 2019 declining to give leave of appeal to Changhong Group in relation to the High Court Decision dated 29 January 2019 (reported in our Chans advice/221). [CAMP197/2019] [2019HKCA1061]
The Hong Kong District Court issued a Decision on 8 May 2020 upholding a summary judgment ordering one forwarder to pay outstanding airfreight charges of HK$440,000 to another forwarder. [DCCJ1202/2018] [2020HKDC307]
The High Court of Hong Kong issued a Decision on 15 November 2018 concerning the tragic collision between the cargo vessel CF Crystal and the tanker Sanchi, which happened on 6 January 2018 and led to the death of all the officers and crew of the Sanchi. [HCAJ3/2018] [2018HKCFI2474]
The Hong Kong High Court issued a Decision on 13 May 2021 to deal with an interpleader action concerning the stakeholding of US$700,000 in relation to a dispute over some management fees between two transport operators. [HCMP510/2020] [2021 HKCFI 1373]
The Hong Kong High Court issued a Decision on 11 May 2021 staying a South Korea container terminal’s legal action in Hong Kong with respect to its allision claims of more than US$90,000,000 against the owners of a container ship. [HCAJ 31/2020] [2021 HKCFI 1283]
The Hong Kong High Court issued a decision on 31 May 2022 ordering a South Korean shipowner to provide a Hong Kong shipowner with security for costs in the amount of HK$600,000 in relation to a ship collision case that happened in Hong Kong during the super typhoon Hato in August 2017. [HCAJ 80-85/2019] [2022 HKCFI 1631]
The amendment to the International Convention for the Safety of Life at Sea (SOLAS) 1974 Chapter VI, Regulation 2 in respect of the verified gross mass of a container carrying cargo (laden container) is for entry into force globally on 1 July 2016.
The Hong Kong High Court issued a Judgment on 3/2/2017 holding Natural Dairy liable to pay HK$4,360,948.38 to Schenker being the outstanding freight charges. In the Judgment, the Judge also explained the principles regarding the meaning of notice of the forwarder’s standard trading conditions. [HCA 1755/2011].
The Hong Kong High Court issued a Decision on 22 Feb 2021 holding that the wreck removal claims of a ship sunk were not subject to the Convention on Limitation of Liability for Maritime Claims 1976. [HCAJ 98/2019] [2021 HKCFI 396]
This continues the Q&A in our off-line real seminar on Uncollected and Undelivered Cargo on 28 May 2024. Participants were keen to know more about seaway bills, how war plays in insurance? How modes of transport differ mis-delivery claims handling? What is insurers’ attitude towards transloading claims? And finally, why mis-delivery and uncollected cargo claims deserve special attention. SMIC deals with similar questions daily. Each case varies in its cause, and therefore healing recipe differs. But if you are conversant with fundamentals. They could be simple.
Remember our Chans advice/165 (reporting the Hong Kong Court of Appeal holding the Hong Kong forwarder liable to pay US$852,339 plus costs and interest to the Indian bank in the air cargo misdelivery case)? On 19/5/2016, the Court of Final Appeal dismissed the Hong Kong forwarder’s application for seeking leave to appeal. [FAMV Nos 45 & 52 of 2015]
The Hong Kong High Court issued a Judgment on 9/4/2018 dealing with a cargo total loss case in which a NVOC in Malta was wrongly sued (because it had the same name as that of the correct NVOC in BVI). [HCAJ 65/2016], [2018 HKCFI 699]
The Montreal Convention is an international treaty agreed by 140 states in respect of governing carriers’ liability for injury or death of passengers, damage to or loss of baggage and cargo and losses caused by delays. Hong Kong has adopted it through the Carriage by Air Ordinance (Cap 500).
The VGM laws have come into operation in Hong Kong since 1/7/2016. They are mainly contained in Section 3 and Section 3A of the Merchant Shipping (Safety) (Carriage of Cargoes and Oil Fuel) Regulation (Chapter 369AV) as follows:
The Ningbo Maritime Court issued a Judgment on 25/5/2016, and dismissed a cargo insurer’s (PICC Ningbo) recovery claim of USD25,238.40 against Mitsui O.S.K. Lines Ltd (“MOSK”) in relation to the vessel MOL Comfort sinking into the Indian Ocean on 17/6/2013.
In Chans advice/215, we reported the High Court of Hong Kong refused Changhong Group’s application to stay the Hong Kong action. The Court of Appeal also subsequently dismissed Changhong Group’s appeal. On 13 July 2020, the Court of Final Appeal finally dismissed Changhong Group’s application for leave to appeal. [FAMV No. 34 of 2020] [2020 HKCFA 24]
The Hong Kong High Court issued a Decision on 25 February 2019 dealing with Changhong Group’s delayed application for leave to appeal in relation to the collision case reported in our Chans advice/218 and Chans advice/215. [HCAJ3/2018, 2019HKCFI542]
The Hong Kong High Court issued a judgment on 12/4/2016 to dismiss a cargo owner’s action in respect of breaking a barge owner’s tonnage limitation. [HCAJ 178/2014]
The Hong Kong Court of Appeal issued a Judgment on 4 October 2019 upholding the High Court’s Decision dated 9 April 2018 (reported in our Chans advice/208). [CACV593/2018][2019HKCA1101]
The High Court of Hong Kong issued a Decision on 23 May 2018 allowing a shipowner to be represented by 2 different firms of solicitors (one appointed by its hull underwriters and the other appointed by its P&I Club). [HCAJ84/2017] [2018HKCFI1136]
The Hong Kong High Court issued a Decision on 20/12/2017 dealing with a dispute of US$948,802.05 (as the price of bunkers supplied to a vessel) between a vessel charterer and a bunker supplier. [HCA2265/2016]
More and more junior staff of the banks insist all the Bills of Lading to be signed and issued with the above remark “As agent for the Carrier”. This is of course right if the concerned Carrier does not have its own office in the place of issuing the Bill of Lading and therefore instruct its agent there to issue the Carrier’s Bill of Lading.
Against the post-Covid tide, we ran an off-line real seminar on Uncollected and Undelivered Cargo on 28 May 2024. Attendance could not be compared with any webinars but the number of enthusiastic questions in the Q&A session reflected the demand for transport liability issue solutions. For the sake of recapitulations and sharing the Q&A among the Chan Advice readership, we like to report the Q&A in two issues. We welcome any other questions you may have on the following.
The Hong Kong High Court issued a Decision on 15 March 2021 converting a domestic Mareva injunction into a worldwide Mareva injunction in a shipowner’s freight and demurrage claim against a charterer. [HCMP 1190/2020] [2021 HKCFI 680]
The Hong Kong High Court issued a Decision on 21 July 2023 in relation to a case that an aircraft (worth at least USD 80 million) and its cargoes were destroyed by a fire caused by the goods of chlorine dioxide disinfection tablets. [HCA 837/2022] [2023 HKCFI 1896]
The Hong Kong High Court issued a Decision on 29 January 2019 dismissing Changhong Group’s application for stay of the legal proceedings against it brought by the consignee and the insurer of the cargo on board the Sanchi. [HCAJ6/2018, 2019HKCFI263]
The Hong Kong Court of Appeal issued a Judgment on 12/2/2018 to deal with the cargo owners’ seeking leave to appeal against the High Court’s Judgment reported in our Chans advice/209 last month. [CAMP 38/2017] [2018 HKCA77]
The Hong Kong Court of Appeal issued a Judgment on 29/1/2016 dealing with a case of one or two days’ delay in appeal in relation to a barge sinking accident. [HCMP 3172/2015]
Remember our Chans advice/163 about the English High Court’s Judgment holding the Hague Visby Rules instead of the Hague Rules to apply to the cargo damage claim case in excess of US$3.6 million? The English Court of Appeal issued a Judgment on 24/2/2016 upholding the High Court’s conclusion but with different reasons. [Case No: A3/2014/1285, 2016 EWCA Civ 101, 2016 WL 00692394]
The English Court of Appeal issued a Judgment on 13/12/2017 dealing with a cargo damage claim of EUR2,654,238 and a charter hire claim of USD1,012,740 in connection with a NYPE charterparty. [2017 EWCA Civ 2107] [2017 WL 06343564] [Case No. A3/2016/4770]
The Hong Kong High Court issued a Decision on 22 January 2021 dealing with an appeal against a Small Claims Tribunal’s award concerning a dispute over a container terminal’s storage charges. [HCSA 44/2020] [2021 HKCFI 200]
The Hong Kong Court of Appeal issued a Judgment on 20 February 2019 dismissing Changhong Group’s appeal against the High Court’s Decision of 15 November 2018 (reported in Chans advice/215) because Changhong Group had not obtained leave to appeal from the Hong Kong High Court. [CACV576/2018] [2019HKCA246]
The Hong Kong High Court issued a Judgment on 2/6/2017 dealing with the liability apportionment among 3 vessels in 2 almost simultaneous collisions that happened near Hong Kong on 14/5/2011. [HCAJ158/2012 and HCAJ49/2013 and HCAJ48/2011]
The Hong Kong High Court issued a Decision on 9/5/2017 allowing a time extension for some cargo interests to claim against the Tonnage Limitation Fund constituted by the owner of one of the two vessels involved in a collision that happened on 7/11/2013. [HCAJ 189/2013]
Remember our Chans advice/171 of 31/3/2015 reporting that the Hong Kong Court of Appeal discharged the Mareva injunctions against Hin-Pro? The Hong Kong Court of Final Appeal issued a Judgment on 14/11/2016 reversing the Court of Appeal’s Judgment of 11/3/2015. [FACA No. 1 of 2016]
Are Standard Trading Conditions (“STC”) equivalent to the House Bill of Lading (“HB/L”) terms or the House Air Waybill (“HAWB”) terms? We have been frequently asked this question by our forwarder clients.
The Hong Kong High Court issued a Decision on 30 September 2021 holding a shipowner’s Defences as an abuse of process in a case of unpaid crew wages. [HCAJ 76/2020] [2021 HKCFI 2961] [HCAJ 91/2020]
The Hong Kong High Court issued a ruling on 2/12/2016 dealing with a shipowner’s interrogatory application in relation to an uncollected cargo case. [HCAJ 118/2015]
In our newsletter last month, we talked about some essential terms in house Air Waybills. In this issue, as the continuation of the loss prevention exercise for freight forwarders, we would like to discuss some essential terms in house Bills of Lading.
In the transport industry, the contracts of carriage (e.g. Bills of Lading, Air Waybills) usually contain an exclusive jurisdiction clause for settling disputes. However, it is not uncommon that the shippers and consignees sue the transport operators in a court other than the one specified in the exclusive jurisdiction clause. In Hong Kong, the transport operators may rely on the Foreign Judgments (Restriction on Recognition and Enforcement) Ordinance to tackle this kind of situation.
The PRC Supreme Court on 26/11/2015 issued a Judgment holding a shipping company’s container demurrage claim against a shipper time barred. [2015民提字第119號]
The Hong Kong High Court issued a Judgment on 18/11/2016 dismissing a shipping company’s application for summary judgment against its former deputy general manager (Mr Ma) for restitution of the sum of HK$387,655,303.70 on the ground of money had and received and/or unjust enrichment. [HCA 619/2016]
The Hong Kong High Court issued a Decision on 4 March 2020 dismissing a shipowner’s application for a stay of proceedings in favour of arbitration in a case of cargo misdelivery without presentation of original bill of lading. [HCAJ 5/2019] [2020 HKCFI 375]
In our last issue of Chans advice/253, the Hong Kong District Court’s judgment dated 26 April 2022 mentioned a case authority of China Ocean v Mitrans Shipping. We would like to discuss this judgment dated 11 July 1995 of the Hong Kong Court of Appeal in our Chans advice this month. [1995 No. 71 Civil]
