Damien helps break down the laws governing breach of contract disputes over yachts, available remedies, and suggested best practices to mitigate damages and protect one’s rights.
The full video interview can be viewed on conventuslaw.com
On 12 December 2016, the South China Morning Post reported that fraudsters have used Hong Kong to take almost HK$1.5 billion in email scams during the first 9 months of 2016.
Parties are tricked into making payments into incorrect accounts based on outright fraud. Sometimes phishing techniques are used to trick people to reveal sensitive information, such as passwords. While it seems that the number of reported incidents has reduced from 2015 to 2016, the money value has increased significantly. The sums taken can be enormous - in late 2016 there was a report of a HK$500 million transfer made as a result of email fraud.
Our team has assisted many overseas clients who have been the victims of substantial email fraud. This usually involves a fund flow tracing exercise through a complex web of bank accounts held by multiple corporate vehicles to find out what happened to the funds and ultimately to recover the funds. We have found that these fraudulent schemes are usually carefully planned, sophisticated and show meticulous attention to detail. We have recently been retained by a European bank to take urgent steps to recover payments totaling over €50 million arising from an email scam commonly known as ‘CEO fraud’, although email scams involving recovery in the range of US$40,000 – US$100,000 are particularly common.
What happens once you realise that your money has been taken by a scam or fraud, and what can you do to get back your money?
Sometimes, funds can be recovered and all is not lost. You need to act fast for recovery of funds. If the bank account into which payment was made is located in Hong Kong, the first step should be to report the matter to the Hong Kong police as soon as possible. If the Hong Kong police are satisfied that the funds in the account may be the proceeds of crime, they may direct the applicable bank to place a hold, or a freeze, on the funds. This can happen quickly and it can be a cost effective initial step to preserve your funds. An additional measure can be to take matters into your own hands and seek an injunction from the court to freeze the moneys, which may be preferred in some circumstances. There may also be need to apply for a disclosure order from the court to find out how much money is left in the bank account, and see the flow of money in and out of the relevant account.
To recover money from the fraudster’s account in Hong Kong, you will need a court order. You have to act fast as there may be others who have been tricked, who are also after money in the same bank account. Moneys are often paid out on a first-come first-served basis. How to go about recovery is a matter that your lawyers will be able to advise, but a common procedure is to file a writ on the fraudster, which is often a company, and obtain a garnishee order after judgment is obtained.
If no claims are brought against the monies in the account, the Hong Kong Government may apply to the Court to confiscate the funds.
We often see clients who have been the victims of fraud and have had the Hong Kong police freeze money in an account. Very often there is genuine hope of recovery, and our experience during 2016 has been that recovery of some or all of the funds is common. The sooner you act, the better the chances of recovery are.
Our litigation and dispute resolution lawyers have been providing competitively priced real solutions to assist an increasing number of particularly overseas clients recover moneys taken from them through fraud. If you have any questions or need assistance, please contact our solicitors on 2525 7525 or by email on email@example.com.
Hill Dickinson’s Hong Kong commercial disputes team wins non-plain vanilla Order 14 summary judgment
The Hong Kong office of international law firm Hill Dickinson has acted for a Hong Kong based media consultancy company in proceedings against a Finland based radio-frequency operator (connected with the PRC Government) to recover unpaid consultancy fees and damages for breach of a consultancy agreement relating to the sourcing and operation of a radio station in Rome. There are also related proceedings underway in Italy.
Our client commenced the action in the High Court of Hong Kong on 29 June 2015. The Defendant subsequently filed a Defence pleading a raft of defences to the claim such as sham agreement, misrepresentation, uncertainty of contract, total failure of consideration and defective quality of services. The Defendant also filed a counterclaim seeking over Euros 1 million in damages against our client.
On 31 May 2015, we applied for summary judgment and dismissal of the Defendant’s counterclaim. The Defendant opposed the application.
There is always a significant risk for a client applying for summary judgment as, if the application is unsuccessful, the client will face a substantial costs order, which will usually be payable immediately, and the client will also have lost valuable time (usually 6 to 9 months) preparing for the summary judgment hearing which could otherwise have been used preparing the case for trial and obtaining the earliest possible trial date. It is therefore a bold (and risky) move for a client to apply for summary judgment except in the clearest possible cases such as a claim on a dishonoured cheque. This was not such a case. This case involved multiple jurisdictions with corporate entities based in the BVI, Rome, Milan, Finland, Hong Kong and the PRC and a detailed analysis of factual and legal issues relating to radio frequency broadcast services, forum non conveniens, exclusive jurisdiction and governing law clauses, expert evidence of foreign law and corporate transaction structuring alleged to be a dishonest tax avoidance scheme.
On 8 July 2016, there was a substantive hearing before Master S Kwang. In a nutshell, we argued that there was no merit in the ‘sham agreement’ defence (an alleged transfer-pricing scheme to avoid paying tax in Italy) relying in particular on Lord Diplock’s classic definition of a “sham” in Snook v London West Riding Investments Ltd 2 QB 786. We submitted that all of the defences raised by the Defendant were themselves a sham and a smokescreen to muddy the waters in what was really a straightforward debt claim for unpaid invoices. After hearing lengthy submissions and considering the various affidavits filed by the parties, Master S Kwang concluded that he was satisfied that none of the defences were believable (particularly tested against the contemporaneous evidence) and he granted our client final judgment and interlocutory judgment with damages to be assessed together with the costs of the action. He also dismissed the Defendant’s counterclaim.
We obtained judgment approximately 12 months after the writ was issued.
The decision is a welcome reminder from the Hong Kong Court that the scope of the Order 14 ‘summary judgment’ procedure goes well beyond the more conventional but limited ‘dishonoured cheque’ type cases. The Order 14 procedure can be a very successful litigation strategy where a litigant is able to persuade the Court that even where, as in this case, a Defendant raises a raft of complicated ‘purported’ defences to a claim and a significant counterclaim supported by lengthy affidavit evidence, there is in fact no substance to the defences. In such cases, it is possible to significantly accelerate the period for a client to obtain a final judgment and significantly reduce overall costs by avoiding the substantial costs of preparing for and attending a trial.
Bryan O’Hare (Partner) led the Hong Kong team with assistance from Victoria Chang (Associate) and Jong Wong (Trainee).
We acted for an international super yacht broker operating in Hong Kong. Our Hong Kong office obtained a favourable judgment from the High Court of Hong Kong, which rejected a claim against our client relating to delivery of an Italian-built Azimut 43 Plus. See decision here: http://www.hklii.hk/cgi-bin/sinodisp/eng/hk/cases/hkcfi/2016/851.html?stem=&synonyms=&query=title(Simpson)
Partner Damien Laracy led a team of assistants, including Associates Douglas Lee and Janice Yik, in conducting the case.
The purchaser commenced the action in 2011 and the trial concluded at the beginning of October 2015. The High Court handed down its judgment on 22 May 2016.
The purchaser alleged that there had been misrepresentations and breaches of implied conditions of contract relating to alleged malfunctioning of the joystick control of the yacht and her bowthrusters. He therefore sought to rescind and/or repudiate the principal sale and purchase agreement.
As a result of the purchaser’s refusal to take delivery of the yacht for which he had paid (he was also being criminally investigated for unrelated matters) our client was left with the substantial costs of berthing and maintaining it. We therefore arrested the yacht on behalf of our client in order to be able to then sell it (again) free and clear of any encumbrances via a High Court Judicial
Sale. The yacht was subsequently sold by the Admiralty Bailiff pursuant to a Court order for the appraisement and sale of the yacht. The sale proceeds were paid into Court. Thereafter the Court considered the evidence of the parties, including expert evidence regarding operation of the joysticks and bowthrusters of the yacht, and found that the purchaser was a “recalcitrant witness” and that our client’s witnesses were reliable and truthful. The Court dismissed the purchaser’s claim and awarded judgment in favour of the seller on its counterclaim against the purchaser, together with interest and costs.
Laracy & Co. wins substantial fraud claim against a former director of a PRC company
Acting for a US private equity firm (the 'Investor'), the Hong Kong office of international law firm Hill Dickinson has recently secured a significant judgment from the High Court of Hong Kong for substantial damages (over US$15 million) against a former director of a PRC based security monitoring services provider, China Alarm Holdings Limited ('CAHL').
Partners, Damien Laracy and Bryan O’Hare, led the team with assistance from Janice Yik (associate) and Joni Wong (trainee).
The Investor commenced the action in 2012, culminating in a two week trial which concluded in March 2016. The High Court handed down its judgment on 24 March 2016. The damages claim against the former director was based on fraudulent misrepresentations contained in a prospectus offer document and related finance documents, pursuant to which the Investor was induced to invest US$15 million in CAHL in 2004. The Investor subsequently lost the entire investment of US$15 million when CAHL was eventually placed into insolvent liquidation in 2009.
The Defendant sought to defend the claim by arguing that the Investor’s funds had been deployed to make substantial contractual payments pursuant to two agreements which CAHL had entered with his personal companies (which the Court accepted were never disclosed to the Investor) for the provision of alleged consultancy and management services to CAHL. During the trial, the Defendant also unexpectedly admitted for the first time during cross-examination that he had actually used a substantial proportion of the US$15 million to pay 'Special Consultants' in the PRC to entertain PRC government officials to try and secure lucrative Government contracts (which never materialised).
The Court held that the Defendant had made a series of false representations to the Investor relating to the intended use of capital and the financial expenditure of CAHL and the Investor had been induced to invest US$15 million to CAHL. As such, the Defendant was ordered to pay approximately USD15 million damages to the Investor together with interest (to be assessed).
Additionally, the Judge commented in the judgment that the solicitors’ preparation of the case for trial was 'exemplary' and 'the proceedings have been an advertisement for civil justice in Hong Kong'.
The Hong Kong office of law firm Hill Dickinson has contributed to leading international arbitration law journal, Global Arbitration Review (GAR).
Damien Laracy and Lynn Chen have completed a chapter for GAR on maritime and offshore arbitration in the Hong Kong jurisdiction. The entry also includes contributions from Mike Mallin, Anthony Woo, Douglas Lee, CJ Tang and Michael NG. The chapter answers questions on offshore oil and gas disputes, maritime disputes and security for claims in arbitration.
The GAR’s know-how series allows for cross-comparison of international dispute resolution practice and procedure across multiple jurisdictions.
Read the Hong Kong office’s chapter for GAR online.
Earlier this year, the firm’s Hong Kong operation was ranked in Chambers and Partners 2015 legal directory for shipping litigation, with Damien Laracy and Anthony Woo recognised as noted practitioners.
Article on Hill Dickinson LLP website:
Article from CDR:
Article from ALB:
Shipping, Litigation (International Firm): "Damien Laracy of Laracy & Co in association with Hill Dickinson tackles a broad spectrum of litigation and arbitration matters and has particularly extensive knowledge of ship mortgage enforcement issues. Sources observe: "He has always impressed with his speed of response, clear understanding of the commercial nature of what we are doing and reasonable fees."
Dispute Resolution (International Firm) " Damien Laracy of Laracy & Co in association with Hill Dickinson is best known for his shipping litigation work, but has a broad practice encompassing contentious employment, white-collar crime and contentious regulatory matters. Peers regard him as an effective operator.
Please see links below for further news press:
Hill Dickinson names Hong Kong partner and seals local association
HILL DICKINSON announces expansion into HONG KONG
Hill Dickinson Announces Expansion into Hong Kong
Hill Dickinson monitoring Asian market
Hill Dickinson Announces Expansion into Hong Kong
Shipping (International Firm) "Damien Laracy of Laracy & Co is best known for his litigation skills, though mortgage enforcement and sales and purchase are also areas of expertise. Clients assert: "He is very commercial and sensible, extremely experienced in dry work and a good problem solver."
Dispute Resolution (International Firm) " Damien Laracy of Laracy & Co has a wide-ranging commercial litigation practice. He has experience in handling contractual and joint venture disputes as well as ship mortgage and cross-border debt recovery issues. He also handles international arbitration."
joins Conventus Law. See : http://conventuslaw.com/laracy-co-2
2012 Acquisition International Legal Awards: Laracy & Co. named as "Hong Kong Commercial Litigation Law Firm of the Year."
“Damien Laracy of Laracy & Co provides ’excellent service, quick response times and extensive experience in all types of charterparty disputes’. In the past year the team has dealt with ship mortgage enforcements, shipbuilding disputes and cargo claims. Clients include Steamship Mutual and West of England P&I Club.”
International WHO’S WHO Historical Society
North Carolina, April 13, 2012, Damien Laracy, Principal, Laracy and Company, Hong Kong, is one of the newest professionals selected for inclusion in International WHO’S WHO Historical Society and will be listed in the 2012 edition of International WHO’S WHO of Professionals.
Inclusion is an accomplishment in itself. International WHO’S WHO Historical Society recognizes the achievements of qualified professionals while simultaneously providing a practical, reference-quality, business-to-business directory of its exclusive membership. Membership and biographical listings in the International WHO’S WHO of Professionals directory is a highly selective process. New members are selected following an in-depth interview and biographical review.
With effect from 2 May 2012, Laracy & Co. will relocate to larger premises: 2102, 21st Floor, Tower Two, Lippo Centre, 89 Queensway, Admiralty, Hong Kong.
This is in reality a move “next door” from our current location in Tower One of the Lippo Centre. All other contact details (phone, fax, email) will remain the same.
What are the key legal directories saying about Laracy & Co? Please see Chambers & Partners profile of Laracy & Co here: http://www.chambersandpartners.com/Asia/Firms/211626-46119 and the Legal 500 profile here: - http://www.legal500.com/firms/34051/offices/34223
"Damien Laracy is managing partner of Laracy & Co., and specializes in a range of contentious areas including debt recovery, damage claims, shareholders’ and joint venture disputes. He also has solid shipping-related expertise. "
What are the key legal directories saying about Laracy & Co? Please see Chambers & Partners
profile of Laracy & Co here: http://www.chambersandpartners.com/Asia/Firms/211626-41538 and the Legal 500 profile here: -http://www.legal500.com/firms/34051-laracy-co/offices/34223-hong-kong
The Laracy & Co team has been strengthened by the recent addition of David Allison. David heads up the IP Practice at Laracy & Co and brings a wealth of IP related experience obtained at international law firms and in-house in both Hong Kong and mainland China.
Laracy & Co is proud to sponsor the 5th Annual Laracy & Co 500 Dragon Boat event on Lamma Island 15 May 2011. The Laracy & Co 500 is one of the best loved but most grueling events on the Hong Kong Dragon boat circuit. For more information see:
Laracy emerges as one of Hong Kong’s most admired practitioners. His firm’s shipping group works on arbitrations relating to charterparty disputes and also handles cargo loss / damage in the region, vessel sale and purchase disputes, and disputes relating to shipbuilding, repair and conversion. Laracy also has a great deal of experience in the enforcement of ship mortgages.