On debt recovery, defamation, and damages: part 3.¹

To recap:
(a) at Mr Chan's request, Ms Tang loaned $120,000;
(b) the loans were not repaid. Ms Tang engaged a debt collection company, which paid visits to and left letters at various locations; and
(c) Mr Chan successfully sued Ms Tang and the debt collection company for defamation - but was only awarded $1 in damages.

So what was the practical outcome of the litigation?

--

Ms Tang:
(a) will have to pay up to² $1 to Mr Chan as damages for defamation;
(b) was awarded costs of $10,000 against Mr Chan for the High Court ("HC") appeal. But she may not actually receive this, as I'll explain below;
(c) has to pay her lawyers' costs for the District Court ("DC") suit as well as for the HC appeal. Considering that the DC Suit alone took 3 years to conclude, and that the HC appeal took more than year and a half, her costs would likely be in the 6-digit range;³ and
(d) is still owed $120,000. While she could perhaps seek recovery against Mr Chan's companies, it would be a futile effort if the companies have no assets, and especially bearing in mind that she had extended the loans in the first place because the companies were facing cashflow difficulties.

The debt collection company:
(a) will have to pay up to $1 to Mr Chan as damages for defamation;⁴ and
(b) has to pay its lawyers' costs for the DC suit.

Mr Chan:
(a) might receive $1 in damages for defamation;
(b) might have to pay costs of $10,000 to Ms Tang for the HC appeal; and
(c) would have had to pay his lawyers' costs for the DC suit, and perhaps part of the HC appeal. Considering that he had engaged a Big Four firm, I expect his costs to be at least as much, if not more than, the costs incurred by Ms Tang.

Each of the parties walked out of the lawsuit with significantly less money in their pockets.

--

And that's not all. Eagle-eyed readers would have noticed my indication that Ms Tang MIGHT only obtain costs of $10,000 from Mr Chan.⁵

Why?

Well, that's because in 2022, upon the application of Standard Chartered Bank, Mr Chan was made bankrupt.

And let's just say that it will be significantly more difficult for Ms Tang to recover anything from a bankrupt.

--

And that's not even the end of the story, because...

...Ms Tang has appealed against the HC decision.

It appears that she is still pushing for:
(a) an order that Mr Chan is personally liable to her for the loans; and
(b) perhaps, an order that she did not defame Mr Chan...

...notwithstanding that even if she succeeds on her appeal, she is likely to face difficulty recovering damages or costs from Mr Chan.

But who knows? We might yet see another plot twist yet.

In part 4, I'll share some learning points for commercially-minded businesses and businesspeople.