Partial Summary Judgment Against Employee Who Misappropriated Employer's Funds

Introduction

What happens when a trusted employee betrays his employer's trust and orchestrates a complex and long-term fraud within the employer's group of companies? How may remedies such as unjust enrichment and constructive trust assist in tracing misappropriated funds, especially when routed through companies controlled by the wrongdoer? In its reasons for decision in JB Management Ltd & Ors v Lau Lik Wah David & Ors [2025] HKCFI 2702, the Court of First Instance ("CFI") discussed these issues, exploring the scope and application of equitable remedies applicable in this scenario.

Background

The plaintiffs, JB Management Limited and several affiliated companies ("Ps"), belong to the Lane Crawford Joyce group of companies ("Group"), which is in the business of fashion, retail and brand management. The 1^st defendant ("D1") was an employee of various companies within the Group, initially as a Senior Accounting Manager and ultimately as the Financial