Upplan Co Ltd v Li Ho Ming (unrep., HCA 1915/2009, [2010] HKEC 1257)

August 27, 2010 in Case Law | Tags: | by colepoon | Leave a comment

The parties agreed to mediate the dispute, but were unable to agree on the choice of mediator. They therefore jointly applied to the Court for direction pursuant to paragraph 13(1) of Practice Directions 31.

The joint application was heard by Mr. Registrar Lung. In his judgment, Mr. Registrar Lung outlined the approach adopted by the Court in deciding the choice of mediator in case of a dispute between the parties.  

Hong Kong Dispute Resolution Bulletin: For full analysis of this case subscribe to the Sweet & Maxwell HKDRB, produced in association with Clifford Chance.

This article is available in [2010] 9 HKDRB.

Deacons v Stanley Wu Chen Kuo (unrep., DCCJ 1133/2010, [2010] HKEC 1229)

August 27, 2010 in Case Law | Tags: | by colepoon | Leave a comment

In this case, the Court considered the question of whether service by email can be regarded as an effective means of substitute service.

The Plaintiff claimed against the Defendant for unpaid charges for professional legal services rendered. The Plaintiff had no knowledge as to when the Defendant would be in Hong Kong, and was unsuccessful in effecting personal service of an amended writ of summons on the Defendant.

The last communication with the Defendant was in the form of an email from the Defendant to the Plaintiff. The Plaintiff therefore argued that email would be the most appropriate means in bringing the writ to the notice of the Defendant. The Plaintiff therefore applied to the Court for an order allowing the Plaintiff to effect substituted service by sending the amended writ of summons to the Defendant’s email address.

Her Honour Judge HC Wong, whilst noting that there is an increasing use and reliance on electronic communications these days, said that service by email “is still not regarded as and considered to be a safe and secure means of communication“. She held that substituted service should not be effected by means of sending copies of the amended writ of summons to the email address of the Defendant.   

Hong Kong Dispute Resolution Bulletin: For full analysis of this case subscribe to the Sweet & Maxwell HKDRB, produced in association with Clifford Chance.

This article is available in [2010] 9 HKDRB.

Re Tsz Wan Shan Ltd (unrep., HCCW 306/2006, [2010] HKEC 1188)

August 27, 2010 in Case Law | Tags: , | by colepoon | Leave a comment

The joint and several liquidator of Tsz Wan Shan Limited (the “Company”) rejected a proof of debt filed by Luk Ngai Ling (the “Creditor”). The Creditor was dissatisfied with the decision of the liquidator and applied to the Court in accordance with r.95 of Companies (Winding Up) Rules (Cap.32H Sub.Leg.) to reverse the decision. The Creditor was successful in its application, and the Court made an order nisi that the Creditor’s costs be paid out of the assets of the Company.

The liquidator, however, did not realise any assets out of which the Creditor’s costs could be paid. The Creditor therefore applied to the Court to vary the costs order nisi to the effect that the Creditor’s costs be paid by the liquidator and that the liquidator will recoup such costs from the assets of the Company. The Creditor argued that if there is a shortfall in the assets of the Company available to pay costs, it is the liquidator (rather than the Creditor) who should suffer.

The Honourable Mr. Justice Harris rejected the Creditor’s argument. He held that the correct costs order should be that both the Creditor’s costs and the liquidator’s costs be paid out of the assets of the Company and that the Creditor’s costs be paid in priority to those of the liquidator’s costs.

Hong Kong Dispute Resolution Bulletin: For full analysis of this case subscribe to the Sweet & Maxwell HKDRB, produced in association with Clifford Chance.

This article is available in [2010] 9 HKDRB.

Pang Tony v Ma Wai Ming (unrep., HCPI 193/2009, [2010] HKEC 1172)

August 23, 2010 in Case Law | Tags: | by colepoon | Leave a comment

This case was concerned about an application by the 3rd and 4th Defendants to strike out the proceedings because of the Plaintiff’s failure to comply with an unless order. The Court allowed the Defendants’ application and provided clear guidance on the legal position regarding strict compliance with unless orders post-Civil Justice Reform.

On 29 March 2006, the Plaintiff (a hawker), whilst evading arrest by the 3rd Defendant (a hawker control officer) ran into the road and was knocked over by a lorry, driven and owned by the 1st and 2nd Defendants, respectively. As a result, the Plaintiff sustained injuries and lapsed into a permanent vegetative state.

At the 4th checklist review hearing between the parties on 18 February 2010, Master Yu considered the Plaintiff’s repeated delay in filing the Writ of Summons and ordered that: “Unless the Plaintiff do serve the Writ together with a Statement of Claim and Statement of Damages on the Defendants within 28 days, the Writ be struck out and this action be dismissed“.

The Court considered the circumstances of the proceedings and decided to strike out the action and dismiss the action. Master Wong laid down the legal position regarding unless order post-CJR:

“(a) When this Court imposes an unless order, he takes a serious attitude towards it.
(b) If he further minds to impose a “self-executing” order, like the present one, sanction will automatically take effect.
(c) Instead of requiring the innocent party to enforce compliance, under CJR, the burden lies on the defaulting party to seek relief.
(d) Our new O.2 r.4 RHC regulates how the application for relief is to be made. To start with, it shall be done timely …
(e) Further, the application for relief must (emphasis added) be supported by evidence [O.2, r.5(2) of the Rules of the High Court (Cap. 4A)].
(f) Upon such application, the Court’s jurisdiction and discretion will then be triggered to consider if relief should or should not be granted.
(g) In so doing, all circumstances are to be considered, including [the factors listed in the O.2, r.5(1) of the Rules of the High Court (Sub. Leg. Cap.4A), e.g. the interests of the administration of justice]“.

Applying the above principles, the Court upheld the unless order of 18 February 2010. The failure to file the Statement of Damages by the deadline clearly meant that the unless order had been breached.  Consequently, the Writ was struck out and the action was dismissed with an order nisi that there be no order as to costs.  

Hong Kong Dispute Resolution Bulletin: For full analysis of this case subscribe to the Sweet & Maxwell HKDRB, produced in association with Clifford Chance.

This article is available in [2010] 8 HKDRB.

Kuok Luen (Macau) Agente De Programs Televisivos Limitada v Tidetime Sun (Group) Ltd (unrep., HCA 1456/2006, [2010] HKEC 1199)

August 23, 2010 in Case Law | Tags: | by colepoon | Leave a comment

Under the new Civil Justice Reform regime, the Courts are more active in managing and short-scheduling cases in order to achieve the underlying objective of progressing cases as expeditiously as reasonably practicable.  The Court in Kuok Luen reviewed the legal principles for striking out in light of the new litigation culture as promoted by the implementation of the CJR.

The case concerned an application by the 1st Defendant to strike out the Plaintiffs’ Statement of Claim and to dismiss their action pursuant to O.18, r.19(a)–(d) and/or O.34, r.2(2) of the Rules of the High Court (Sub. Leg. Cap.4A) and for want of prosecution and/or abuse of process pursuant to the inherent jurisdiction of the Court.

On 10 July 2006, the Plaintiffs commenced proceedings suing for damages for breach of contract. At the checklist review hearing on 31 October 2007, Master Lung ordered the trial to be set down. Up to mid 2010, the Plaintiffs had still not set down the action for trial.  The 1st Defendant applied to strike out the Plaintiffs’ Statement of Claim by summons respectively dated 5 May 2010 and 23 June 2010.

Master Ng reviewed the English post-Civil Procedure Rules and the Hong Kong post-CJR authorities on the Court’s inherent jurisdiction to strike out for abuse of process. The Court agreed with the observations in the High Court decision of Nanjing Iron & Steel Group International Trade Co Ltd v STX Pan Ocean Co Ltd (unrep., HCAJ 177/2006, [2009] HKEC 1492) and the Court of Appeal’s decision in Re Wing Fai Construction Co Ltd [2010] 3 HKC 593 and stated:

“In Hong Kong, post-CJR changes to the court’s approach towards the conduct of litigation bring into focus the effect of how the parties’ conduct of proceedings after 2 April 2009 has on the courts and other litigants. Due recognition should be given to the underlying objectives and to the public interest in efficient use of court resources.  Where a litigant demonstrates disregard for the orders or procedures of the court, his failure to take procedural steps and other delay in the conduct of proceedings are capable of constituting abuse of process, and the court may strike out the claim if it is fair to do so.”

Taking into account all relevant circumstances, the Court exercised its discretion to strike out the Plaintiffs’ claim and dismissed the action against the 1st Defendant for abuse of process as a result of inordinate and inexcusable delay on the part of the PLaintiffs and also pursuant to O.34, r.2(2) of the Rules of the High Court (Sub. Leg. Cap. 4A).

Hong Kong Dispute Resolution Bulletin: For full analysis of this case subscribe to the Sweet & Maxwell HKDRB, produced in association with Clifford Chance.

This article is available in [2010] 8 HKDRB.

Thanakharn Kasikorn Thai Chamkat (Maha Chon) v Akai Holdings Ltd (unrep., FACV 16/2009, [2010] HKEC 927)

August 20, 2010 in Case Law, News & Analysis | Tags: | by colepoon | Leave a comment

The Court of Final Appeal was asked to consider whether it was necessary for a respondent to a civil appeal to the Court of Final Appeal to apply for leave to bring a cross-appeal and whether the grant of such leave was liable to the imposition of conditions under s.25 of the Hong Kong Court of Final Appeal Ordinance (Cap.484).

The Honourable Mr. Justice Bokhary PJ, sitting as a single permanent judge, adopted a purposive approach in interpreting s.24 of the Ordinance and the nature of a cross-appeal with reference to the Court of Final Appeal’s decision in Common Luck Investment Ltd v Director of Legal Aid (2002) 5 HKCFAR 467.  The Honourable Mr. Justice Bokhary PJ ruled that:

“A cross-appeal is a specie of appeal.  It is therefore an appeal.  And a party who seeks to bring and then brings a cross-appeal assumes the obligations of a would-be appellant and then an appellant.  In my view – and I so direct – a respondent to a civil appeal to the Court of Final Appeal who wishes not merely to defend but actually to improve the result in its favour must do so by way of a cross-appeal for which leave is needed, and the grant of such leave is liable to the imposition of conditions under s.25 of the Court’s statute.”

The Court of Final Appeal also directed that the Respondent’s application for leave to cross-appeal and the questions of conditions under s.25 of the Ordinance and a supplemented printed case by the Appellant to resist the cross-appeal go straight to the Appeal Committee, without the need for a prior refusal of leave by the Court of Appeal.

Hong Kong Dispute Resolution Bulletin: For full analysis of this case subscribe to the Sweet & Maxwell HKDRB, produced in association with Clifford Chance.

This article is available in [2010] 7 HKDRB.

Standard Chartered Bank (Hong Kong) Ltd v Sweetmart Garment Works Ltd (unrep., HCA 1807/2005, [2010] HKEC 1071)

August 20, 2010 in Case Law, News & Analysis | Tags: , , | by colepoon | Leave a comment

In an action by the Plaintiff bank against the guarantor, the Court upheld the guarantee and found in favour of the Plaintiff, with an order nisi that the Plaintiff was to have the costs of the action, to be taxed if not agreed. The Plaintiff brought an application to vary the costs order nisi that declined the Plaintiff’s request that costs be awarded on an indemnity basis, in reliance of a contractual provision under the Guarantee which provided for indemnity costs to be paid to the Plaintiff bank in recovery of moneys due to it. The Plaintiff also argued that the Court should certify the case as being fit for two counsel.

The Honourable Mr. Justice Stone declined to follow the English decision in Gomba Holdings (UK) Ltd v Minories Finance Ltd (No. 2) [1993] Ch 171, which was cited for the principle that the discretion of the Court in making costs orders should normally be exercised to reflect a contractual right to costs, if any.  The Court formed the view that the exercise of the court’s jurisdiction as to costs cannot be fettered by any contractual costs provision.  In the absence of any frivolous, unarguable and wholly unsustainable points raised by the Defendant, the Court perceived no basis to depart from the usual order that the losing party is to pay the other party’s costs on the normal “party and party” basis and dismissed the Plaintiff’s application to vary the order nisi.

Turning to the issue on whether there was a requirement for a judge to give a certificate for two counsel for their costs incurred in a High Court open trial to be allowed in taxation, the Court held that the post-Civil Justice Reform position was that no costs were to be allowed in respect of the appearance of two or more counsel before a High Court judge in open court unless the judge has certified such attendance as proper, pursuant to paragraph 2(3) of Part II of the First Schedule to O.62 under the Rules of the High Court of Hong Kong (Cap.4A, Sub.Leg.).  In relation to costs of proceedings other than attendance in court, such costs, in the absence of a court order allowing two counsel on taxation, remain a matter of the taxing master’s discretion.  In the present case the Court certified the trial to have been fit for two counsel. 

Hong Kong Dispute Resolution Bulletin: For full analysis of this case subscribe to the Sweet & Maxwell HKDRB, produced in association with Clifford Chance.

This article is available in [2010] 7 HKDRB.

Lau Chi Keung v Wong Wai Kei (unrep., DCPI 1846/2008, [2010] HKEC 987)

July 20, 2010 in Case Law | Tags: , | by colepoon | Leave a comment

In an application by the Defendant for variation of a costs order nisi, Deputy District Judge Edward Shum considered the effect of a sanctioned payment made by the Defendants in a sum marginally less than the award made by the Court in favour of the Plaintiff on the exercise of the court’s discretion on costs.

Hong Kong Dispute Resolution Bulletin: For full analysis of this case subscribe to the Sweet & Maxwell HKDRB, produced in association with Clifford Chance.

This article is available in [2010] 6 HKDRB.

Golden Eagle International (Group) Ltd v GR Investment Holdings Ltd (unrep., HCA 2032/2007, [2010] HKEC 1023)

July 20, 2010 in Case Law | Tags: , | by colepoon | Leave a comment

In this case, the Honourable Mr. Justice Lam considered the issue of (i) how the Court should exercise its powers under O.22, r.24 to award interest at an enhanced interest rate, costs on indemnity basis and interest on the costs; and (ii) whether any costs sanction should be imposed on the Defendant for its refusal to mediate.

Hong Kong Dispute Resolution Bulletin: For full analysis of this case subscribe to the Sweet & Maxwell HKDRB, produced in association with Clifford Chance.

This article is available in [2010] 6 HKDRB.

Menno Leendert Vos v Global Fair Industrial Ltd (unrep., HCA 4200/1995, [2010] HKEC 719)

July 2, 2010 in Case Law | Tags: , | by colepoon | Leave a comment

This case illustrates the Court’s post-CJR approach to the new O.59 of the Rules of the High Court in the context of a late application for appeal against two interlocutory orders brought by the Defendants. 

The Defendants applied for leave to appeal against a disclosure order after the expiration of the 14-day period stipulated in O.59, r.2B(1) of the Rules of the High Court (Cap. 4A), arguing that they had already made full disclosure of their assets already as required by an earlier Court Order for disclosure.  It was also argued that the appropriate costs order should have been costs in the cause of the appeal and not costs to be paid to the Plaintiff forthwith.

The Honourable Mr. Justice To provided further guidance regarding the application of O.59 and commented:

“Under this new scheme introduced by the CJR into Order 59, leave to appeal against an interlocutory judgment or order may be made to the court below and so far as is practicable to the judge or master against whose judgment or order leave to appeal is sought: rule 2B(1) and(2).  If that application is refused, the applicant may make a further application for leave to appeal to the Court of Appeal within 14 days from the date of refusal: rule 2B(3) […] Rule 15 gives the court below the power to extend or abridge the period for serving notice of appeal under rule 4 on application made before the expiration of that period.”

In pursuit of the underlying objectives of the CJR, the Honourable Mr. Justice To dismissed the application for extension of time to apply for leave to appeal, for leave to appeal and for stay of execution of the Orders with costs. It was ordered that costs should follow the event and be paid to the Plaintiff forthwith.  

Hong Kong Dispute Resolution Bulletin: For full analysis of this case subscribe to the Sweet & Maxwell HKDRB, produced in association with Clifford Chance.

This article is available in [2010] 5 HKDRB.

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