Echelles Riffaud S.A. v. The Secretary for Justice
Read the full judgment text of HCA 1841/2011 on BabelCite. This High Court CFI judgment was delivered on 10 May 2016.
1. There are four Summonses (two by each party) before this Court: -
Cites 15 cases
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HCA 1841/2011 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE HIGH COURT ACTION NO 1841 OF 2011 _________________________
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_______________ D E C I S I O N _______________ 1.There are four Summonses (two by each party) before this Court: -
2.There is no dispute over the amendments to the summonses. There will be an order in terms of the summonses for amendment. The costs of the amendment summonses should be in the cause. The discussions below will be based upon the amended summonses for expert evidence accordingly. THE FACTUAL BACKGROUND 3.The parties have helpfully submitted the Agreed Brief Facts. I shall adopt the brief factual background as set out in the defendant’s written submissions as follows[1]:
4.There seems to be no dispute on the common ground stated in paragraph 3(d) above. The real difference between the Plaintiff and the Defendant is the nature of the pleaded case, with which the expert evidence should correspond. Senior Counsel for the Plaintiff and Counsel for the Defendant have helpfully identified the difference for this Court’s consideration. 5.This Court is presented with two versions, one from the Plaintiff, the other from the Defendant, both with the common ground for the resolution of the disputes in this action. Therefore, at the end of the discussion, this Court can simply decide which version should be adopted. 6.The legal principles on the admissibility of expert evidence are trite. The parties have no dispute over those as set out in:
7.I shall apply those legal principles to the issues under discussion. 8.However, as seen from the written submissions of respective parties, the focus of dispute is over whether the Plaintiff should be allowed to put the proposed expert directions to the experts for expert directions whereas the Defendant’s proposed directions for expert evidence is relatively limited in scope as compared to that of the Plaintiff’s. The live issues of dispute in this hearing will be whether a wider scope of expert directions as proposed by the Plaintiff should be allowed under the present pleadings. In this connection, guidance should be sought from the following authorities:
DISCUSSION 9.In fact, the disputes between the Plaintiff and the Defendant can be resolved quite conveniently by weighing their reasons in support of their assertions, bearing in mind that they have no difference in their objectives set out in paragraph 3(d) above, applying the relevant legal principles above. From the written submissions, it is quite apparent that the Plaintiff has no objection to the Defendant’s proposed directions for expert evidence except that the Plaintiff considers that it is only fair for the expert directions to include the impugned parts in the experts’ reports. This will be discussed below. 10.When there is a dispute over whether expert evidence should be adduced at trial, the court has to examine the pleadings to determine whether the proposed expert evidence is required in the pleaded case. Yeung Ga Wai v Lau Ming Shum (unreported, HCA 798/2004, 19 July 2012). 11.Counsel for the Defendant has succinctly summarized the parties’ pleaded case in his written submissions.[4] 12.Briefly, the Defendant has pleaded that the Contracts A and B Platforms are not of merchantable quality by reason of their critical and other defects and are not safe nor fit for the purpose of fire-fighting and high level rescue operation by reason of the critical defects, references being made to the clauses and specifications in Contract A and Contract B respectively. By reason thereof, the Defendant says that the Plaintiff was in breach of Contract A and Contract B. As such, the Defendant was entitled to and did terminate Contracts A and B in accordance with clauses 3(a) and 8 of the Contracts A and B General Conditions (which are identical). As to Contract C, the Defendant pleaded that the Plaintiff had been in breach of clause 5(d) of the contract in that the Plaintiff had failed to provide the Defendant with the parameters for the Factory Assessment Test for the turntable ladders. 13.In its Reply and Defence to Counterclaim, the Plaintiff denies that the Contracts A and B Platforms have the critical and other defects as pleaded and it denies that the critical defects of the Contracts A and B Platforms as pleadedare latent. 14.It seems that the Plaintiff has no quarrel with the Defendant over the above summary of their pleaded case. On this basis, I shall proceed to consider the disputed paragraphs of the Plaintiff’s proposed expert directions. Paragraph 2(1) 15.The Defendant’s objection to the Plaintiff’s proposed directions over the phrase “relevant published/applicable standard or standards” is on the following reasons:
16.The Plaintiff’s reply to those objections is:
17.The Plaintiff has also pointed out that for Contract B, there are specific provisions “Chapter 5.4.1.1 of EN1777:2004” as “Relevant Specifications” for “High risk of overturning”. That published standard is not referred to in the Contract A Specification.[6] 18.The Plaintiff has no dispute that the intended phrase of “relevant published/applicable standard or standards” is not pleaded in the pleadings. The question under consideration is whether the intended phrase will form an issue in this action or is simply a clarification of the pleaded cases of the parties. If it forms an issue, which the court has to determine at the end of the trial, it falls within the criticism of the Court of Final Appeal in the two cases cited above. 19.I agree with the Defendant that to allow the expert opinion to include the intended phrase will enlarge the scope of the dispute between the parties. The Defendant now argues that no such standards were found in the contracts and they are not pleaded in the pleadings. I consider that it does not only incur more costs for the trial, but also muddles the issues in dispute for the trial judge. One can imagine if one is to make a search in the web’s searching machines on this phrase, the results may be numerous. There may be different standards of different countries or locations all over the world, each of which may have published standard or standards. All of these standards and how they are defined will have to be considered by the experts and included in their reports and the court will have to consider them. This is the kind of situations that the Court of Final Appeal in Kwok Chin Wing’s case said that the Defendant should keep a vigilant eye on and to prevent it from taking place in the trial. 20.As the issues were raised by the Defendant, it is the Defendant’s pleaded parameter that the Plaintiff should answer. If the Plaintiff wants to rely upon other issues beyond the scope, the Plaintiff has to plead its case clearly in the pleadings. The Plaintiff submits that the standard would probably be the European standard as for Contract B, it is for the Plaintiff to identify this issue in the pleadings so that the Plaintiff is allowed to bring it into expert directions. Those examples as set out in the written submissions do not assist the Plaintiff’s argument on this fundamental principle of pleadings as enunciated by the Court of Final Appeal. 21.It is true that it is the function of expert evidence and of expert witnesses to provide assistance to the court on matters requiring specialist knowledge or expertise. But the issue of pleadings is for the legal representatives of the parties, monitored by the court under its case management power. See §8 of Li Xiao Yun & Another v China Gas Holdings Ltd (unrep., HCCL 18/2011, M Chan J, 8 March 2013). The experts can certainly apply their expertise on the issues which require their expert opinions, including the explanation of the technical terminologies as mentioned by the Plaintiff in paragraph 16(b) above without expanding the scope of the issue for the expert evidence. 22.The Plaintiff criticizes the Defendant of bringing in the EN1777 standard in the pleadings, but objects the Plaintiff’s proposed standards in the expert directions. One has to bear in mind that it is the Defendant, who had brought up the expert issue in the pleadings. The Defendant is allowed to do so under Sinoearn International Ltd. 23.Based upon the legal principles of the Court of Final Appeal, I accept the Defendant’s argument. Paragraph 2(2) 24.I agree with the Defendant that there is no basis for asking the experts to answer the “at large” question of whether the platforms “conform to the Specifications of the Contracts and/or relevant standards” on the same reason that it is for the Defendant to define the parameter of the dispute. The Plaintiff will simply respond to the Defendant’s pleaded case. Paragraphs 2(4)(i), 2(5)(i), 2(7), 2(8)(i), 2(9)(i), 2(11) 25.For the same reasons under paragraph 2 (1), the phrase of “Published/Applicable Standards” should not be included in those paragraphs. 26.The Defendant agrees to replace the impugned words with “standard pleaded in”. I shall leave it to the parties. Paragraphs 2(4)(ii), 2(8)(ii) 27.The Defendant’s case is that the critical defects of the Contract A Platforms and the Contract B Platforms are latent in the sense of not being discoverable even if and despite that Factory Acceptance Tests and/or Local Commissioning Tests were actually conducted. The Plaintiff’s formulation using the word “during” in these paragraphs will narrow the scope of the question by focusing attention on only the times when those tests were carried out, and asks whether the critical defects could be discovered (or were discoverable) during the tests. 28.Again, as said before, it is for the Defendant to define the parameter of the breach of contract for the trial, the Plaintiff cannot limit the Defendant’s scope of dispute by limiting the scope of the issues for expert evidence. The Plaintiff is at liberty to plead its own case in defence of the Defendant’s case and apply for leave to adduce expert evidence on its own pleaded case. I can see no reason for the Plaintiff to ask this Court to restrict the Defendant’s right in defining its own issues of dispute by exercising its discretion, which must be exercised in accordance with the guided legal principles laid down by the higher courts. The fundamental principle for the court to exercise its discretion is fairness as the Court of Final Appeal in Poon Hau Kei v Hsin Chong Construction Co Ltd Taylor Woodrow International Ltd Joint Venture (2004) 7 HKCFAR 148 at §21, citing Bank of America v Chai Yen [1980] 1 WLR 350 at p353 D, Lord Lane, delivering the advice of the Privy Council: " 'the essence of any rule of procedure must be fairness'. The same is true of any rule of practice." It is simply not fair for the Court to restrict the Defendant’s right of pleading. I decline to accede to the Plaintiff’s request. 29.As a conclusion, the Plaintiff’s proposed expert directions are refused. This Court adopts the Defendant’s proposed expert directions. COSTS AND ORDER 30.As to the costs of this application, including the costs reserved and the costs for today (with counsel’s certificate), the Defendant accepts that in the amended summons, it asked for “costs in the cause”. Now it submits that the costs of today’s hearing should be given to the Defendant because it has been maintaining the stance throughout the negotiation with the Plaintiff for agreeing the expert directions. The Plaintiff says that the costs should be in the cause. This Court has dealt with other similar applications in the past. Some of the applications were taken out because the parties were unable to come to the agreed directions and they asked this Court to make decision on the proper expert directions. Of course, each party made submissions to this Court for consideration. At the end of the hearing, there was simply no one winning the argument. This kind of application was always issued by the parties in their joint application. This application is somewhat different. Here each party insists upon its own version of the expert directions. At the end of the argument, this Court has made the decision in favour of the Defendant, a winning party. As such, the costs should be dealt with in accordance with O62 r3 RHC, which provides that the costs should follow the event, meaning the winning party should have the costs. Although the Defendant has said in the amended summons that the costs should be in the cause, the Court should look at the circumstances of the matter and make its order for the sake of justice and fairness. In the circumstances, I award the costs of the application, including the costs reserved and for today’s hearing to the Defendant; but such costs do not include the costs for the correspondence or negotiation before the hearing today as these should be costs in the cause. The costs are summarily assessed at $110,000 to be paid by the Plaintiff to the Defendant within 28 days from the date hereof. 31.The Court shall now make an order in terms as follows:
Mr Anthony Houghton SC and Ms Anny Chak, instructed by Ho & Ip, for the plaintiff Mr Mike Lui, instructed by Department of Justice, for the defendant |
Cases cited in this judgment
Further hearings and rulings under HCA 1841/2011