Amuse Peace Ltd v. China City Construction (International) Co., Ltd

HCA 2913/2016
[2018] HKCFI 146

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2913 OF 2016

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(By Original Action)

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(By Counterclaim)

Before: Deputy High Court Judge Sakhrani in Chambers

Date of Hearing: 10 January 2018

Date of Decision: 10 January 2018

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DECISION

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1.There are a number of late applications before me for leave to adduce further evidence for use at the substantive hearing of the Order 14 application. These are:

(1) the plaintiff’s summons dated 29 December 2017 for leave to file and serve the affirmation of Laura Au, the plaintiff’s solicitor.  This also exhibits the judgment of B Chu J dated 6 November 2017 in another related action, namely HCA 2814/2016 (“HCA 2814”);

(2) the defendant’s summons dated 4 January 2018 for leave to file and serve the affirmation of Yuen Chan Wah, the defendant’s solicitor, dated 4 January 2018.  In the course of the hearing before me, Mr Shieh SC applied for leave to withdraw the summons and an order was made granting leave to withdraw the summons with costs to the plaintiff;

(3) the defendant’s summons dated 5 January 2018 for leave to file the second affirmation of Yuen Chan Wah dated 5 January 2018 and the second affirmation of Yuan Qing as per the draft enclosed; and

(4) the defendant’s summons dated 8 January 2018 for leave to file and serve the third affirmation of Yuan Qing.  Yuan Qing is the deponent who has filed an affirmation opposing the plaintiff’s application for Order 14 in this action.

2.As to the plaintiff’s summons, it was submitted that because of a material development in the case, namely the judgment and findings of B Chu J in HCA 2814, the application to adduce the further evidence should be granted.  It was submitted that it was an important development in this case.  It was pointed out that the facts and evidence relied on in the proceedings before B Chu J, leading to the judgment on 6 November 2017, was identical with the facts in this case.

3.HCA 2814 was a minority shareholders’ derivative action.  And as a related action, although neither the plaintiff here nor the defendant here were parties, the deponent who filed an affirmation for the plaintiffs in that case was also Yuan Qing who has filed the affirmation for the defendant in this case to oppose the Order 14 application.

4.Both Ms Eu SC and Mr Shieh SC drew my attention to certain passages in the judgment of B Chu J.  I have considered their submissions. 

5.A point made by Ms Eu was that the defence relied on by the defendant in this case was inconsistent with the evidence filed by Yuan Qing in the proceedings before B Chu J in HCA 2814.  It was submitted that this goes to support the plaintiff’s case and to undermine the defendant’s case in the Order 14 application in this case.

6.Having considered counsel’s submissions, it seems to me that the plaintiff is entitled to rely on the matters in the judgment to make good that point. Although the application has been made late by the summons issued on the last working day before the New Year, it is an important development in the case which arose only after all the affirmations had been filed for the substantive hearing.  I grant leave to the plaintiff on its summons for leave to file and serve the affirmation of Laura Au.

7.Mr Shieh correctly submitted that the judgment of B Chu J must be viewed in its proper context.  He submitted that in the judgment the judge did not find that Yuan Qing was an incredible witness or that he was not to be believed.  The conclusion arrived at was that the statement of claim in that case ought to be struck out as it was inconsistent with the evidence of Yuan Qing filed in that case.

8.At paragraph 78 of her judgment, B Chu J came to the view that the pleadings should not have been verified by a statement of truth in that case.  She said in the same paragraph that the pleading was so defective that it was not a matter of simple amendment but of reconstituting the claim. I agree with Mr Shieh that as the judgment is a relevant matter for the court’s consideration in the Order 14 application, it is also important for the court to have before it the material that was placed before B Chu J in HCA 2814. 

9.I am also of the view that the defendant should be afforded the opportunity to deal with the evidence of Laura Au, which also criticises the defendant’s case by pointing out the inconsistencies as set out in her affirmation, leading her to conclude that there is no defence to the plaintiff’s claim in this action.

10.I am unable to accept Ms Eu’s submission that the defendant’s applications amount to a back door attempt to appeal against the judgment of B Chu J.  As to the defendant’s summonses dated 5 January and 8 January 2018, I grant leave to the defendant as sought.

11.I will hear counsel on the question of costs and further directions to be made.

Ms Audrey Eu SC, leading Mr Ryan T H Law, instructed by Nixon Peabody CWL, for the plaintiff (by original action) and the 1^st defendant (by counterclaim)

Mr Paul Shieh SC, leading Mr Jonathan T Y Chang and Mr Chow Ho-kiu, instructed by C W Yuen & Co, for the defendant (by original action)and the plaintiff (by counterclaim)