Chow Nap Man v. Chung Wai Kwong

CACV 137/2017

[2018] HKCA 469

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 137 OF 2017

(ON APPEAL FROM HCMP NO 3307 OF 2016)

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J U D G M E N T

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Hon Kwan JA (giving the judgment of the court):

1.On 24 May 2017, Deputy High Court Judge Kwok, SC dismissed the originating summons of Chow Nap Man (“Chow”) on the ground that his case was “obviously unsustainable” as a matter of law, as the memorandum for a contract for the sale and purchase of land was silent on the date for completion, applying Kwan Siu Man v Yaacov Ozer (1997‑98) 1 HKCFAR 343.

2.By our judgment on 17 April 2018, we allowed the appeal of Chow for the main reason as set out in §§39 and 41 of our reasons for judgment of 2 May:

“The Chinese memorandum stipulated that Chung [Chung Wai Kwong, the defendant in the originating summons] was willing to give time to Chow or his family to raise capital for the purchase of Chung’s half share in the Property. It is reasonably arguable that a term could be implied that completion of the sale was to take place when the capital was raised. However, the memorandum was silent as to how much time was allowed to Chow to raise capital. The question is whether a term ought to be implied that reasonable time was to be allowed to Chow, and whether such an implied term would be void for uncertainty. …

… We are not persuaded it is obviously unsustainable to imply into the agreement a term that Chow was to raise capital for the purchase within a reasonable time or that such term would be unworkable or simply too indefinite as to be void for uncertainty. The judge was in error in dismissing the originating summons summarily on the basis it was obviously unsustainable.”

3.We ordered the originating summons be remitted to the Court of First Instance for hearing.  We took the view that the entire dispute of Chow and Chung arising out of the property, being the subject of the originating summons in HCMP 3307/2016 as well as HCA 1787/2015, should be dealt with by the same judge at the same time.  We therefore gave directions for the respective plaintiffs in these two proceedings to issue a summons to seek directions from a judge on the further conduct of proceedings in each case.  We ordered Chung to pay Chow’s costs of the appeal.  For the costs of the hearing before the judge, we ordered that those costs be the plaintiff’s (Chow’s) costs in the cause of the originating summons.

4.Chung issued a notice of motion on 25 May 2018 seeking leave to appeal to the Court of Final Appeal.  The questions said to be of great general or public importance are set out in §21 of his notice of motion:

“1. Is time always of the essence in agreements for the sale and purchase of land (“Question 1”)?

2. Where a case is remitted by the Court of Appeal to the Court of First Instance for further hearing, can the Court of Appeal direct the manner in which the Court of First Instance should award or refrain from awarding costs for the further hearing when costs usually follow the event (“Question 2”)?” [emphasis supplied]

5.Chung also relies on the “or otherwise” limb, contending that the Court of Appeal was in error in concluding that the document contained an agreement which was not unsustainable, and that the case should not have been remitted to the Court of First Instance for further hearing.

6.An oral hearing was requested by Chung’s counsel.  Having considered the papers and the submissions lodged by the parties, we do not think it appropriate to hold an oral hearing.

7.It is submitted on behalf of Chung that on a proper reading of the relevant parts of the judgments in Kwan Siu Man v Yaacov Ozer (at §§33, 73 to 74) and Ch’ng Poh v China Everbright Ltd, CACV 3805/2001, 23 October 2002 (at §17), Question 1 should be answered in the affirmative.  Chung also prayed in aid that the facts in the present case are similar to Kwan Siu Man and there is a “good arguable case” that the Chinese memorandum here is unenforceable.  And if it is considered that the law is well settled on the point raised in Question 1, it is submitted that leave should be granted on the “or otherwise” limb.

8.This court did not hold that the point raised in Question 1 should be answered in the affirmative or the negative.  The only ruling we made was that the judge should not have dismissed the originating summons summarily on the basis it was obviously unsustainable as a matter of law.  It is wholly inappropriate in these circumstances to seek leave to appeal to the Court of Final Appeal.

9.In respect of Question 2, it is clear from the words we italicised that counsel for Chung must have misunderstood the costs order we made.  The costs order relates to the hearing before Deputy High Court Judge Kwok, not the costs of the rehearing of the originating summons.  On any basis, this cannot possibly be a question of great general public importance.

10.As for the “or otherwise” limb, Chung’s contention is that the decision of the Court of Appeal has occasioned unfairness to him.  It is the practice of the Court of Appeal whether to grant leave on the “or otherwise” limb should be left to the Appeal Committee.  We would only say that no exceptional circumstances are made out in this instance to justify a departure from the practice.

11.We dismiss Chung’s application for leave to appeal with costs to Chow.  We make a gross sum assessment.  It seems to us the costs in the statement of costs of Chow are clearly excessive.  We will reduce the amount claimed from $161,300 to $77,300.

Written submissions by Mr Wallace Cheung and Mr Leonard Chow, instructed by Arthur K H Chan & Co, for the Plaintiff (Respondent)

Written submissions by Mr John Reading SC and Ms Cindy Li, instructed by Lo & Fung, for the Defendant (Applicant)