Zeng Li Feng v. Super Worth International Ltd and Another

HCA 1043/2012

[2018] HKCFI 1577

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1043 OF 2012

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Before: Deputy High Court Richard Khaw SC in Chambers (Not open to public)

Date of Hearing: 10 April 2018

Date of Reasons for Decision: 9 July 2018

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R E A S O N S   F O R   D E C I S I O N

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1.By Summons dated 6 April 2018 (ie about 2 days before the trial of this action was about to commence), Messrs Charles Yeung Clement Lam Liu & Yip, solicitors which were then on record acting for the 1^st and 2^nd Defendants (“the Defendants”), applied to cease to be the solicitors acting for the Defendants pursuant to O 67 r 6 of the Rules of the High Court (Cap 4A).

2.Order 67 rule 6(1) of the Rules of the High Court provides:-

“ Where a solicitor who has acted for a party in a cause or matter has ceased so to act and the party has not given notice of change in accordance with rule 1, or notice of intention to act in person in accordance with rule 4, the solicitor may apply to the Court for an order declaring that the solicitor has ceased to be the solicitor acting for the party in the cause or matter, and the Court or the Court of Appeal, as the case may be, may make an order accordingly …”

3.At the end of the hearing of the above application, I granted the application and ordered as follows:-

“ Upon the undertaking given by the Defendants’ solicitors that an affirmation of service of the Summons dated 6 April 2018 and the Affirmation of Wong Chi Kau dated 6 April 2018 be filed by 4 pm on 11 April 2018, the following order be made:-

1. Messrs Charles Yeung Clement Lam Liu & Yip cease to be the solicitors acting for the 1^st and 2^nd Defendants in this action.

2. In any event, service of the Summons dated 6 April 2018 on the 1^st Defendant be dispensed with.

3. There be no order as to costs of this application.”

4.I now give my reasons for the above decision.

5.The reason for the application has been provided in paragraph 2 of the Affirmation of Wong Chi Kau of Messrs Charles    Yeung Clement Lam Liu & Yip (“Mr Wong”) which reads:-

“ The trial of the Action will take place on 10^th April 2018. There has been a difficulty on my part to contact the person-in-charge of the 1^st Defendant and the 2^nd Defendant during the past months so that I am not in a position to prepare for the trial for the 1^st Defendant and the 2^nd Defendant. I have tried to reach the person-in-charge of the 1^st Defendant and the 2^nd Defendant including through their latest telephone numbers but in vain. I have tried my best to contact the person-in- charge of the 1^st Defendant and the 2^nd Defendant but in vain.”

(emphasis added)

6.The Law Society’s Circular No. 98‑128 (PA) issued on 11 May 1998 (referred to in Aqua‑Leisure Industries Inc & Anor v Aqua Splash Ltd (No 1) [1999] 3 HKC 338) reads:-

“ The Registrar [of the High Court] has advised the Law Society that a substantial number of applications pursuant to Ord 67 r 6 are made ‘very shortly before the date fixed for a substantive hearing’. The Registrar has stated that, in future, solicitors may encounter difficulties in obtaining orders to withdraw … if the application is made less than 2 working weeks before the date fixed for a substantial argument.”

7.At the hearing, Mr Wong admitted that the application could have been made earlier, in view of the difficulties in locating the 1^st and 2^nd Defendants for “months”.  He, however, explained that despite such difficulties, his firm still maintained some hope that the Defendants might eventually show up so that they would be able to continue with the preparation for trial.

8.In a situation like the present one (which is not uncommon), solicitors acting for their clients have to exercise judgment and common sense in order to form a realistic view on whether and when they should make an application to cease to act, particularly in the light of the fact that a substantive hearing or a trial is approaching.  In the present case, it appears to be wishful thinking if one were to expect that the Defendants would be located after their disappearance for months.  Any late application to cease to act will likely cause unnecessary expenditure of time, costs and also judicial resources.  Further, as a matter of fairness, if an application for withdrawal is timeously made, it will also enable the parties (ie the clients) to have sufficient opportunities to dispute (if necessary) their solicitors’ assertions, prior to the commencement of the upcoming substantive hearing or trial.

9.Notwithstanding the above, Mr Wong confirmed at the hearing that given the difficulties encountered, his firm’s relationship with the Defendants had already been terminated when they filed the application.  In the circumstances, I am satisfied that the requirement for withdrawal under O 67 r 6 has been fulfilled.  I also bear in mind that in this context, it is not for the Court to consider whether the relationship of solicitor and client should continue or be terminated.  According to the views expressed by the High Court of Australia in Plenty v Gladwin (1986) 67 ALR 26 and also referred to by Keith J (as he then was) in Aqua-Leisure Industries Inc (above), 341B‑F:-

“ … The purpose of the rule [i.e. equivalent of O.67 r.6] is quite different. Its concern is with the record of the Court and with the service of documents. It comes into play when, rightly or wrongly, a solicitor has ceased to act and the party has not given notice of change of solicitor or notice of intention to act in person. The solicitor may then take steps to have his name removed from the record. The first step is by applying to the Court or a Justice for an order declaring that the solicitor has ceased to be solicitor acting for the party in the proceeding. As we have noted the court has a discretion whether or not to make the order, but unless there are special circumstances which render it expedient to retain the solicitor on the record the order will generally be made as a matter of course upon proof that the solicitor has in fact ceased to act for the party and that no steps have been taken to take the solicitor’s name off the record. Order 7 rule 7(4) [i.e. equivalent of O.67 r.6(3)] makes it plain that an order made under the rule does not affect the rights or liabilities of a solicitor and a party as between themselves.”

10.Further, an application under O 67 r 6(1) shall be made by summons which must, unless the Court otherwise directs, be served on the party for whom the solicitor acted (see O 67 r 6(2).   This, as mentioned above, gives the party an opportunity to dispute, in the interest of fairness, his solicitors’ assertion that their instructions have been withdrawn (see Aqua‑Leisure Inc (above), 341I‑342A). There was no evidence as to how service of the Summons for the present application was effected.

11.At the hearing, Mr Wong informed me of the details of service and also the fact that the 1^st Defendant was apparently struck off from the Register of Companies recently.  However, such details ought to have been properly set out in an affirmation of service, which Mr Wong then undertook to affirm by 4 pm on 11 April 2018.  In any event, since the history of these proceedings shows that the 1^st and 2^nd Defendants have been absent for a substantial period of time, I also ordered that service of the Summons be dispensed with, as permitted under O 67 r 6(2).

12.Even after an order declaring that the solicitor has ceased to act for a party is made, he or she shall still be considered as the solicitor for that party unless and until the order is served on every party to the cause or matter, according to O 67 r 6(1).  I believe that this constitutes another reason why such applications should be made in good time.  In the present case, however, since the trial was scheduled to start immediately after the hearing of the Summons, I do not think the continuous attendance of the Defendants’ solicitors will serve any meaningful purpose since the Defendants had terminated their instructions.  I therefore allowed that the attendance of the Defendants’ solicitors be dispensed with.

13.Finally, in the Summons, the Defendants’ solicitors asked for an order that costs of this application be paid by the 1^st and 2^nd Defendants and that such costs be summarily assessed at HK$8,000.  Quite apart from the lack of particulars regarding the sum of HK$8,000 claimed, I am unable to see any reason why such a costs order should be made, particularly in view of the reasons provided in paragraphs 6 to 10 above.  I therefore made an order that there be no order as to costs of this application.

Mr C K Wong, instructed by Charles Yeung Clement Lam Liu & Yip for the 1^st and 2^nd Defendants

The 1^st Defendant was absent

The 2^nd Defendant was absent