Lee Kin Yan t/a Kin Shing Engineering Co. v. Honeywell Ltd.
Read the full judgment text of CACV 35/2000 on BabelCite. This 高等法院上訴法庭 judgment was delivered on 19 May 2000 before Hon Rogers JA, Woo JA.
Civil procedure — Dismissal for want of prosecution — Inordinate and inexcusable delay — Whether delay caused serious prejudice or risk to fair trial — Sub-contractor claim for variation work under partly oral contract — Evidence of witness availability — Exercise of discretion to strike out. The plaintiff commenced proceedings in 1994 against Honeywell Limited for unpaid works at Times Square under a partly oral and partly written 1991 contract. The action experienced repeated, lengthy delays. The trial judge struck out the action in January 2000 for want of prosecution citing inordinate and inexcusable delay causing prejudice to the defendant’s defence due to difficulty of witness evidence. On appeal, the Court considered whether the delay warranted striking out the claim under the test in Birkett v. James [1978] AC 297, focusing on whether the delay risked an unfair trial or serious prejudice. The Court held that although delay was proven, the defendant failed to establish sufficient prejudice from witness unavailability or reluctance directly caused by the delay. The defendant's inability to obtain statements was more attributable to its own failure to act promptly. Accordingly, the exercise of discretion in striking out was flawed. The appeal was allowed and the dismissal order set aside, with costs in lower court to stand and plaintiff granted costs of appeal.
Legal issues: Whether the action should be struck out for want of prosecution
Outcome: Appeal allowed; order dismissing action for want of prosecution set aside
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CACV000035/2000 CACV 35/2000 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF APPEAL CIVIL APPEAL NO. 35 OF 2000 (ON APPEAL FROM HCCT 8/1995)
---------------------- Coram: Hon Rogers JA and Woo JA in Court Date of Hearing: 16 May 2000 Date of Judgment: 19 May 2000 ---------------------- J U D G M E N T ---------------------- Hon Rogers JA : 1. This is an appeal from a decision of Burrell J given on 18 January 2000 whereby he dismissed this action for want of prosecution. The order drawn up was in an unusual form since paragraph 1 recited :-
2. Aside from the obvious repetition of the order in relation to costs, the order itself, insofar as it continues after the first line of paragraph 1, could be said to be ambiguous by reason of the inclusion of the words "and/or" : the basis upon which any order is to be made must be definite. 3. This action concerns a claim made by a sub-contractor in respect of the supply and installation of fire alarm systems and associated equipment at Times Square in Causeway Bay. The action was commenced in October 1994 by writ endorsed with a statement of claim. The claim concerns a contract which was alleged to have been made in mid-1991 and to have been partly oral and partly written. The essence of the action is that the plaintiff is claiming in respect of what is referred to in the statement of claim as "variation work", although it is particularised in many respects as being work which is additional to the contracted work. 4. The defendant takes the position that there is some confusion in the way that the plaintiff originally framed his case. It is the defendant's case that insofar as the plaintiff was alleging that the contract was a "re-measurement" contract, he had put his case in the wrong way and had not pleaded the case on the basis of a re-measurement but had pleaded it by trying to compare the original work and the costs thereof and the additional work and the costs of that. This matter was highlighted in the defence which was served in December 1994 whereby it was pleaded that the contract was a lump sum contract. It was not until September 1998 that the statement of claim was amended to include a claim based on quantum meruit, in effect, relying on precisely the same items which were said in the original statement of claim to be variation works or additional works. It is fair to say that the defendant contends that the plaintiff has still not pleaded his case correctly, nevertheless, a consent order was made in October 1998 permitting the defendant to amend its defence which it did shortly thereafter. 5. There were considerable periods of delay which the judge analysed in his judgment as occurring at six different periods throughout the time the action has been in being, the longest being 11 months in the period up to September 1999. Thereafter the defendant launched its application to strike the action out in October 1999. In relation to these periods, the judge said :-
6. The judge held that these periods of delay were both inordinate and inexcusable. The judge then went on to consider the question of whether the delay was such that the action should be struck out. He concluded that he was satisfied that the defendant would be quite unable to do justice to its case and the judge would be faced with a most difficult if not impossible task. 7. Before us, Mr Denis Yu, on behalf of the plaintiff, has not sought to contest the findings that the various periods of delay were both inexcusable and inordinate. He says however that the judge was wrong in exercising his discretion to strike out the action because the facts did not warrant such a course. 8. Before proceeding to consider whether an appeal is open in this case, it is necessary to consider the facts briefly. 9. In the first place, the plaintiff pleaded, right at the outset of the action, that insofar as the contract had been made orally, it was made by the plaintiff and Mr P.C. Chan, Mr Stephen Chan and Mr Lai Ting Chung acting on behalf of the defendant. Insofar as any reference is made to any oral matters giving rise to the additional works which were carried out, a Mr T.N. Wong was identified. In the founding affidavit seeking to support the application to strike out this action, Mr Cocking, the solicitor acting on behalf of the defendant said :-
10. It was pointed out that that evidence was perhaps not entirely in accordance with the rules of the court and in any event, even if it should be given a liberal interpretation, it was difficult to see how the defence which was filed could have been drafted if the relevant persons said to have been at the meeting relied upon by the plaintiff were not consulted. 11. In his second affidavit, Mr Cocking amplified what had been said in the following way :-
And in the following paragraph :-
12. The judge's assessment of that evidence is contained in the paragraph on page 9 of his judgment where he said :-
13. It is trite law that this court will not interfere with the discretion exercised by a judge unless it can be shown that the judge erred in principle or took into account facts which should not have been taken into account or failed to take into account facts which should have been taken into account or otherwise misapprehended the evidence. This court also takes into account that the judge below had, by the date of the hearing, been appointed to take charge of the Construction and Arbitration List and hence, his views as to the viability of witnesses giving evidence carry considerable weight. 14. There are, however, obvious matters which arise from the statements which have been made in the defendant's evidence. The departure of Mr P.C. Chan and Mr Stephen Chan from the defendant's employment was something which took place very close to the commencement of these proceedings. Any difficulties occasioned because of their departure from the defendant's employment cannot be laid at the door of the plaintiff's delay. No evidence has been given that the defendant is unable to contact these two persons nor as to what steps have been taken to make contact with them, still less is there any clear statement that they have expressed an unwillingness to give evidence. 15. In relation to Mr Lai Ting Chung, the judge, in my view, rightly discounted the matter. Indeed, it seems to me that the defendant has no reason for not having taken statements from him, if not all three persons, when the action was started. As I have pointed out, in order to plead the defence in the way it was, it is surprising if statements were not taken. If Mr P.C. Chan and Mr Stephen Chan had already left the defendant's employment by the time of the service of these proceedings and the defendant had been unable in any event to obtain any written statement from those persons, again, the cause of the defendant's difficulties does not stem from the plaintiff's delay. For my part, I would adopt what was said by Hirst LJ in the case of Hunter v Skingley [1997] 1 WLR 1466 at p.1472E :-
16. Whatever defects the defendant may have considered arose from the manner in which the plaintiff's claim was originally framed, Mr Lai Ting Chung was employed by the defendant until 1999 and, indeed, after the service of the amended statement of claim. 17. In my view, the judge below erred in approaching the matter, as he seems to have done, on the basis that Mr P.C. Chan and Mr Stephen Chan would not be available to appear as witnesses. In any event, even if that were so, that was not caused by the plaintiff's delay. It is thus, in my view, open to this court to review the exercise the judge's discretion and to exercise anew its own discretion in relation to this matter. 18. In my view, it does not assist to reiterate in different words the test which the court should apply in deciding whether on the basis that there has been inordinate and inexcusable delay on the part of the plaintiff or its lawyers, the case should be struck out. Using the words of Lord Diplock in Birkett v. James [1978] AC 297 at 318F, the court must consider whether the delay will give rise to a substantial risk that it is not possible to have a fair trial of the issues in the action or is such as is likely to cause or to have caused serious prejudice to the defendant in this case as between the defendant and the plaintiff. 19. In my view, that is not made out. As has been drawn to our attention, the defendant in October 1999 stated that it intended to call as witnesses four employees, namely Eric Leung, Ricky Woo, Simon Chan and T.N. Wong; albeit in that document, the defendant stated that the three key witnesses had left Hong Kong and were unlikely to return to give evidence. Those were possibly the Messrs Chan and Mr Lai. For my part, as I have indicated, I am not satisfied from the defendant's evidence that the two Messrs Chan would not return to Hong Kong. The fact that Stephen Chan is now working for a competitor of the defendant is not in itself a matter which would militate against his giving evidence in relation to a matter which is in no way alleged to have any reference to his new employer. Similarly, the fact that Mr P.C. Chan may own a shop in Canada does not seem to be a bar in itself to his returning to assist his former employer. No reference is made in any of the defendant's evidence as to Mr Eddie Chu, who appears from many of the documents which have been exhibited in this case to be a person who was intimately involved on behalf of the defendant with the matters which are the subject of the plaintiff's claim. Whereas, of course, witnesses' memories will have faded over the years, in my view, that failing of memory is likely to have been most acute in the early years. I am not satisfied that the potential witnesses are or would be unable to recall the essential facts. The trial of an action, should, in my view, take place either later this year or early next year. Whereas this is far from ideal since it is now coming up to nine years from the time when it is said that the initial contract was made and seven years from the time when the work was completed, the defendant has not shown that degree of prejudice which would justify driving the plaintiff from the court. 20. In my view, this appeal should be allowed. The order below should be set aside and I would make an order nisi that the costs in the court below should remain as ordered by the judge but the plaintiff should have his costs in this court. Hon Woo JA : 21. I agree that the appeal be allowed for the reasons given in my Lord Rogers JA's judgment which I have had the advantage of reading in draft. I also agree to the order for costs nisi as proposed.
Representation: Mr Denis Yu, instructed by Messrs Ng, Lie, Lai & Chan, for the Plaintiff Mr Jonathan Harris, instructed by Messrs Simmons & Simmons, for the Defendant |