Leung Hong Wah Andy v. Shum Wang Chiu also known as Louis Shum and Another

HCA 346/2012

[2021] HKCFI 997

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 346 OF 2012

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Before: Deputy High Court Judge MK Liu in Chambers

Date of Hearing: 13 April 2021

Date of Decision: 13 April 2021

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DECISION

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1.By a summons dated 19 June 2020 (“the Summons”), the plaintiff (“P”) sought leave to amended his statement of claim (“the S/C”) in the manner as shown in red as per the copy of the draft Amended Statement of Claim (“the Draft AS/C”) annexed to the Summons. The substantive hearing of the Summons took place before Master Sara Tong (“the Master”) on 15 December 2020. At the end of that hearing, the Summons was dismissed with costs.

2.The matter now before me is the appeal lodged by P on 28 December 2020 against the Master’s decision made on 15 December 2020.  I would approach the matter as if the application as per the Summons came before me for the first time[1]. 

Background

3.P was a former branch manager of the 2^nd defendant (“D2”).  His wife, Ms Avril Wong (“the Wife”), was also a former insurance agent of D2.  Their agency agreements with D2 were terminated by a notice dated 6 April 2006.

4.In DCEO 3/2008, the Wife made discrimination claims against the 1^st defendant (“D1”) and D2 (collectively (“Ds”)) arising from her termination (“the DCEO Proceedings”).  The DCEO Proceedings were settled before trial in April 2013.  P was not a party to the DCEO Proceedings.

5.In the DCEO Proceedings, 11 e-mails published in a work setting between 17 March 2006 to 3 July 2006 (“the 11 Emails”) were disclosed to the Wife by Ds.

6.These proceedings were commenced by P on 27 February 2012.  At the time of the commencement of these proceedings and until 11 June 2012, P was represented by Huen & Partners (“HP”).  HP were the Wife’s solicitors in the DCEO Proceedings.

7.In the S/C, the case pleaded against Ds is a defamation case entirely based upon the 11 Emails.  It is indisputable that P was only able to obtain the 11 Emails, which were not sent or copied to him, through the Wife or HP.

8.On 8 August 2012, Ds issued a summons to strike out various parts of the S/C on the basis that they referred to the e-mails disclosed in the DCEO Proceedings, and the use of these emails in this action was an abuse of process of the court (“the Striking-Out Summons”).  The basis of the striking-out application was that the 11 Emails were disclosed in the DCEO Proceedings and were subject to an implied undertaking that those emails could not be used for purposes unrelated to the DCEO Proceedings without consent from Ds or without leave from the court.

9.By a consent order made by Master J Wong on 26 April 2013 (“the Consent Order”), the application as per the Striking-Out Summons was allowed with costs to Ds.

10.The Striking-Out Summons covered 8 out of 11 Emails, but not all of them.  The 3 other e-mails (the 7^th, the 10^th and the 11^th e-mails) were not included by Ds in the Striking-Out Summons.  However, P admitted that the 7^th, the 10^th and the 11^th emails are subject to the implied undertaking[2].

11.After the Consent Order was made, P did not take any step to bring these proceedings forward for about 21 months.  On 28 January 2015, P issued a summons to seek leave to amend the S/C (“the 2015 Amendment Summons”).  However, P did not take any active steps to bring the application made by this summons to a conclusion for many years.

12.On 22 October 2018, P issued another summons seeking an order that (“the Release Summons”):

“The Plaintiff be released from the implied undertaking not to use the documents disclosed by the Defendants in DCEO No 3 of 2008 who are the same Defendants in the Action, and be given leave to use those documents for the purpose of these proceedings.”

13.On 27 May 2019, after a contested hearing, Master Lawrence Hui dismissed the Release Summons with costs to Ds.  On 6 June 2019, P lodged an appeal against that decision.  However, on 25 February 2020, P withdrew the appeal.

14.On 19 June 2020, P took out the Summons.

15.On 14 September 2020, P withdrew the 2015 Amendment Summons.

16.Over the years, P has made 3 personal data requests to D2:

(1)  First Personal Data Request

(a)  On 25 May 2007, P made his first personal data request.

(b)  On 4 July 2007, D2’s solicitors replied and mentioned the costs implication of P’s request. Pending confirmation that P would agree to pay the costs involved in retrieving the personal data, P was provided, in the interim, with copies of the 1^st to 3^rd, 5^th to 6^th, and 8^th to 9^th E-mails, with names other than P redacted.  This letter made it clear that at that stage, D2 was not relying on any grounds to refuse the data access request.

(c)  There was no response from P requesting for any follow-up on the matter. There was also no inquire from P as to the amount of costs that were proposed to be charged.

(2)  The Second Personal Data Request

(a)  On 3 September 2012, P made his second personal data request to D2.  This request was made after the commencement of these proceedings, and after disclosure of the 11 Emails in the DCEO Proceedings. Among other things, P asked for the 4^th, 7^th and 10^th to 11^th E-mails (with reference to specific dates and times) in this request.  These were those not provided in the first data request.

(b)  On 9 October 2012, D2’s solicitors replied and asked, among things, whether P was willing to pay the costs to be incurred by D2 in complying with this data request.  There was no reply from P.

(3)  The Third Personal Data Request

(a)  Nearly 7 years later, on 26 September 2019 (ie after the dismissal of the Release Summons and after lodging the appeal against that decision), P made a third personal data request.  The contents of this request is as follows:

“所要求的資料的描述

(一)  有關本人合約的終止及降職為Senior Unit Manager事件, 包括由SHUM WANG CHIU LOUIS (Agency Manager), Leung Wai Kin Michael (Chief Agency Officer), Benny Tsoi (Agency Operation Department) 所發出及接收的電郵

(二)  有關本人及Avril Wong於2006年5月30日向英國信誠亞洲總部的機密援助熱線投訴的調查報告、陳述、口供和總結” 

(b)  After payment of fees indicated in D2’s letter of 11 November 2019, this request was complied with on 19 November 2019, and 9 emails (“the 9 Emails”) were provided to P, with the senders and recipients of the e-mails, and some contents, redacted.

The core issue

17.It is not disputed that the 9 Emails provided by D2 to P under the Third Personal Data Request are among the 11 Emails originally mentioned in the S/C.  In fact, the 9 Emails are the first 9 emails in the 11 Emails.  The core issue in the appeal is, taking the background facts as set out in the above into account, whether P should be allowed to rely upon the 9 Emails to plead a defamation case against Ds.

The principles

18.A party who obtains documents on discovery gives an implied undertaking to the court that he would make use of them only for the purpose of that action and no other purpose. Where release from the undertaking is sought, it is for the person who obtained the documents to demonstrate cogent and persuasive reasons why it should be released[3].

19.It is a clear breach of the implied undertaking to use a document obtained on discovery in one action as the foundation for a claim in a different and wholly unrelated proceeding.  This extends to information derived from the document as well[4].

20.In Riddick v Thames Board Mills, a former employee of the defendant sued the defendant for wrongful arrest and false imprisonment. In discovery, the defendant disclosed a memorandum which reported on the performance of the plaintiff.  The parties eventually settled the legal action, but the plaintiff commenced a new action against the defendant claiming damages for defamation based on the memorandum.  The English Court of Appeal held that the plaintiff was not entitled to use the memorandum as the basis for the subsequent defamation action.  Lord Denning MR said[5]:

“The memorandum was obtained by compulsion. Compulsion is an invasion of a private right to keep one's documents to oneself. The public interest in privacy and confidence demands that this compulsion should not be pressed further than the course of justice requires. The courts should, therefore, not allow the other party—or anyone else—to use the documents for any ulterior or alien purpose. Otherwise the courts themselves would be doing injustice. Very often a party may disclose documents, such as inter-departmental memoranda, containing criticisms of other people or suggestions of negligence or misconduct. If these were permitted to found actions of libel, you would find that an order for discovery would be counter-productive. The inter-departmental memoranda would be lost or destroyed or said never to have existed. In order to encourage openness and fairness, the public interest requires that documents disclosed on discovery are not to be made use of except for the purposes of the action in which they are disclosed. They are not to be made a ground for comments in the newspapers, nor for bringing a libel action, or for any other alien purpose.” (Emphasis added).

21.Further, in Halcoln International Inc v The Shell Transport and Trading Co[6], Megaw LJ:

“…… it is in general wrong that one is thus compelled by law to produce documents for purposes of particular proceedings should be in peril of having these documents used by the other party for some purpose other than the purpose of those particular legal proceedings and, in particular, that they should be made available to third parties who might use them to the detriment of the party who produced them on discovery”.

22.In Derek Joseph Parry v Nicholas Bryan Bentley[7], the Court of Appeal held that a party was not entitled to use documents disclosed in an existing proceedings to support a separate claim for defamation even if it was made by way of counterclaim in the existing proceedings.  The disclosing party would suffer serious prejudice and that the desire of the receiving party to obtain redress by way of defamation proceedings was not a sufficiently important fact to override the implied undertaking[8].

23.The implied undertaking is not only binding upon the party to whom the documents have been disclosed, but also extends to his solicitor and to anyone whose hands the document may come[9].  In this regard, in Milano Assicurazioni SpA v Walbrook Insurance[10], Waller J[11] referred to the “very strict view” that has been taken in relation to whether there should be a release of information to a third party for the purpose of enabling that third party to pursue a claim against the party who originally gave discovery.  Waller J specifically approved the statement of Sir Nicholas Browne-Wilkinson VC in Derby & Co Ltd v Weldon (No 2)[12] that such a release in favour of a third party was “virtually never given”.

24.By taking out the Release Summons mentioned in [12] below, P must have been regarded as having accepted that the implied undertaking offered by the Wife to the court in the DCEO Proceedings is also binding upon him.

25.As to personal data requests made under the Personal Data (Privacy) Ordinance (“PDPO”):

(1)  In Wu Kit Ping v Administrative Appeals Board[13], Saunders J held that in relation to the PDPO, it is lawful to redact documents provided by a personal data request to enable a person to examine the personal data for correctness and to rectify his or her own personal data, while also maintaining the privacy of personal data to which the maker of the statement was entitled to under section 20 of the PDPO.  The learned judge said:

“34. It is not the purpose of the Ordinance to enable an individual to obtain a copy of every document upon which there is a reference to the individual. It is not the purpose of the Ordinance to supplement rights of discovery in legal proceedings, nor to add any wider action for discovery for the purpose of discovering the identity of a wrongdoer under the principles established in Norwich Pharmacal & Others v Commissioners of Customs and Excise [1974] AC 133. ……

……

45. The obvious way to achieve this in most cases will be the redaction of the identity of the source of the information, be he an anonymous complainant, or merely the maker of a report. That redaction enables the data subject to examine for correctness or otherwise his personal data, and at the same time maintains the privacy of personal data to which the maker of the report is entitled under the provisions of the Ordinance. In this respect it must be remembered that the purpose of the Ordinance is to enable a data subject to examine his or her own data, it is not to enable a data subject to locate information for other purposes, such as litigation.” (Emphasis added).

(2) In Chan Shu Chun v Kung Yan Sum[14], Mimmie Chan J held that the mischief which the PDPO was intended to address was the misuse and retention of personal data collected, and the objective it was intended to achieve was to provide for the right of an individual to access the personal data collected by a data user, to prevent it from being misused and to correct any inaccuracy of the data collected. It had nothing to do with the operation of discovery in legal proceedings and it was not intended to produce any collateral effect on the settled law and already broad scope of discovery.

Analysis

26.I must say that P’s application as per the Summons is bound to fail at the outset.

(1)  The 9 Emails are subject to the implied undertaking.  P has not obtained leave from the court or consent from Ds allowing P to use the 9 Emails for the purpose of these proceedings.

(2)  Further, the pleas based upon the 1^st to 6^th and 8^th to 9^th Emails have been struck out by the Consent Order.  P is bound by the Consent Order[15] and cannot re-instate these pleas.

27.P now tries to circumvent these difficulties by contending that the 9 Emails have now been obtained through the Third Personal Data Request on 19 November 2019, and hence these e-mails are not subject to the implied undertaking.  With respect, there is no merit in this argument.

(1)  The senders/recipients of the 9 Emails can only be ascertained by reference to the unredacted versions which are covered by the implied undertaking.

(2)  It is well established that in order to pursue a case in defamation, the plaintiff must state all the facts necessary for the purpose of formulating a complete cause of action[16].  The particulars of claim would include, in respect of each publication relied on as a cause of action, that (a) the words were published by the defendant on a specific occasion, and (b) to a named person or persons other than the claimant[17].

(3)  The 9 Emails attached to Schedule 1 of the Draft AS/C do not set out the senders and recipients of those e-mails, and clearly do not provide a valid basis for a proper averment of publication, which is an essential element in libel.   There cannot be a good cause of action in libel in these circumstances.

(4)  There is no averment in the Draft AS/C setting out the relevant particulars of each publication in terms of date, time, sender and recipient.

(5)  With all these deficiencies, no reasonable cause of action has been pleaded by P in the Draft AS/C.

28.P submits that Ds have not denied that D1 is the author of the 9 Emails obtained via the Third Personal Data Request.  P also submits that in [7] of the Defence, Ds have admitted that the senders of the 9 Emails are D1.  With respect, these submissions are misconceived.

(1)  P has obtained the 11 Emails in the first place.  Based upon the evidence before the court, in my view, P has used the information from the 11 Emails to make the Third Personal Data Request.  This point is further supported by the fact that the Third Personal Data Request was taken out after the dismissal of the Release Summons and after lodging an appeal against the dismissal.  After obtaining the 9 Emails from the Third Personal Data Request, P sough to withdraw the appeal.

(2)  In my judgment, that P is able to identify D1, Michael Leung and Benny Tsoi as the senders/recipients of the e-mails in the Third Personal Data Request (and to limit the request in such terms) is because of his use of information contained in the original 11 Emails.

(3)  The implied undertaking is not confined to the use of the document itself, but also information derived from the discovered document. In my view, P has used the information in the discovered documents to frame the Third Personal Data Request.  It is only because of that information, P was certain that there was e-mail communication between D1, Michael Leung and Benny Tsoi in the relevant period.  As a result of the Third Personal Data Request, P obtained the 9 Emails. 

(4)  It is plain and obvious that this is an indirect way of using the information contained in the original 11 Emails for a purpose unrelated to the DCEO Proceedings and is a clear breach of the implied undertaking binding upon P.  This must not be allowed and must be deplored.

(5)  Further, as set out in Wu Kit Ping and Chan Shu Chun, the purpose of the PDPO is to enable a data subject to examine the correctness of personal data, and not to locate information for other extraneous purposes such as litigation.  This is precisely what P is seeking to do by the Summons. The application made by the Summons is entirely contrary to what is intended under the PDPO.

(6)  P cannot derive any assistance by relying upon [7] of the Defence.

(a)  Defence [2] has made it clear that Ds pleaded to the S/C “on the basis that it is without prejudice to their rights to strike out all or parts of the Statement of Claim”.

(b)  Subject to this proviso, Defence [7] is an averment in response to the matters pleaded in the S/C.

(c)  Ds have never consented to the use of the 11 Emails by P in these proceedings, and hence Ds took out the Striking-Out Summons on 8 August 2012.  As a result of the Consent Order made on 26 April 2013, various parts of the S/C have been struck out.

(d)  Defence [7] was in response to a pleading which was largely struck out by the Consent Order.  Accordingly, Defence [7] could no longer be regarded as a “live” pleading.

(e)  Further, Ds’ solicitors have expressly reserved their rights in respect of P’s breach of the implied undertaking before and at the time of filing of the Defence[18], and after the filing of the Defence.

29.As said in the above, P is trying to make use of the information contained in the 11 Emails for the purpose of these proceedings through the backdoor, which would be a flagrant breach of the implied undertaking.  I agree with Ds that the application as per the Summons is an affront to the court and makes a mockery of the serious obligations attaching to an implied undertaking.  The application as per the Summons is an abuse of the process of this court.  All the proposed amendments based upon the 9 Emails must be refused.

30.P also pleaded in the Draft AS/C that D2 has failed to comply with the personal data requests made by him, and D2 has acted mala fides in not complying with the said requests.  P submits that these pleas do not establish any new cause of action, but they are relevant and necessary (1) to substantiate the relief sought by P, and (2) to account for the substantial delay occasioned by Ds in these proceedings.

31.In my view, the pleas concerning the personal data requests made by P must also be refused.

(1)  I have ruled that all the pleas based upon the 9 Emails must be refused.  Without those pleas, there cannot be a reasonable cause of action against Ds.  Since P says that the pleas concerning the personal data requests do not constitute a new cause of action, there is no reason to allow these proposed pleas.

(2)  Based upon the evidence before the court, P was never serious about the First and the Second Personal Data Requests since he never bothered to provide confirmation regarding fees payable, or to make inquiries in that regard.  D2’s solicitors have provided replies to all the requests made by P within a reasonable time, and their replies are legitimate and reasonable.  D2 is allowed to redact parts of the emails provided to P, as explained in Wu Kit Ping.  There is simply no basis to say that D2 has done anything to impede these proceedings.

Disposition

32.For the reasons above, this appeal must be dismissed.  I dismiss the appeal.

33.Costs should follow the event and be paid by P to Ds forthwith.  Those costs be summarily assessed on the papers.  As said in this decision, I am of the view that this appeal is an abuse of the process of the court and is indeed an affront to the court.  I order that costs be assessed on indemnity basis.

34.P submits that Ds should be deprived of some costs because Ds have only provided a note made by the Master to P at a very late stage, ie yesterday. That note only consists of 2 pages.  In my view, costs of and occasioned by that note is insignificant.  I would not accede to P’s request.

35.There be leave to Ds to file and serve a bill of costs for summary assessment within 7 days, and leave to P to file and serve a written reply to the said bill within 7 days thereafter.

36.Ds have taken out a striking-out application by a summons dated 5 November 2020, which has been adjourned pending the outcome of this appeal.  Since I have read the papers in this case, it would be better if the striking out application is heard and determined by me.  I direct that the substantive hearing of the striking out application be before me on a date to be fixed, with 3 hours reserved, in consultation with counsel’s diaries.  I also give the following directions for the filing of affidavit evidence in that striking-out application:

(1)  Leave to P to file and serve affidavit evidence in opposition within 28 days.

(2)  Leave to Ds to file and serve affidavit evidence in reply within 21 days thereafter.

(3)  No further evidence be filed without leave of the court.

37.I thank counsel for the assistance rendered to the court.

Mr Andrew Mak and Mr Francis Chung, instructed by Adrian Yeung & Cheng, for the plaintiff

Mr Jin Pao SC, instructed by Mayer Brown, for the 1^st and 2^nd defendants