Su Xin and Another v. Qian Xiaochun

DCCJ 5882/2019

[2022] HKDC 156

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 5882 OF 2019

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Before:  Deputy District Judge Tracy Chan in Chambers (Open to Public)

Date of Hearing:  20 August 2021

Date of Decision:  3 September 2021

Date of Further Hearing:  15 November 2021

Date of Further Submissions:  21 December 2021

Date of Further Decision:  11 April 2022

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FURTHER DECISION

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Introduction

1.This is an appeal against Master’s decision taken out by the plaintiffs. Their application before the master was for leave to serve a concurrent amended writ (“Amended Writ”) by substituted service on the defendant on his last known address in the Mainland. The mode of service proposed was by way of public announcement to be effected by a PRC court (“Public Announcement Application”). Master refused the application on 25 February 2021 and the plaintiffs brought up this appeal.

Procedural History

2.The plaintiffs claim to be victims of a fraudulent scheme by which they suffered loss and damage. Investigation revealed that an amount similar to the defrauded sum was withdrawn from the plaintiffs’ bank account and eventually deposited into the bank account of the defendant. The plaintiffs commenced this action to claim compensation and restitution. Leave to serve the Amended Writ out of jurisdiction had been granted by a master on 31 December 2019.

3.Personal service was attempted through the Arrangement for Mutual Service of Judicial Documents in Civil and Commercial Proceedings between the Mainland and Hong Kong Courts (“Arrangement”) at the defendant’s last known address in the Mainland but not successful. The return form on the service issued by the Court of Mainland China was received by the High Court on 20 October 2020 (“the Return Form”). The reason for the unsuccessful attempt was that “the owner of the property at the address has changed. The whereabouts of Qian XiaoChun (the defendant herein) unknown and he could not be located”[1] . Attached to the Returned Form was a land search showing that the defendant was not an owner of the property[2] .

4.By an affirmation dated 8 February 2021, the plaintiffs took out the Public Announcement Application before a master and was refused on 25 February 2021. The plaintiffs appealed from the master’s decision.

5.The appeal was heard on 20 August 2021. I had the benefit of reading relevant correspondence produced by the plaintiffs in their affirmation in support which included but not limited to a letter dated 29 May 2014 sent by the Director of Justice (DoJ’s Letter) to the Law Society of Hong Kong. In answering a question on the mode of substituted service by way of public announcement, a letter from the Supreme People’s Court of the People’s Republic of China (SPC) issued in May 2014 (“SPC’s Letter”) was referred to and DoJ stated the latest development of the matter:

“…..although the Arrangement does not specify the mode of effecting service in the mainland, since service by “public announcement’ is a prescribed mode of effecting service under the Civil Procedure Law of the PRC, it would appear possible for the mainland court to consider entertaining requests for service of “public announcement……Nevertheless, since the Arrangement makes no express reference to service by public announcement” and give the special nature of this mode, the matter should be further considered by the High Court and the SPC through consultation in accordance with Article 10 of the Arrangement[3].” (Emphasis added by court)

6.Having considered all documents, expert opinion on PRC law by 杨全虎and counsel’s submissions before me, a decision was handed down on 3 September 2021 (“the Decision”) allowing the appeal and granting the application for Public Announcement Application (“the Order”).

7.Before the Decision was sealed I however found it appropriate to reconsider the practical aspect of the Order. According to the DoJ Letter cited above, the Arrangement makes no express reference to service by public announcement and that the matter should be further considered by the High Court and the SPC through consultation. So, although, in principle, such mode of service is possible, there is no evidence indicating that the technicalities and practicalities have been sorted out, in particular, consultation has taken place between the Hong Kong High Court and the SPC as required. This point has not been specifically addressed by Mr Leung (erroneously referred to as Mr Ho in the Decision) representing the plaintiffs. Mr Leung was requested to appear before me to deal with the practical aspect of the Order and the power of the court to re-visit its order before it is sealed.

Power to revisit a Decision

8.In his submissions before me, Mr Leung has fairly admitted that the court has the jurisdiction to revisit its decision before an order is perfected but such jurisdiction could only be exercised in exceptional cases. Liu Weiguang v Li Kent Ko citing Sun Jianqiang v Trans-Island Limousine Service Ltd [2004] 1 HKC 533 at paragraph 25 is on the point. What is stated therein is considered by this court. I have also considered the approach taken in Andayani v Chan Oi Ling [2000] 4 HKC 233 and Lo Yuk Siu v Fubon Bank [2017] 2 HKLRD 477. In these cases, to deal with the case justly is to consider, in particular, whether any party has acted upon the decision to his detriment. There is nothing in this relation that causes any concern of the court because the documents had not yet been successfully served on the defendant and he has never acted upon the Decision or the Order.

9.Relying on the principle of finality, Mr Leung asked the court to see whether there is a sufficiently compelling reason before exercising the discretion to revisit the Decision even if in principle the court has the jurisdiction to do so.

10.Mr Leung did not and could not dispute that there is no evidence or information before this court to show that there was consultation or consensus on the technicalities and practicality between the courts in the two jurisdictions. He could not offer any useful information further. In the circumstances, the mode of service approved in the Order is not appropriate because it cannot take effect under the Arrangement. I am of the view that this is a sufficiently compelling reason to revisit the Decision and the Order and they should therefore be set aside.

Other Possible Modes of Substituted Service under the Arrangement

11.At the hearing for further submissions, the possibility of substituted service by post on a PRC address was explored. I took it as an oral application in addition to the Public Announcement Application (“Additional Application”). Mr Leung asked for time and later lodged with the District Court Registry further written submissions on 21 December 2021. It was submitted that substituted service by post was considered a possible means under the Arrangement. According to the legal opinion of 杨全虎, modes of service of legal documents by post is governed by Clause 88 of the PRC Civil Procedure Law which provides that where direct service proves to be difficult, service of litigation documents may be entrusted to another people’s court or done by mail.[4]

12.It is noted that the address to effect the substituted service by post is in fact same as the one on which personal service had been attempted unsuccessfully by the PRC court. As it was stated on the Return Form that the defendant could no longer be located at the address specified, I cannot be satisfied that an order made to serve the Amended Writ on the defendant by his last known address could bring the same to his notice as required under O.65 r.4(3). For this reasons, I refuse to grant leave for the Additional Application.

13.For reasons set out above, I now set aside the relevant parts of the Decision and the Order. The appeal against Master’s decision dated 25 February 2021 is dismissed. I also refuse the Additional Application.

14.Order and directions:-

(1)  Paragraph 17 of the Decision and paragraphs 1 to 3 of the Order be set aside and there be order made as follows;

(i)  The Public Announcement Application is refused and the appeal dismissed;

(ii)  The Additional Application is also refused.

(iii)  There be no order as to costs of the appeal including the further hearing and further written submissions.

Mr Leung Sze Lum, instructed by Au Yeung, Cheng, Ho & Tin, for the 1^st and 2^nd plaintiffs

The defendant acting in person, being absent