Esports Business Development Ltd v. Wong Chun Yee Christopher

HCA 1953/2018

[2022] HKCFI 2627

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1953 OF 2018

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Before:  Deputy High Court Judge H. Au-Yeung in Chambers (Open to Public)

Date of Hearing:  23 August 2022

Date of Decision:  23 August 2022

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DECISION

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THE APPLICATION

1.This is the Pre-Trial Review of this action. The trial has been scheduled to commence on 1 December 2022 with a total of 10 days reserved[1]. This Decision will only deal with the summons filed by the 2^nd defendant (by counterclaim) (“Victor Chan”) on 15 August 2022 (“the Summons”), by virtue of which he applied for leave to give evidence through video-conferencing facilities (“VCF”) at the trial. 

GROUNDS OF APPLICATION

2.An affidavit of Ms Roberta Chan (solicitor acting for Victor Chan) has been filed in support of this application.  In the said Affidavit, Victor Chan’s signed Affirmation was exhibited.  This Court was informed that Victor Chan will sign this Affirmation again once he is back in Hong Kong and the Affirmation will then be filed formally.

3.In Victor Chan’s Affirmation, he has provided two grounds in support of this application:

(1)  He is heavily engaged in a corporate restructuring and capital raising project which involves a listed company in the Mainland with an estimated transaction value in excess of RMB 3 billion (“the Project”).  In the light of some recent developments in the Project, he is required to stay in the Mainland physically in December 2022;

(2)  He would be exposed to significant health risks if he comes back to Hong Kong.  There is also no certainty that he will be able to return to Hong Kong because of the quota system for inbound passengers from the Mainland.

THE LEGAL PRINCIPLES

4.The applicable legal principles have been summarised by Anthony Chan J in Re Nobility School Limited [2020] HKCFI 891 as follows:

“(1) The giving of evidence by video conferencing facilities (‘VCF’) is an exception;

(2) The starting point is that proceedings are conducted in court. I would add that this is more important when it comes to a trial;

(3) Sound reason is required to justify a departure from the starting point;

(4) The solemnity of court proceedings and its atmosphere is highly important in the taking of evidence;

(5) The court may be more disposed to exercise its discretion to allow evidence by VCF in respect of technical or purely factual evidence which involves no serious issue on credibility or relatively unimportant evidence;

(6) Where the credibility of the witness is seriously contested, it is important for the witness to be examined under the solemn atmosphere of the court;

(7) Costs and convenience may be important considerations which the court will have to weigh in the determination of the application;

(8)  Ultimately, it is a matter of judgment of the court choosing the course best calculated to achieve a just result by taking into account all the material considerations, including whether the witness is capable of attending the proceedings, any prejudice to the other party, the Underlying Objectives, any delay to the proceedings and practical considerations like the availability of the facilities (see Practice Direction 29).”

5.Mr Chong and Mr Lee who act for Victor Chan have also drawn my attention to the Guidance Note for Remote Hearings for Civil Business in the Civil Courts (Phase 3: Wider Video-Conferencing Facilities and Telephone) issued by the Judiciary on 15 December 2020, in which it was provided, among other things, that:

“18. In making the case management decision as to which hearings will be dealt with remotely, the court will take into account the views of the parties, the availability of VCF equipment, the subject-matter of the proceedings or relevant part of the proceedings and all other material circumstances, including in particular whether the proposed use of VCF is likely to promote the fair and efficient disposal of proceedings (including through the avoidance or reduction of delay) and/or to save costs.

[…]

20. In addition to those general matters mentioned above, those factors may include (but are not necessarily limited to): (a) the importance and nature of the issue to be determined; (b) whether there is a special need for urgency, or whether the decision could await a later hearing without causing significant disadvantage to the parties; (c) whether the parties are legally represented; (d) the ability of the parties to engage with and follow remote proceedings meaningfully; (e) whether evidence is to be heard (and, if so, the nature of that evidence) or whether the case will proceed on the basis of submissions only; (f) the proposed length of the remote hearing; and (g) whether there are other alternatives consistent with public health concerns and the need for safety, such as for some or all of the participants to take part in the court hearing by physical attendance in a court room before the JJO.”

6.Both legal teams have also referred this Court to a number of authorities in an attempt to demonstrate how this particular aspect of case management power had been exercised in the past.  Without disrespect, I do not propose to set those cases out in this Decision, because after all, all cases depend on their own facts, and such a case management power has to be exercised according to the circumstances of the particular case before the Court.  Ultimately, the question is which course would be best calculated to achieve a just result.

DISCUSSION

The Covid-19 factor

7.For the sake of convenience, I will deal with Victor Chan’s ground which is related to Covid-19 first.

8.Victor Chan’s points in this regard may be summarised as follows:

(1)  The prevailing Covid-19 pandemic, his age and travel restrictions are material considerations;

(2)  There is no certainty that he will be able to return to Hong Kong or to the Mainland at all because of the quota systems of both places;

(3)  There are still quite a lot of Covid-19 cases in Hong Kong.  The risks and uncertainty are further heightened given the fact that he is over 60 years old, who has not been vaccinated for Covid-19 in the Mainland.  This amplifies the health risks to himself and other court users.

9.In my view, particular attention has to be paid to what Victor Chan said in paragraph 7 of his Affirmation which was signed on 15 August 2022:

“I have been advised of, and understand, the importance of giving evidence in person in the Trial scheduled on 1 December 2022 to 14 December 2022. In anticipation of giving evidence in this Trial, I had all along planned to travel to Hong Kong for the purposes of the Trial.” (emphasis added)

10.The trial dates in December 2022 were fixed on 14 May 2021.  The entry restrictions and the quarantine requirements have been in place for sometime, and the health risks to those who have not been vaccinated (like Victor Chan) have always been in existent.  If Victor Chan’s intention has always been travelling to Hong Kong for the purpose of the trial (presumably he had this intention even throughout those months when Hong Kong was hit by the 5^th wave of the pandemic earlier this year), I cannot see any reason why he should be worried at this stage about his exposure to the risks of contracting Covid-19, travel restrictions and the uncertainty of entering into Hong Kong. 

11.These show that the Covid-19-related factors relied upon by Victor Chan per se are not as important as he claimed to be in his case. 

The Project

12.Mr Suen SC and Ms Chan submitted that in the light of Victor Chan’s long-standing intention to come to Hong Kong and give evidence in Court, the real reason of the present application is the professed business need.

13.While I may not go that far, it seems to me that the Project must be the main reason of the present application.  Victor Chan frankly admitted that:

“[…] although it is my wish and intention to come to Hong Kong to give evidence in person in the Trial, coming to Hong Kong would likely jeopardize the Project given the uncertainties due to the Covid-19 situation in Hong Kong and in Shenzhen, the ever-changing travel regulations and the practical difficulties over the commute between Hong Kong and Shenzhen.”[2]

14.In other words, it is clear that Victor Chan would not have made this application but for the Project.

15.Hence, this Court has to consider Victor Chan’s justification of this application in relation to the Project more carefully.

16.However, Victor Chan stated that because he is not at liberty to disclose the details of the Project due to confidentiality and regulatory requirements, limited information about this Project was made available to the Court. 

17.Of course, since this is Victor Chan’s application, it is up to him as to how much information should be disclosed in support.  That said, the Court can only assess the merits of this application by considering whether the grounds have been adequately substantiated by the evidence. 

18.Having done so, I hold the view that there is inadequate evidence to justify Victor Chan’s proposal that he should be allowed to give evidence by VCF as an exceptional case:

(1)  While he has relied heavily on the “December Event” which he described as a milestone event in the Project involving over RMB 1 billion, there is inadequate explanation as to the details thereof, such as:

(a)  what this event is about;

(b)  when exactly this event will take place;

(c)  why he cannot attend the negotiations concerning the December Event remotely from Hong Kong; and

(d)  bearing in mind he is not doing this Project alone but with a team, why he cannot authorise someone else to execute the legal documents involved with a specific instruction that such execution shall only take place with his approval.

(2)  He anticipated that he would be the first witness giving evidence in Court, and his evidence should conclude by the 3^rd or 4^th day of the trial.  That means he should be able to leave Hong Kong on around 6 December 2022.   There is no explanation as to why he cannot go back to the Mainland immediately thereafter and devote his time on the Project again.  I have not lost sight of the requirement that he has to go through a quarantine period in the Mainland, but there is inadequate information to show that it will be too late for him to join the team in person after such a period.

19.In any event, Victor Chan has demonstrated that he has placed his business engagement as first priority, over and above the present civil litigation.  That is his own choice.  But that is not a good reason why the Court should in such circumstances make it an exception for him to give evidence via VCF.

20.Counsel for Victor Chan cited paragraph 5(2) of the case of Taishin International Bank Co. Ltd v QFI Ltd [2020] HKCFI 938 and submitted that the serious disruption caused to work commitments is a highly relevant factor.  With respect, that was not what was held in Taishin. The paragraph cited by counsel was only a summary of one of the grounds relied on by the defendant therein in support of its application to allow its witness (“Huang”) to give evidence via VCF.  While the application was acceded to at the end of the day, the alleged disruptions to Huang’s work was not one of the reasons referred to by DHCJ MK Liu in his Decision[3].

Prejudice

21.It was submitted on Victor Chan’s behalf that there will be little prejudice or slight disadvantage only caused to Wong even if this application is allowed. 

22.With respect, I do not agree with that submission. 

23.It is undeniable that Victor Chan’s evidence will be hotly disputed.  In such circumstances, it is all the more important that he will be cross-examined under the solemn atmosphere of the Court. 

24.As it has been pointed out in a number of authorities, justice must be seen to be done, and the other side would have a justified sense of grievance if an important witness like Victor Chan would be allowed to give evidence by VCF, thereby having a perceived advantage over Wong.

25.In this regard, I echo Anthony Chan J’s view expressed in Re Nobility School Limited (supra) that “there will likely be interruptions of the evidence due to, eg, quality of the audio, and such interruptions will normally be to the disadvantage of the cross-examiner”[4].  Indeed, judging from my own experience, the usage of VCF may be an advantage to the witness, because any problem in the internet connection (which may arise at any time and from time to time) may interrupt the transmission of the video signal.  The screen may be “freezed” during the cross-examination as a result.  The questions or answers asked/given may be “lost” in the process.  This may deprive the Court and the examiner the chance to observe the immediate reaction of the witness when certain questions are asked.  Such sudden loss of signal may also lead to suspension of the Court proceedings, and this in turn may give the witness a longer time to think about his/her answer to the question just asked by the examiner.  If the witness alleges that he/she cannot hear a question clearly, it is also very difficult if not impossible to verify whether such an assertion is real, and whether he/she is just buying time to figure out what to say in response to a question.

26.Furthermore, giving evidence at any place other than the Court room would also tend to reduce the formality of the Court proceedings.  This will create an injustice situation in favour of the witness who gives evidence by VCF.

27.Counsel for Victor Chan submitted that the Court will be able to assess the credibility of the parties by reference to Wong’s own subsequent conduct and statements and subsequent events.  In my view, this does not make it less important for Victor Chan to be cross-examined inside the Court room.

28.This Court has been told that in the event this application is not acceded to, Victor Chan will be unable to give evidence at the trial.  This is a matter which this Court should take into account because the interest of Victor Chan (and the other defendants (by counterclaim)) would be prejudiced.  However, since this is Victor Chan’s own choice and a question of priority which he placed these proceedings, I do not think this factor should be given any great weight at all. 

CONCLUSION

29.Having considered all the above matters, I take the view that, for the purpose of conducting the trial fairly, this Court should not allow Victor Chan to give evidence via VCF.

30.The Summons is therefore dismissed.

COSTS

31.Costs should follow the event.  

32.Victor Chan should therefore bear the costs of the Summons, with certificate for two counsel.

33.I agree with Mr Suen SC that the costs of the PTR should be apportioned such that two-thirds of such costs should be regarded as the costs of the Summons.

34.The plaintiff (by counterclaim)’s costs of the Summons are summarily assessed pursuant to Order 62 rule 9A(1)(a) of the Rules of the High Court (Cap.4A, Laws of Hong Kong) at $130,000, payable by Victor Chan on or before 6 September 2022.

Mr Jenkin Suen SC leading Ms Tinny Chan, instructed by W. K. To & Co., for the plaintiff (by counterclaim)

Mr Patrick Chong and Mr Adrian Lee, instructed by Baker & McKenzie, for the defendants (by counterclaim)