Pmcl also known as Lmc also known as Klmc v. Akk also known as Kak and Another

FCMC 11521 / 2015

[2023] HKFC 155

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NO. 11521 OF 2015

----------------------------

----------------------------

_____________________________

DECISION
(Leave to Appeal Out of Time
and Stay of Execution)

_____________________________

A.  INTRODUCTION

1.This decision should be read together with the Reasons for Decision on the March Order (“Reasons”)[1]. The definitions and abbreviations in the Reasons are adopted here.

2.On 1 June 2023 (almost 3 months after the March Order), ZL took out two Summonses.

3.By the first Summons (“First Summons”), ZL applied for, inter alia,

(1)  leave to appeal against the September Order[2] and the March Order[3] out of time (“Leave Application”); and

(2)  a stay of execution of the September Order and the March Order until determination of the intended appeal (“Stay Application”).

4.W opposed the applications. H has not indicated any stance. In line with the established practice, the above applications were dealt with on paper without an oral hearing.

5.By the second Summons (“Second Summons”), ZL asked for a temporary suspension of paragraph 7 of the March Order until determination of the intended appeal (“Para 7 Stay Application”). Paragraph 7 of the March Order is an unless order directing ZL to file and serve her Points of Defence by 1 June 2023, failing which she will be debarred from filing any Points of Defence in the preliminary issue.

6.W opposed while H supported the Second Summons.

7.This is the decision on the Leave Application, Stay Application and Para 7 Stay Application.

8.These proceedings, including the hearings and submissions leading to the September Order and the March Order, were in English. This decision is also written in English. If ZL and H consider necessary, they may make an appointment with the Court for interpretation of this decision into Putonghua to them in the Court building.

B.  THE BACKGROUND

9.The relevant background and procedural history are in [5] to [16] of the Reasons.

10.The Summons dated 6 September 2022 (“W’s Summons”) was issued by W with leave granted by the September Order. The substantive argument of paragraphs 2, 6 and 7 of W’s Summons (Joinder Application and Interim Injunction Applications) was heard on 9 March 2023 (“March Hearing”). All parties (W, H and ZL) were represented by counsel at the March Hearing. The March Order was made at the end of the March Hearing: [72] of the Reasons.

11.On 23 March 2023 (the last day to apply for leave to appeal against the March Order), ZL filed a Notice to Act in Person. According to W, the above notice was not served on her or her solicitors CCBH in accordance with Order 67 rules 1 and 4 until 5 June 2023.

12.On 29 May 2023, H also filed a Notice to Act in Person in these proceedings.

C.  LATE APPLICATION FOR LEAVE TO APPEAL

13.Pursuant to Order 58 rule 2(4)(c) of the Rules of the District Court, an application for leave to appeal from an interlocutory judgment, order or decision of a judge shall be made within 14 days from the date of the interlocutory judgment, order or decision.

14.As acknowledged by ZL in the First Summons, her Leave Application was made out of time.

15.It is well established that in considering whether discretion should be exercised to extend the time to take out an application for leave to appeal, the Court will consider (1) the length of the delay; (2) the reason for the delay; (3) whether the intended appeal has reasonable prospects of success; and (4) whether any prejudice would be caused to other parties if leave to appeal out of time is granted.

C1.  Length of delay

16.The application for leave to appeal against the March Order was nearly three months late. It was made on the last day when ZL’s Points of Defence was due to be filed. This is not a short delay.

17.The delay in her application for leave to appeal against the September Order is more serious. It was almost nine months late. ZL had participated in the March Hearing (which was fixed pursuant to the September Order) without questioning the force and effect of the September Order.

C2.  Reasons for the delay

18.ZL set out in her affirmation filed on 1 June 2023 the reasons for her delay. I am not satisfied that these are good reasons.

19.Her first two reasons were that (1) W or her solicitors deliberately failed to effectively serve the documents on her, she was excluded from participating the litigation; and (2) her legal representatives had not applied for an adjournment of the March Hearing on the ground of invalid service and lack of sufficient time to prepare her case in accordance with the proper procedures.

20.The above are events happened before the March Order. They are not reasons for the delay.

21.Her next reason was that a note of the March Hearing and orders made by the Court were received from her solicitors on 14 March 2023 after repeated requests. A copy of the March Order was received on 27 March 2023. She did not have the transcript of the hearing to verify what her solicitors had said.

22.ZL was legally represented until the deadline for the leave application (23 March 2023). She had the written note of the March Hearing from her solicitors on 14 March 2023, which was 5 days after the hearing, and 9 days before the expiry of the statutory 14-day limit. This does not justify a delay of almost three months (in the case of March Order) nor a delay of almost nine months (in the case of September Order). There was no oral evidence heard at the March Hearing. ZL has the note of hearing from her solicitors. She prepared the First Summons and filed the papers for her intended appeal without the transcript. The claim that she did not have the transcript does not assist her.

23.ZL then said that she does not know Hong Kong laws. She sought legal assistances from multiple sources and consulted Mainland lawyers. She spent a lot of times to study and analyse the documents in the litigation.

24.The above assertions without particulars do not amount to a satisfactory explanation. She has not explained why she did not engage another legal representative in Hong Kong. She has not claimed a lack of funds to engage lawyers.

C3.  Prejudice against the other party

25.Having regard to the nature of the orders subject to appeal, if leave is granted, there is no prejudice against the other parties that cannot be compensated by costs.

C4.  Prospect of success

26.ZL has the burden to show that there is a reasonable prospect of success in her intended appeal. This is an important consideration in these applications, and is addressed at the next section.

D.  MERITS OF THE INTENDED APPEAL

D1.  Legal principles

27.Leave to appeal should not be granted unless there is a reasonable prospect of success or some other reason in the interests of justice that the appeal should be heard: Section 63A of District Court Ordinance.

28.A reasonable prospect of success involves the notion that the prospect must be more than fanciful, without having to be probable: SMSE v KL[4].

29.Where an appeal is against the findings of fact or is involved the exercise of the discretion, the intended appellant must show that the decision was plainly wrong, or has taken into account irrelevant matters or omitted to have regard to relevant matters. The appellant must identify palpable errors in the judgment. An assertion that the finding is against the weight of the evidence or that the judge should have reached another conclusion because of the points advanced in the submissions are not errors within this category: TAC v VDC nee VDM [5]; China Gold Finance Limited v CIL Holdings Limited [6].

D2.  Attempt to rely on rejected/new evidence

30.In the Draft Grounds of Appeal, ZL annexed and referred to an affirmation made by her dated 8 March 2023 on events relating to service of the documents (“March Affirmation”).

31.I decline to grant leave to admit the March Affirmation for the intended appeal on the following reasons:

(1)  It appeared that the March Affirmation is the same Chinese affirmation (“Chinese Affirmation”) for which her counsel had sought leave to admit as evidence after lunch of the March Hearing. The Court has refused the application. I refer to [43] to [45] of the Reasons.

(2)  If the March Affirmation is different from the Chinese Affirmation, ZL failed to prove that all conditions in Ladd v Marshall[7] are satisfied:

(a)  This is not a document that ZL and her solicitors could not reasonably obtain prior to the March Hearing. The March Affirmation was made by her prior to the March Hearing. Her then solicitors’ (Kwong & Lee) name and address were printed on the backsheet.

(b)  The March Affirmation would not have an important influence on the result of the case. Most of the evidence in the March Affirmation overlapped with the contents in H’s 13^th and 14^th Affirmations. The Court has considered these Affirmations of H when determined the March Order. The other matters in the March Affirmation are either not relevant or would not change the decision made.

D3.  Intended Grounds of Appeal

32.ZL did not seek to challenge the substantive merits of the decision to join her as a party and the interim injunction against her. She has no locus to appeal against paragraph 1 of the September Order, which was a matter between H and W.

33.Her intended grounds of appeal are summarised below.

34.Ground 1: ZL contended that because W and CCBH deliberately failed to effect proper service of the September Order and W’s Summons in time, she was “excluded” from participating in the litigation.

35.Ground 1 has no reasonable prospect of success.

(1)  Contrary to ZL’s assertion, the evidence showed that CCBH had made many attempts to serve the documents on her. ZL and H had taken steps to evade or delay the service.

(2)  On 7 and 13 September 2022, CCBH had sent the Summons and related documents by ordinary mail to ZL at the FMH Address, which is ZL’s last known address. According to CCBH, these letters were not returned. This is prima facie evidence of service. H said that he returned a letter in mid-September. There is no evidence that CCBH knew at that time the September letters were returned and not passed to ZL.

(3)  ZL received Withers’ Email dated 17 September 2022 and has notice of the September Order. I have found that her subsequent assertion of doubt on Withers’ Email was not credible.

(4)  But for ZL/H’s steps to evade service, ZL ought to have sufficient time to prepare her case pursuant to the September Order.

(5)  Similarly, CCBH served further documents by letter dated 10 February 2023 addressed to ZL at the FMH Address. But for H’s deliberate return of the letter, ZL would have received the documents.

(6)  I have found that service of the documents was effected on ZL by Personal Service on 21 February 2023.

(7)  ZL had fully participated in the March Hearing through counsel. She was not “excluded” from the litigation as she asserted.

(8)  ZL failed to satisfy the Court that the intended Further Evidence is relevant to the Joinder Application and the Interim Injunction Applications. There is no prejudice against her if she could not adduce the Further Evidence before the making of the March Order.

(9)  The reasons for not admitting ZL’s Chinese affirmation dated 8 March 2023 were set out in [45] of the Reasons.

(10)  There was no merit in the other alleged problems of the September Order, for example, her assertion that a direction to file evidence within 42 days is unrealistic and unreasonable.

36.Ground 2: ZL contended that service of the documents before 1 March 2023 was invalid.

37.She essentially repeated the arguments in the March Hearing (see Section C of the Reasons). ZL could not identify any palpable error in the decision. Ground 2 has no reasonable prospect of success.

38.Ground 3: W and her legal representatives advanced untrue submissions that the CCBH Letters were not returned.

39.As set out in [26] to [28] of the Reasons, I have accepted H’s evidence that he had not opened the letters from CCBH and had not passed them to ZL. I have found that the posting of the CCBH Letters was not a valid service on ZL. There is no reasonable prospect of success in this ground.

40.Ground 4: ZL complained that her legal representatives had not lodged the March Affirmation before or during the March Hearing, nor sought an adjournment of the March Hearing.

41.I refer to [34] to [42] of the Reasons which relate to the issues of adjournment, and [43] to [45] of the Reasons which relate to the application to admit the Chinese Affirmation at the March Hearing.

42.During the March Hearing, ZL’s counsel had sought leave to lodge the Chinese Affirmation (which appeared to be the same as the March Affirmation). It bears repeating that this application was rejected not only because of the extreme lateness, but more importantly, there will be no real prejudice against ZL if the same was not admitted since similar evidence has been produced by H and considered by the Court. Even if the March Affirmation/Chinese Affirmation was admitted, it would not result in a different decision by this Court.

43.Other than the Further Evidence, ZL has not set out the evidence she intended to file if there was an adjournment. She was unable to show that an adjournment should be granted.

44.Ground 4 has no reasonable prospect of success.

D4.  Conclusion on Leave Application

45.As demonstrated above, there is no reasonable prospect of success in ZL’s intended appeal. The Leave Application is dismissed.

E.  STAY APPLICATION

46.It is trite that an appeal does not operate as a stay of execution of the orders: Order 59 rule 13(1); Star Play Development Ltd v Best Fashion Management Co Ltd[8] [6].

47.The Court will usually not exercise the discretion to grant a stay of execution unless the intended appellant can show that there is an arguable appeal (that is, one with reasonable prospects of success), and there is circumstance justifying the deprivation of the winning party of the fruit of judgment, for example having regard to the nature of the order that is the subject matter of the appeal, an appeal would be rendered nugatory without a stay of execution. A balancing exercise shall be conducted with common sense. It is impractical and undesirable to go deeply into the merits and strength of an appeal, but the court must form a preliminary view of the same: Star Play Development Ltd v Bess Fashion Management Co. Ltd.

48.For the reasons set out above, ZL failed to show that this is an arguable appeal. She also failed to demonstrate any circumstances justifying a stay of execution. The compliance of the September Order and the March Order would not render her intended appeal nugatory.

49.The Stay Application is dismissed.

F.  PARA 7 STAY APPLICATION

50.The only ground for Para 7 Stay Application was the intended appeal against the September Order and March Order[9]. The submissions made by ZL and H at the hearing of the Second Summons were a repetition of their arguments in the Leave Application and Stay Application, which were dismissed in Sections D and E above.

51.Paragraph 7 of the March Order is an unless order. The sanction has taken effect on 1 June 2023. ZL was debarred from filing Points of Defence in the preliminary issue: Order 2 rule 4. There is nothing to “stay”. The Second Summons is dismissed.

52.If ZL wishes to be relieved from the sanction and asked for leave to file the Points of Defence notwithstanding her non-compliance with the unless order, she ought to apply promptly for relief from sanction under Order 2 rule 5.

53.In an application under Order 2 rule 5, the Court will consider all the circumstances of the case and determine whether discretion shall be exercised to relieve a party from sanction of the unless order. The circumstances to be considered by the Court include, inter alia, (a) the interests of administration of justice, (b) whether the application for relief has been made promptly, (c) whether the failure to comply was intentional, (d) whether there is a good explanation for the failure to comply, (e) the extent to which the party in default has complied with other rules and court orders, (f) whether the failure to comply was caused by the party in default or his legal representative, (g) in the case where the party in default is not legally represented, whether he was unaware of the rule or court order, or if he was aware of it, whether he was able to comply with it without legal assistance, (h) whether the trial date or the likely trial date can still be met if relief is granted, (i) the effect which the failure to comply had on each party, and (j) the effect which the granting of relief would have on each party. The party in default is seeking an indulgence to be relieved from his default, he will usually be required to pay costs even if relief from sanction is granted.

54.ZL has not taken out any application under Order 2 rule 5.

G.  COSTS

55.There is no reason to depart from the general principle of costs follow the event. ZL failed in all the applications. Following the general principle, she has to bear the costs.

56.On a nisi basis, ZL shall pay W the costs of the First Summons forthwith at an amount summarily assessed at HK$30,000.

57.On a nisi basis, ZL shall pay W the costs of and occasioned by the Second Summons on a party and party basis with certificate for one counsel, at an amount to be taxed if not agreed.

58.The above orders nisi will become absolute after 14 days in the absence of any Summons for variation.

H.  OTHER RELIEF

59.The First Summons contained a plethora of prayers for reliefs. Apart from the Leave Application and the Stay Application, ZL also made a request for the setting up of a system of security monies (建立保證金制度) and other case management directions. If ZL wishes to pursue these other reliefs, she has to take out separate Summons for each of these other reliefs in accordance with the prescribed procedures.

First Summons

Mr. Deepak Nagpal and Ms. Bonnie Cheng instructed by Chaine Chow & Barbara Hung for the Petitioner.

The 1^st Respondent acting in person.

The 2^nd Respondent acting in person.

Second Summons

Ms. Bonnie Cheng instructed by Chaine Chow & Barbara Hung for the Petitioner.

The 1^st Respondent acting in person.

The 2^nd Respondent acting in person.