Chan Sing Fu v. Yau Sau Chun the Executrix of the Estate of Yau Tung Hoi, Deceased (“The Deceased”)
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HCA 1220/2019 [2026] HKCFI 5801 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE ACTION NO 1220 OF 2019 ________________________ BETWEEN
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________________________ DECISION ________________________ APPLICATIONS 1.There are before the court 2 applications by the defendant:
2.The plaintiff has indicated, in paragraph 1 of the Supplemental Submission of Mr Raymond Lau, counsel for the plaintiff, that he no longer had any objection to the Affirmation Leave Summons subject to costs. What remains to be dealt with is thus the Set-aside Summons. 3.The Set-aside Summons is mounted on the grounds that (1) the Default Judgment was irregular as a result of the irregular service of the writ of summons issued on 9 July 2019 (“Writ”) and the plaintiff’s summons issued on 13 June 2020 for default judgment (“Default Judgment Summons”); and/or (2) the defendant has a meritorious defence. 4.It is trite in Hong Kong that an irregular judgment would be set aside without regard to the merits of the proposed defence. Nevertheless, even if there was no effective service, the court retains a residual discretion to impose terms for setting aside a judgment, having regard to the parties’ conduct. See Hong Kong Civil Procedure 2026, Volume 1, paragraph 13/9/4 at pages 345-346. See also Po Kwong Marble Factory Ltd v Wah Yee Decoration Co Ltd [1990] 4 HKC 157 (CA). 5.For the reasons explained below, this is a clear case of irregular service of the Writ and the Default Judgment Summons which renders the Default Judgment also irregular. BACKGROUND The Deceased and his estate 6.Mr Yau Tung Hoi, deceased (“Deceased”) was the registered owner of the following 3 properties (collectively “Properties”):
7.The Deceased passed away on 11 November 2014, leaving 9 surviving children, including the defendant and Madam Yau Sau Ha, the plaintiff’s wife. 8.By the grant of probate under HCAG002247/2016 on 14 December 2017, the defendant was appointed the sole executrix of the estate of the Deceased. Plaintiff’s claim 9.It is the plaintiff’s case that he has, for upwards of 12 years prior to the issue of the Writ, the continuous and undisturbed possession of the Properties with the intention to exclude the world at large, including the Deceased, from the Properties and has exercised acts of ownership over the Properties. 10.By this action, the plaintiff claims declarations that:
Procedural history Service of the Writ 11.On 9 July 2019, the plaintiff’s then solicitors, Li & Associates (“L&A”), sent a sealed copy of the Writ by registered post to 1/F, 68 Hoi Pa Village, Cheung Pei Shan Road, Tsuen Wan, New Territories, Hong Kong (“Service Address”), which the plaintiff claims to be the usual and last known address and/or address for service of the defendant. 12.On 12 August 2019, the plaintiff filed an affirmation of service by which Mr Li Hoi Kwong, the principal of L&A, deposed that the Writ had been served by registered post to the defendant’s usual and last known address and/or address for service of the defendant (which was the Service Address) on 9 July 2019, and that the letter had not been returned undelivered by the Hong Kong Post (“HK Post”) through the Dead Letter Service. There is, however, no statement to the effect that in the opinion of the deponent the copy of the Writ, so sent to the defendant, will have come to the knowledge of the defendant within 7 days thereafter, as required by Order 10, rule 1(3)(b)(i). 13.As it happened, according to the letters dated 9 and 16 December 2021 from the HK Post to Lee & Associates Law Office (“L&A Law Office”), the defendant’s solicitors, a postman attended the Service Address on 11 July 2019 to deliver L&A’s letter dated 9 July 2019 but to no avail. The letter was then held at the Shek Wai Kok Post Office in Tsuen Wan for collection by the addressee who never turned up. As the HK Post had not been provided with a return address, the letter could not be sent back to the sender through the Dead Letter Service. The statement in the plaintiff’s said affirmation of service that the letter had not been returned undelivered by the HK Post through the Dead Letter Service, which is required by Order 10, rule 1(3)(b)(ii), is misleading, and likely to be knowingly so, as L&A should realise that the letter could not have been returned to them in the absence of a return address which they knew they had not provided. Correspondence between the parties’ solicitors 14.In the meantime, on 10 July 2019, L&A also sent a sealed copy of the Writ to L&A Law Office which were then acting for the defendant in some other disputes between the parties. 15.By reply dated 22 July 2019, L&A Law Office informed L&A that (1) it was their understanding that the defendant was no longer living at the Service Address (which was indorsed on the Writ as the defendant’s address) and (2) they had no instruction to act for the defendant in this action. L&A were asked to confirm and prove by supporting evidence whether and when the Writ had successfully reached the defendant. If service on the defendant was ineffective, they would take instruction from her whether they should accept service of the Writ for and on her behalf. 16.L&A never responded to L&A Law Office’s said letter dated 22 July 2019 despite the latter’s chaser by letter dated 7 August 2019. Application for and entry of default judgment 17.Instead, the plaintiff took out the Default Judgment Summons on 13 July 2020, for judgment against the defendant in default of defence under Order 19, rule 7, supported by, inter alia, the plaintiff’s said affirmations of service dated 12 August 2019 and 23 July 2020. 18.Despite having been told that the defendant had already moved out of the Service Address, the plaintiff purportedly served the Default Judgment Summons on the defendant by ordinary post to the Service Address which the plaintiff maintains was “the last known address” of the defendant. See paragraph 4 of the affirmation of service of Ma Ka Mei Samantha dated 23 July 2020. 19.The Default Judgment Summons came before me, and I granted the Default Judgment, on 30 July 2020. 20.Again, despite having been told that the defendant had already moved out of the Service Address, the plaintiff purportedly served the Default Judgment on the defendant by ordinary post to the Service Address on 30 July 2020. The defendant’s knowledge of the Default Judgment 21.On 4 June 2021, the defendant in her capacity as the sole executrix of the Deceased’s estate commenced HCA 855/2021 against Madam Yau Sau Ha (the plaintiff’s wife) for vacant possession of the Properties. It is the defendant’s case that she came to know of the Default Judgment upon receipt of Madam Yau Sau Ha’s defence and striking out summons in HCA 855/2021 which were based on the existence of the Default Judgment. 22.On 10 August 2021, the defendant filed the Set-aside Summons. DISCUSSION Whether there has been service of the Writ in accordance with RHC 23.Order 10, rule 1(2)(a) provides an alternate mode to personal service of a writ on a defendant within the jurisdiction through sending a copy of the writ by registered post to the defendant at his usual or last known address. This alternative is based on a good working, but rebuttable, presumption that such service will bring the proceedings to the notice of the defendant. The presumption will be rebutted, and the writ will be treated as not having been duly served, if it is returned through the HK Post undelivered to the addressee (Hong Kong Civil Procedure 2026, Volume 1, paragraph 10/1/12 at page 128). 24.In this case, the HK Post has actually confirmed that the Writ had not been successfully delivered to the defendant, but it could not return the Writ to L&A because no return address had been provided. Had a return address been provided, the plaintiff would have the Writ returned by the HK Post. 25.In answer, Mr Lau contends that (1) Order 10 rule 1(2)(a) does not mandate the provision of a return address when a writ of summons is served by registered post; and (2) Order 10 rule 1(3)(b) only requires an affirmant of service that in his opinion, the copy of the writ has not been returned to the plaintiff through the post undelivered to the addressee. The need to give the post office a return address is obvious (and therefore implicit). Otherwise, the deponent of the affirmation of service would not have any or any proper basis to depose that the letter had not been returned undelivered by the HK Post through the Dead Letter Service. As noted in [13] above, the purported statement to such effect in the Affirmation of Li Hoi Kwong, which is required by Order 10, rule 1(3)(b)(ii), is misleading. 26.In the premise, the deemed service of the Writ by way of registered post is rebutted. Whether service of the Default Judgment Summons is irregular 27.The plaintiff sent the Default Judgment Summons (and later the Default Judgment) by ordinary post to the Service Address. Such purported service should, to the plaintiff’s knowledge, not have brought the application for default judgment and the entry of judgment to the notice of the defendant, which would defeat the purpose of service. The plaintiff should have had such knowledge because they had already been advised by L&A Law Office back in July 2019 that the defendant no longer lived at the Service Address. The purported service of the Default Judgment Summons by post to the Service Address is, in my opinion, ineffective. Whether irregular service of the Writ can be salvaged by the defendant’s alleged notice of the Writ (if proved) 28.Mr Lau submits on behalf of the plaintiff that service at an address at which a defendant no longer resides is only irregular if the writ has not been otherwise brought to the notice of the defendant. In support, counsel relies on the generally and broadly worded remarks of Coleman J (as Coleman JA then was) in Cheung Sai Lon v Cheung Sai Ha [2021] HKCFI 904, particularly [20]:
29.Each case turns on its own facts. In Cheung Sai Lon v Cheung Sai Ha, service was effective. Coleman J’s observation is thus obiter. 30.It is well established in the case law that what applies is the “actual notice” test: “the test for service of a writ was whether it had been brought to the defendant’s notice and not whether it had been delivered to the defendant’s last known address” (see, for example, Kwan Kam Wah v Chan Wai Ming [2000] 2 HKC 378). The crux is that if a plaintiff chooses to take advantage of the alternate mode of service allowed in Order 10, rule 1(2)(a), service of the writ by registered post in accordance with the rules is required but mere compliant service is inadequate. The writ had to be brought to the notice of the defendant. This is consistent with what Deputy High Court Judge Winnie Tsui (as her Ladyship then was) said, after reviewing a long line of precedents, in Tse Shiu Hoi v Sun Bo [2021] HKCFI 2351 at [44]:
31.In the instant case, the HK Post’s said letters to L&A Law Office conclusively prove that service of the Writ was irregular. Whether the court should impose terms in setting aside the Default Judgment 32.The plaintiff has not suggested that the defendant had actual notice of the Default Judgment Summons or adduced sufficient evidence refuting the defendant’s submission that she only learned of the Default Judgment in the course of HCA 855/2021 (which are proceedings brought by the defendant against the plaintiff’s wife for possession of the Properties) in July 2021 upon receipt of the defence of the plaintiff. On this basis, I fail to see any or any undue delay on the part of the defendant to take out the Set-aside Summons in August 2021. 33.Having reviewed the conduct of both parties, I do not accept the plaintiff’s submission that the defendant had acted improperly or tried to evade service/ these proceedings. In particular, the letters of L&A Law Office dated 22 July 2019 and 7 August 2019 ([15]-[16]) invited the plaintiff to clarify the situation so that the defendant could decide on her next step. They also made clear that the defendant had not accepted service of the Writ and warned against hasty application(s) pending L&A’s reply. Inexplicably, L&A did not reply to L&A Law Office nor find alternative means to take matters forward. On balance, I do find the defendant’s explanation credible, i.e. she had only been asserting her legitimate legal rights to proper service upon counsel’s advice. 34.Rather, the conduct of L&A is regrettable, including, inter alia:
35.I therefore do not consider it justified to impose terms against the defendant for setting aside the Default Judgment. Whether the defendant has an arguable defence 36.Having ruled that the Default Judgment was irregular, it is not necessary for me to consider the merits of the defendant’s case. I nonetheless note that the defendant has produced detailed contemporaneous records (ledgers, A4 size notebook and handwritten accounts, counterfoils of receipts of rentals and tax documents etc) showing, among others, the plaintiff’s wife had accounted for the rental income and outgoings of the Properties to the Deceased until he passed away in 2014. DISPOSITION 37.In the premises, I allow the Set-Aside Summons and set aside the Default Judgment. 38.For the further conduct of this action, the defendant shall file and serve her defence and counterclaim (if so advised) within 28 days from the date of this Decision and the plaintiff shall file and serve her reply and defence to counterclaim (if required) within 28 days thereafter. 39.I also order on a nisi basis that the plaintiff shall pay the defendant’s costs of the Set-Aside Summons to be taxed, if not agreed, on a party and party basis with certificate for counsel. 40.As for the Affirmation Leave Summons, I formally grant leave to the defendant to file and serve the 2nd LKK Affirmation. With regard to costs, the defendant is seeking an indulgence and would normally be ordered to pay the plaintiff’s costs. However, as noted in [34] above, the plaintiff also contributed to the time taken by the defendant in filing the Affirmation Leave Summons. In the circumstances, I believe it is fair to make no order as to costs of the Affirmation Leave Summons and I so order on a nisi basis. 41.Lastly, I thank counsel for their assistance.
Mr Raymond Lau, instructed by Patrick Mak & Tse, for the plaintiff Mr Victor K H Chiu, instructed by Lee & Associates Law Office, for the defendant [1] Forward v West Sussex County Council [1995] 1 WLR 1469. [2] Phillip Securities (HK) Ltd v Lam Chi Bin Stanley [2002] 1 HKC 432. [3] Bank of China (Hong Kong) Ltd v Cheung King Fung [2007] 1 HKLRD 462 (CA). | |||||||||||||||||||||
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