Nina T H Wang v. Chubb Hong Kong Ltd.
Read the full judgment text of HCA 118/1991 on BabelCite. This High Court CFI judgment was delivered on 27 January 1999.
1. These are matters of great difficulty. The summons is said to be issued under O.18, r.19. I think it should be under O.25, all the parties have approached it on that basis, and therefore I deal with it on that basis.
Cites 1 case
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HCA000118/1991 HCA118/91 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE ACTION NO.118 OF 1991 ---------------------
-------------------- Coram : Hon Sears J in Chambers Dates of hearing : 26 and 27 January 1999 Date of judgment: 27 January 1999 ---------------------- J U D G M E N T ---------------------- 1. These are matters of great difficulty. The summons is said to be issued under O.18, r.19. I think it should be under O.25, all the parties have approached it on that basis, and therefore I deal with it on that basis. 2. As I said it raises a number of problems which has not been helped by this case being set down for one day, I have been presented with 400 pages of affidavits and documents a few minutes before coming into court. Although I have complained before - I hope I do not complain too much - High Court judges appear not to be given any time, prior to hearing these important cases, of having any opportunity of reading any of the papers, or studying the ably prepared skeleton submissions, particularly that which Mr Fok has prepared. My colleagues in higher places appear to have long periods of time so that they can study the papers, and some of the authorities in this field appear to indicate that the affidavits have to be analyzed. I have, however, had considerable help from Counsel. I confess I have not read every page of the affidavits, but I have been referred to all the material parts, I think, which enables me to come to a fair judgment on this matter. 3. This area of what is called "satellite litigation" had spawned a vast number of authorities on principles which had been set out in Birkett v. James [1978] AC 297 (HL) for the last 20 years, but nevertheless Courts of Appeal and the House of Lords, both in England and Courts of Appeal in Hong Kong appear to have had a large number of these cases presented to them. 4. One of the difficulties is that this summons relates to an action which Mr Tang, in my judgment, very properly has described as unique. It relates to an unfortunate gentleman, by the name of Mr Wang. He was kidnapped in 1983. I should say at the outset that I have been greatly helped by the chronology prepared by Mr Fok, and I will incorporate that, if necessary, in this judgment, and I accept it as setting out accurately the time scale and dates which are all relevant to this matter. 5. Mr Wang was kidnapped in 1983 and some US$11 million was paid for his release. This is a notorious case in Hong Kong. What happened was that shortly thereafter, a Mr Leung, who worked for Chinachem of which Mr Wang was the Chairman, wanted to have a security system. Essentially the real problem was the pathway leading to Mr Wang's residence in Bluff Path, not far from Peak Road so a system was installed. Apart from matters in relation to the house, there were a number of communication boxes which could be activated by means of a wireless panic alarm switch and these were installed in certain positions along the path. That was way back in 1983. There was a maintenance agreement entered into by which the defendant company had to maintain these boxes. 6. Unfortunately, Mr Wang was kidnapped again. This time in April 1990 and some US$33 million was paid by the wife. To this day, he has not been found. There have been a number of criminal trials, I indeed dealt with are in respect of the same persons handling parts of the money. That was some years ago and recently, I think the last case has finished in Hong Kong. 7. The writ here was served in January 1991. It was an action which was claiming against the defendant, basically a sum of money equivalent to the ransom money that had been paid out. There was an application made to strike it out and what happened was that an Amended Statement of Claim, which has been referred to and I have read, was prepared in 1992. 8. A number of allegations were made in relation to the reasons behind the installation of the security system. One of these was that the plaintiff specifically requested the defendants to advise on a system that would reduce the risk of the plaintiff and her husband being kidnapped while travelling along Bluff Path and they were told that the system would be effective. Essentially, however, there is no doubt at all from a factual point of view that there was a system installed, and there was a maintenance agreement entered into between the parties. The relevance of that aspect which can be seen from the pleadings becomes important later on. 9. The chronology which Mr Fok has prepared demonstrates that there were periods of inactivity by the plaintiff. One occurred from April 1993 to January 1994, some 11 months; one occurred between November 1994 and December 1995; another occurred from 1996, it is said, until the issue of this summons. 10. The basic principles, as I said, have been set out a long time ago in Birkett v. James and, first of all, one has to identify and decide whether there have been periods of inordinate and inexcusable delay. It is conceded by Mr Tang that the delay is inordinate, apart from this last one which is called the fourth period which runs from December 1996 to the middle of last year, some 18 months. 11. The reasons behind this being such an usual action are really because Mrs Nina Wong has been of the view, at all relevant times, that her husband is not dead. The evidence which was produced in the criminal courts and which has been the subject of extensive coverage in the media, would indicate that he was dumped overboard from a ship. Whether that is right or wrong, for the moment it is not necessary for me to say, but she has always been of the view that her husband is still alive. She has consulted apparently psychics who presumably have told her that her husband is alive. 12. The action, on any view, is highly speculative. It is claiming a substantial sum of money - equivalent to the ransom money. The plaintiff faces a number of hurdles in order to succeed. However, that is also not for me to decide. She has hurdles, insofar as the factual background of how the kidnapping occurred. The only people who could tell the court that are the unfortunate Mr Wang and the kidnappers. There were no witnesses, of course, to it. The other matter relates to where it occurred, and the third and very important matter is whether the payment of the ransom money can be linked to any failure on the part of the defendants, if there is any, so that the damages are recoverable. Mr Tang recognises all of these difficulties and, as I said, on this type of application, whilst I am permitted to look at the general background of the case, I am not permitted to decide it. Further, there have just been affidavits filed, I have not had witnesses or anything like that. But I recognise, and Mr Fok has emphasised, the fact that his clients have over a number of years, had an action for a very substantial sum of money hanging over their heads. 13. One of the other problems has been that the defendants themselves were taken over and the person, who was running the files in 1987, presumably had other matters on his mind. The importance of that will be apparent later. 14. The factual evidence would appear to indicate that the kidnapping did take place on Bluff Path because a mask and broken glass were found in the vicinity of these boxes and also when a car was hauled out of the sea, one of these buttons which was programmed to activate the radio portion of the box was found. However, much of the evidence may be in the hands of the Police. 15. The first matter to decide is : were the delays inordinate. They clearly were for the first three, I leave aside the last one at the moment. 16. The second matter to decide is : were they excusable. I have had considerable and able submissions put before me by the plaintiff to demonstrate that there was an excuse for them. The first matter prayed in aid is the views of Mrs Wang : that because she believes that her husband was alive, that is a reason for the delay. She was afraid that publicity from the action might jeopardise his second release as set out basically in solicitor's affidavits and it is said by Mr Tang in his skeleton argument that :-
As I have said in the course of argument her belief clearly is not a non-sensible belief. She obviously genuinely believes this. However, Mr Fok has persuaded me, having given the matter considerable thought in the few hours I have had to think about this judgment, that that is not a sufficient reason. He says, and I accept, that the test really is an objective test and that I must look at it not necessarily from her point of view, but from an objective point of view. In my judgment, that is right. I therefore do not find that her belief that her husband is still alive is a valid excuse. 17. The second matter put forward is that the Police co-operation is essential, as Mr Tang says, to prove certain factual matters, for example where did the kidnapping take place and whether Mr Wang had a panic alarm switch. The Police case, as far as I can gather from the papers put before me, had been concerned with trials of either the kidnappers or their assistants, but the ones that I dealt with are those that handled portions of the kidnap money. 18. From the correspondence, there is no doubt at all that the solicitors acting for the wife have sought to obtain the Police files, and the Police took the view (their letters in the correspondence indicating) that they would not release the files until such time as the criminal cases were over. I have found this a difficult matter to resolve because it appeared to me that the Police files probably were essential in some way. However, I am persuaded by Mr Fok that I should not approach it necessarily from that point of view. He cites a decision of the Court of Appeal of Hong Kong, which of course is binding on me : Nissei Sangyo America Ltd. v. Philip Lawrence Choy, unrep., decided in 1995 with Litton V-P (as he then was) giving the main judgment. That was an appeal from Mayo J. (as he then was) when the judge had held that the reliance by that plaintiff on some other proceedings in Illinois was a valid excuse for the inaction in that particular case. 19. Mr Barlow, who appears also with Mr Tang here, argued and Litton V-P said (at page 5) :-
And he also cited an observation of Godfrey J. in Can-Asia Capital Co Ltd v Kwok Yee William & Ors [1995] 1 HKC 521 where the judge said this :-
20. Whilst I have considerable sympathy for both Mrs Wang's feelings and her solicitor's attempts to get the Police files, Mr Fok has persuaded me, I confess I thought otherwise at one time in this case, but he has persuaded me that it would be wrong of me to find that that was a sufficient excuse. What should have happened is that the solicitors should have applied to the court for a stay, or at any rate, should have written letters saying to the other side "we are waiting for Police files". There is no doubt that the defendants themselves sought the files, but again Mr Fok has persuaded me that I would be wrong to decide from that that was a sufficient excuse. I therefore find that insofar as the first three periods of delay are concerned, they are both inordinate and inexcusable. 21. As far as the fourth period of delay is concerned, this is much more difficult. What had happened, as the chronology shows, was that some further and better particulars of defence were filed in November 1994. There was a change of solicitors and in December 1996, there was an application made by the plaintiff for some of those particulars. It is not necessary to examine it in detail, but essentially what had happened was that the defendants had taken the view that the plaintiff was not entitled to some of those particulars. There was a long gap before the particulars were sought. 22. The solicitor then acting has filed an affidavit and he says that what was happening was that Mrs Wang still was of the view that her husband could be found and had told him not to take any steps in the action. The two solicitors submitted, very properly and obviously very honestly and again completely frankly with the court insofar as their affidavits are concerned, that those were her instructions. 23. What happened however was very unusual. Mr Yu Ying Wai, who was the consultant in Ford Kwan & Co at this relevant time, received instructions on 31 December in place of Mr Peart who is now back again. And then he said this :-
The 8 January letter is an important letter. I do not read it in full as it can be read, but what the solicitors was essentially saying was :-
24. What appears from the file note is it is clear that there was an agreement between the parties, and therefore the summons was adjourned sine die. This, as I said, presents certain problems to both parties. First of all, the defendants' solicitors did nothing. They did not seek to resurrect the summons, they did not seek any unless orders and they did not notify the other side that there was to be an imminent application to strike out. The plaintiff did nothing. They did not seek to resurrect the summons or communicate with the plaintiff. They just sat back. In other words, both parties appeared to me to have just sat back and let the matter be adjourned. It is clear from the letter that the delay and prejudice to which the defendants were to rely upon were the earlier three periods which I have identified, which as I have already held are both inordinate and inexcusable. 25. Mr Fok is right when he says to me that supposing this had gone on for years and years, but all I have to be concerned about is what actually happened. What did happen, again, is very unusual. The solicitor proofed a number of witnesses whose statements are before me not until April 1998, in other words, they had done nothing. It is not necessary to come to a clear conclusion, but this may have been caused by the reorganisation of the defendant company following the takeover, and the fact that the person in charge of various files may have moved or mislaid the files, I do not know, but nothing was done. No statements had ever been taken from these witnesses, as far as I can discover no signed statement had ever been taken until this very late date. And the solicitors proofed the witnesses who said that they could not remember anything at all about what took place 15 years ago, in 1983. This is not surprising. 26. As to whether I find this period of delay to be inordinate or inexcusable, as I said I find this very difficult. On balance, having regard to all of the matters, I do not find it inordinate. Even were I to be wrong about that, I think it is excusable. I think this is one of those cases which does not necessarily fall within the general legal principle of acquiescence, and I have had decisions cited to me on acquiescence, but I think this is similar to what is called in the Rules of the Supreme Court in England, "both parties to blame". It does not fall within Hunter v. Skingley [1997] 1 WLR 1467 (CA). There there was a substantial contribution to delay by the defendant. It does not fall within that type of behaviour, but, in my judgment and in the exercise of my discretion, it would be wrong of me to hold that this period of delay was inexcusable. I think I am entitled to look at the conduct of both parties, the actual period of delay and the fact that the solicitors decided, in April 1998, to take statements from witnesses. They were intending to rely upon, from the correspondence, the periods of delay earlier as demonstrating prejudice to their clients. 27. It goes without saying that if you cannot remember something in 1998, I doubt whether you could have even remembered it in 1990. 28. But I do not find that that period is inordinate or is inexcusable. I, therefore, would concentrate on the three periods which I have identified as falling within the general ambit of Birkett v. James. I then have to consider whether or not the plaintiff has suffered substantial prejudice. It goes without saying - and I have said it on a number of occasions - that parties ought to get on with litigation and I feel great sympathy with the position of the defendants here. Mr Fok is at pains to point out, and in my judgment, rightly, that they face an enormous claim - speculative in its nature, alleging a number of matters, in contract and in tort, and seeking to recover the amount of money which was paid out as ransom money. He says, and I think again he is right, that the proof of this is difficult, but that, in my judgment, would fall within the purview of an O.18, r.19 application rather than this one. I think it is right that I should take it into account in any balancing exercise that I do in the exercise of my discretion, and I think I should take it into account in favour of the defendants. 29. However, one must analyse what is the prejudice. This is a very unusual case because the authorities I have referred to, and I have myself, over the years I have been sitting here and at the Bar, had a number of these summonses, and I have the benefit of looking at very eminent judges pronouncing on these matters. Because generally speaking, the factual background against which these are made, are where there are witnesses of fact who speak as the factual matters, insofar as for example an accident happening, or a specific representation for documents, or the normal factual background where a witness' recollection fades over the period of time. Here, in one sense, there are no witnesses. The only witnesses are, as I said, Mr Wang who cannot be found and has been lost for many years, and the actual kidnappers. A lot of the proof of where this occurred and what happened, would emanate from the Police files, forensic evidence and inferences to be drawn from other factual matters such as an examination of the boxes. There is no doubt at all that the maintenance agreement provided for the maintenance of these boxes every three months, and on the defendants' own document which they put before the court, they failed, for two periods, to examine them, and when they were examined, some of them, or one or more, they were full of ants and there were electrical faults or technical faults. So the plaintiff has good evidence which demonstrates that there was a breach of contract. Whether this in itself permits a court to allow the plaintiff to recover this substantial sum of money as a direct causation of the breach of contract may well be difficult and I am sure it involves complex issues of law. Insofar therefore as the incident is concerned, in my judgment, there cannot be any prejudice to the defendants. 30. However, Mr Fok has asked the court to look at the Statement of Clam and what is said there is that the plaintiff or a representative of the plaintiff is asserting that she was told that it would be effective and that this was the best way to stop Mr Wang being kidnapped. 31. Now the witnesses that have been identified by the defendants as dealing with that, say they cannot remember anything, if at all, about it. I am not surprised. I am sure they could not have remembered anything in 1990. It must be remembered that these alleged conversations, if they amount to anything, took place in 1983. I doubt whether anyone can remember anything about it. Certainly by 1990, which is seven years after the actual installation of this security system, Mr Wang was kidnapped again. This is not one of those cases where the delay itself causes a loss of recollection. The loss of recollection in my judgment is caused by the passage of time between the implementation of the security system and the kidnapping, which is 1990. The period of limitation goes on, though the claim, as Mr Fok rightly points out, in respect of some damages for shock expired most probably in April 1993, but the general period of limitation did not expire until April 1996, which is nearly 13 years after this. I would have thought that anyone's recollection of anything must have dimmed. But I can find no prejudice caused to the defendants by any of the delay. 32. Mr Tang has identified the witnesses whom he said are witnesses of fact. As I said they are unusual witnesses of fact, they may be witnesses to a conversation that occurred, if they could ever remember anything, when the system was installed. In my judgment, the important matter is that this was a firm holding itself out as a security firm, and providing an unusual security system by the installation of these wireless controlled junction boxes. There could be no dispute of fact that that was the purpose of their installation, that is indeed what the defendants were supplying and the maintenance agreement demonstrates that it was being installed at various places for that purpose. 33. The maintenance agreement is found at pages 183 - 185. It is called the "Service and Maintenance Agreement for Chubb Burglar Alarm System". The heading on the paper is called "Chubb Security Systems". This is indeed a very well known organisation, not only in Hong Kong but internationally, and the service includes quarterly routine inspection, 24-hour emergency call service, replacement of parts and for monitoring service with the use of the Company's transmission unit, etc. Over the page, the client accepts the terms which say :-
They were asked to provide the security system and that is indeed what they did. There is an exclusion clause in this which may be the subject of considerable argument in the course of trial as to whether it excludes liability for what has happened here. 34. At pages 188 - 189 is found what is called the "Overhaul Service" which is dated shortly after the kidnapping and sets out what the equipment was, about these wireless receivers and panic alarm systems, and says this :-
What this does demonstrate was that it was a defective service. It also appears that for the previous two quarters, this had not been inspected, or indeed if it was inspected, there was no maintenance carried out. That fact appears to be common ground between the parties and there is no factual dispute. It might have been different had the court of trial been faced with complex factual issues with regard to the maintenance and inspection. For example, supposing the defendants actually went up to inspect these boxes and Mrs Wang told them not to bother about it. The witnesses who the plaintiff indicates a memory loss has occurred, are witnesses in relation to some conversations in 1983. As far as those who are called to be major witnesses are concerned, I accept the criticism which is made by Mr Tang on this aspect of the case. Someone has emigrated to Canada, that happened actually in 1992; one witness cannot be found, but I do not know whether a stringent search has been made for him. 35. I do not find any serious prejudice caused to the defendants by the delay which I have found both inordinate and inexcusable. I find, obviously that with the passage of time people's memories fade, but this is a very very unusual action and, in my judgment, I cannot stress sufficiently that it is basically the facts behind the kidnapping which are of the greatest importance. 36. As I said, this is not the standard type of case that comes to the courts when one witness says "in 1990, I cleaned the roadway and I did not leave a pool of oil lying on the ground which the plaintiff says he slipped on". That type of situation, I can well understand, as a judge would take the view that the passage of time must cause substantial and serious prejudice. In my judgment, therefore, I do not find any serious prejudice caused to the defendants. I accept that there is obviously prejudice in the sense that they have had this matter hanging over their heads. It would have been quite easy for them to have issued some summons obtaining an unless order which they have not done. 37. I therefore conclude, on this aspect of the case, that there is no prejudice and in the exercise of my discretion, I would not strike this claim out. I do bear in mind that I put in favour of the defendants, both the period of delay, the number of years - although the number of years in themselves are not necessarily prejudicial but I think it is right to put in their favour that - I also put in their favour the speculative nature of the action. But again balancing all these matters in my judgment, and in the exercise of my discretion, I would not strike out the action. 38. However, Mr Fok has another limb to his submissions and I confess I found this, when presented, a very attractive submission he was making, he says :-
And he cites recent decisions from England. First of all Grovit v. Doctor [1997] 1 WLR 640. There, Lord Woolf, who as one knows is at the forefront of reviewing civil procedure and is a most able judge who wishes all litigation to be conducted speedily and at the least expense of the parties, sets out the general approach that the House of Lords in Birkett v. James had adopted all those years ago. He said that on the facts of that case where a plaintiff commences and continues litigation which he has no intention to bring to a conclusion, that could amount to an abuse of process and that in itself would give the court the power to strike it out. I do not cite it in detail as it can be read, and I accept from Mr Fok that that indeed should be the approach of Hong Kong courts : that where a person has demonstrated that he or she has no intention to continue with the action, the court should strike the matter out. It should not permit these actions to continue. 39. In a later decision of the Court of Appeal Arbuthnot Latham Bank Ltd. v. Trafalgar Holdings Ltd. [1998] 2 All ER 181 when Lord Woolf, now the Master of the Rolls, again reiterated the importance of the court having control of its own litigation, and he said at page 186 :-
And he cites some earlier decisions when he said :-
40. What is said here is that the conduct of this lady, instructing her solicitors not to take any steps in the action, falls within the general principles of Grovit v. Doctor and I should strike this case out even though there is no prejudice as involving an abuse of the process of the court. Grovit v. Doctor also demonstrates that the Rules of the Supreme Court in England may well be adapted. At page 644, in a speech of Lord Griffiths who himself had called for an overhaul of the system which permitted these delays just to continue. He again talked about the applications in the County Court that was established in England and he said it has funded an industry of satellite litigation similar to the satellite litigation now occurring in these courts. He said :-
41. I have examined the statements of the lady to her solicitors. I have no doubt, although I have found that the obtaining of the Police files did not provide a satisfactory excuse, that they demonstrate the plaintiff has all along wanted to continue with the action. Albeit that she was of the view, it may be a misguided view, that he was still alive, in my judgment, the plaintiff has awaited the files which have only been put into her hands. Despite this being a speculative action, I find no evidence to support the proposition that she has no intention to continue this action. In my judgment, the evidence is to the contrary. I have also had an affidavit from her, albeit put in at a late date, which says she does wish to continue with the action. 42. What should have happened, quite simply, and I make no criticism because it is easy to be wise, as Mr Fok says, after the event, is that all that should have happened here is that someone should have got hold of this case, brought it back before a judge, and said "Look, no summons for direction has been issued, unless this is done within 10 days or 14 days, the court ought to strike it out". It can be very simple instead of this mountain of matter that has come before me - as I said with 400 pages of affidavits and 12 authorities cited to me and very experienced Counsel - and I am not quite sure what would have happened. It might have been that the plaintiff may not have issued it, I do not know, may be she would have done. 43. In my judgment, on the evidence presented to me, this case does not fall within the principle of Grovit v. Doctor. Although I can see in the chronology that there have been a number of instances : being late delivery of particulars and there was one unless order made in 1994 to provide outstanding further and better particulars, I do not find that she is in anyway contumelious, or that she has been in deliberate disregard of orders of the court. Whilst I agree in particular with the words that have often fallen from Litton V-P in the Court of Appeal on a number of occasions, that "the rules of the court should be strictly adhered to," I do not find on the evidence that the plaintiff has acted in a manner that would permit me to strike her action out as being an abuse of the process of the court. 44. I should add, for the sake of completeness, that the plaintiff has said, through her leading Counsel and through her affidavit, that she is prepared for me to make an order that she do file the summons for direction within a period of days. Mr Fok, very properly pointed out to me, and I accept from him, that that in itself should not influence me in coming to a decision on this aspect of the case, and I think he is right. I disregard it for the purposes of deciding, again in the exercise of my discretion, whether or not she has committed an abuse of the process of this court. However, I do have regard to it insofar as the future conduct of this case is concerned. 45. Whilst therefore I do dismiss the application under O.24 to strike out on statutory or inherent jurisdiction grounds, I do, as the case is now before me, make an order, as I am entitled so to do, that the plaintiff do file within 10 days a summons for directions. I make an order also that if she does not do so, the action stands dismissed. I give liberty to apply on that matter and as the matter must come back to me, I reserve this aspect of the case to myself, despite the fact that I have only a few weeks left. So, that is the end result of this case. The summons is dismissed.
Representation: Mr Robert Tang, S.C. and Mr Barry Barlow, inst'd by M/s Miller Peart De Witt, for the plaintiff Mr Joseph Fok, inst'd by M/s Deacons, Graham & James, for the defendants |
Cases cited in this judgment