Printers' Circle v. Focus Advertising and Trading Co

HCSA000028/1983

______________

Coram: Hon. Clough, J.

Dates of Hearing: 19 April and 28 May 1984

Date of Delivery of Judgment: 14 June 1984

___________

JUDGMENT

___________

1. These are my regrettably belated reasons for dismissing the appeals of the Appellants in the above-mentioned cases from the awards of the Tribunal (Adjudicator Mr. C.L. Shum) made on the 7th November 1983 awarding the Respondent firm the sum of $4,882 with interest of $118 and costs and expenses of $97.20 as the claimant in the first of the above-mentioned claims and awarding the same firm in the same capacity in the second of the above-mentioned claims the sum of $4,540 with interest of $235.78 and costs and expenses of $97.20. In both cases the award was made against the Appellants who were two of the Defendants in each of the claims. For all practical purposes the Appellants can be treated as one entity because the second Appellant is the sole proprietor of the first Appellant. The second Defendant in both sets of proceedings was sued as the partner of the third Defendant in the business named as the 1st Defendant but the second Defendant claimed to have retired from the business in 1978 and the proceedings against him have been stayed by the Tribunal with the consent of the Respondent (Claimant).

2. The Respondent is evidently a firm conducting a printers' business and the Appellants were its customers.

3. On the 30th August 1983 the Respondent filed its two claims in the Small Claims Tribunal for the sums of $4,882 and $4,540 respectively in two separate and distinct proceedings being claims Nos. 10908 and 10909 respectively of 1983. There are separate files for each set of proceedings and separate notes of proceedings and separate written reasons for the two awards have been prepared by the Tribunal. However the hearing dates appeared to have been the same in both cases and the records and the written reasons read as if they have been prepared at one in the same time mutatis mutandis.

4. At some stage prior to the first attendance of the parties before the Tribunal on the 13th October 1983 a Defence was filed in each case, in common form, on behalf of the Appellants. It is stated, inter alia, in the Defence that the Appellants started to do business with the Respondent in 1982 when the person in charge of the Respondent was a Mr. Chow with whom accounts were settled. It is contended that in July 1983 a Mr. Tung claimed to be in charge of the Respondent and to be entitled to collect monies owing by the Appellants. Mr. Chow did not confirm this and so the Appellants invited Mr. Chow and Mr. Tung to settle their problems before the Appellants could make payment.

5. The Defence goes on to assert that in early August Mr. Tung and Mr. Chow had come to the Appellants without prior notification and asked the Appellants to clear the amount of money due. It is contended that the Appellants requested them to sign a certificate indicating how and to whom sums due should be paid, in order to provide a guarantee to the Appellants. It is also contended that Mr. Chow and Mr. Tung were requested to issue a copy of "the signed receipt so that it could be given to our company's accounts office to check against the amounts of money as well as returning all draft articles and films in the custody of" the Respondent. The Defence concludes by alleging that up to the date thereof the Appellants had not received all the documents concerned and therefore could not make payment before ascertaining the actual amount due.

6. Both claims came before the Tribunal on the 13th October 1983. The Defence was referred to and the parties agreed that there should be an adjournment. Accordingly the Tribunal adjourned both sets of proceedings to the 27th October 1983 at 11 a.m. "for mention". On the 27th October 1983, the representative of the first Appellant is recorded as stating in both cases that the photo copies "of bill" were received on the 24th October 1983 and he requested an adjournment for one week to give time to check. There was no objection from the Respondent and the Adjudicator accordingly adjourned the hearing for not one week but until the 7th November 1983 which was a longer period than had been applied for on behalf of the first Appellant.

7. When the hearing took place on the 7th November 1983 the Respondent's witness, Mr. Chow, was called to confirm both the claims and to submit invoices in support thereof. In the case of Claim No. H 10908/83 for $4,882 the invoices were Exhibits C1 to C5 inclusive. The earliest of the six invoices was dated the 24th February 1983 and the latest was dated the 28th April 1983. When Mr. Chow had given his evidence in relation to this claim the record shows that the first Appellant's representative did not cross-examine him but admitted that he had copies of the invoices, referred to the Defence and added "We doubt on Exh. C1 about price only. No dispute on Exh. C2 to C5. We would like to check price." Asked if he had anything else to say, he stated that the Appellants needed time to check. Thereupon the Adjudicator made his award in favour of the Respondent's claim.

8. The proceedings in the second claim No. H 10909 for $4,540 followed a similar sequence according to the record of the hearing on the 7th November 1983. Mr. Chow was called as the Respondent's witness, he confirmed the Respondent's claim and submitted invoices which were Exhibits C1 to C3 inclusive. The earliest of these three Exhibits was dated the 29th March 1983 and the latest was dated the 30th April 1983. After Mr. Chow had given his evidence the Appellants' representatives again referred to the Appellants' Defence and said "We have not confirmed exh. C1." Mr. Chow is recorded as then saying that the Respondent had delivered goods in the invoice at C1 to the Appellants and that Exhibit C1 was correct. The Adjudicator is then recorded as asking the Appellants' representative if he has anything else to say and the record then shows the Appellants' representative as saying "We are not saying that what C.W.2 (Mr. Chow) said was incorrect. We need time to check." The brackets are mine. Again the Adjudicator thereupon made his award in favour of the Respondent.

9. In his written reasons for his decisions the Adjudicator referred to the sequence of events culminating in the making of his award on the 7th November 1983 and then went on to set out the terms of s.14(1)(a) of the Small Claims Tribunal Ordinance (Cap.338) which are as follows:-

"14.(1) The registrar shall, when a claim has been filed -

He then added that he was convinced that unless the parties otherwise agree the case must be dealt with within 60 days from the date of filing of the claim. That was evidently his understanding of the meaning of s.14(1)(a).

10. He went on in his reasons to emphasise that the summons in respect of both claims had been posted to the Appellants by registered post on the 10th September 1983 so that assuming it had reached them on the 13th September, there was still plenty of time for the Appellants to check whether the contents of the summons were true or not. He then set out the terms of s.8 of the Interpretation and General Clauses Ordinance (Cap.l) and stated in relation to each case -

"If the defendants were diligent enough, they should have sufficient time to check whether Exhibit C1 was correct. The opinion of this Tribunal is that any asking for more time is merely a delaying tactic to pay. This Tribunal has no doubt that the goods named in Exhibit C1 had been delivered to the defendant in good time and judgment was passed as aforesaid."

11. He went on to emphasise that the Defence filed on behalf of the Appellants on the 13th October 1983 had been signed by Mr. Victor Suen, the second Appellant (the third Defendant) who must therefore have had knowledge of the summons at that time.

12. On the 15th November 1983, the Appellants lodged an application for leave to appeal pursuant to s.28(l) of the Small Claims Tribunal Ordinance in each of the cases. The grounds set out in the application were the same in each case. They were to the effect that the invoices were sent to the Appellants on the 24th October 1983, they bore no signature of the Appellants' staff to acknowledge receipt and therefore whether the amount shown on the invoices was correct could not be confirmed on that day. A further ground was that the Respondent's words were accepted in full and the claim had been allowed without having given any time for the checking of the invoices.

13. On the 23rd December 1983, 1 granted leave to the Appellants to appeal against the award of the Adjudicator. Pursuant to r.8(2) of the Small Claims Tribunal (General) Rules, I gave the Appellants leave to appeal, in addition, on the ground that the Adjudicator had misinterpreted s.14 of the Ordinance when refusing an adjournment of the hearing to the Appellants.

14. During the hearing of the application I informed the Appellants' representative, a Mr. Lo Ying-yu who was evidently an administrative manager of the Appellants, of the effect of Sections 8, 9 and 16(3) of the Ordinance and asked him whether the Appellants wished to appeal also on the additional ground that the Respondents had split their claims in order to bring them within the jurisdiction of the Tribunal in breach of Section 8 of the Ordinance. According to my record Mr. Lo said that he could not decide whether he wanted to raise this matter on appeal and he added that it had not been explained to anyone in his company. Accordingly it seemed to me that there had been no consent on behalf of the Appellants to add an additional ground of appeal on this point under r.8 (2). Therefore the leave to appeal then granted by me related to the grounds set out in the Appellants' application together with the additional ground in respect of Section 14 of the Ordinance.

15. It had occurred to me that the two claims made by the Respondent in the manner indicated above were almost certainly split claims for the purposes of Section 8 of the Ordinance because close examination of the dates of the relevant invoices indicated that they were in effect tradesman's bills for printing work between the 24th February and the 30th April 1983 which had been segregated out of chronological sequence to produce two separate claims for sums of less than $5,000 and therefore each within the jurisdiction of the Tribunal. There seemed to be the connection between the various invoices and the character of tradesman's bills to indicate an intention of continuous dealing which was not intended to terminate with one contract so as to result in one "claim" for the purposes of Section 8 if that section is to be construed, as I think it is, by analogy to Section 45 of the District Court Ordinance (Cap.336) and Section 69 of the County Courts Act 1959: see Halsburys' Laws of England, Vol. 10, para. 80; re Aykroyd, Grimbly v. Aykroyd (1848) 1 Exch. 479; and Lun Tai Insurance Co. Ltd. v. Lee Ying-lin (1965) H.K.L.R. 961.

16. On the 19th April 1984 both the Appellants' appeals came up for hearing before me. Mr. Lo again represented the Appellants. I heard each appeal separately. In support of the first above-mentioned appeal, Mr. Lo made it clear that the primary source of complaint of the Appellants was that they were not given sufficient time to check the validity of the Respondent's invoices which he claimed were not given to the Appellants until the 24th October 1983. When I pointed out to him that the Appellants had been given more time by the Tribunal on the 27th October 1983 than they had asked for, he submitted that it was only when they checked the bills and discovered that none of them were signed by any of their employees that it was realised that they did not have sufficient time to carry out their investigations into the authenticity of the bills. He said this applied to all the invoices. When asked by me to explain why he had told the Adjudicator on the 7th November 1983 that there was no dispute regarding Exhibits C2 to C5. He said that those invoices were correct to the extent that something had been done by the Respondent for the Appellants. However he contended that the Respondent had failed to show that the figure and amount stated in the invoices was correct and had been agreed between the parties. The Adjudicator had, he contended, been wrong to refuse his application for a further adjournment.

17. In my judgment, the Adjudicator had clearly misinterpreted Section 14(l)(a) of the Ordinance as being a provision that obliged the Tribunal to conclude the hearing of a claim not later than 60 days after the filing thereof. Such a conclusion flies in the face of the wording of the provision which is expressed to state that the Tribunal is to "fix a place and date for hearing the claim" not later than 60 days after the filing of the claim. Moreover the Adjudicator's interpretation of the provision takes no account of Section 26 of the Ordinance which provides that the Tribunal may at any time, either of its own motion or on the application of any party, adjourn the hearing of proceedings on a claim on such terms as it thinks fit. This provision contains no qualification and is not expressed to be subject to any limitation.

18. Although the Adjudicator was, in my judgment, wrong in law in considering himself precluded by Section 14(1)(a) of the Ordinance from granting the adjournment sought by the Appellants, it is clear from the terms of his written reasons for his decision that he also based his decision to refuse the adjournment on additional grounds which would have been more than adequate if he had understood himself to be exercising a judicial discretion which was not circumscribed by Section 14(1)(a). He clearly had formed the view that the Appellants had had plenty of time to check whether the claim brought against them by the Respondent was a valid one. He was satisfied that the Appellants were aware of the claim from the 13th September 1983 onwards and that if they had been reasonably diligent they would have had sufficient time to check whether the invoices of the Respondent were correct or not. In my judgment, he was fully justified in concluding that the Appellants, in seeking a further adjournment on the 7th November 1983, were merely employing delaying tactics and dragging their feet.

19. Accordingly I dismissed the Appellants' first appeal on the footing that the decision of the Adjudicator, although clearly influenced by an error of law, was fully justified under the circumstances of the case. On the 23rd December 1983 when I had granted leave to the Appellants to appeal in both cases I had warned Mr. Lo to consider the question of costs before proceeding with the appeal. There seemed to me, in the event, to be no merit in the appeal and when I dismissed it I awarded $200 fixed costs to the Respondent.

20. The second appeal was really a carbon copy of the first appeal. As soon as it began Mr. Lo representing the Appellants informed the court that his submissions would be almost the same as in the previous appeal but he also sought to introduce the split claim point as a further ground of appeal. I reminded him that when leave was granted and he had been asked whether he wished to take the point he did not decide to do so. Mr. Lo then informed the court that he believed the interpreter had failed to convey exactly what the court had told him. He added that he was sure that if he had been asked he wanted to take the point he would certainly have told the court that he was prepared to do so. I was unimpressed by this conduct and refused to permit Mr. Lo to take the additional point on the split claim issue pursuant to r.9(2) of the Small Claims Tribunal (General) Rules. It seemed to me that the Appellants had had every opportunity of raising the point either at the time that leave was granted or at any time thereafter prior to the hearing of the second appeal. Indeed, it seemed to be manifestly clear that Mr. Lo , who impressed me as being an intelligent and articulate person was only seeking to take the point when he realised that the first appeal had failed for reasons which must be applied in the second appeal.

21. Accordingly I dismissed the second appeal and awarded $200 fixed costs to the Respondent.

22. After dismissing both appeals, it occurred to me that there might be grounds for contending that the court should inquire further into the question whether a fundamental issue of jurisdiction was involved if a claim had been split in breach of Section 8 of the Ordinance. I therefore recalled both appeals in case either of the parties should want to take a point of jurisdiction. I also considered that it was my duty to inform the unsuccessful Appellants of the provisions of Section 29A of the Ordinance conferring a further right of appeal to the Court of Appeal with leave on a question of general public importance. Regrettably when I recalled the case I failed to notice that any such appeal must be brought within 7 days after the date of the decision to be approved.

23. Both the appeals were restored before me on the 28th May 1984. The Appellants did not attend. However after further consideration of this matter, I had by then come to the conclusion that I must be functus officio and powerless to reopen either of the appeals. Moreover, I had further come to the conclusion that although Section 8 of the Ordinance is differently worded from the corresponding provisions of the English County Court Act 1959 and of the  District Court Ordinance its provisions are in pari materia.

24. Section 8 introduces a reference to the jurisdiction of the Tribunal, unlike the comparable provisions in the County Court and District Court legislation, but, in my judgment, although it can be said to be the duty of the Tribunal under Section 16(3) to invoke Section 8 of the Ordinance if a claimant splits his claim in breach of that provision, a failure by the Tribunal to challenge the split claims does not render the subsequent proceedings a complete nullity. In my judgment, the decisions of the English courts to the effect that split claims in breach of the County Court legislation are not outside the jurisdiction of the County Court if not objected to at the trial are in point in relation to Section 8: see Halsburys' Laws of England, Vol. 10 para. 80 and c.f. the dicta of Huggins J. in Lun Tai Insurance Co. Ltd. v. Lee Ying-lin (supra) at p.979 to similar effect in relation to what is now Section 45 of the District Court Ordinance.

25. In the present case the Tribunal had failed to raise the question of the application of Section 8 in circumstances where clearly the Respondent had split its claim. However I had given the Appellants every opportunity to rely on Section 8 on the appeal and had explained fully to the Appellants' representative the effect of Sections 8, 9 and 16(3) of the Ordinance. Accordingly it seemed to me, on further consideration, that it would be quite wrong to permit the Appellants to raise the split claim issue as an afterthought in the second appeal when their representative had realised that the second appeal was bound to fail for the same reasons as the first appeal if an additional ground were not advanced.

26. I emphasise that there were difficult points arising in this case and I did not have the benefit of legal representation on behalf of either party. However, doing the best I can, these are my reasons for dismissing the appeal initially and then declining to attempt to interfere with my decision when I recalled both of the appeals for further consideration on the 28th May 1984.

Representation:

Mr. Lo Ying Yu, Adm. Manager of Appellant/Defendant, in person.

Mr. Peter Tung, partner of Respondent, in person.