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DCCJ000164/1973
IN THE DISTRICT COURT OF HONG KONG
HOLDEN AT TSUEN WAN
CIVIL JURISDICTION
ACTION NO.164 OF 1973
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CHAN Chiu-hung |
Plaintiff |
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and |
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Pantex Garment Factory
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1st Defendant |
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Mr. Emil Haas trading as Pantex Garment Factory
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2nd Defendant |
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CHAN Cheuk-chong alias CHAN Cheuk trading as Yick Hing Decoration Co.
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3rd Defendant |
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Coram: D.A. Davies, D.J. in chambers
Date of Judgment:10 January 1974.
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RULING
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1. The position in this action is that the Plaintiff as the holder of a cheque which was subsequently dishonoured, issued a writ against the two drawers (1st and 2nd Defendant) and the endorser (3rd Defendant).
2. The Plaintiff later filed a Notice of Discontinuance in relation to his claim against 1st Defendant, and in due course has obtained judgment by default against 3rd Defendant.
3. The present application is made by Miss Kelly on behalf of 2nd Defendant and prays for an order that by reason of his having obtained judgment against 3rd Defendant, the Plaintiff is now barred from proceeding further against 2nd Defendant.
4. In support of this application Miss Kelly relies upon R.S.C. , O. 19, R. 2/5, and in particular the final paragraph in the Annual Practice 1973 page 314.
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Proceed Against the Other Defendants.- The effect of this Rule is to remove an action against several joint contractors sued together in one action from the limitation imposed on such actions, by King v. Hoare, 13 M. & W. 494; Kendall v. Hamilton, 4 App. Cas. 504; Parr v. Snell, (1923) 1 K.B. 1. Judgment may be taken against one in default of appearance; against another under O. 14; and against a third under this rule, without prejudice to further prosecuting the action against the remainder (Weall v. James, 68 L.T. 515, C.A., and Walton v. Topakyan & Co. (1905), 53 W.R. 657, C.A., decided on similar words in O. 14, r. 5, and see Goldrei, Foucard & Son v. Sinclair, (1918) 1 K.B. 180, C.A., there cited). But if a judgment is obtained by consent against any one of the joint contractors such judgment may be pleaded as a bar to further proceedings against the others (NcLeod v. Power (1898) 2 Ch. 295). |
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And where two defendants are sued on a claim on which the plaintiff has a right of action alternatively, but not jointly, a judgment against one of them is equivalent to an election to sue that one, and a bar to further proceedings against the other (Morel Bros. v. Westmorland, Earl of, (1903) 1 K.B. 64, C.A.; Moore v. Flanagan, (1920) 1 K.B. 919, C.A.; and see Sullivan v. S., (1912) 2 Ir. R. 116); and a judgment entered against one of two defendants alternatively liable cannot be set aside by order to enable the plaintiff to obtain judgment against the other (Cross & Co. v. Matthews, 91 L.T. 459). |
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See more fully O. 14 r. 8(n) "Law as to Joint Contracts", para. 14/8/2, supra." |
5. After hearing the submission, I expressed some doubt as to whether the principle enunciated in that paragraph was applicable to an action upon a dishonoured cheque where the holder sues both drawer (s) and endorser (s), because it is stated to apply to actions where defendants are sued "in the alternative", whereas my understanding was that on a dishonoured cheque the liability of drawer and endorser is both joint and several.
6. A certain amount of further research has revealed that my doubt was fully justified, and with great respect to Miss Kelly, it would seem that her application is founded upon a misapprehension of what is meant by defendants being sued "in the alternative".
7. This is however made clear by O. 15 R. 4/7 (Annual Practice 1973 page 167):
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Joinder of Parties in the Alternative.- Where there is or may be a doubt as to which of two or more persons is entitled to the relief claimed, e.g., whether C made a contract with A or with B, such persons may be joined as plaintiffs in one action, and make their respective claims in the ternative. The costs, in so far as they are increased by the joinder of the unsuccessful plaintiff, are in the discretion of the Court under O. 62, r. 3, infra, but where the joinder was reasonable, as where the defendant has himself raised the doubt, the defendant may be ordered to pay such costs (on the analogy of Bullock v. L.G.O. Co., (1907) 1 K.B. 264). |
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Similarly, where the plaintiff is in reasonable doubt as to the person from whom he is entitled to redress, he may join two or more defendants in one action, and make his claim against them severally or in the alternative (of. the former O. 16, r. 7, which has not been expressly reproduced). Thus where each of two proposed defendants blames the other, the proper course is to join both, and to make the claim against them severally or in the alternative, but not jointly (per Bankes, L.J., in The Koursk, (1924) P., p.153). This practice applies in Admiralty (The W.H. Randall, (1928) P. 4). |
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The power to join several defendants in the same action for the purpose of claiming relief against them severally or in the alternative is not confined to cases in which the causes of action alleged as against the several defendants are exactly identical, but extends to cases where a common question of law or fact is involved, although the causes of action against them are, technically, different in form, and the several liabilities alleged against them respectively are to some extent based on different grounds. If two actions are brought, the costs of one may be disallowed (The Svein Jarl, 129 L.T. 255). |
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The following are instances of cases where alternative claims have been allowed:- |
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Principal and Agent. - Claim against principal joined with claim against agent for damages for breach of warranty of authority. Instances: Honduras, etc., Ry. v. Lefevre, 2 Ex. D. 301; Massey v. Heynes, 21 Q.B.D. 334; Bennetts v. McIlwraith, (1896) 2 Q.B. 464; Sanderson v. Blyth, etc., (1903) 2 K.B. 533. |
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Husband and Wife. - See (n.) under "Married Women" in Vol. 2, Pt. 7 E, infra. |
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Negligence.- Claim for damages for negligence against owners of two vehicles jointly joined with claim against each of them in the alternative (Bullock v. L.G.O. Co. (1907) 1 K.B. 264, as to which case see Compania Sansinena, etc. v. Houlder Bros., Ltd., (1910) 2 K.B. 354). |
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Other cases which may be referred to: Child v. Stenning, 11 Ch. D. 82; Rudow v. Great Britain Mutual, etc., 17 Ch. D. 600; Mullen v. L.C.C., 51 S.J. 82; Medley v. L.U.T., Ltd. (1910), 26 T.L.K. 315; Besterman v. British Motor Cab Co., Ltd. and Others, (1914) 3 K.B. 181, C.A.; Poulton v. Moore (1914), 109 L.T., p.979; and see Jud. Act, 1925, s. 50. |
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Trespass.- Claim by tenant against person claiming an easement under grant from plaintiff's landlord and the landlord jointly for trespass joined with alternative claim against landlord for breach of covenant (Child v. Stenning, 7 Ch. D. 413; 11 Ch. D. 82)." |
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and further O. 15, R. 4/8 (last paragraph P. 167):-
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Effect of Joinder of Defendants in the Alternative.- In actions where alternative defendants are joined plaintiff must be careful not to sign judgment by default, or under O. 14, against one of such defendants, unless he is prepared, by so doing, to abandon his claim against the other. See Morel v. Westmorland, (1903) 1 K.B. 75, affirmed (1904) A.C. 11. It is, of course, possible for a joint liability to exist in the case of husband and wife, as in the case of any other contracting parties, but in practice such cases would be infrequent, the wife being agent for the husband (see Moore v. Flanagan, (1920) 1 K.B. 919). As to the difficulty which may be experienced in setting aside such a judgment, see Hammond v. Schofield, (1891) 1 Q.B. 453; Cross v. Mathews, 91 L.T. 500; Parr v. Snell, (1923) 1 K.B.1. |
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If the plaintiff accepts money paid into Court, the action is at an end, both against the defendant making the payment, and against any other defendant sued in the alternative to him (O. 22, r. 3 (2), infra, and see Reardon Smith Line v. Cayzer Irvine & Co., 46 T.L.R. 146; Stracey v. Urquhart, (1930) A.C. 28). |
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Allegations made in the defence of one of several defendants sued in the alternative do not enure for the benefit of the others. |
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re-affirms the effect of joinder of defendants in the alternative.
8. This category of suit is, however, clearly not the one with which we are at present concerned, and indeed O. 15 R. 4/10 makes specific reference to liability of parties on a bill of exchange:-
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Although the liabilities of drawer, acceptor and indorser of a bill of exchange are several, as between themselves and the holder, yet there may be joint drawers, joint acceptors, or joint indorsers, and this paragraph, it is apprehended, would not entitle the holder of a bill of exchange in such a case to sue one only of several joint drawers, joint acceptors, or joint indorsers. |
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(For the nature of the liability between drawers, acceptors, indorsers, and holders of bills of exchange, see judgment of H.L. in Duncan Fox & Co. v. N. & S.W. Bank, 6 App. Cas. 11; and Bills of Exchange Act, 1882, s. 54 (Acceptors); s. 55 (1) (Drawers); ib. (2) (Indorsers).) |
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9. This passage clearly indicates that drawer and endorser are severally liable.
10. The issue is however most clearly and informatively discussed in the Law of Contract (2nd Edition) by G.H. Treitel published by Stevens in 1966, at pages 430 and 431, under the heading of "Judgment". (Read (2) at page 430 to end of (b) "Judgment in Default of Appearance or Defence.")
"(2) Judgment
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If one joint debtor is sued alone and does not plead non-joinder of the others, judgment may be given against him alone. Once the creditor has recovered such a judgment, he cannot take further proceedings against any of the other joint debtors, even though the judgment remains unsatisfied. Thus in Kendall v. Hamilton the plaintiff recovered judgment against two members of a partnership to which he had lent money. This judgment remained largely unsatisfied, and the plaintiff then discovered the existence of a third partner, against whom he brought a fresh action. This action failed as the liability of the partners was joint and the plaintiff had, by obtaining judgment against two of the joint debtors, precluded himself from suing the third. The reason for this rule was said to be that, once judgment is obtained on a cause of action, the original cause of action is merged in the judgment and extinguished. In the case of a joint contract there is only one promise, and only one cause of action. Thus only one judgment can be obtained on such a contract. But where the contract is joint and several, judgment against one debtor is no bar to proceedings against the other, for each is liable on his separate promise as well as on the joint promise. Thus there are several causes of action, only some of which are merged in the first judgment. A claim against joint and several debtors is only barred if one of them satisfies it, whether under a judgment or otherwise. |
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The rule in Kendall v. Hamilton is well established but is not wholly satisfactory. It was based on the earlier decision in King v. Hoare, which in turn was based on the rule that judgment against one joint tortfeasor, though unsatisfied, was a bar to an action against the others. That rule proved so unjust and inconvenient that it was eventually abolished by statute, and it might have been better had the rule in Kendall v. Hamilton been abolished at the same time. The rule is subject to many exceptions and qualifications, of which the following are the most important. |
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(a) Judgment Against Partnership In Firm Name. The actual decision in Kendall v. Hamilton can now be evaded by suing a partnership in the firm name. A judgment obtained in such an action can be enforced by execution against the estates of all the partners. |
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(b) Judgment In Default Of Appearance OR Defence. Where an action for a liquidated sum is brought against a number of joint debtors, one or some of whom fail to appear, or to defend the action, judgment in default of appearance or defence may be given against those defendants without prejudice to the plaintiff's right to proceed against the other or others." |
11. To sum up the position, it would appear that if liability is joint only, or in the alternative, judgment against one defendant will bar the plaintiff from proceeding against the other or others, though even then a judgment in default against one joint debtor will not prejudice the plaintiffs right to proceed against the others.
12. That in itself would dispose of the question which I am called upon to decide, but the Plaintiff need not rely upon that alone, for it is clear that he has sued the Defendants severally, if not jointly and severally.
13. For these reasons, I have no doubt whatever that this application is misconceived, and the Plaintiff is fully entitled to continue his action against 2nd Defendant if he so wishes.
14. Accordingly, the application is dismissed, with costs against the 2nd Defendant.
This 11th day of January, 1974.
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Sd. D.A. Davies |
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District Judge |
Certified true copy:-
| (I. Tang) |
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| S.A.T./K.D.C. 10.1.74. |
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Representation:
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