East Seas Shipping Corporation and Another v. Liu Chong Hing Bank Ltd and Another

HCA001408/1980

Practice and procedure - further particulars of statement of claim alleging fraud and conspiracy - when will be ordered - particulars of defence containing traverses - application of "negative pregnant" rule.

HIGH COURT

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BETWEEN

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Coram: Fuad, J.

Date: 2 February 1982

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JUDGMENT

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1. I have six matters before me which arose in this way. The plaintiffs issued their writ on the 21st March 1980. After making a request for further and better particulars by letter which was refused, the defendants took out a summons for that purpose. It was dismissed as being premature on the 9th June 1980. The defence was filed on the 26th September 1980. The plaintiffs took out a summons for particulars of the defence on the 21st September 1981, and on the 25th September the defendants took out their summons for particulars in respect of a number of requests which had not been given by correspondence. On the 29th September 1981 the plaintiffs' summons for particulars and the defendants' summons for the outstanding particulars came before the Registrar. It seems that since the defendants had agreed by letter that the plaintiffs were entitled to certain particulars of the defence (although they had insisted that the plaintiffs should comply with their own request for further particulars of the statement of claim simul-taneously) and for want of time to go into the disputed area, the Registrar ordered the defendants to supply the undisputed particulars within 21 days and ordered that the hearing of the plaintiffs' summons for the disputed particulars and of the defendants' summons for the outstanding particulars should be heard on a later date, three days being reserved. Costs were reserved.

2. On the 5th October 1981 the defendants filed notice of appeal against that part of the Registrar's order which had directed that the undisputed particulars of the defence be served within 21 days. On the 20th October the plaintiffs filed an application for an "unless" order, which the Registrar granted on the 27th October with costs to the plaintiffs in any event. On the same day the defendants filed an appeal against the "unless" order. Again on the same day the defendants took out an applica-tion for a stay against the "unless" order pending appeal and for the plaintiffs' and defendants' summons for particulars be heard with the appeal. This application was granted on the 30th October, again with costs to the plaintiffs in any event. It was now the turn of the plaintiffs to appeal and they filed an appeal against the order staying the "unless" order. On the 9th November 1981 an application by the plaintiffs for an order that the defendants' appeal against the Registrar's order directing undisputed particulars to be given of the defence and the plaintiffs' appeal against the order staying the "unless" order be dealt with on their own on that day was not acceded to by my brother Power, J. who adjourned the two matters to the 11th January 1982 when all the issues that presently divide the parties came on for hearing.

3. It will be seen, therefore, that the matters before me are the following-

The final matter which has not been mentioned before is -

4. This bare account of the steps taken by the parties tells it's own story. But for the matters before me to be understood, it is necessary to discuss the plaintiffs' claim in considerable detail.

5. The 1st plaintiff ("East Seas") and the 2nd plaintiff ("Transocean") are shipowning companies registered in Liberia. They sue the 1st defendant, the Liu Chong Hing Bank ("the Bank") and the 2nd defendant, Mr. Liu Lit Man ("Mr. Liu") the Bank's managing director. The Bank's premises are in Des Voeux Road, Central. The claim is in respect of sums due under two charterparties from a Thai company, the Thai Commercial Navigation Co. ("Thai Navigation") still owed to the plaintiffs. The statement of claim avers that the Bank and/or Mr. Liu committed frauds on each of the plaintiffs and conspired with and/or induced Thai Navigation to break contracts lawfully made with them causing loss and damage, in that the plaintiffs were deprived of the use of the sums due under the chartenparties. A claim is also made for the plaintiffs to be indemnified against the expense to which they were put in investigating the activities of the defendants.

6. According to the statement of claim, East Seas owned a ship called the "Newton", and Transocean a vessel named the "New Breeze". Thai Navigation chartered the vessels on different days in 1976 and although various sums due on each of the charterparties were duly paid, Thai Navigation still owes US$390,232 in respect of the charter of the first vessel and US$379,429 in respect of the second. These are sums of which the plaintiffs say they have been deprived.

7. The statement of claim goes on to say that the sole directors, and substantial shareholders, of Thai Navigation were three named Thai nationals who were men of modest means with no shipping experience. Thai Navigation (whose authorised and paid-up capital is mentioned) made losses for the years 1973 and 1974, since when no balance sheets or accounts had been filed. The plaintiffs had entered into the two charterparties as a result of certain oral, and later written, representations (subsequently proved to be false) made to their agents by the agents of Thai Navigation about the company's financial state, trustworthiness and privileged status as a Government approved company. Specifically, no allegations are made against Thai Navigation's agents.

8. It is then averred that the two ships carried cargoes of 10,551 tonnes and 10,369 tonnes respectively, but Thai Navigation had offered and obtained cargo rates of US$38-42 per tonne; rates which were unecono-mical and uncommercial, for the proper rate should have been US$60-62 per tonne. Thus instead of US$1,218,750, only US$836,800 was due.

9. Next the statement of claim says that around the sailing dates of the two vessels, Thai Navigation was paid the full, agreed, freight charges. In March 1976 East Seas received an amount due under the charterparty from Thai Navigation, and in May 1976 Transocean received the sum due to them. Later in May, Thai Navigation falsely telexed East Sea's agents to the effect that delay in payment for the hire of the "Newton" was due to "temporary cash flow problems resulting from the delay in receiving freight income from our regular shippers". It is said that all this demonstrates that Thai Navigation always intended to avoid full payment of the amount due on each charterparty.

10. Four more companies now come into the picture. It is stated that Manufacturers Shipping Co. Ltd. ("Manufacturers Shipping"), a Liberian registered company "was at all material times owned and/or controlled by the Bank and Mr. Liu". Victoria Navigation Co. S.A. ("Victoria Navigation") was a Panama company, whose sole directors and major shareholders were the same three named Thai nationals who ran Thai Navigation Precisely the same is said about another Panama company, Siam Navigation Co, Ltd. ("Siam Navigation"). Both these last-mentioned companies were subsidiaries of or associated with Thai Navigation, and were small companies with trivial assets or were insolvent. Goldwyn Shipping Co. Ltd. ("Goldwyn Shipping") is incorporated in Hong Kong. At the end of 1975 the registered directors and shareholders of the company were a Mr. John Mang, a director of the defendant Bank, and Mr. Liu, the 2nd defendant. It's offices were in the Bank's premises. The Bank acted as bankers to Goldwyn Shipping, who paid no rent or other charges for their offices. The contention is made that in view of this, "Coldwyn Shipping was at all material times owned and/or controlled by the Bank or Mr. Liu".

11. The statement of claim continues by going into great detail about the sale and purchase of three vessels -

how the deals were financed and how each ship was mortgaged to the Bank by its new intended owners. The gravamen of the allegations made against the defendants on this aspect of the case is set out in paragraphs which can be brought together as follows. The Bank and Mr. Liu fraudulently and in conspiracy with the three Thai nationals who were men of modest mesas -

subject in each case to a mortgage in favour of the Bank at such a price and on such repayment terms as to make it inevitable that Victoria Navigation could not, out of the earnings of any of the vessels, meet such repayment obligations. The Bank and/or Mr. Liu knew that all or most of the deposit and any mortgage repayments made would (as they did in the event) come out of the monies obtained by one paper company from another such company controlled by the three men (Thai Navigation) from the freight charges earned by the "Newton" and the "New Breeze". The Bank and/or Mr. Liu knew that the two charterparties (as demonstrated by the facts earlier pleaded ) had been entered into by Thai Navigation for the express purpose of generating a fraudulent profit by means of non-payment of the charter hire due, with the object that such fraudulent profit could be extracted from Thai Navigation by the methods that had been enumerated. As regards the "Phutnakorn" it is then pleaded -

"It was further the intention of the Bank and/or Mr. Liu that by the means aforesaid the deposit and any mortgage repayments received would be utilised to repay the indebted-ness of Manufacturers Shipping to the Bank and that the Bank would shortly after the said sale and mortgage be in a position to repossess the said vessel under the terms of the said mortgage so that the deposit and any mortgage repayments paid by the said paper company and/or another paper company owned and/or controlled by the said three men (namely Siam Navigation) as well as the value of the equity in the vessel could be obtained as a profit of the Bank and/or the said company owned and/or controlled by the Bank and Mr. Liu. The said payment to Manufacturers Shipping in fact did enable it to repay its own loan to the Bank together with all interest (no interest and capital repayments having been made at all)."

12. In regard to the "Phutphithak" and the "Phutruksa" the following is alleged -

"It was further the intention of the Bank and/or Mr. Liu that the Hank would shortly after the said sale and mortgage be in a position to repossess the said vessel under the terms of the said mortgage so that [for the "Phutphithak" only] the deposit and any mortgage repayments paid by the said paper company as well as the value of the equity in the vessel could be obtained as a profit by the Bank [for the "Phutruksa"] and/or Mr. Liu."

13. The statement of claim then states that in October 1976 the "Phutnakorn" and the "Phutphithak" were duly repossessed by the Bank under the respective mortgages. The former vessel was sold to a Panama bank whose registered office was on the 9th floor of the 1st defendant's premises; and the latter to another bank registered in Panama controlled by Mr. Liu, and whose Hong Kong registered office was also on the 9th floor of the defendant Bank's premises. The sums due in terms of the mortgages from the defendant Bank respectively to Siam Navigation and to Victoria Navigation remained unpaid and no action had been taken to enforce payment.

14. Mr. Swaine, for the defendants, has succinctly summarised the nature of the claim thus. Three men chartered the plaintiffs' two vessels with the sole aim of collecting freight from the shippers with no intention of paying the plaintiffs their charter hire in order that the profits so generated should be applied towards the settlement of the purchase price of three other vessels purchased by the three men from the defendants. Each such purchase was at an over-value and financed by a loan from the defendants to the three men on a mortgage of the three ships, the terms of which made it impossible for the price of the ships to be paid out of their trading profits so that the defendants would repossess the threw ships, which they did; and thus they deprived the plaintiffs of the charter hire due to them for their own two ships from the three men.

15. Before I turn to a consideration of the requests made for particulars of the statement of claim and the defence I must, of course, firmly bear in mind the provisions of 0.18 r,7 (requiring that material facts and not evidence be pleaded) for apart from the application of what I will for convenience call the pregnant negative rule, the issues between the parties concern particulars which one side says are material facts, the other maintaining that they are matters of evidence. It is acknowledged that it is sometimes extremely difficult to draw the line between facts and evidence and a particular issue will often be the subject of much rea-sonable competitive argument which the Court will have to resolve in a practical and commonsense way in the light of the special circumstances of the case Since the plaintiffs' case is founded and fraud, in accordance with 0.18 r.12, as the Supreme Court Practice has it (note 18/12/11) "The pleader should accordingly set out the facts, matters and circumstances relied upon to show that the party charged had or was actuated by a fraudulent intention. Fraudulent conduct must be distinctly alleged and as distinctly proved, and it is not allowable to leave fraud to be inferred from the facts." (see also note 18/8/4 under "Fraud"). Moreover since a labyrinthine and complex fraud is averred it is incumbent on the plaintiffs to plead and, if necessary, supply all particulars needed precisely to indicate how it is said the chain of events and transactions are linked together to establish it. Apart from the primary purpose for which particulars will be ordered, I must, in view of the nature of the plaintiffs' case, remind myself that the defendants are entitled to seek to bind them to a definite story.

16. I will now examine the defendants' request for particulars of the statement of claim which have been refused. Of the 32 requests, 10 were abandoned during the hearing and only 20 remain live issues.

Request 11 (b) relates to the averment that three specific representations were made by the agents of Thai Navigation to the agents of the defendants to induce them to enter into the charterparties, and seeks the identities of the persons who made and received such representations. I think that the defendants are entitled to know by whom and to whom the false representations were made, and this is not simply a matter of evidence.

Request 15 concerns the allegation that Thai Navigation offered and obtained freight rates for the cargoes below the market rates. The plaintiffs ask whether the alleged offer and obtaining was in writing or oral, and the identities of the persons concerned. In my view these details just fall on the "evidence" side of the line and the defendants are hot entitled to them. No doubt more information will emerge upon discovery.

Request 24 refers to the allegation that Manufacturers Shipping was at all material times owned or controlled by the Bank or Mr. Liu. It will have been appreciated that this is a most important plank in the plaintiffs' case. The defence states that whereas Mr. Liu (the 2nd defendant) became a director and shareholder of Manufacturers Shipping in December 1968, he ceased to be either on the 3rd December 1971, some five years before the charterparties which give rise to the claim were entered into, and full details are given. In the circumstances I have no doubt that the plaintiffs must reveal how they are able to maintain that at the material time the Bank and/or Mr. Liu "owned and controlled" Manufacturers Shipping and the defendants are entitled to the "facts matters and documents relied upon in support of each of the allegations".

Requests 36 and 37 have to do faith the allegation that all or most of he payment for the "Phutnakorn" was made out of the freight charges earned by the "Newton" and the "New Breeze". The defendants ask for all the facts, matters and documents relied upon for that allegation and for the facts etc. relied upon if it is alleged that either of the defendants were a party, with knowledge, to this method of payment. In my judgment they are entitled to this information for the allega-tions form such a central part of the allegations of fraud and conspiracy. They must know where they stand and precisely what case they have to meet; I do not regard this as a matter of evidence.

Requests 38, 39, 40 and 42 are concerned with the allegations which relate to the mortgage of the "Phutnakorn"; that the defendants knew that the repayments were such as to make it impossible for the obligations to be met out of the vessel's trading profits; that all or most of the repayments would and did come out of the freight charges obtained by Thai Navigation; and that the deposit and any repayments received would be used to repay the indebtedness of Manufacturers Shipping to the Bank. While it is not essential that particulars of knowledge be given in the statement of claim, it seems to me that such particulars must be ordered if requested and refused. I entertain no doubt that these requests must be answered in the manner demanded.

Request 46 relates to the source of the monies used in payment for the "Phutphithak" and I decide the issue, and for the same reasons, as I did the issues raised when considering requests 36 and 37. The defendants are justified in seeking the parti-culars set out.

Requests 47, 48, 50 and 51 are about the mortgage, repayments etc. concerning the "Phutphithak" and the "Phutruksa", and I determine the issue in the same way, and on the same grounds, as reflected in my decision regarding requests 38, 3y, 40 and 42. The defendants are entitled to the particulars they seek.

Request 49 concerns the alleged payment for the "Phutruksa" out of the freight charges gained by the "Newton" and the "New Breeze" and my conclusion upon it is that which I reached in relation to requests 36, 37 and 46. I hold the view that the defendants are entitled to the particulars sought.

Request 52 has to do with the allegations that at all material times the 2nd defendant, Mr. Liu, controlled the Compania Naviera Greenwood S.A. (to whom the Bank sold .the "Phutphithak"). Substantially for the reasons I gave when considering request 24, in my judgment the request for particulars is fully justified.

Requests 53 and 54 again relate to the allegation that the Bank and/or Mr. Liu knew that the charterparties were entered into by Thai Navigation for the express purpose of generating a false profit and that they knew that 'most of the payment for the "Phutphithak" was made out of the freight charges earned by the "Newton" and the "New Breeze"; I consider the defendants are entitled to know .the case they have to meet, and that the particulars asked for must be supplied.

17. As regards the plaintiffs' requests for particulars, it will be recalled that at an early stage the defendants conceded that they were bound to meet a considerable number of the requests. The only dispute about these conceded matters was the proper time when the particulars should be applied. The defendants had argued that they should not be required to furnish particulars of the defence until the plaintiffs had dealt with the outstanding requests relating to the statement of claim. This line was taken in correspondence between the solicitors for the parties and maintained before the Registrar. In the event the Registrar did not agree and ordered the conceded particulars to be given while standing over the particulars of defence which had not been conceded and the outstanding requests for particulars of the statement of claim. It was, as has been seen, this decision what led to the three appeals which are before me.

18. Of the 59 requests for particulars made by the plaintiffs, 28 had been conceded. Of the remaining requests, two were conceded in the course of the hearing by Mr. Swaine on behalf of the defendants, and four abandoned by Mr. Mills-Owens who represented the plaintiffs before me. I will presently deal with the 25 still contested requests but before I do so, it is necessary to discuss the negative pregnant rule because in a number of instances the result will depend upon whether or not such is the effect of a particular pleading in the defence. The principles, discussed in notes 18/12/31 and 18/13/6 of the Supreme Court Practice, are not in doubt and are easy enough to state, although they are not always easy to apply. I can do no better, I think, than to read a passage from the judgment of Stable, J. in Pinson v. Lloyds & National Provincial Foreign Sank, Ltd., ^(l) a decision of the English Court of Appeal regarded as one of the leading authorities on the subject. He said, at pages 644 - 645-

"It remains, therefore, to consider whether or not, as it stands, the passage in the defence which I have set out is sufficient. To determine this question, it is necessary to consider the nature of a denial or traverse in a pleading. A traverse in a defence is never an assertion of fact on oath, and often is not an assertion of fact at all, but may amount to no more than: 'Prove your allegation, if you can. I do not intend to give you any help by admitting it.' Where the traverse is a mere denial or putting in issue of some positive of affirmative allegation in the statement of claim, the rule that a defendant cannot be ordered to give particulars really rests on the commonsense basis that there is nothing which the defendant can particularise, in which case there would be no point, to say the least of it, in ordering him to do something which ex hypothesi is impossible. Where the allegation in the statement of claim is a negative allegation, the traverse necessarily involves a double negative. When used in ordinary speech, a double negative must involve an affirmative propo-sition, but, where the double negative appears in a defence in the form of a denial of a negative allegation in the statement of claim, it does not necessarily follow, by reason of the very nature of a traverse which I have tried to indicate that a positive or affirmative statement is contained in it. It may or may not be so.

A traverse involving a double negative may fall under one of three heads. First, it may be a mere traverse involving no affirmative allegation. Secondly, it may be a negative pregnant, which contains within the double negative an affirma-tive allegation. Thirdly, its true nature may be left in doubt. In my judgment, the defendant at the trial of the action can do no more than put the plaintiff to the proof of the negative alleged. He can seek to shake or destroy by cross-examination any evidence which the plaintiff may bring on the point, but, once the plaintiff has established a prima facie case, the defendant on such a pleading cannot, in my judgment, set up an affirmative case in answer, because, ex hypothesi, that would be to set up a case which he has not pleaded, which is what the rules expressly preclude him from doing. If it falls under the second head, the double negative extends beyond a mere traverse, and amounts, as in the present case, to this: 'If you establish a prima facie case that I sold or purchased shares for you, and that, in so doing, I acted without authority, then I intend to call evidence to establish that on each or some of the occasions there was an express authority to act as I did or an implied authority to be derived from certain facts.' That, in my judgment, is to set up an affirmative case of which particulars ought to be given, and none the less so because the affirmative case is concealed, albeit imperfectly, in a negative shell. The third head may be excluded in the present case, because counsel for the respondents has told us that, at the trial of the action, if the pleading rests where it is, it is his intention to contend that he is entitled to set up an affirmative case, and to prove the existence of an express authority of which he refuses to give particulars.

In my judgment, in each case where a negative allega-tion by a plaintiff in a pleading is traversed in the defence, the question whether or not the defendant can be ordered to give particulars depends upon whether the traverse is a mere traverse or whether, though negative in form, the negative is pregnant with an affirmative, in which case particulars of such affirmative must be given. This result seems to be in accordance with the rules which govern these matters, with common sense, and with the authorities in which the importance of this distinction seems to me to be clearly recognised."

19. I will deal first with the requests which demand particulars of traverses in the defence.

Request 2 relates to the allegation in the statement of claim that the three named Thai Nationals were men of modest means. This is simply denied in the defence and it cannot be said that an affirmative case is made out, or concealed. The plaintiffs have been put to proving the allegation if they can and it would not be right to order the particulars requested.

Request 11 involves the bare denial by the defendants of the allegation that no rental, utility or other charges were paid by Goldwyn Shipping pleaded to support the inference that Goldwyn Shipping was owned and or controlled by the Bank and/or Mr, Liu; again I think that a mere traverse is involved of a positive allegation and no affirmative case is made out. It is for the plaintiffs to prove what they allege. I decline to order that the particulars requested.

Request 20 concerns the allegation made by the plaintiffs that Manufacturers Shipping sold the "Golden Chrysanthemum" (later the "Phutnakorn") at an over value. This is denied in the terms of the allegation in the statement of claim. St is for the plaintiffs to prove this if they can and in my view particulars should not be ordered of this traverse,

Request 30 is in relation to the denial in the defence that the repayments required by the mortgage of the "Phutnakorn'' were such as to make it impossible for the obligations to one met out of the trading profits achievable by that vessel. In my judgment this traverse (although it follows the wording of the statement of claim and is perhaps on the borderline) is not one of which particulars should be ordered. The onus is on the plaintiffs to substantiate what they allege and they cannot demand the defendants' assistance.

Request 32 refers to the allegation made by the plaintiffs that Goldwyn Shipping were the managing agents of the "Phutnakorn". This is denied although the defence states that they were the vessel's crewing agents. The plaintiffs now demand to know who were the shipping agents and I can see no valid basis upon which they are entitled to this further information.

Request 33 has to do with the allegation that the Bank on behalf of Victoria Navigation or Siam Navigation paid HK$3,750,000 to Manufacturers Shipping which enabled the latter to repay it own mortgage to the Bank. This is admitted but the further allegation which was made that "no interest and capital repayments having been made at all" is denied in these terms: "It is denied that no capital repayment had been made by Manufacturers Shipping to the Bank under its mortgage of the "Golden Chrysanthemum"." I think that the pleader, by following the language of the allegations too closely, fell into the trap of pleading a negative pregnant, carrying with it an affirmative proposi-tion. I would therefore order particulars of this traverse, as requested.

Request 39 must be dealt with in the way I determined request 20 and no order will be made.

Request 43 falls to be decided on grounds similar to request 3Q and I will not order the particulars sought.

Request 45 is to be resolved in the same manner as request 32.

Request 49 must be determined in the same way as request 30.

Request 51 must be decided in line with my decision regarding requests 32 and 45.

20. I will now discuss the remaining requests for particulars of the defence, those which do not involve a traverse.

Request 3 has to do with the important part of the plaintiffs' case that at the material time Manufacturers Shipping was owned and controlled by the Bank and/or Mr. Liu. As has been seen, this is denied and the defence goes into considerable detail about the directors and the acquisition of Manufacturers Shipping by other named persons on the 3rd December 1971. The plaintiffs now want to know how the acquisition was made and paid for. I think it would be imposing an unjustifiable burden on the defendants to supply these particulars at this stage. No doubt further particulars will come to light upon discovery and in my view the plaintiffs should wait until then.

Request 2 relates to the sale of the "Phutnakorn". The defence admits that Manufacturers Shipping sold the vessel to Thai Navigation and goes into very fair detail about the method of payment and the amounts involved. The defendants say that a first instalment of US$10,000 was paid on the 15th January 1975 and the plaintiffs demand to know the time and place of the payment, and by whom and to whom it was made if it was in cash; and if the payment was not made in cash, what was the means of payment (with all documents). I entertain no doubt that all these are matters of evidence, as are requests 22, 23 ,24, 35, 36, 37 and 38 which I do not propose to summarise.

Requests 42 and 48 are relevant to the mortgage finance advanced to Victoria Navigation in respect of two of the vessels which feature in each case. It is clear that the plaintiffs will be asking the trial Court to draw inferences from the facts that the mortgage on the "Phutphithak" was entered into on the 26th May 1976 but not registered until the 14th July; and that relating to the "Phutruksa" was entered into on the 5th July 1976 but not registered until the 16th August. In respect of each allegation the defence says "It is admitted that the ...... mortgage was not registered until sometime later. The tran-section relating to purchase and mortgage of [the vessel] was handled by Deacons, well known and established solicitors ..... who followed the usual procedures in these matters." Each request asks for the date upon which it is admitted and alleged that the mortgage was registered. I mention these requests only to dismiss them. On the state of the pleadings it would be vexatious and wrong to order the particulars sought.

Requests 52 and 53 concern the repossession and sale of the "Phutnakorn". The statement of claim avers that the vessel was sold by the Bank to New Sioux Shipping Co. S.A. allegedly controlled by Mr. Liu, in October 1976. The defence admits the sale in terms and speaks of "causing" Siam Navigation to execute a memorandum of agreement to sell the vessel to New Sioux. But the plaintiffs want to know more - how it is alleged that the Bank did this and how New Sioux was intro-duced to the Bank. I come to the conclusion that these requests are oppressive and need not be answered, and request 56 which asks similar questions about the sale of the "Phutphithak" must be dealt with in the same fashion.

21. As regards what happened before the Registrar, much has become academic, but after carefully considering the arguments presented to me, the chronology of events and the correspondence exchanged between the solicitors for the parties, I find myself unable to say that he was wrong in ordering particulars of defence to which the defendants said the plaintiffs were entitled, before the defendants' own outstanding requests for particulars of the statement of claim could be dealt with. Nor can I say that he erred in all the circumstances in making the "unless" order. I can well appreciate the stand taken on behalf of the defendants regarding an exchange of particulars on a "quid pro quo" basis, but it seems to me that the defendants were simply out-manoevered. They would not have found themselves in a disadvantaged position had they not frankly acknowledged that the plaintiffs were entitled to a number of particulars of the defence. On the other hand, I think the Registrar was perfectly right in granting a stay of the "unless" order in the somewhat unusual situation as it developed. There were many important matters left over for consideration by the judge. On the substantive issues, as it turned out, of the 25 requests for particulars of the defence that remained contested at the end of the long hearing before me, the plaintiffs succeeded in obtaining an order in respect of only one request. On the other hand the defendants succeeded in relation to 19 of the 20 requests still in issue at the con-clusion of the hearing. I have stated all these matters to serve as a guide to counsel when they address me on costs here and below, and I now invite them to make submissions on what orders as to costs I should appropriately make.

(1)    [1941] 2 All E.R. 636

Representation:

Richard Mills-Owens, Q.C. and Robert Tang (Demon, Hall and Burgin) for plaintiffs

John Swaine, Q.C. and William Waung (Chu & Lau) for defendants