Esraymo Co Ltd v. Cracious Industries Ltd

DCCJ010312/1983

Wrong to allow amendments to writ to increase amount under claim when the new amount would exceed the jurisdiction of the District Court. The increase of the District Court general jurisdiction to $60,000 from the l.l.1984 has no retrospective effect. Carson v. Carson [1964] 1 W.L.R. 511, per Scarman L.J. at p.516 applied.

The affect of amendments would date from the date of the original writ as if such amendments had originally been in the writ at the outset; if granted the new amount in the sum of $46,000 on the date of the writ 30.11.1983 would have exceeded this court's jurisdiction which was then limited to $40,000 only increased to $60,000 with effect from l.l.1984. Order 20/5 - 8/2 (p.382) of the 1982 White Book Vol. I considered. Halliard Property Co. Ltd. v. Jack Segal Ltd. [1978] 1 W.L.R. followed.

Acceding to the parties' request their desire to have both claim and counterclaim heard in the High Court the amount under counterclaim being $75,000, the court applies S.38(2) of the District Court Ordinance and report the proceedings to the Registrar of the Supreme Court for his referral to the High Court for the High Court's consideration whether the High Court will accept jurisdiction under S. 38(3).

IN THE DISTRICT COURT OF HONG KONG

HOLDEN AT VICTORIA

CIVIL JURISDICTION

ACTION NO. 10312 OF 1983

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BETWEEN

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Coram: H.H. Judge E. Li in Court.

Date: 9 February 1984

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RULING - EX-TEMPORE

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1. This is a joint application by solicitors for both Parties for an order to amend the writ as shown in red and for the Defendant to file an amended defence and counterclaim within time specified and for dispensing with service thereof. This joint application in effect seeks to supersede the Plaintiff's application for amendment dated 20th of January 1984; in other words, the unilateral application in January has now become the joint application in February.

2. Miss Cheung for the Defendant has very sensibly and reasonably withdrawn the joint application, leaving the unilateral application of the Plaintiff in January to stand. I say it is sensible as it will as can be seen clear some of the cloud of confusion.

3. What have been asked for in the application for amendment in January unilaterally by the Plaintiff are substantially the same as asked for in the joint application in February, namely to amend the total amount under claim to $46,900. This amount has fundamental significane in view of the fact that the claim was filed on 30th of November 1983 when the civil jurisdiction of the District Court, landed property and revenue jurisdiction apart, was limited to $40,000. The amount exceeded the jurisdiction.

4. Now as from 1st January 1984 our jurisdiction has been enhanced to $60,000. However "it is a fundamental rule of English law that no statutes shall be construed to have a retrospective operation unless such a construction appears very clearly in the terms of the Act, or arises by necessary and distinct implication", (see Maxwell on The Interpretation of Statutes, 12th Edition, pages 215 and 216 and cases cited thereunder). It further says "the statement of the law contained in the preceding paragraph has been "so frequently quoted with approval that it now itself enjoys almost judicial authority'", see Carson v. Carson (1964) 1 W.L.R.511 at 516 per Lord Scarman. It is clearly trite law that, with rare exceptions apart of which this case is not one, the amendment which affects rights or obligations or jurisdiction or governing jurisdiction cannot be presumed to have retrospective effect - the presumption should be to the contrary.

5. If I allow the amendment to enlarge the claim to $46,900, the effect will be to confer jurisdiction on the District Court where it had not. As correctly submitted by Miss Cheung by quoting Order 20/5-8/2 at 382 of 1982 Vol. 1 The White Book "an amendment duly made, with or without leave, takes effect, not from the date when the amendment is made, but from the date of the original document which it amends; and this Rule applies to every successive amendment of whatever nature and at whatever stage the amendment is made. ...".

"The rule as to the effect of an amendment is the reason why a plaintiff may not amend his writ by adding a cause of lotion which has accrued to him since the issue (p.423 see also, Halliard Property Co. Ltd. v. Jack Segad Ltd. (1978) 1 W.L.R.377; (1978) 3 All E.R.1219); and this rule lies at the root of the difficulties which arise when an amendment is sought which will or might prejudice the ether party or deprive him of a defence which has already accrued to him."

6. As equally succinctly put in Re Athlumney cited from Cross on Statutory Interpretation 1978,1981 re-print (1898) 2 Q.B.547:-

"Perhaps no rule of construction is more firmly established than this - that a retrospective operation is not to be given to a statute so as to impair an existing right or obligation, otherwise than as regards matter of procedure, unless that effect cannot be avoided without doing violence to the language of the enactment. If the enactment is expressed in language which is fairly capable of either interpretation, it ought to be construed as prospective only. "

7. In Brian Shane McLelney, Civil Appeal No.51 of 1983, it was held by the Hong Kong Court of Appeal that an amendment allowing an application to amend under Order 20 Rule 5(5) of the Rules of Supreme Court; Hong Kong, with the effect of circumventing the Limitation Ordinance whereunder the cause of action could have expired was ultra vires notwithstanding that all matters arose from the same facts.

8. In my humble view, to allow this application is to inflate the jurisdiction of Plaintiff's claim to beyond what had been conferred on the Court by the Legislature on the date when the writ was filed on 30th November 1983. I need hardly stress that in law, if amended, this sum $46,9000 would for all purposes of these-proceedings be taken to have been there as if they were so claimed on the date of the writ. Jurisdiction is always a substantive part of the law; it is never procedural and goes to the root of what the Court can or cannot do with wide repercussion so wide that no human genuity can exhaustively cover. It is highly dangerous to unnecessarily speculate or even to make any unnecessary ruling on matters of such fundamental importance unless it is really necessary and unless it is safe from what the Court has knowledge of to do so. Again in my humble view, it is equally vital, if not more vital as a jurisdictional matter as to matters of rights or obligations. It follows that it would be neither right nor proper for me to allow the Plaintiff's application for amendment which is dismissed.

9. I have been told by Mr. Tang for the Plaintiff that his client is highly desirous of having this case transferred to and be heard in the High Court and by Miss Cheung that her client has no objection to that course at all, leaving me with the impression that both parties for reasons best known to themselves, including the time factor perhaps, prefer the High Court. I think it is common Court practice especially in civil cases that as far as the legal limits permit to accord to the parties as much of their wish and desire as possible.

10. Under the Defence and Counterclaim dated the 14th of December 1983, a sum of $75,000 is under Counterclaim. This sum obviously exceeds the jurisdiction of the District Court even as of today when we have jurisdiction of $60,000 as from lst January 1984.

11. Under Section 38(2) of the District Court Ordinance, "In any such proceedings, and at any stage thereof, a judge may, at any time of his own motion, report to the Registrar of the Supreme Court the fact and circumstances of or relevant to such proceedings and the Registrar of the Supreme Court shall thereupon place such report before the High Court or before a judge thereof." Thereafter it will be up to the High Court to decide what to do.

12. Having taken into consideration of the history, the background and the dire desire at least on the part of one party to have the wisdom and judgment from the High Court I feel that I am almost duty-bound to invoke Section 38(2).

13. May what is briefly stated be taken as the brief fact and circumstances of or relevant to these proceedings:-

14. This is basically a claim for goods sold and delivered originally to the amount of, to some $10,000. The particulars of claim is extremely brief lacking in details expected in a case of such nature. In the Defence and Counterclaim $75,000 are counterclaimed as both liquidated damages and general damages with interest thereon. From the Defence and Counterclaim, while it does not appear to be a contract of sale by sample, paragraph 7 read with 16 would suggest sales by description with warranty of certain standard and their finishing. The Defence would be as seen from this document, that the goods sold and delivered did not answer to the description and the Plaintiff was in breach of warranty with the result that the Defendant had suffered substantial damages as liability towards their overseas buyers and this forms not only the basis of the Defence but the cornerstone for the Counterclaim. The proposed Reply to the Defence and Counterclaim - I am informed that eventually an application would be made to the High Court to amend the pleadings along the lines as applied for and heard before me. In his proposed Reply to the Defence and Counterclaim, the Plaintiff would deny any breach of warranty and it would further allege waiver and/or estoppel either by conduct or expressly. I am further informed by Miss Cheung now that the Defendant will adduce evidence at some stage in the High Court to establish the extent of damages suffered as a result of breach of warranty and the extent would be as substantial in the region of some $75,000 for failure to deliver goods answerable to description as contracted for.

15. Finally, the Deputy Registrar, Victoria District Court, shall as soon as practicable cause this Ruling which gives the history, the background and the fact and circumstances of the case, to be sent to the Registrar of Supreme Court under Section 38(2) of the District Court Ordinance for the Registrar of Supreme Court to refer the case to the High Court for the High Court's consideration as to whether or not to accept judisdiction there.

16. Briefly I have heard solicitors. I think it is only right for me to order costs in the cause. After all, both parties have filed this joint applications with one of the conditions of costs in the cause as one of the agreed term. Accordingly I so order.

17. I should add that as a measure to save redundant pleadings, time and costs, I have taken this course of reporting instead of simply dismissing the application for amendment with the likely consequences of the discontinuance of these proceedings in the District Court and identical the institution of new but identical proceedings in the High Court.