Samme Trading Co Ltd v. United Agencies (A Firm)

HCA001402/1968

IN THE SUPREME COURT OF HONG KONG

ORIGINAL JURISDICTION

ACTION NO. 1402 OF 1968

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Coram: Briggs, J.

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JUDGMENT

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1. In this case the defendants apply to have the Statement of Claim struck out on two grounds. First, that it discloses no cause of action: secondly, that it is vexatious, frivolous and an abuse of the process of the court. It will be convenient to deal with the two grounds together.

2. The Statement of Claim complains that the defendants published the following words of the plaintiff:

"United Agencies (i.e. the defendants) has now evolved from and replaced the former 'Samme Trading Company Limited'."

3. It is alleged that these words were published falsely and maliciously and that they mean that the plaintiff company had been dissolved and replaced by the defendants firm. In fact this is not the case, the plaintiff company is still very much in existence.

4. There is no allegation in the Statement of Claim that the words complained of have resulted in consequential damage to the plaintiffs: though there is a claim for damages in that the plaintiffs allege that the words are calculated to cause pecuniary damage to the plaintiffs and have in fact damaged the reputation of the plaintiffs.

5. This is clearly a Statement of Claim which complains of a libel on the plaintiffs.

6. Mr. Wong for the defendants drew my attention to paragraph 68 of Chapter 2 of Gatley on Libel and Slander (6th Edition) where the following sentence appears:

"It is not defamatory to publish of a tradesman that he has ceased to carry on his business or that his business has been or is about to be, acquired or absorbed by another firm, for such statement, though likely to injure him in his business, does not reflect on him in his conduct of it."

7. The learned editors quote various authorities in support of this statement to one of which I was referred: i.e. Irish Toys v. Irish Times⁽¹⁾ which certainly supports this. I am satisfied that the sentence I have quoted above is an accurate statement of the law.

8. Were the matters to end there I would have been disposed to agree with Mr. Wong and to accede to his request. For it is obvious that as the Statement of Claim stands it is bound to fail. The words complained of are not libellous.

9. However Mr. Martin Lee for the plaintiff asked that he be given leave to amend the Statement of Claim and to convert the present claim into a claim for damages arising out of the publication of a malicious falsehood.

10. His argument was that the court will not strike out a Statement of Claim if by granting leave to amend some cause of action is shown to exist, however weak it may appear. He referred me to the authorities collected on page 273 of the White Book.

11. In the case of Ratcliffe v. Evans⁽²⁾ the defendant published in a newspaper a statement to the effect that the plaintiff firm had ceased to exist. This caused the plaintiff to suffer a heavy loss of business. The statement in question was not a libel but it was untrue. The jury found that it was not made bona fide and that the plaintiff had suffered damage. They found for the plaintiff who recovered damages.

12. That case appears to be close to the facts of the present case, that is had it been founded in malicious falsehood and not in libel.

13. In the circumstances, I think that the interests of the parties are best served by granting the plaintiff leave to file and serve a new Statement of Claim. This must be done before the Christmas vacation. And the costs of this application are to be the defendant's in any event.

14. Certificate for counsel.

Representation:

Martin Lee (Peter Mo & Co.) for Plaintiffs.

Ignatious Wong (P.C. Woo & Co.) for Defendants.

(1) (1937) I.R. 298.

(2) (1892) 2 Q.B. 524.