Hong Kong Wing on Travel Service Ltd. v. Hong Thai Citizens Travel Services Ltd.
Read the full judgment text of HCA 13082/1999 on BabelCite. This High Court CFI judgment was delivered on 25 May 2001.
1. In this action, the plaintiff claims against the defendant damages in malicious falsehood. Much of the facts are not in dispute and they can be summarized as follows.
Cited by 15 cases · Cites 2 cases
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HCA013082/1999 HCA13082/1999 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE ACTION NO.13082 OF 1999 --------------
-------------- Coram: Hon Chu J in Court Dates of Hearing0: 7 and 8 May 2001 Date of Judgment: 25 May 2001 ------------------------ J U D G M E N T ------------------------ INTRODUCTION 1. In this action, the plaintiff claims against the defendant damages in malicious falsehood. Much of the facts are not in dispute and they can be summarized as follows. 2. The plaintiff and the defendant are competing licensed travel agents carrying on business in Hong Kong. Part of their business includes organizing short haul tours to mainland China. 3. On 20 and 22 August 1999, two concerts called "''Sprite' Cheng Huei-Mei I am I Mei Power' 99 Guangzhou Concert" (雪碧張惠妹我就是我妹力99廣州演唱會) were held at Tien He Stadium in Guangzhou featuring the Taiwanese pop song singer, Sherry Cheung (張惠妹 transliterated as Cheng Huei-Mei or Cheung Wei Mui) ("the Concerts"). The Concerts were jointly organized by Guangdong Province External Cultural Association (廣東省對外文化交流協會) ("GPECA") and China Cultural and Art Company Limited (中國文化藝術有限公司). It is the defendant's case that GPECA is an organization under the auspices of Guangdong Province Cultural Office (廣東省文化廳) and that it is either a government or a quasi-government organization. It is not disputed that GPECA is responsible for overseeing cultural activities in Guangzhou Province that involve performers from outside the province, including vetting the programmes and making logistic arrangements for the activities. It is also common ground that the tickets for the Concerts were on sale to the public at large at some 30 box offices in Guangdong Province, including the Hotel Landmark Canton (華厦大酒店) in Guangzhou ("Hotel Landmark"). Hotel Landmark was the designated hotel for the Concerts (大會指定接待酒店). Miss Sherry Cheung and the working team for the Concerts all resided at Hotel Landmark. 4. On 18 July 1999, the defendant started to advertise in the local Chinese newspapers for tours to Guangzhou to attend the Concerts. The advertisement stated that the defendant was the exclusive agent for the Concerts for Hong Kong and Macau (獨家港澳區總代理). The advertisement had previously been submitted to the Travel Industry Council ("TIC") for approval, which was granted. On 20 July 1999, the plaintiff also advertised in the local Chinese newspapers about similar tours. In around this period of time, several other travel agents in Hong Kong also advertised about similar tours in the newspapers. 5. It is the defendant's case that it made complaints to TIC about these advertisements of the plaintiff and other travel agents. So on 21 July 1999, TIC wrote to GPECA to ascertain the position, to which GPECA replied on 22 July as follows :
TIC wrote again on the same day seeking further clarifications as to whether other Hong Kong travel agents could through their mainland agents arrange for their customers to attend the Concerts and whether GPECA was entitled to prevent Hong Kong travel agents from including the Concerts as part of their tour itineraries and/or to advertise about the Concerts. GPECA did not reply to any of these questions. 6. This was then followed by a letter dated 24 July 1999 from the defendant's solicitors to the plaintiff asserting that the defendant was the sole agent for Hong Kong and Macau with exclusive authority to organize packaged tours for the Concerts. It also asserted that the plaintiff's advertisement promoting special packaged tours for the Concerts constituted an act of passing off and also trade libel against the defendant's reputation and credibility. The plaintiff was warned to cease and desist from the conduct complained of. It is the defendant's case that similar warnings had been issued to other travel agents who had advertised for tours for the Concerts. The defendant's assertions were refuted by the plaintiff through its solicitors' letter dated 30 July 1999. Meanwhile on 26 July 1999, TIC wrote to the plaintiff enclosing a letter from GPECA, but it is unclear from the evidence what this letter is. This is because there were two letters dated 22 July 1999 from GPECA, one addressed to GPECA and the other addressed to a 香港旅業總會 (Hong Kong Travel Industries Federation). The evidence is unclear as to whether the latter name is a misdescription of TIC or is in fact a different entity. 7. Then on 11 August 1999, the defendant caused to be published in two local Chinese newspapers an announcement ("the Announcement"), the subject matter of the plaintiff's claim herein. It reads :
8. The Announcement was repeated on 12 August 1999 in nine Chinese newspapers except that the plaintiff's name was deleted and substituted by "XX". Also on 12 August 1999, the defendant issued a press release asserting its status as the exclusive tour organizer for the Concerts and complaining that the plaintiff had without the authorization of GPECA advertised about the tours using the name of the Concerts. It also stated that GPECA might consider cancelling the rights of the plaintiff's tour group members to attend the Concerts. A press conference was further held on that day to disseminate a similar message. The plaintiff on the same day issued a press release refuting the defendant's allegations. THE ISSUES 9. In the Statement of Claim, the plaintiff pleads in paragraph 12 that the defendant had, in the Announcement, made the following false representations :
10. The plaintiff also pleads that the representations were published maliciously and calculated to cause pecuniary damages to the plaintiff. No special damages, however, is pleaded as the plaintiff relies on section 24 of the Defamation Ordinance, Cap.21. The defendant denies all these allegations and pleads in its defence that the Announcement was published with a view to protect its rights and interests. 11. The issues to be determined in this trial are therefore :
THE WITNESSES AND THE EVIDENCE 12. The plaintiff called its operation manager, Mr Chow Wing Hing, and its general manager, Mr Lee Chun Ting. Mr Chow's evidence is that sometime in July 1999, a Ms Noel Wong, the director of sales and marketing of Hotel Landmark, informed him that Hotel Landmark was the main or principal box office (總票房) for the Concerts and could reserve tickets for the members of the plaintiff's tour groups. As a result, the plaintiff began to promote tours for the Concerts and also to advertise about the same. Subsequently, upon receipt of the letters from the defendant's solicitors and from TIC, Mr Chow had sought clarifications with Ms Wong and was repeatedly assured that tickets for the Concerts had been reserved for the plaintiff's tour groups and that the members would have no problem attending the Concerts. Eventually, the plaintiff's tour groups did set off as scheduled and the members also attended the Concerts without problems. Mr Lee gave similar evidence. In addition, he said that the Announcement had led to a number of enquiries from the plaintiff's customers so that the plaintiff had to incur the trouble to explain to or assure them the tours would be undertaken as scheduled. Despite this, five customers did decide to withdraw and, in order not to jeopardize its reputation and goodwill, the plaintiff had granted them a refund notwithstanding that they were strictly speaking not entitled to it. Mr Lee also said he had to personally meet with the business associates of the plaintiff, such as airline companies, to explain the situation. To clear the doubts, the plaintiff further caused the advertisements to be placed in local newspapers to state that it had obtained tickets for the Concerts from Hotel Landmark and that legal action had been taken in respect of the Announcement. 13. For the defendant, its senior operations (short haul China tours) manager, Mr Yung Yee Fai, had given evidence. Mr Yung's evidence is that in about the end of June 1999, he on behalf of the defendant reached an oral agreement with a Mr Lau of Guangzhou Jun Yue Express Limited ("Jun Yue") that the defendant would act as the "exclusive tour group organizer" (獨家組團社) for the Concerts. Jun Yue has been the defendant's agent in the Mainland for the purpose of making arrangements for the defendant's tour groups. Jun Yue had by a written contract dated 13 July 1999 agreed with GPECA to underwrite 6,000 tickets for the concerts. In return, Jun Yue was authorized by GPECA to be the "exclusive tour group organizer" for the Concerts for Hong Kong, Macau and the Pearl River Delta region. The agreement reached between Mr Yung and Mr Lau was that in turn the defendant would be the "exclusive tour group organizer" for the Concerts for the Hong Kong and Macau areas, and that in the event the tour groups organized by the defendant could not take up all the 6,000 tickets underwritten by Jun Yue, Jun Yue would sell the surplus tickets in the Pearl River Delta region. Any loss suffered in terms of the tickets that could not be sold would be equally shared between Jun Yue and the defendant. 14. Mr Yung said that the defendant, through Jun Yue, procured GPECA to issue a letter dated 8 July 1999 appointing the defendant as the "exclusive tour group organizer" for Hong Kong and Macau. With this letter, the defendant obtained approval from TIC to publish the advertisement referring itself as the exclusive agent for Hong Kong and Macau. When the defendant discovered that other travel agents including the plaintiff were advertising for similar packaged tours, the defendant, apart from issuing the letter dated 24 July 1999 through its solicitors, also complained to Jun Yue about the situation. As a result, GPECA wrote the letter dated 22 July 1999 to TIC and also a letter dated 9 August 1999 to the defendant. In the letter to the defendant, GPECA stated that :
Despite the steps taken by the defendant, the plaintiff continued to promote tours for the Concerts. The defendant therefore issued the Announcement, the press release and also convened the press conference. 15. It is Mr Yung's evidence that he had not discussed with Mr Lau on the duties of GPECA with particular reference to how the defendant's exclusive rights might be safeguarded. Nevertheless, Mr Yung said it was his understanding that GPECA would protect the defendant's interest by, for example, refusing to admit members of tour groups organized by other travel agents. When cross-examined, Mr Yung said he believed that GPECA, being an organizer, should have the power to grant exclusive rights to organize tours to attend the Concerts. He however also accepted that any member of the public could purchase tickets for the Concerts. He considered that this would not be a problem provided there were no commercial activities and prominent advertisements (大事宣傳). He went so far as suggesting that it would be acceptable even if the plaintiff were to offer the Concert tickets as gifts to its tour group members. Mr Yung denied the suggestion that there was no substance in the exclusive right granted to the defendant by Jun Yue. He said he believed had the plaintiff insisted on asserting its rights, it was possible to exclude members of the plaintiff's tour group from the Concerts. According to Mr Yung, it was because of the mediation by a Mr Liu Pin (劉平) of Guangdong Travel Bureau (廣東旅遊局) and for commercial considerations, the defendant had shortly before the Concerts were held decided not to press the matter further. 16. There are two aspects of Mr Yung's evidence that I find puzzling. The first relates to the oral agreement he made with Mr Lau of Jun Yue. According to him, the agreement between the defendant and Jun Yue was in essence a joint venture whereby the parties were to bear equally any loss arising from the underwriting of 6,000 Concert tickets. This arrangement is hardly compatible with a letter dated 26 July 1999 from Jun Yue to the defendant. In this letter, Jun Yue stated that it had on the defendant's behalf ordered and purchased a total of 1,000 VIP tickets for the Concerts and requested for a pre-payment of $300,000. The letter concluded by saying that surplus tickets could be returned and calculation was to be made in due course based on the number of tickets actually consumed (剩餘票位可以退回，[屆]時按實際用票結算). Mr Yung's explanation is that at the material time, Jun Yue was requesting for payment from the defendant. At the same time, other travel agents were advertising for similar packaged tours and there were disputes in relation to this. In view of the situation, he asked Jun Yue to add this last sentence to the letter. Mr Yung said the letter was in the nature of an invoice to enable payment be made by the defendant's accounts department. The last sentence was therefore to protect the defendant's interest as well as to protect himself and his colleagues in the accounts department. Notwithstanding all these explanations, there is no convincing reason why Jun Yue would state that it had acquired 1,000 tickets for and on behalf of the defendant if the arrangement was as described by Mr Yung. There is also no explanation for Jun Yue's request for pre-payment of the 1,000 tickets, which is prima facie out of tune with the alleged oral agreement. What is more disturbing is the last sentence of the letter. The suggestion there is that the tickets were to be sent to the defendant on a "sold or return" basis. This is different from the effect of the oral agreement made between Mr Yung and Mr Lau. Not only that, it is difficult to see how it could operate as a protection of the defendant's position unless the intention was that the defendant would only pay for the tickets actually taken up by its tour groups and would not be liable for any loss arising from the surplus tickets. Yet Mr Yung emphatically denied that the defendant had any intention to put the initial oral agreement to one side. On the contrary, Mr Yung said that the defendant had not retracted from its contractual position and remained bound to perform the contractual obligations. It is also difficult to understand what Mr Yung meant when he said this last sentence was to enable him to account to the defendant's accounts department and also to protect himself and the accounts department. No reason has been given for the need to protect himself and/or the accounts department and what it was that they had to be protected against. On the other hand, while it may be the intention of the defendant or of Mr Yung to protect their interest, there is no apparent reason why Jun Yue would agree to insert the last sentence, which did not accord with the terms of the oral agreement as described by Mr Yung. In my view, Mr Yung's evidence relating to this letter is far from satisfactory and convincing. The letter suggests that Mr Yung has not been totally candid and completely forthcoming in respect of the exact arrangement between Jun Yue and the defendant. In particular, I find his evidence that the defendant never at any stage had doubt or reservation about its exclusive status unreliable. 17. Another disturbing aspect of Mr Yung's evidence concerns his understanding of the rights and benefits conferred upon the defendant by being made the "exclusive tour group organizer" of the Concerts for Hong Kong and Macau. It is common ground that the concept of "exclusive tour group organizer" for a concert was a novel one. Yet, it is Mr Yung's evidence that he did not have much discussions with Mr Lau as to what the exclusive right entailed. Mr Yung's explanation was that it was out of his expectation that other travel agents would put up advertisements to promote tours for the Concerts, but he had not given any reason for the optimism. Afterall, it is his own evidence that Ms Sherry Cheung was extremely popular in 1999, so much as that he believed there should be no difficulty in selling all the 6,000 tickets underwritten by Jun Yue. Not only that, Mr Yung was not a new comer to the travel industry. With 12 years of experience in the trade, he must be aware of the keen competitions among travel agents especially for the summer season. He would not be so naive as to think that other travel agents would not try to use the Concerts as an attraction to promote packaged tours simply because the defendant had claimed in its advertisements to be the "exclusive tour group organizer", when it is public knowledge within the trade that travel agent does not require permission to organize tours to Guangzhou and the Concert tickets were widely on sale. Hence, it is most unusual that Mr Yung did not ascertain from Mr Lau how the defendant's "exclusive right" would be protected in the event of an infringement. The fact that he was contended to leave the matter as it was indicates, in my view, that Mr Yung knew there was little substance in the "exclusive right" conferred upon the defendant. 18. Mr Yung was also on shifty ground on what he understood to be the rights or exclusivity enjoyed by the defendant under the agreement with Jun Yue. Initially, Mr Yung said the defendant had requested from Jun Yue an exclusive right in Hong Kong and Macau to accept customers (獨家收客) for the Concerts. But in cross-examination, he said it would not be a problem for other travel agents to organize tours to attend the Concerts so long as they did not put up prominent advertisement about the tours. When asked by the Court to clarify the position, Mr Yung explained that the exclusive right meant that only the defendant could refer to the Concerts in commercial advertisements promoting packaged tours. I pause here to note that this is in line with the sentiments expressed by GPECA in the two letters dated 22 July and 9 August 1999. Mr Yung however also went on to say that the exclusivity lay in the fact that no other travel agent could organize tours to Guangzhou to attend the Concerts and this is so irrespective of whether such travel agent had advertised about the tours. The last statement is an extraordinary one and is clearly inconsistent with his previous evidence. 19. Despite being the one who struck the "exclusive" deal with Mr Lau, Mr Yung does not appear to have a firm grip of the very substance of that deal, namely, the rights and protections that the defendant stood to receive from Jun Yue by being appointed as the "exclusive tour group organizer". Not only does his evidence suggest that he had not given the matter any or any careful consideration, but it also shows that he simply did not have any clear or definite idea as to what the term "exclusive tour group organizer" connotes. While he repeatedly said that he believed GPECA, as an organizer, was in a position to grant exclusive right to the defendant, he was unable to state with any precision the manner or mechanism whereby such right was to be protected against infringement and how the defendant could be redressed in the event of an infringement. Mr Yung was not on any firm ground when he said he believed that GPECA would protect the defendant's rights by refusing to admit members of the plaintiff's tour groups to the Concerts, bearing in mind that he knew no permission was required for organizing packaged tour to Guangzhou and that the tickets for the Concerts were freely available for sale to the public. In my view, the assertion is very much an afterthought. 20. I now turn to deal with the issues of the case. THE LAW 21. The essential elements for the tort of malicious falsehood are that :
22. In Spring v. Guardian Assurance plc, the plaintiff sued his former employer over the contents of a reference letter. The plaintiff succeeded in the claim in negligence but failed in the claims in malicious falsehood and breach of contract. The defendants appealed and the plaintiff cross-appealed. The Court of Appeal dismissed the cross-appeal and held that the test of what constituted malice in the tort of malicious falsehood is the same as that in the tort of libel and slander, and that it was apt for the trial judge to adopt the dictum of Lord Diplock in Horrocks v. Lowe [1975] AC 135 at p.150B-H. Horrocks v. Lowe concerns an appeal from a slander action where the defence raised was qualified privilege. The part of Lord Diplock's judgment that is relevant for the present discussions states as follows at p.150G :
Based on this dictum and the judgment of Spring v. Guardian Assurance plc, Mr Shieh argued that the improper motive had to be a dominant one. 23. Spring v. Guardian Assurance plc was decided at a time when it was thought or assumed that in the law of defamation, malice bears the same meaning in all respects irrespective of whether it is in the context of qualified privilege or as a rebuttal to fair comment. Since the decision of our Court of Final Appeal in Albert Cheng & Anor v. Tse Wai Chun Paul [2001] 3 HKLRD 418, it has been made clear that this is not so. Accordingly, it would be more appropriate to read the judgment in Spring v. Guardian Assurance plc as deciding that the test of what constitutes malice in the tort of malicious falsehood is the same as that of malice in relation to qualified privilege under the law of defamation. 24. Mr Leong SC, for the plaintiff, submits that there is no justification for applying the test of malice in qualified privilege to malicious falsehood. His argument is that since the law sees fit to afford protection under certain privileged occasions, the test of malice should also be formulated so as to ensure that the privilege will not be lightly destroyed. Hence, malice is not to be inferred unless it is demonstrated that the defendant is actuated by a dominant and improper motive to injure. There is however no such consideration or "starting point" in the tort of malicious falsehood. I am in agreement with this analysis. Although motive is important both in relation to the defence of qualified privilege and the tort of malicious falsehood, the emphasis seems to be different. In the context of qualified privilege, motive is crucial for the purpose of ensuring that a defendant does not misuse the privileged occasion. In the context of malicious falsehood, motive is important as a part of an essential ingredient of the tort : see British Rail Traffic Co. v. C.R.C. [1922] 2 KB 260, 269 in which McCardie J pointed out that "... malice in its proper and accurate sense is a question of motive intention or state of mind." The essence of the law of malicious falsehood is some dishonest or otherwise improper motive. The narrow or cautious approach towards improper motive as defeating the defence of qualified privilege therefore does not necessarily hold good when it comes to the tort of malicious falsehood. One should not readily adopt the test for malice in qualified privilege to the tort of malicious falsehood unless for good reason. Mr Leong SC is also correct when he submitted that in Spring v. Guardian Assurance plc, the appeal does not turn on whether an improper motive has to be the dominant motive for the purpose of inferring malice. It is probable that in holding that it was proper for the trial judge to adopt the dictum of Lord Diplock, of which the passage quoted hereinabove forms part, Glidewell LJ had not specifically addressed his mind to the point under discussion. 25. On the other hand, I must also acknowledge the force of Lord Diplock's observation in the same judgment that the motives with which human beings act are mixed (at p.150H). Indeed, it is often difficult to divorce a motive to advance one's interest from a motive to injure another's interest, especially in the case of trade rivals. It is not unusual for an objective to promote one's business to be accompanied by an incidental desire to weaken that of a trade rival. It will be casting the net too wide if malice can be inferred for a defendant who published words in pursuit of his own interest but with the incidental consequence of harming the plaintiff. In DPT Co. (Limited) v. Mason Talbot & Ors (1904) 20 TLR 579 at 581, Collins MR held that "... it [is] not malice if the object of the writer was to push his own business, though at the same time it might incidentally injure another person's business. To make the act malicious it must be done with the direct object of injuring that other person's business. Therefore, the mere fact that it would injure another person's business was no evidence of malice." I respectfully agree. In my view, it will be so even where the writer was aware of the incidental consequence of the publication, so that he may be said to have harboured an agenda of harming his opponent. Having regard to human complexities and to avoid the danger of unduly widening the tort of malicious falsehood, I have come to the view that the improper motive or the motive to injure has to be a direct and dominant one. FALSITY 26. In order to determine whether the Announcement is false, it is necessary to determine the meanings conveyed by it. In this regard, it is the ordinary meaning as understood by an ordinary reader that matters : Gatley on Libel and Slander (9th edn) para.20.5. The plaintiff's case is that the Announcement carries with it the meanings particularized under paragraph 12 of the Statement of Claim. I do not understand Mr Shieh's submission as disputing that the Announcement gives rise to the meanings pleaded. His submission is that the literal meaning of the material part is that the organizer GPECA was considering cancelling the entitlement of the members of the plaintiff's tour groups to attend the Concerts. In particular, Mr Shieh argued that the meanings pleaded in paragraph 12(b) to (d) of the Statement of Claim are not the sting of the words complained of, but that they were part and parcel of the meaning pleaded in paragraph 12(f). In my judgment, the Announcement does give rise to the meanings or representations contended by the plaintiff under paragraph 12(a) to (f) of the Statement of Claim, whether individually or collectively. The literal meaning or the sting of the Announcement is that while the defendant was the "exclusive tour group organizer" for Hong Kong and Macau for the Concerts, the plaintiff had without authority organized packaged tours in the name of the Concerts, as a result of which the organizer of the Concerts was in the process of considering refusing to admit members of the plaintiff's tour groups to the Concerts. 27. Insofar as the Announcement stated that the defendant was appointed the "exclusive tour group organizer" for Hong Kong and Macau for the Concerts, on the strength of the letters from GPECA dated 8 and 22 July and 9 August 1999, it cannot be said that it is false. It is a fact that GPECA did authorize the defendant to be so, although, as previously discussed, the precise implications of such an authorization remain unclear. It is however a different matter when it comes to considering the meanings pleaded in paragraph 12(b) to (d) of the Statement of Claim. As noted above, Mr Yung accepted that travel agents, including the plaintiff, did not require permission to organize packaged tours to Guangzhou. As to the need for permission to organize tours to attend the Concerts, Mr Yung had wavered in his evidence. The unchallenged evidence is that tickets for the Concerts were freely and widely available on sale to the public. There is also no suggestion that there was any restriction in the number of tickets that could be purchased by an individual or an organization. The evidence further does not show that Hong Kong travel agents were in any way restricted or prohibited from purchasing or acquiring tickets for the Concerts. It is significant to note that in both its letters dated 22 July and 9 August 1999, GPECA merely stated that other travel agents and the plaintiff were not entitled to organize tours and attract customers by reference to the title of the Concerts, "'Sprite' Cheng Huei-Mei I am I Mei Power' 99 Guangzhou Concert". The objection of GPECA as stated in these letters was the unauthorized use of the title of the Concerts and not the organization or advertising of packaged tours to attend the Concerts. The conclusion to be drawn from the evidence is that the plaintiff did not require permission or authority to organize tours to Guangzhou to attend the Concerts. It follows that there is no question of the plaintiff organizing such tours without due authorization. The Announcement, in stating and suggesting that the plaintiff required permission to organize tours to attend the Concerts, but was not so authorized, is therefore a false statement. 28. As to the meanings pleaded in paragraph 12(e) and (f) that the organizer was in a position to refuse to admit members of the plaintiff's tour groups holding valid tickets to the Concerts and that it was considering taking such action, the plaintiff says that the falsity lies in the fact that GPECA was not in a position to do so and that GPECA merely indicated a possibility of considering taking such action, as opposed to considering to do so. On the first complaint, the defendant's argument is that the Announcement could only mean that GPECA was factually able to stop members of the plaintiff's tour groups from attending the Concerts, but did not mean that it was legally entitled to take such step. It was submitted that GPECA, being a government or quasi-government organization and an organizer of the event should have the ability to prevent the plaintiff's customers from attending the Concerts. In any event, it was said that the available evidence does not show otherwise. In my judgment, this issue cannot be judged by merely looking at what GPECA could or could not factually do, without considering the legitimacy of the action contemplated. While one cannot say that it was impossible for GPECA to stop the plaintiff's customers from entering the stadium, that does not mean that GPECA was in a position to do so. There is the additional question of whether GPECA could afford to do so. The defendant had emphasized the difference in social systems and ideologies between the Mainland and Hong Kong as supporting the contention that GPECA could, had it wished, refuse to allow holders of valid tickets to attend the Concerts. Mr Yung repeatedly asserted that things operated very differently in the Mainland and that affairs in the Mainland could not be judged by ordinary process of reasoning. He went so far as drawing analogy from incidents whereby holders of valid travel documents had been denied entry into the Mainland. Such analogy is wholly inappropriate. The decision to allow or refuse entry into a country involves an executive act whereas the decision to allow or refuse admission to a concert, in the present context to say the least, is a commercial decision. The differences between the two are so fundamental and plain that they do not merit further elaboration. I have no difficulty accepting that the way of life and the way of thoughts in the Mainland do in some aspects differ from those in Hong Kong. But in the absence of cogent evidence, I will be slow to find that there are significant differences between the two places in terms of the considerations and reasonings underlying commercial decisions. It would appear to me that an organizer of a large scale public concert is in no position to arbitrarily exclude holders of valid tickets from the event. This would be so be it in Hong Kong or in the Mainland. This commercial reality was recognized in this case by the organizers of the Concerts for among the terms and conditions for the Concerts printed on the tickets, there was no reservation of a discretionary power to refuse admission to the Concerts. That, in my view, is a clear indication that the organizers, of which GPECA was one, acknowleged and accepted that holders of valid tickets were entitled as of right to enter Tien He Stadium and to take part in the Concerts. The Announcement in suggesting that the organizers were in a position to cancel the entitlement of the plaintiff's customers to attend the Concert is therefore false. 29. As to the part of the Announcement stating that the organizers were considering cancelling the entitlement of the plaintiff's tour group members to attend the Concerts, the wordings admittedly are at variance with the contents of the 9 August 1999 letter from GPECA. The letter only stated that there was a possibility of GPECA considering so to do. It was however argued that, to an objective and untrained reader, no real distinction in meaning can be drawn between "possibly consider" and "considering". I agree. To an ordinary reader, whether the words used were "possibly consider" (有可能考慮) or "was considering" (正考慮), the meaning conveyed to him remains the same, namely, there was a risk or a chance that members of the plaintiff's tour groups could not gain admission to the Concerts. I therefore do not consider that there was any falsity in this part of the Announcement. 30. In a round, therefore, the Announcement is false. It is false in so far as it suggests that the plaintiff required but did not have permission or authority to organize packaged tours to attend the Concerts and that the organizers were in a position to refuse to allow the plaintiff's tour group members who held valid tickets to attend the Concerts. MALICE (1) Knowledge 31. The question here is whether the defendant, through Mr Yung, knew or was indifferent as to whether the Announcement was false in the aspects stated above. The answer to this is inextricably tied up with Mr Yung's understanding of the defendant's rights associated with the appointment as "exclusive tour group organizer" for the Concerts. 32. I had, when discussing the evidence, observed that Mr Yung had not been totally candid with respect to the deal struck between the defendant and Jun Yue and that Mr Yung did not have a clear idea of the defendant's rights as the "exclusive tour group organizer". If Mr Yung was unclear as to the ambit of the defendant's "exclusive rights", he could not honestly believe that the plaintiff needed authorization from the organizers to organize tours for the Concerts. I had also observed that Mr Yung's claim that he believed GPECA would take step to exclude members of the plaintiff's tour group from the Concerts had the defendant insisted on its rights is very much an afterthought on his part. I do not accept that at the time of putting up the Announcement, Mr Yung genuinely believed that GPECA was prepared and was in a position to take such action. It is not to be forgotten that GPECA was only one of the two organizers and, more significantly, GPECA owed no contractual obligation to the defendant. 33. In my judgment, therefore, the defendant knew, at the time the Announcement was published, that it was false in the aspects mentioned above. To say the least, the defendant was reckless, in that it was indifferent, as to whether the Announcement was true or not. (2) Motive to injure 34. Having found knowledge of falsity on the defendant's part, it would not be necessary to go into the alternative element of a motive to injure. But for completeness sake, I will also deal with it. In discussing the applicable legal principles, I had concluded that for malice to be inferred, the motive to injure or the improper motive has to be a direct or dominant one. In the present case, such direct and dominant motive can be readily found. 35. According to Mr Yung, the objective of publishing the Announcement was to inform the consumers that if they joined the tours organized by the plaintiff and other travel agents, they might not gain admission to the Concerts. The reason for making a specific reference to the plaintiff, said Mr Yung, was to warn (警告) members of the plaintiff's tour groups that they might not be able to attend the Concerts. Mr Yung agreed that he anticipated that, as a result of the Announcement, the consumers in Hong Kong would not want to join the tour groups of the plaintiff. He further agreed that it was anticipated that those who had already enrolled for the plaintiff's tour groups would raise queries with the plaintiff, although he said he believed the plaintiff would be able to find solutions to those queries. It is plain from Mr Yung's evidence that the publication of the Announcement was not to pursue the defendant's interest, but was to injure the plaintiff and its business. The Announcement was clearly targeted at the plaintiff. In this regard Mr Yung's explanation for not mentioning Kwan Kin Tours, another travel agent who had been advertising tours for the Concerts, in the Announcement is unconvincing. In the early part of this evidence, Mr Yung said that the Announcement only referred to the plaintiff because the plaintiff was the only travel agent who persisted in advertising tours for the Concerts. He however accepted that apart from the plaintiff, Kwan Kin Tours had also continued to advertise for such tours after the warning letters from the defendant's solicitors and the complaints made to TIC. But he said, after receiving the letter dated 9 August 1999 from GPECA, he spoke to a Mr Leung of Kwan Kin Tours about the possibility of GPECA refusing to allow members of other travel agents' tour groups to attend the Concerts, Mr Leung promised to discuss it with his boss but he never reverted to Mr Yung. On 10 August 1999 Mr Yung noticed that Kwan Kin Tours had not advertised about the tour in the newspapers. He therefore believed that Kwan Kin Tours would desist from further promoting and advertising the tours. Hence the Announcement made no mention of Kwan Kin Tours. It was revealed in the cross-examination, and Mr Yung accepted, that Kwan Kin Tours in fact continued to advertise such tours after the publication of the Announcement. 36. In the first place, I find it hard to accept that Mr Yung would comfortably accept that Kwan Kin Tours had decided to desist from advertising for tours for the Concerts when Mr Leung never gave him a reply on the matter. Secondly, there was no satisfactory explanation as to why the defendant would not want to warn consumers who had already joined the tour groups organized by Kwan Kin Tours that they might be refused admission to the Concerts. It is to be noted that the Announcement only said that the organizers were considering cancelling the entitlements of the plaintiff's tour group members. It is not Mr Yung's evidence that the defendant already knew at the time that no consumer had enrolled with Kwan Kin Tours for tours to the Concerts. The conscious decision not to refer to Kwan Kin Tours in the Announcement is a strong indication that the defendant was singling out and targeting at the plaintiff. Had the defendant's motive been solely or mainly to assert its exclusive rights, there would be no need at all to refer to the plaintiff, let alone to target at the plaintiff. At this point, it is convenient to recall Resolution No.62 of the TIC Directive which prohibits the inclusion of another travel agent's name in any advertising material unless prior approval has been obtained from that travel agent. Mr Yung said in deciding to put up the Announcement, he was under the misapprehension that reference to another travel agent was permissible if prior approval had been sought from TIC. And that in the interest of time, he had decided to publish the Announcement first and to obtain the approval later. I do not for one moment accept this account. The defendant was an experienced and leading travel agent in Hong Kong. Mr Yung himself had many years of experience in the trade. The TIC Resolution was issued as recently as in 1998. There can be no doubt that the Announcement, given its pointed language, would give rise to great controversies. If the defendant's only or dominant motive is to assert its own rights or interests, it would have taken a more cautious and less aggressive approach, instead of the casual or rash attitude as demonstrated by Mr Yung's evidence. It is therefore eminently clear that the direct and dominant objective in publishing the Announcement was to harm the plaintiff. The Announcement was published maliciously. DAMAGES 37. The plaintiff builds its case in damages on section 24 of the Defamation Ordinance. Mr Shieh does not dispute that if the words are found to amount to malicious falsehood, the words are calculated to, in the sense of being likely to, result in pecuniary loss. It is also common ground between counsel that having pitched its case on section 24, the plaintiff cannot adduce evidence of actual loss. However, that does not necessarily mean that the plaintiff can only be awarded nominal damages : Joyce v. Sengupta [1993] WLR 337, 346H-347C. Counsel are also in agreement that damages for malicious falsehood does not cover damage to reputation : Jones v. Sengupta at 348F-G, and that under section 24 of the Defamation Ordinance, the plaintiff can only recover damages for its probable monetary loss, and not for injured feelings : Fielding v. Vaiety Inc. [1967] 2 QB 841, 850. It will appear that in determining damages, the court should see whether any monetary loss can be inferred from the evidence. If so, it would make an award for general damages. Otherwise the plaintiff could only recover nominal damages. 38. In the present case, some pecuniary or monetary loss can be inferred from the evidence. Firstly, there is evidence that the plaintiff had to change the contents of its advertisements to counteract the Announcement and to put up the counter advertisement for about a week. Secondly, refunds were given to five participants who decided to withdraw from the tours. Thirdly, the plaintiff had to deploy resources to explain the situation to its business associates and also participants of the tours for the Concerts. It is therefore an appropriate case for awarding general damages. 39. Mr Leong SC submits that there are aggravating features in this case in that the defendant had insisted on denying the falsity of the Announcement, that there was wide media coverage of the matter and that the parties are trade rivals. These aggravating features, in my view, have no bearing on the amount of damages to be awarded. They are only relevant to any damage to the plaintiff's reputation and/or injured feeling suffered by the plaintiff, which however are not recoverable in the instant case. Mr Leong SC also refers to two defamation cases as providing guidance on the amount of the award. I agree with Mr Shieh that they cannot provide any assistance since the cases do not deal with pecuniary loss, which is the sole concern here. Mr Leong SC has suggested an award of $100,000. I am unable to infer that as the probable monetary loss of the plaintiff from the evidence adduced. For my part, I consider that an award of $30,000 would be appropriate. CONCLUSION 40. For the reasons given above, there will be judgment for the plaintiff in the amount of $30,000 together with interests thereon at judgment rate from the date of judgment to payment. I also make an order nisi that the plaintiff will have the costs of the action to be taxed if not agreed together with a certificate for two counsel.
Representation: Mr Alan K.K. Leong SC and Miss Christine Law, instructed by Messrs Sit Fung Kwong & Shum, for the Plaintiff Mr Paul Shieh, instructed by Messrs Paul W. Tse, for the Defendant |
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