Secretary for Justice v. Wembley International (HK) Ltd and Another

HCA008518B/1998

HCA 8518/1998

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO.8518 OF 1998

---------------------

----------------------

Coram: Hon Stone J in Court

Date of Judgment: 19 March 2004

-------------------------

J U D G M E N T

-------------------------

-------------------------

Introduction

1.This is a case about the new Hong Kong Government Stadium at So Kon Po in Causeway Bay, the redevelopment of which, on the site of the old stadium, took place between April 1992 and March 1994.

2.More precisely, this is a case about the management of the new stadium, the parties to this litigation being the Secretary for Justice, acting on behalf of the then Urban Council, as plaintiff, and the 1st and 2nd defendants, respectively Wembley International (HK) Limited and its English parent, Wembley Plc.

3.The intention behind the redevelopment of the Hong Kong Stadium, which was a gift to the people of Hong Kong by the Hong Kong Jockey Club at a cost of approximately HK$850 million, was the provision of a modern stadium with greatly improved facilities for hosting major sports and entertainment events; in short, a multi-purpose arena aimed at becoming a world class venue for such events.

4.A stadium such as this required professional management, a task which ultimately was entrusted by the then Urban Council to the 1st defendant, the local subsidiary of the 2nd defendant, a well known manager and operator of stadia, conference and exhibition centers throughout the world. During the course of this trial there has been little, if any, differentiation between these defendants, which throughout have been referred to by the sobriquet 'Wembley'.

5.When the new stadium was formally reopened on 11 March 1994, the 1st defendant already had been in place as manager of this new project for some 11 months, a Management Agreement between the Urban Council and the 1st defendant, as Manager, and the 2nd defendant, as Guarantor, having been executed on 30 April 1993.

6.Unhappily, the relationship between Wembley and the Urban Council, which controlled the stadium through the medium of an appointed Board of Governors, proved less than harmonious, and Wembley's management tenure at the stadium was abruptly terminated by the Urban Council on 26 May 1998 when letters were sent to the 1st and 2nd defendants, letters which were signed off by Dr Ronald Leung Ding-bong in his capacity as Chairman of the then Provisional Urban Council.

7.These letters recited that at its meeting of 26 May 1998 the Provisional Urban Council had considered the findings of a review upon the performance of the 1st defendant as Manager of the Hong Kong Stadium since its appointment, and that having considered the findings of that review had decided to terminate the 1993 Management Agreement with Wembley "with immediate effect in accordance with Clause 16.4 of the Agreement".

8.An Annex attached to these letters detailed, within itemized subparagraphs (a) to (o), that which was said to be fifteen "examples of major incidents/management issues revealing Wembley International (Hong Kong) Limited's breaches of its obligations under the Management Agreement".

9.The issue which came to dominate this case, namely that of the care and maintenance of the stadium playing pitch, was accorded no priority within the fifteen examples upon which reliance then was placed the pitch itself is referred to at item (d) under the rubric 'Maintenance of Stadium Pitch (Since March 1994)'.

10.These letters of termination further stated that officers of the Urban Services Department would contact Wembley to arrange the hand over of the stadium. In the event, on 26 May 1998 possession of the stadium and its contents, including all Wembley's documentation as was kept on-site, was physically taken within the space of one hour on the afternoon of that day, and Wembley was duly evicted.

11.This litigation, therefore, which has come to trial after a lapse of some five and a half years, represents the unfortunate by-product of these events.

The original scope of these proceedings

12.On 26 May 1998 the writ herein was issued on behalf of the body then known as the Provisional Urban Council, although by amendment on 23 November 1999, the Secretary for Justice assumed the position of plaintiff.

13.The Re-Re-Amended Statement of Claim, dated 6 May 2003, asserted widespread breaches on the part of the defendants under the 1993 Management Agreement, and to a considerable extent mirrored the complaints originally ventilated in the Annex attached to the letters of termination. Whilst the final re-amendment sought to restrict the ambit of the matters in issue with the withdrawal of 8 heads of complaint out of the 23 then pleaded, by the time of trial there nevertheless remained outstanding 15 complaints made by the plaintiff against Wembley, notwithstanding the defendants' request, through leading counsel shortly before the commencement of the trial, that critical consideration be given to whether each and every one of the matters remaining on the pleadings was to be pursued.

14.The plaintiffs' prayer for relief claims, inter alia, declaratory relief to the effect that the plaintiff was entitled to terminate the Agreement, and further asks for damages for breach of agreement to be assessed.

15.In response thereto the defendants (whom given the history of events might have been anticipated themselves to have been in the position of plaintiffs) defend and counterclaim. Like the claim itself, the defendants' 88 page pleading also runs into violet, the Re-Re-Amended Defence and Counterclaim being dated 6 May 2003. This counterclaim also seeks primary declaratory relief, namely that the termination of the 1993 Management Agreement by the Provisional Urban Council was wrongful and unlawful, and similarly seeks damages for the contractual wrong that it is alleged has been suffered.

16.Given the range and diversity of issues variously raised on the pleadings, it was inevitable that this case would generate a phenomenal amount of paper. Indeed, some 42 box files of primary documents have been assembled, running into some thousands of pages.

17.Not all the documents in these files are documents solely representing the discovery of the litigants themselves. Upon the application of the solicitors acting for Wembley, subpoenas duces tecum were issued against three parties which had been closely connected with the redevelopment of the stadium but which otherwise were uninvolved in this case.

18.These entities were the Hong Kong Jockey Club, which had been instrumental in the planning and had wholly financed the project, HOK (Helmut, Obata & Kassabaum Inc.), the project architects, and the French main contractor for the stadium construction, Dragages et Travaux Publics (HK) Ltd, whose documentation included documents emanating from the sub-contractor tasked with constructing the pitch, Gregori International.

19.The production of documents from non-parties added to the complexity of the discovery process; some of the documents the subject of the subpoenas had to be rescued from microfiche records, and even in some cases recopied.

20.The result, however, was that there became available a substantial body of evidential material hitherto not seen until late in the day, and two dates in advance of the commencement of the hearing of the trial proper were nominated for the receipt of this additional subpoenaed documentation in order that it could be processed and thereafter inserted into the trial bundles. This additional documentation, as thus revealed, has had a significant effect upon the course of the evidence in this case, and quite possibly has had an influence upon its outcome.

The issues currently for decision

21.On the face of the pleadings after the final re-amendment, it appeared that when this case was called on the court would be occupied not only with what clearly was the fundamental issue between the parties, namely, the care and maintenance of the stadium pitch, but also with a large number of other matters which had taken place during the course of Wembley's management tenure and which were asserted to have provided cause for termination - one such example was a complaint about the occurrence at the stadium of an unauthorized bungy jump.

22.However, with robust good sense, Miss Li SC, who appeared on behalf of the plaintiff, took steps to cut through the pleaded undergrowth and to distill for the court's attention those complaints which were now regarded as the 'live' issues between these litigants, and upon which the adjudication of this court was required.

23.Accordingly, on the morning of the second day of this trial Miss Li interrupted her opening to state that the only issues which she now wished to pursue were that of the care and maintenance of the stadium pitch, together with the associated complaint of failure to keep proper records [that is, those matters pleaded at paragraphs 12-28], that relating to the operation of Wembley's provident fund scheme, and an assignment of the rights thereunder [at paragraphs 108-112] - an issue in any event not disputed by Wembley, albeit deferred pending trial of the defendants' counterclaim - and lastly a complaint relating to that which were termed 'non-contractual payments' allegedly made by Wembley to the Hong Kong Rugby Football Union [at paragraphs 116-120].

24.It followed, therefore, that the plaintiff's damages claims reflected this severely modified approach. In addition to the claim in the sum of HK$3,985,113.00 representing recovery of such allegedly 'non-contractual payments' to the HKRFU, Miss Li also made it clear that in the context of the damages claim relating to the pitch, she no longer pursued the claim for revenue loss arising out of that which was pleaded as "the persistent failure to use the pitch at its optimal rate"; instead the plaintiff now chose to confine its claim to "the costs and expenses required to turn the pitch into an acceptable condition".

25.As the result of this clarification, the plaintiff's case against Wembley for breach of the 1993 Management Agreement resolved itself first, into an investigation regarding the care and maintenance of the stadium pitch, the issue which was to constitute the main thrust of this case, and second, and that which appeared, at the outset at least, to be a matter in a far more minor key, namely, consideration of the merits of the claim that the admitted payments made by Wembley to the HKRFU were extra-contractual, and were payments for which Wembley now was required to account. This aspect had not been one of the original grounds which had been set out in the letters of termination and subsequently was to cause unexpected procedural difficulty, although this became apparent only at the end of this trial.

26.Consequent upon the reduction, at this very early stage, of the matters requiring resolution, the defence became focused upon these twin issues, which now had crystallized into the only bases upon which the plaintiff sought to justify its ejection of Wembley from management of the new stadium. It followed that, in terms of the defendants' counterclaim, the declaratory relief sought depended upon the decision upon these outstanding matters, whilst the defendants' damages claim remained unaffected.

27.This damages claim by the defendants represented a number of separate heads of loss and damage arising from what was said to be the wrongful termination of the management contract, in particular the loss of the Basic Fees and the Incentive Fees arising from stadium events that could have been earned by the 1st defendant had the Management Agreement been allowed to run its full course, together with a claim for recovery of severance benefits and other payments made by Wembley to its employees upon termination, and, finally, a claim for an award allegedly due to Wembley consequent upon the wrongful termination of the Management Agreement.

28.As to the issue of quantum, the efforts of both teams of counsel in this case ultimately resulted in an agreement being reached as to the loss and damage under the various heads respectively claimed, such agreement being conditional upon attribution of liability. I refer to this agreement at the conclusion of this judgment. The fundamental point, however, is that a detailed assessment of damages was not a feature with which this court has been required to become involved.

The evidence

29.The crystallization of the matters for inquiry had a significant effect upon the time needed to hear this case. Rendered unnecessary also was reference to the full panoply of box files which had been assembled for this hearing, although it must be said that a very substantial amount of paper nevertheless remained in play.

(a) Witnesses of fact

30.For the plaintiff a total of four factual witnesses were called. They were Mr Cheung Kwok Ki and Mr Choy Chi Mun, together with Ms Elaine Chung Lai Kwok and lastly, Mr Lee Kwok Fai.

31.Mr Cheung and Mr Choy gave the most extensive factual evidence. Both career civil servants within the Leisure and Cultural Services Department, each had had a connection with the new stadium. Mr Cheung had been involved with the planning and completion of the project, and further had acted as liaison officer between Wembley and the Urban Services Department when the stadium began operation. Mr Choy, who had taken over as manager of the stadium after Wembley's termination on 26 May 1998, remaining in that post until August 2000, had had some involvement with the operation of the stadium during the latter part of Wembley's tenure from March 1997 to May 1998 when acting in his capacity as a senior staff officer with the Urban Council.

32.For her part Ms Chung, now a senior official within the Housing Department, had been the Director of Urban Services from March 1997 to July 1999, in which capacity she had acted as a member of the Board of Governors which oversaw Wembley's management and operation of the stadium. Ms Chung gave her broad view as to Wembley's performance, but primarily she was called to rebut an allegation that when she had taken over the post as Director of Urban Services she had expressed to Mr Alan Murray, the then Wembley CEO, at a social function an observation to the effect that she would "give Wembley a hard time". This was an assertion to which I paid little attention when it had appeared in Mr Murray's witness statement, and I have given no thought to it since.

33.Last of the plaintiff's factual witnesses was Mr Lee Kwok Fai, now an Assistant Manager of the Hong Kong Stadium, and currently the person responsible for the daily maintenance of the stadium pitch. Mr Lee was called to give evidence about what he did and saw as an assistant leader within the 'Special Turf Team' which was set up under the auspices of the Urban Council to attempt to remedy the defects in the pitch during the period October 1994 to June 1995.

34.On behalf of Wembley, a total of seven witnesses of fact were called, five of whom at various times had been employees within the Wembley organization, together with two third parties who testified to the issue of the payments made by Wembley to the Hong Kong Rugby Football Union in connection with certain commercial aspects of the Hong Kong Rugby Sevens tournament during the years 1994-1998, including the Rugby World Cup Sevens tournament held at the Hong Kong Stadium in March 1997.

35.On this latter aspect, this court heard evidence from Mr David Roberts, at the relevant time either the Commercial Director or Chief Executive Officer of the HKRFU, and the 'Sevens' tournament manager from 1992 to 1999, and from Mr Peter Duncan, Chairman of the HKRFU from June 1996 to June 1999, and Chairman of the HKRFU's Steering Committee for the preparation and organization of the 1997 Sevens World Cup.

36.Of the five Wembley employees, or ex-employees who gave evidence, two were administrators, and three had been employed purely on the groundstaff side. In the latter category, evidence was first led from Mr Steve Tingley, who from 1985 to 1995 was Head Groundsman of Wembley Stadium in the UK, and whom had been involved in the new Hong Kong stadium since July 1993. He had been seconded to the stadium during February to March 1994, at the time of the handover of the pitch to Wembley, thereafter remaining involved in various aspects of maintenance of the stadium pitch for the next four to five years, although he actually left Wembley's employ in 1995.

37.The other two Wembley groundsmen who were called were Mr Darren Lyons, an Australian who was employed as Head Groundsman of the new stadium from February 1994 to June 1995, and Mr Matthew Frost, who was a Grounds Manager employed at the stadium from December 1994 until the termination of Wembley's management agreement in late May 1998. Mr Frost had worked with Mr Lyons, and also with a Mr Wayland Lee, who had come in to replace Mr Lyons, and who was the only other important member of the stadium pitch groundstaff not to give evidence, this because he could not be located.

38.As to the administrators, Mr Simon Hill and Mr Alan Murray were called. Mr Hill had begun working for Wembley in Hong Kong in October 1993 as Catering Manager for the new stadium, thereafter assuming the position of Deputy General Manager of the stadium in March 1997. As such, Mr Hill had had an involvement in stadium operations from the date of the opening of the stadium in March 1994 until the termination of the Management Agreement in May 1998.

39.So far as Mr Murray was concerned, he was the Chief Executive Officer of Wembley at the Hong Kong stadium from October 1993 until July 1997; prior to coming to run the new stadium, Mr Murray had been the Commercial Director for Wembley Stadium in the UK, and had had over eight years experience in stadium management prior to becoming CEO in Hong Kong. On Mr Murray's departure in July 1997 it was Mr Hill who became Acting General Manager, and remained so until the arrival, in October 1997, of Mr Gar Chiang, who was not called.

40.The evidence in chief of all witnesses of fact had as its foundation the formal introduction into evidence of the witness statements which had been drawn to cover the very substantial number of issues which had remained on the pleadings prior to the commencement of this trial, and thus in many instances were considerably longer than ultimately proved to be necessary and which had been filed well in advance of the start of the case. As may have been anticipated in a hotly disputed case of this nature, those statements as were employed also contained their fair share of evidential massaging, with arguendo and submission at times presented under the guise of factual transmission. In considering this case this court has ignored the obvious 'glossing' that on occasion has been injected into the statements filed on behalf of each side.

41.Nor have I accepted as representing the truth the somewhat curious insistence by the two main factual witnesses for the plaintiff, namely Mr Cheung and Mr Choy, that their statements - which largely took the form of narrative commentary upon the pleaded issues on the basis of the then available documentation - exclusively represented their own efforts, untrammelled by legal input. Why these two gentlemen felt it necessary to perpetrate this quaint fiction, perhaps due to an imperfect understanding of the litigation process, is unclear, but for the avoidance of doubt I have not permitted this aspect otherwise to colour my view of the merits of the plaintiff's case.

(b) Expert evidence

42.With the rationalization of the 'live' issues remaining in this case, the expert evidence as led was restricted to experts who sounded to the design and construction of the Hong Kong stadium pitch, together with the care and maintenance of the turf upon that pitch.

43.In this regard the plaintiff called two witnesses under the designation of experts : first, Dr K.C. Chau, who had made several pitch inspections at various dates after Wembley's demise, and who opined as to care and maintenance issues, and second, Dr R.J. Gibbs, hitherto of the New Zealand Sports Turf Institute, who gave the court the benefit of his views relating to the design and construction of the pitch at the Hong Kong Stadium.

44.On behalf of Wembley both elements of the expert inquiry, that is the issues of care and maintenance together with that of design and construction, were combined within the evidence of one expert, namely Professor W.A. Adams, who presently holds the post of Research Professor at the University of Wales, Aberystwyth.

45.I refer to aspects of this evidence later in this judgment. I was impressed with the expert evidence of Professor Adams and Dr Gibbs, each of whom took considerable pains to educate the court in an area less than readily accessible to the layman, and each of whom, if I may say so, went out of their way to explain and to justify their views whilst at the same time abjuring bias. If and in so far as one view ultimately has been preferred, such is no reflection upon the quality of the evidence presented by the other to the court.

The contractual position

46.The Management Agreement entered into on 30 April 1993 between the Urban Council and the 1st and 2nd defendants is a comprehensive document, although the circumstances of this case do not require extensive citation therefrom. Its broad structure is clear. The 2nd defendant, the local subsidiary, was to manage the new stadium, and the 1st defendant, the English plc, was to guarantee the performance of its subsidiary's obligations. As earlier noted, for the purpose of this trial no practical distinction is drawn between these distinct contractual obligations.

47.The Agreement recognizes and divides the obligations of the Manager into two stages : Stage 1, which encompasses what are referred to as 'Pre-opening Duties', and Stage 2, which is the actual operation and management of the stadium subsequent to its opening.

48.This case is concerned with what occurred during Stage 2, which commenced on 11 March 1994 upon the formal opening of the new stadium. Wembley's contract to operate and manage the stadium was to continue until the 10th anniversary of the Opening Date, or, if a Renewal Option was to be exercised, until the 15th Anniversary of such date.

49.Clause 16 of the Management Agreement provides for termination of the Agreement, which in normal course was to terminate on the last day of Stage 2.

50.In this case, however, the termination of Wembley's contract by the Urban Council was, as the letters of termination make plain, pursuant to Clause 16.4 of the Agreement, the operative part of which reads :

"The Council may terminate this Agreement if the Manager is in serious or persistent breach of its obligations thereunder ..."

51.Accordingly, the gravamen of this case is whether the two areas of complaint now finally pursued by the plaintiff fall within the rubric of "serious or persistent breach" of Wembley's contractual obligations. If yes, the plaintiff succeeds; if no, the case fails. The cause of action in this case is purely contractual, and there is no pleaded claim in negligence.

52.As the assertion of contractual breach with regard to the pitch, the plaintiff relies upon the alleged breach of two sub-clauses of the Management Agreement, sub-clause 4.2 and sub-clause 5.8.

53.The relevant part of sub-clause 4.2 provides that :

"The Manager will at all times manage the Stadium in a responsible and attentive manner ...",

whilst sub-clause 5.8 reads :

"The Manager shall use all due care and skill as an expert in the management and operation of stadia in preparing the Annual Operating Plans and in the management of the Stadium".

54.As to the assertion of breach with regard to the disputed payments as were made to the HKRFU, reliance is again placed upon sub-clauses 4.2 and 5.8, and in this connection there is also pleaded that part of sub-clause 19(1)(a) asserting Wembley's failure "to execute and perform contracts for the hiring of the stadium". I have more to say about the ambit of this pleading later in this judgment.

55.This then constitutes the legal underpinning of the case as put forward by the plaintiff. I turn now to consider the two distinct issues presently invoked by the plaintiff to justify termination.

The pitch

56.The stadium pitch has not had a happy history. Its performance has been subject to criticism at various times, not least by the press and media, which has not been slow over the years to highlight its perceived deficiencies. And it is for the performance of the pitch that Wembley was made to pay the price, in May 1998, at a time of another crescendo of press complaint of which, I apprehend, the Board of Governors was only too well aware. Indeed, whilst the letters of termination of 26 May 1998 identified, and relied upon, no less than 15 separate areas of complaint, there is no doubt that the vexed question of the pitch was responsible for the decision to remove Wembley from its management of the stadium. Purported reliance upon a wide range of other perceived administrative complaints appears, at bottom, to have been little more than window dressing, and the course this litigation ultimately has followed, with its abandonment of the many other issues hitherto invoked to justify the action taken to terminate Wembley's contract, reinforces this impression.

57.The issue of whether the care and maintenance of this pitch by Wembley properly can be said to fall within the rubric of "serious or persistent breach" of its contractual obligations in turn devolves upon whether the plaintiff can establish, in the language of sub-clause 5.8, that Wembley has failed to use "all due care and skill" in the care and maintenance of the stadium pitch.

58.In this connection Miss Li SC recognized that the plaintiff assumed the burden of thus establishing that this had been the case, and it is in this area, also, that the contractual invocation of the concept of "all due care and skill" imports into the mix considerations associated with the law of negligence.

59.Thus, the benchmark against which to evaluate the evidence relating to the allegation that Wembley failed to exercise due care and skill in the care and maintenance of the pitch must be that expected of the notionally reasonably competent professional manager/groundsman in a like position to that occupied by Wembley at the new stadium. In substance I do not think that there is any real dispute between the parties about the appropriate standard to be applied, although there are strongly contrasting views as to the answer consequent upon application of this benchmark. However, if it be suggested by the plaintiff that the particular terms of the Management Agreement suffice to raise the bar I reject such contention. Wembley's contractual obligation, pursuant to clause 5.8, to use "all due care and skill as an expert in the management and operation of stadia in the management of the stadium" serves to import the level of expertise recognized within the profession as being expected of one of its members in such circumstances, but in no sense does it connote any form of warranty or guarantee that all problems of turf management as in fact are encountered will be successfully overcome. As Bingham LJ put it (in the context of architects) in Eckersley v. Binnie & Partners (1980) 18 Con. LR 1 at 80, the law does not require such professionals to be "paragons, combining the qualities of polymaths and prophets".

60.Accordingly the primary nettle to be grasped by the court is thus : on the evidence in this case as to the objectively-verifiable problems with the pitch - as to which there is a large amount of documentation - has the plaintiff demonstrated, on a balance of probability, that in its care and maintenance of this pitch that Wembley has fallen short of the standard that could be expected of a competent manager/groundsman in its position?

61.If yes, the case justifying termination is established, because it cannot sensibly be argued (and indeed was not) that upon an issue of this magnitude a demonstrable shortfall in the standard of care to be thus expected did not constitute, in the language of clause 16.4, a "serious or persistent breach" in the contractual obligations of the stadium manager whose responsibility it was to look after the pitch. Conversely, if no, the justification for termination on this ground must fail.

62.The task thus required in order to get to grips with this issue is more than usually daunting. Not only is there a vast profusion of historical primary data which has been assembled with regard to all aspects of this pitch, but detailed viva voce evidence has been led by the groundsmen involved as to its maintenance throughout the four year period in which Wembley was charged with its care, the whole being overlaid by expert reports themselves containing much detail and analysis.

63.The issue further is complicated in that the object of the current investigation is not into the workings of an inanimate machine, which would at least contain static and readily discernible frames of reference, but into an area of living turf which, over the period in question, between March 1994 and May 1998, was subjected to an enormous diversity of influences, both natural and artificial. As Dr Gibbs pointed out, a pitch is a "dynamic living system" which never remains the same from the moment that it is constructed.

64.It follows, therefore, that the task of demonstrating, albeit to the civil standard, that all or any of the serious or persistent problems suffered by the pitch during this period can with reasonably probability be laid at Wembley's door, and that such would not have occurred if the pitch had been in the care of our notionally competent groundsman in the like position, strikes me as testing indeed. It seems to me, also, that the quality of the evidence required in order to discharge this burden must be clear and cogent before any such desired conclusion may fairly be drawn.

65.There is a limit, moreover, as to how much historical micro-analysis may sensibly be deployed in this task, and it became increasingly obvious during this trial that excessive preoccupation with vast amounts of detail brings the inevitable risk of obscuring the larger picture. Clearly it is essential to have regard to the main outlines as they emerged, and in my view the fundamental question of whether Wembley fell below the contractual standard of "due care and skill" cannot be answered without first placing this inquiry into the pitch into broad factual context.

The history

66.I consider the factual background in terms of the following distinct elements.

(a) Pitch design

67.As earlier noted, this stadium was financed by the Hong Kong Jockey Club as a gift to the people of Hong Kong, and as a consequence it was to be expected that the Jockey Club, qua employer under the main construction contract, should maintain considerable supervisory input during its construction. However, unlike the basic stadium structure, in which the project architects, HOK, held sway, the design of the pitch to be installed within this new project was very much the 'baby' of one senior and respected Jockey Club official, Mr John Halliday, the then Chief Engineer and Construction Projects Controller of the Club. It is unfortunate that the court has not had the opportunity of hearing evidence from Mr Halliday during the course of this trial; had it been able to do so, a number of imponderables certainly would have been clarified.

68.The evidence is that Mr Halliday, whom no doubt is a strong-minded man of firm view, brooked little interference with the constituent elements of his pitch design. Although it did not start out as such, the cross-section of this pitch ultimately comprised a layer of washed Bermuda grass turf above a 150mm sand mesh layer, which in turn was laid over a 125mm pure sand layer, and finally a 75mm gravel layer of 10mm single size aggregate placed on top of a perforated drain which lay on the base of the excavated subgrade, which drain itself was packed with a 10mm gravel surround.

69.So far as this profile was concerned, it is evident that at the outset there were strong reservations, certainly on the part of Wembley and also by the project architects, HOK, about the use of a stabilising top layer of sand mesh in the design of a sports field (as opposed, for example, to the use of sand mesh on a race course, which had been used at Shatin with some success.) In essence this involved the sand to be used on the top 150mm layer being intermixed with pieces of plastic mesh, in this instance the proprietary product 'Netlon', the mix being spread over the existing sand base, levelled, with the washed Bermuda grass sod then being laid on the top.

70.However, one of the problems perceived with the use of a 'Netlon' turf pitch was the levelling process. Mr Steve Tingley gave evidence before this court essentially along the lines of a Memorandum he had written to the Chairman of Wembley, Sir Brian Wolfson, on 6 July 1993, wherein he expressed his doubts. He wrote thus at the time :

"The nature of the sand/mesh element is to create stability; the mesh elements are added to the sand to act as a stabilizing agent. The reason for using sand is to create high velocity drainage capability. This on paper is the best of both worlds but the fact that stability is created means that you have tremendous difficulty in working with this material. The levelling of the mix is almost impossible, as soon as you try to grade to form a level then the whole material structure begins to move. Each individual piece of Neton is approx. 50mm times 125mm and when pulled will be removed from the mix, which in turn will leave a depression.

My experience of the Netlon systems is that the material will be levelled to within plus/minus 100mm and then levelled with pure sand. Unless the Netlon company have found a new way of levelling the material then this is what is likely to happen in Hong Kong.

The only Netlon pitch in the Football League is at Blackburn Rovers, this was laid by ICI and McAlpine approx 5 years ago; since then the pitch has been relaid, at least twice to my knowledge, because of drainage and level problems, and problems still exist there ..."

71.Mr Tingley made it clear during his evidence that Mr Halliday was unimpressed by, and had appeared uninterested in his concerns. At a meeting held at Wembley Stadium, London, on 24 March 1993, ostensibly to finalise the pitch specification, Mr Tingley gave evidence that during lunch with Mr Halliday at an executive box at the stadium he had announced his concerns over the pitch specification "but unfortunately Mr Halliday was set on what he was going to build and that was it. It was not for discussion". Elsewhere in the contemporaneous papers a Memo dated 7 July 1993 from Robin Oram, then Chief Executive of Wembley, on the subject of 'Netlon Turf' noted that "John Halliday has formed an entrenched view and will be difficult to shift, particularly as the RHKJC are footing the bill", whilst a like sentiment was expressed by Oram over a year later, on 14 September 1994, in a fax to Alan Murray, in which he observed that the pitch specification had been "controversial from the outset", that Tingley had met with Mr Halliday when Wembley's concerns had been raised regarding difficulties with pitch levelling and replacement, and the apparent lack of success of Netlon sand based pitches to provide suitable playing surfaces for soccer, but that the Jockey Club "have remained adamant that the only option is a sand-based Netlon reinforced pitch, and have dismissed Wembley's views."

72.The unchallenged evidence, also, is that so concerned were the project architects, HOK, about the use of 'Netlon' in this pitch design that they went so far as to disassociate themselves entirely from any responsibility for the pitch : a handwritten internal memorandum within HOK's Sports Division, embodied in a fax dated 5 July 1993 to Mr Eeds, the officer in charge of HOK's work with the stadium, stated that "As the result of some rather infamous correspondence last year - HOK has no involvement with the pitch. We are still in total disagreement w/ RHKJC regarding the pitch turf, irrigation and drainage systems."

73.The issue was complicated further by the fact that Netlon Advanced Turf Systems, the Blackburn, England vendor of the proprietary 'Netlon' product, wrote to Mr Halliday on 24 May 1993 in connection with the specifications of a plan and cross-section of the Hong Kong stadium field, and was clearly concerned about the design specification of the pitch. In particular, the comment was that from the available cross-sections it was not clear whether a continuous gravel drainage layer was to be included, the writer continuing : "I believe that it is essential that a 100mm continuous gravel drainage layer be incorporated below the sand layer", the point made being that pitches with pipe drains only are less efficient than the "suspended water table design which incorporated a continuous drainage layer".

74.On the face of this correspondence a handwritten note from Mr Halliday to Mr Peter Chan, his deputy at the Jockey Club involved with this project, reads : "Peter. The recommended drainage layer is as per the racecourse but would be an extra at the Stadium. JH." It appears that, initially at least, the actual design proposed by the Club also took into consideration the lump sum contract with Dragages, the aim being that Dragages would only need to construct a pitch "to a most economical design". This latter view was expressed by Mr Peter Chan of the Jockey Club in a letter dated 2 October 1993 to Mr Eeds of HOK in which he responded to a letter from Dragages containing adverse comment on the pitch construction, and in which Mr Chan commented (somewhat oddly in the circumstances) that "the stadium pitch design specification was never intended to match the propriety (sic) system detailed by Nelton (sic) Ltd".

75.Nevertheless, whilst it is tolerably clear that the original pitch design in fact had not envisaged that there would be a continuous gravel layer, it is also evident that subsequently it was decided that such a gravel layer would be installed, although, as will be later seen, the reduced specification for the depth of this layer, to 75mm only, did not match the Netlon specification requirements, as Mr Chan indeed had recognized. I note at this juncture that the depth of this gravel layer, taken together with what almost certainly was a lack of consistency in construction, has served to create a fertile area of dispute in this case, and in my view holds the key, or at least one of the keys, to the character and performance of this pitch during the period in which Wembley were seized with its care and maintenance. But I am getting ahead of the story.

76.With the project architect, HOK, having disavowed responsibility entirely for the stadium pitch, the consequence was that the Jockey Club became more involved than might otherwise have been the case in overseeing the pitch construction, which was a job done by Gregori International, a specialist sub-contractor of the main contractor, Dragages. In a letter dated 30 September 1993 Mr Eeds, director of the Sports Facilities Group of HOK, reminded Dragages, "for the last time we hope", that HOK had no design responsibility for the turf or for any of the sub-grade layers, and made no endorsement of the proposed system, and stated that Dragages direct the concerns which it had (which echoed the concerns of its specialist sub-contractor) about the technical details to the Jockey Club "as they have directed that you provide the design as it now stands."

(b) Pitch construction

77.As with the design itself, the actual construction of the pitch, and the problems associated with that construction, are matters which are able more readily to be appreciated by virtue of the documentation lately discovered by the Jockey Club, and by Dragages, pursuant to the subpoenas issued by the defendants in this case. In this connection a number of matters are relevant. Let me briefly spell them out.

78.First, it appears that the construction of the pitch was, or came to be, a rushed and difficult job coming as it did at the end of a major project which itself had suffered its fair share of delay. In this connection a letter dated 12 August 1993 from Mr Eeds of HOK to M. Henri Paoli of Dragages requested a detailed revised programme for the roof steel erection and fabric installation, and noted that HOK remained "concerned that the delay you are now experiencing will have a serious effect on pitch installation which is a critical programme item." Clearly the pitch could not be prepared until the stadium infrastructure was completed; equally, it is clear that the laying of a pitch demanded, as the expert evidence was amply to demonstrate, a great deal of care in grading the levels within the prescribed design.

79.I accept, of course, that this court has heard no direct evidence from the contractors involved, and thus has had to do its best to glean what it can from the belatedly discovered documentation. However a like impression as to delay, combined with an insight into the physical difficulties being encountered in terms of construction, is garnered from a significant letter dated 5 November 1993 from the Jockey Club to Dragages. In this letter concern is ventilated about the mode of laying the layers of the pitch, and the view expressed that "for the present time, RHKJC believe that Gregori is not yet fully aware of the steps required and characteristic of the sand mesh layer construction", whilst in the same letter the Jockey Club also noted that HOK had advised that "it appeared that Gregori might have to work at night because of the tight programme."

80.Subsequently, in a letter dated 7 December 1993 the Jockey Club expressed to Dragages its disappointment "with the slow progress of pitch construction", and thereafter, in a pointed letter from Dragages to Gregori, dated 11 December 1993, M. Paoli of Dragages castigated a Gregori fax of the previous day as reflective of "your lack of awareness of the progress" of the work, and suggests, in an itemised response, that Gregori are "delaying your own works" and that "the pitch installation is proving to be much more difficult than we believed even with your appointment" as specialist subcontractor.

81.It seems clear, also, that the difficulties which were being encountered in the physical laying of the pitch were compounded by significant problems which were encountered in the supply of constituent elements, namely the standard of the Bermuda turf and of the sand required by the pitch design.

82.The washed turf sods were, of course, to be laid on top of the prepared sand mesh surface. However, in terms of quality the discovered documents indicate that the turf as supplied by the Chinese supplier, Southern Turf Nurseries, was not of the standard that had been anticipated. A minute of a Gregori meeting at Southern Turf of 30 September 1993, refers to the turf as " not well maintained", insufficiently rolled and requiring verticutting, and being "strawy" at the cut heights required for mowing. This was the beginning in a series of complaints : a letter dated 23 December 1993 from M. Paoli of Dragages to Southern Turf complained of insufficient deliveries to meet anticipated schedules, and concluded "we have serious doubts about your ability to provide turf in good condition and to accord with our programme/timing requirements."

83.It also appears that when the sods had been laid early signs of disease began to manifest. On 11 January 1994 the Jockey Club wrote to Dragages and noted, inter alia, that "brown patches" had begun to appear over the pitch, whilst some days later, on 20 January 1994, a Jockey Club letter to Dragages cited "signs of early disease" in the newly laid sods, which in turn necessitated the change of some 100 square metres of sod. The turf laying in fact was completed, on 24 January 1994, some two months late, although even by that stage a Dragages memo of 22 January recorded that some areas of the pitch had "died", and that the turf was brown and that no roots were penetrating the sand mesh : a further 500 square metres of sod were requested as replacement.

84.Matters did not improve quickly. A Dragages letter of 25 February 1994 to Southern Turf records that an earlier diseased turf delivery had progressively attacked the whole pitch, that all the turf was infected with worms and required remedial treatment of fertilizer and fungicide, and that, in addition to the Tifton 419 Bermuda grass which had been specified, another "unknown type" of grass had also been included.

85.If there were problems with the quality control of the turf, the sand supplied seems also to have been of problematic standard. The size of the sand specified within the Jockey Club design for inclusion within this sand-based system appears to have been difficult to acquire in Hong Kong, as a Dragages document of 25 August 993 makes clear. A further letter of 3 September from the Jockey Club to HOK advised that the sand proposed by Dragages sub-contractor possessed a grading curve outside the specification and was unacceptable, whilst on 8 October 1993 Mr Peter Chan of the Jockey Club recorded, in a letter to HOK, the concern that Gregori may not be able to provide the correct grading of sand for the pitch construction, and proposed "in order to avoid last minute panic" a modification of the then design of the pitch by putting in a 75mm thick layer of single size aggregate and thereby effectively reducing the pure sand layer to 125mm.

86.This latter design amendment, which subsequently was effected at additional cost and embodied within an Architect's Instruction, has considerable significance in this case in that it confirms that until this stage there in fact had been no plan in place for a gravel drainage layer. Now there was to be such a layer, although, as the expert evidence makes clear, its depth was below the widely accepted specification for such a gravel layer.

87.The difficulties with the supply of the correct grading of sand continued, in particular with a sieving machine at Tsing Yi : a Jockey Club letter of 30 November 1993 records that despite Gregori's attempts to alleviate the problem with replacement of a 1mm screen by one of 0.75mm, the sieved sand remained without the Jockey Club's grading specification, and Gregori's attention was drawn to the necessity to eliminate all particles under 0.1mm, such elimination being essential for the drainage of the pitch. This letter concluded with the telling observation that the stadium was scheduled to be open by early March "so the time is short", and indicated that given the situation the Jockey Club "is forced to accept" the sand as was being used. There is also reference within the discovered papers to that which Mr Oram was subsequently to describe, in the fax to Mr Murray of 14 September 1994, as "heavy metals" contamination within the sand which had been supplied for the pitch.

(c) Pitch performance

88.The laying of the pitch was completed on 24 January 1994 and the pitch in its finalised state was handed over to Wembley, represented on that occasion by Mr Steve Tingley, on 3 March 1994, just over one week before the stadium proper was handed over on 11 March 1994. There was much urgency. Not only were there the Opening Galas immediately to host, but the 1994 Rugby Sevens was imminent, and the stadium was booked for a number of other events in March and April 1994.

89.Not all these events were sports events. This was a magnificent new multi-purpose stadium and was expected, for example, to host concerts and other non-sporting gatherings, for which a plastic pitch covering, the proprietary name of which was 'Terraplas', would be laid by Wembley in order to guard against pitch damage. Criticism of the usage of this product by Wembley was considerably more strident at the beginning of this case than at the end, when it was no longer mentioned. Whilst I do not believe that the point remains alive, for the avoidance of doubt on the evidence before the court I find nothing wrong with the use, in a multi-purpose venue, of this product, which I accept constitutes the industry-standard in terms of such pitch protection.

90.Witnesses of fact on each side have dealt in detail with the events of the next four years in terms of the state and performance of the pitch, and also as to the related issue of its proposed reconstruction. As to the objective events themselves there is a substantial measure of agreement, although major differences arise in terms of the attribution of responsibility for the undoubted problems as were encountered. Let me attempt no more than an overview of the most significant developments.

91.The first sign of problems occurred very quickly, and as soon as the pitch was first used for the opening soccer games, the manifestation being the widespread 'divoting' that was taking place all over the pitch; as Mr Tingley put it in evidence, the washed turf but recently laid on top of the sand mesh mix "simply ripped up".

92.A letter dated 23 May 1994 from Robin Oram of Wembley to John Halliday, in his capacity as Construction Projects Controller of the Jockey Club, provides detail of the problems being encountered after a Chelsea v Hong Kong soccer match, which took place at a time when the pitch had had ten days without use. The pitch had "cut-up badly", Mr Oram noted, even after the pre-main event ladies' soccer game. He observed that there was little or no root growth apparent, whilst top growth was less than predicted, and the pitch was draining very quickly, and did not retain water. Mr Oram described the problems for the players, who could not accelerate, turn or sidestep without the danger of losing their footing, and noted, further, that the level of the pitch was not satisfactory for top-class sport. He concluded that "the pitch will not resist lateral forces without opening the surface, which then becomes unstable, and cannot be repaired easily", and requested an early meeting with Mr Halliday to agree a remedial course of action.

93.I have little doubt that Mr Halliday, and the Jockey Club, were greatly concerned at this turn of events, and it is clear from the documents that strenuous efforts were made to investigate and to correct the sub-standard performance of a pitch which was beginning publicly to mar the image of Hong Kong's new showpiece stadium.

94.The difficulties arising with the pitch were ventilated at meetings of the Project Steering Committee for the stadium, and at meetings of the Board of Governors, to whom, of course, Wembley reported on a continuous basis. At one early such meeting with the Board of Governors, on 1 April 1994, Wembley tabled a written report which noted that during March 1994 some nine events had been held in the stadium, including two days of the Opening Gala event; and in terms of the pitch this document contained the following extract :

"With regard to the playing surface, a number of complaints and criticisms have appeared in the media as to the unsuitability of the playing surface for sporting events. The situation is that the RHKJC and the contractors determined the specification of the pitch which formed part of the main contract works. Wembley doubted the suitability of the specification determined by contractors and preferred a playing surface similar to that at Wembley Stadium in London. The RHKJC and contractors did not share Wembley's views and provided the pitch that we now have. The problem that has arisen is that the turf which was grown in mainland China is laid on a netlon bed and was laid much later than originally planned. The turf has not had time to root to the netlon. The surface is very soft and has no retention properties so that divots can easily be created on the playing surface. The RHKJC are confident that the playing surface will become good once the fine weather arrives and the rooting to the netlon bed has been completed. We are monitoring the situation closely."

95.Consequent upon these visible, and no doubt embarrassing, difficulties which were being encountered with the pitch, a number of courses of action were set in train.

96.First, a number of experts/advisers, urgently instructed at the behest of the Jockey Club, variously attended in the early days to inspect the pitch, and some, if perhaps not all, of their reports/letters of advice, have been discovered as the result of the subpoena duces tecum issued to the Jockey Club. Hence the case papers available to the court contain the views of a variety of visiting experts, most notably Dr James Beard, a well-known authority, who visited the stadium on 26 May 1994, and who inspected the pitch with Mr Halliday of the Jockey Club and with Mr Oram and Darren Lyons, the then resident groundsman, of Wembley. Subsequently assistance was also sought on ways to improve the condition of the pitch from, among others, Southern Turf Nurseries, the vendor of the turf laid in the stadium, the New Zealand Sports Turf Research Institute, Thomas Turf Services and Strathayr, a company which provided an analogous product to Netlon.

97.The result was that a large amount of data was collected, and a considerable number of views expressed, but it is, I think, probably fair to say that no one predominant view emerged, either as to cause or remedy. To the contrary, since the problems first began a large number and variety of factors have been identified as possible causes or contributory causes. I have considered the reports which came into being at the time, some of which have figured large in this case, in particular that of Dr Beard, whose views have been mooted in the course of examination of the expert witnesses in this trial; I note also that Mr Lyons, the groundsman who accompanied these visitors, gave evidence that both Dr Beard and David Powell, of Southern Turf, had indicated that there was a problem with the perched hydration system of the pitch, and also had noted a lack of uniformity in its original construction. There is a danger, however, in according undue weight to the opinions of experts who have not been called, not least because on occasion the premise upon which such views were expressed may be mistaken (for example, Dr Beard appears to have been under the erroneous impression that there was a coarse or 'blinding' layer of sand employed within the pitch profile), and absent the opportunity to see and hear the authors of other opinions it is difficult to judge the extent to which such views have been influenced by considerations other than a spirit of pure inquiry.

98.Expert visitations apart, a specialist committee, entitled the Stadium Pitch Technical Committee, also was established in October 1994, chaired by the then Deputy Director (Leisure Services) of the Urban Services Department of Government. Representatives of Wembley and of the Jockey Club regularly attended on this committee, which considered ways in which to improve the condition of the pitch; the assembled case papers contain minutes of a large number of meetings of this entity.

99.In addition to this Pitch Technical Committee, in late October 1994 a Special Turf Team comprising USD staff specializing in turf maintenance was deployed to the stadium to carry out remedial work upon the existing turf, whilst the Architectural Services Department was invited to carry out checks on the effectiveness of the drainage system, which it subsequently concluded was adequate.

100.The unchallenged evidence is that Wembley, which continued throughout to be seized with the care and maintenance of the pitch, co-operated fully at all levels with the ancillary input that was taking place at the Jockey Club behest, which in my view was a proper and understandable course to adopt in the circumstances. It is fair to say, however, that the initial optimism which had been expressed by Wembley that the pitch would improve in time as the grass consolidated gave way, within a relatively short period, to the more considered view that a complete reconstruction of the entire pitch was necessary. For example, a confidential Memorandum dated 26 July 1994 prepared by Wembley for the Board of Governors stated that notwithstanding the continuous efforts made in improving the conditions of the turf following the advice of the turf experts, it was unlikely that the pitch could be restored to the expected standard, and that it was therefore crucial that a decision be made as quickly as possible as to whether the pitch should be entirely rebuilt : "Given the unsatisfactory conditions of the pitch, it appears that the sooner it is rebuilt the better" was the concluding comment. This represented the commencement of a continuous refrain by Wembley.

101.Nevertheless, whilst the Urban Council in 1994 in principle accepted Wembley's suggestion that the pitch be rebuilt a matter to which I return later in this judgment as a matter of history this never actually occurred, and a series of essentially interim measures were effected during the period of Wembley's mandate, commencing with the work of the Special Turf Team.

102.This USD Special Turf Team assisted Wembley in what was termed a 'turf rejuvenation programme' during the period from October 1994 to July 1995. During this time there had been no laying of any interim turf, as the Pitch Technical Committee initially had envisaged as the first part of a two phase operation; instead the decision was made in the autumn of 1994 to overseed the existing Bermuda grass with winter rye grass, the rye flourishing in the cooler winter temperatures as the growth of the warm weather Bermuda began to tail off. Whilst there remains a measure of disagreement in this case about the desirability of employing this so-called "dual grass system", wherein the rye is said to flourish in competition with and at the expense of the Bermuda, there is no argument as to the pleasing cosmetic effect of the rye, which 'greens up' the playing surface over and above the dun colour of the dormant, or quasi-dormant, Bermuda.

103.In the event the rye overseeding proved a considerable success, the condition of the pitch was thought to have improved, and accordingly it was decided not to proceed with the anticipated pitch reconstruction as originally had been going to take place following the 1995 Rugby Sevens. As Mr Tingley remarked in evidence, the obvious improvement to the playing surface by overseeding served to frustrate Wembley's clearly expressed desire to see the pitch entirely reconstructed. As to this, Mr Tingley earlier had carried out trial excavations in ten areas of the pitch, and had uncovered what he believed were "considerable inconsistencies" within the pitch profile, which he concluded would continue to lead to varying turf growth. He believed, he said, that although Wembley was continually striving for reconstruction, its view was set against the "entrenched position" of the Jockey Club and the USD that there was no need for such works. Be that as it may. The evidence is that the pitch was entirely returfed in the summer of 1995 with 7,000 square metres of washed Bermuda sod. A modified irrigation system was installed also, Wembley having been concerned about drainage and the operational inflexibility of the irrigation system as had been initially installed in the pitch. And as is apparent from the Technical Committee Minutes, a satisfactory playing surface was achieved through the winter of 1995 as the overseeded rye became established.

104.It is tolerably clear, therefore, that the position at the end of 1995, and indeed for the first five months of 1996, was that the pitch continued to be in perfectly acceptable playing condition. It is also evident, however, that Wembley continued to believe that only a full reconstruction would be the ultimate solution, not least because chemical testing of the pitch sand had produced concerns as to its high copper content, and drainage difficulties continued. At the July 1996 meeting of the Board of Governors Wembley's advice was that a total reconstruction would assist in removing uncertainties over the profile and in increasing usage, a recommendation rejected because of the high cost, concerns about disruption, and the uncertainty, perhaps understandable, about whether after reconstruction the pitch would be demonstrably better than hitherto.

105.The drainage issue which had been concerning Wembley, manifesting in saturated sand conditions leading to root growth problems, in fact was acted upon by Mr Halliday of the Jockey Club with his decision to install in the summer of 1996, at Jockey Club expense, a 'Sub Air' system under the pitch. Also coincident with the installation of this American ventilation system, which it was hoped would increase aeration, came the stolonisation of the entire pitch with bushels of Bermuda Tifton 419 sprigs.

106.The preponderance of the evidence is that the 'Sub Air' system did not bring the improvement which had been hoped for, and indeed it seems that the condition of the pitch deteriorated, so that by the re-opening of the pitch in September 1996 Wembley was requested by the USD to improve matters, particularly since after a soccer match at the stadium on 10 September the players complained about the loose surface, and the increase in 'divoting' that was occurring. At this stage it was hoped by the members of the Technical Committee that the pitch condition would be improved after the establishment of the overseeded winter rye by early November 1996.

107.Wembley reported to the Technical Committee that the pitch had showed some signs of improvement during the winter of 1996, and by this stage it seems to have been recognized that any possibility of fundamental reconstruction, during 1996 at least, was out of the question as a practical matter. The evidence, which I accept, is that any pitch restoration activities in 1996 were governed by the obvious need to provide a good surface for the events planned in June and July 1997 to mark the hand-over of Hong Kong to China. Proposals as to what best to do emanated from the then Head Groundsman, Wayland Lee, in June 1996, and from Matthew Frost, his associate, in September 1996, who had sent his proposals for pitch renovation work in a fax dated 24 October from Wembley to the Stadium Pitch Technical Committee. Although on this occasion not pressing for a total reconstruction, and in fact mooting an alternative plan he thought was feasible in the circumstances, at this stage Mr Frost obviously was very concerned about the state of the pitch, noting that currently there was an extremely poor surface, that the situation would not improve until modifications were made to the upper root-zone area, given that there was little or no growth beyond the top organic layer, and that the divot damage after events was unacceptable. To lay more washed sod as was currently planned, he suggested, "would only lead to even greater deterioration in the pitch's condition".

108.Notwithstanding these views, however, an immediate interim decision indeed was made to returf once again, at the relatively low cost of HK$1 million, with the aim of seeing the pitch through to enable the 1997 hand-over events to take place. There was to be no alteration to the pitch profile : the works comprised the laying of washed sods of 50% Tifton 419 and 50% Cultivar C1, the latter strain of grass having been recommended by Wembley after subplot trials in the hope that it would be more durable for the hand-over events than the Tifton 419, and that this turf mix would provide a good quality playing surface for the events of June and July 1997. Nevertheless, the Minutes of the Pitch Technical Committee meeting of 20 November 1996 record Wembley's view that "a reconstruction of this pitch might still be required after this temporary pitch maintenance work".

109.This returfing of the pitch, again with 7,000 square metres of washed sod, took place in mid-April 1997, somewhat earlier than normally would have been the case for such a pitch transition, but mandated in this instance by the necessity to be ready for the June/July 1997 celebratory events. In fact, the first match on the new surface was the HKFA Cup Final on 8 June 1997, although this again caused a certain amount of 'divoting' and the cutting up of loose turf, in turn producing consequential negative publicity. Thereafter there were other high-profile matches, and an heavy schedule of other events in late June and early July, some of which necessitated the laying of 'Terraplas' in order to protect the turf.

110.It is a matter of record that during the summer of 1997 that there were detailed exchanges between Wembley and the Board of Governors as to the issue of reconstruction of the pitch, and papers/memoranda on the subject were submitted to the Board during July to September 1997. An extract from one of these papers, dated 7 July 1997 and of which Mr Hill told the court he was co-author, provides a useful summary of the case as then put :

"Pitch

The 1994 built Hong Kong Stadium pitch had several fundamental problems in its construction all of which are present today. The surface has simply been levelled and re-turfed/stolonized on three occasions under three different managers. All of these managers and Wembley agreed that only total reconstruction would suffice. The 1997 returfing of the pitch was the only option since there was a window of 8 weeks as a closedown period which certainly would not have been enough time to reconstruct. In fact, two proposals for construction were drawn up but later withdrawn once it was clear that the closedown period would be too short. It was agreed at the pitch committee meetings that this surface would be a temporary surface until June 1998 when there would be a window big enough to allow total reconstruction. We can state that should the present pitch remain we shall continue to have problems; the usage will be low and a closedown period of 8-10 weeks will be necessary each year.

It is understood that the Hong Kong Jockey Club would be able to fund a reconstruction project such as this. The cost of such a project would depend on the specification chosen but at this stage could be estimated at no less than HK$7.5 million. The closure period would be a minimum of 12 weeks and a maximum of 18 weeks. A Paper on the pitch reconstruction will be presented to the Board of Governors in September. It is essential that a decision be made in September 1997."

111.The content of the exchanges on this issue, some it must be said of an increasingly vigorous nature, wherein criticisms began to be voiced by Board Members as to Wembley's performance and the view expressed that problems with the pitch had "dragged on for too long", can readily be gleaned from the Minutes of the various Board of Governors' meetings of this period.

112.One minute in particular, from a Board Meeting of 18 October 1997, seems to me to sum up the attitude then prevailing in the Board of Governors. After hearing a progress report from Mr Hill of Wembley, who had stated that Wembley had invited recognized international pitch specialists to submit proposals for pitch reconstruction, and also from Mr Gar Chiang, the then General Manager, who had agreed that Wembley accepted the responsibility to improve the pitch if it had authority to make key decisions with the full cooperation and support of the Provisional Urban Council and the USD, the then Chairman of the Board, Mr Ambrose Cheung, is minuted as concluding the discussion thus :

"Wembley's stance that they were not responsible for the pitch condition was unacceptable; notwithstanding that the origin of the problems might be the Hong Kong Jockey Club's inappropriate pitch design and structure, nevertheless Wembley was responsible for the management and maintenance of the pitch";

and further that :

"Since it was Wembley's responsibility to manage the pitch, they should pay for the consultant's fee if they considered it necessary to seek the advice of consultants."

113.In the event, as the papers demonstrate, a measure of agreement finally was reached as to reconstruction of the pitch, and invitations to tender were sent out by Wembley in October 1997, with an anticipated award of contract in January 1998 and commencement of works in June 1998. In fact, on 8 January 1998 four short-listed contractors were invited to make representations to the Board. Curiously in the circumstances, one of these contractors was Gregori International, which had been the sub-contractor responsible for the installation of the existing pitch. In the course of questions about the problems with the pitch, the unchallenged evidence of Mr Hill, who was present, was that Gregori had stated that they had tried to modify the decision of the Jockey Club to use the Netlon system, because there had been problems elsewhere with it, but that their letters seeking to change the design had been ignored.

114.A pitch reconstruction proposal, prepared by Wembley, was tabled at a Board Meeting on 23 January 1998. However, this was rejected, apparently because of the objection raised by Board Members that carpet grass, an indigenous grass used in the majority of USD football pitches in Hong Kong, was not intended to be laid on the new pitch. I accept the evidence of Mr Hill, again unchallenged, that the issue of the use of carpet grass had been raised by Board Members in earlier meetings in 1996 and 1997 and addressed by Wembley and the USD, and that the explanation repeatedly given for not using this grass was that it was not appropriate for international level football and that, in contrast to sand based systems, the loamy soil profile required by carpet grass was susceptible to waterlogging, and hence the potential cancellation of events.

115.A letter dated 3 February 1998 from the Chairman of the Board of Governors to Wembley duly set out the agreements reached between Wembley and the Board in relation to the pitch reconstruction process. However, the evidence of Mr Hill is that this agreement was sought to be amended on three separate occasions by the Board, so as purportedly to change the ambit of Wembley's responsibilities in such reconstruction. The final set of conditions which the Board wished to impose was not received by Wembley until 16 March 1998 in a letter of that date from the Board. In this regard, Wembley was particularly concerned as to stipulated test to be satisfied, within the clause providing for Wembley's termination, "if the Council is not satisfied with the performance of the pitch after the reconstruction project". This formulation now embodied a subjective, as against the previously objective, and hitherto agreed, approach. As to this Mr Hill stated, and I accept, that Wembley was concerned that, if this amendment were to be accepted in that form, then Wembley's Management Contract could be determined irrespective of an objective view as to the performance of the new pitch.

116.It is evident that by this late stage the relationship between Wembley and the Board was on a distinctly downward curve, and at a meeting on 3 April 1998 the Board did not accept Wembley's counter proposal on this point, and ultimately refused to sanction any pitch reconstruction. Such reconstruction in fact never did take place, although between June and September 1998 the pitch was substantially renovated by the USD after Wembley's departure on 26 May 1998.

117.It is clear on the evidence that during the 'reconstruction negotiations' between Wembley and the Board of Governors, the pitch remained in the poor condition that it had been in since the latter part of 1997, during which time there had been severe press criticism. In fact, in April 1998 both the HKRFU and the Asian Football Confederation, after staging respectively the Rugby Sevens in late March 1998 and the Asian Cup in early April 1998, went so far as to write to the Chief Executive to complain about the poor condition of the pitch. The letter of 14 April 1998 from Mr Duncan, Chairman of the HKRFU, noted that "If events such as ours are to continue it is imperative that the present problems be overcome", whilst the AFC letter of 16 April baldly stated "It is a matter of shame for a magnificent stadium to tolerate a pitch totally unfit for first class football".

118.Accordingly, it was the pitch in this state, accepted by Wembley to have been in very poor condition during this period, which was the subject of inspection by Dr K.C. Chau on three occasions, on the 4th, 15th and 28th May 1998, the latter occasion, of course, being after the USD had taken over management of the stadium. Dr Chau's Report, whilst headed 'May 1998', was not written and submitted until some time later, and certainly well after the decision had been taken by the Board of Governors to invoke its contractual powers and to terminate Wembley's employment for "serious or persistent breach" of its obligations under the 1993 Management Agreement.

119.In fact, on the evidence before the court it is not clear precisely when the decision was taken to terminate Wembley's management of the stadium, although there is testimony from Mr Hill, which was unchallenged, that the decision to remove Wembley had been referred to by Mr Fred Li of the Board of Governors on Radio Hong Kong on 3 April 1998, which date, of course, was well before Dr Chau had made any of his visits to the pitch. In her brief evidence Ms Elaine Chung, who had been on the Board of Governors at the time, stated that before Wembley was terminated that the Urban Council had had lab tests and expert opinion that there was nothing wrong with the structure or design of the pitch. In this regard I have concluded that Ms Chung's memory has failed her, and indeed I doubt whether she had any but the most general recollection of that which had occurred; in any event she was unable to identify any such lab test or expert opinion. No such documents were placed before this court, and it is clear that at the time the Urban Council was in possession of none of the documentation dealing with design and construction which now has been discovered by the Jockey Club, Dragages and HOK consequent upon the issuance, in 2003, of subpoenas duces tecum by Wembley's solicitors.

120.Perhaps the absence of such information was not of great significance in terms of the decision to terminate. No doubt the Provisional Urban Council and the Board of Governors had become very concerned about the adverse and widespread publicity regarding the pitch, and also, I suspect, the failure to reach agreement with Wembley notwithstanding lengthy negotiations about the reconstruction issue must have proved a significant irritant.

121.And thus it was that Wembley's tenure was brought summarily to an end on the basis of the 15 grounds so specified in the appendices to the letters of termination, of which now but one, the maintenance of the pitch, has survived for debate in this court. Given the history of the problems with the pitch, and the high profile which such problems attracted, it was perhaps understandable, in political terms at least, that the Urban Council resolved to terminate Wembley in the manner that it did, and thus publicly to demonstrate robust action to resolve the issue. The hard question for this court, however, is whether legal justification has been demonstrated for the decision to cast Wembley as scapegoat?

The respective cases

122.The plaintiff pleads that the poor condition of the pitch was caused, or at least significantly contributed to, by Wembley's failure to exercise proper skill, care and attention in the maintenance of the pitch. In attempting to make good this contention the plaintiff further says that it is not restricted to the poor condition of the pitch as at the date of Wembley's termination in May 1998, but that it is also entitled to pray in aid the pitch condition in 1994 and 1996.

123.In defending the allegation that in managing the pitch it had failed to exercise "all due care and skill", Wembley does not merely dispute the assertion of contractual breach; as part of its defence it maintains a positive case of its own. The thrust of this plea is that as the consequence of what is said to be an unsuitable and/or impractical design, taken together with inherent defects in pitch construction, recurrent problems were encountered in maintaining the pitch to the required standard, and that despite the use of due skill, care and diligence the court should not find that Wembley's turf management practices fell outside the parameters of what a reasonably competent turf manager would have done in Wembley's position.

124.Thus were the battle lines drawn, and the expert evidence marshalled. In fact, the real argument in this case fell within the two areas which respectively throughout have been referred to as 'cultural practices' and 'design and construction'. I consider the latter elements at the outset, since this particular debate has permeated this case, and has been a particular focus of the expert evidence.

Wembley's contention : a 'difficult' pitch

125.I take first the issue of design. Whatever may originally have been intended, the design as ultimately settled upon by the Jockey Club, and by Mr Halliday in particular, was a pitch profile which was to function as a suspended or "perched" water table. Given the history of this matter, this fact cannot realistically be gainsaid, and in so far as may be necessary I find this to be the case. As Dr Gibbs remarked, a suspended water table effect is created at any time a design involves a layer of sand over gravel.

126.The essence of a suspended water table design is to have a sand-based root zone of a specified depth and particle size overlaying a blinding layer of coarse sand, which in turn overlays a gravel layer that provides a 'capillary break' to create a 'perched' or suspended water table in the root zone. The idea is that the gravel layer at the bottom of the profile helps prevent the drying out of the overlying sand root zone. The large pores in the gravel layer drain under the force of gravity, thereby creating a capillary break at the interface with the sand root zone, which has far smaller pores, this capillary break behaving like a water table in the way that it controls the retention of water in the sand root zone above. If the water table thus created functions correctly, there will be water retention in the root zone whilst at the same time ensuring sufficient air entry at the surface, thereby promoting the key elements of oxygen and moisture to facilitate growth. In such design it is, however, essential that care is taken with the depth of the root zone layer and of the underlying gravel layer. If, for example, the root zone is too deep too much water will be removed from the surface; if the root zone layer is too shallow, critical tension within the root zone will not be overcome, and the root zone will remain saturated after gravitational drainage has ceased. It is also critical that the gravel layer itself must be of sufficient depth so as to ensure efficient drainage, notwithstanding any particle migration into the gravel layer which may have occurred from the sand/rootzone layer above.

127.In his Report, prepared under the aegis of the New Zealand Sports Turf Institute, Dr Gibbs underscored this point and emphasised that successful construction and performance of a suspended water table pitch depends upon adherence to tolerance levels for depths of different layers within the particular profile, the uniform mixing of constituent components of the root zone, high levels of quality control with regard to material selection, preparation and placement, and the prevention of particle migration into the gravel layer by the root zone (and/or blinding layer) during the construction phase, together with subsequent maintenance and usage programmes for the pitch surface.

128.The most commonly used, and probably best known, suspended water table design is that which comes from the United States Golf Association, which since 1960 has provided profile design criteria for the construction of golf greens. Frequent reference has been made throughout this case to the USGA specifications - Miss Li SC in her closing submissions went so far as to suggest that in this case there had been an unjustified "obsession with USGA specs" - but the fact remains that the USGA provides the universal benchmark for suspended water table systems.

129.The stadium pitch, as built, did not of course conform to USGA specifications, and it is doubtful if these specifications were ever seriously considered. In fact so far as one is able accurately to judge from the history of its development, as revealed in the recently discovered documentation, the original design did not encompass a suspended water table at all, given the absence of any gravel raft at the foot of the originally-intended profile; as earlier noted, this gravel layer subsequently appears to have been added by design amendment in direct response to the failure to obtain the correct grading of sand required by the initial design. To an extent, therefore, Miss Li had a point when she observed that in this case the USGA specifications had assumed a disproportionate importance; on the other hand, the fact remains that the proper working of a suspended water table, which this pitch became, if only by default, is generally evaluated with reference to the work the USGA has done, and continues to do, in this area - for example, in the latest proposed amendment to the USGA specification, the 'blinding' or choker layer of coarse sand separating the sand/root zone layer from the gravel is now considered to be optional.

130.On the basis of the evidence before the court I have concluded that the design of this pitch, as ultimately built, can only be regarded as idiosyncratic. Notwithstanding their considerable experience and expertise in the design of sports pitches, neither Professor Adams nor Dr Gibbs had seen a profile like this one which, to repeat the specification (obtained from a discovered Gregori drawing dated 24 August 1993), comprised a 150mm sand/Netlon mesh layer overlying a 125mm unamended sand layer overlying 75mm of 10mm single size aggregate, all of which overlay a drained sub-base containing 65mm diameter perforated drains installed 100mm deep at 3 metre centers, with each perforated drain discharging into a concrete 'U' channel located around the perimeter of the pitch.

131.Apart from a slightly closer drain spacing and smaller pipe diameter than that specified by the USGA, the most important differences of note when compared with the USGA specification are at the top and bottom of the pitch profile. The gravel layer at the bottom is 75mm, as against the univeral standard of 100mm, whilst at the top there is a total sand root zone depth of 275mm as against the minimum 300mm specified by the USGA. In addition, of course, the top root zone mix has been amended with Netlon, the pieces of plastic mesh designed to add stability to the surface area. Nor is there any 'blinding' layer of coarse sand between the gravel aggregate and what lies above.

132.Much of the expert debate between Professor Adams and Dr Gibbs dwelled upon the absence of any 'blinding' layer, and upon the depth of the gravel layer which could be tolerated within a pitch design of this nature. As to the latter aspect, I note in passing that within the case papers is a Gregori document dated 14 September 1993 expressing concern that "following ... numerous communications with experts in charge of Netlon design" it appeared that by omitting the gravel layer the Hong Kong Stadium specification did not follow the usual requirement as to drainage. We now know that this omission was corrected, if only by a side-wind, but the annex accompanying this document points out the comparisons between the specification requirements of the Netlon manufacturer and the profile of the stadium pitch as then designed. In this context, two matters in particular stand out : first, that the 'Netlon Advanced Turf" specification required use of a coarse sand layer, and second that the same specification required a 100mm gravel drainage layer. In the event, of course, a 75mm only gravel layer was installed, and there never was any coarse sand or 'blinding' layer.

133.As to the depth of the gravel drainage layer, in evidence both eminent experts agreed that the 75mm depth was too shallow, in that, as opposed to the universally accepted 100mm gravel layer, such lesser depth failed to provide a sufficient safety margin against contamination of the gravel layer, whether from sand particle migration from above or soil infiltration from below, in order to ensure that there was at least a layer of 50mm of uncontaminated gravel which then could perform the drainage function, and maintain the 'capillary break' within the 'perched' water table concept. As to the use of a 'blinding' layer itself, Professor Adams was emphatic that such a layer should be included, notwithstanding the difficulty of accurate installation and the concomitant expense, whilst Dr Gibbs was less concerned about the existence of such a layer, pointing out that in modern practice increasingly this was regarded as optional and non-essential.

134.These disagreements, and the evidential discussion thus stimulated on the point, revealed that which I understood to be the essential kernel of difference between Professor Adams and Dr Gibbs. Professor Adams was of the view that the eccentricities of this pitch design, together with the issue of problematic installation, could be said with reasonable certitude to have been responsible for the unsatisfactory performance of this pitch, whereas Dr Gibbs accepted that whilst this was a possibility "in a general sense", and whilst he acknowledged "risky" departures from established good practice, he remained unconvinced on the evidence that the sort of problems which might have been expected to occur in fact had occurred on this particular pitch, and certainly not to the extent as would have caused the problems with the pitch as had been described.

135.At this juncture let me shortly deal with the main problems as they were described by the only witnesses who actually were there at the time, namely the professional groundsmen, Messrs Tingley, Lyons and Frost. One of the curiosities of this case is that this factual evidence is virtually all one way, with the plaintiff's evidence in this regard being extremely limited. Apart from Mr Lee, who had participated in the work of the Special Turf Team relatively early in the Wembley regime, from October 1994 to about June 1995, and whom had no further contact with the pitch until Wembley's departure, the plaintiff called no factual evidence relating to the condition of the pitch in the years prior to Wembley's termination; certainly Mr Cheung and Mr Choy, whose evidence amounted to little more than a narration of the documents as then discovered, were quick to accept that they themselves had no personal knowledge of turf or turf maintenance. Accordingly, the sole direct oral evidence of the particular problems that arose came from those whose task it was to tend this pitch throughout the period of Wembley's management.

136.Having heard and seen these three witnesses, I accept their evidence. They were all, if I may say so, rather different characters, and in fact none of Messrs Tingley, Lyons or Frost remains in Wembley's employ; of the three, only Matthew Frost remains in Hong Kong, where currently he is groundsman at the Hong Kong Football Club. But they all struck me as knowledgeable, sincere and concerned, if at times impatient with some of the propositions which were put to them, and none, in my judgment, was simply espousing that which could be considered to be the 'corporate line'.

137.It was clear from his evidence that Mr Tingley had never liked the design of this pitch. His strong preference, he said, and one which he had communicated to Mr Halliday when he had tried to discuss the pitch design with him, was to install a Sports Turf Research Institute/USGA specification pitch, which would have incorporated an 80/20 sand/peat mix, without the use of Netlon mesh elements, with an 'herringbone' drainage system together with a properly installed 50mm coarse sand 'blinding layer', which would have created a perched hydration zone and a level of water above the drainage layer which would be accessible to the grass roots. However, he had had no success in his discussion with Mr Halliday, and Wembley had had to live with the design decision as made by the Jockey Club.

138.His view was that the lack of a uniform and properly functioning perched water table was one of the major inherent defects with which Wembley, as managers, had had to deal. His other major concern was with the use of the Netlon system, and in particular the problems this caused with the maintenance and levelling of the surface. In terms of maintenance he noted that with a normal pitch it was relatively easy to repair surface damage, to lift indentations in the surface, to cut out and replace damaged areas, and to repair divots. However with a Netlon system, because the roots are interwoven with the plastic mesh elements, lifting out a section of turf causes the roots to break in the adjoining areas and damages the turf. As to levelling, Mr Tingley stated that the introduction of the Netlon elements made it hard to grade the surface to the finished levels, because the process of grading to form a level caused the surrounding structure to move. Whilst this problem today has substantially been overcome with modern machinery, the best that could be achieved at that time was to get a reasonably level surface, to top-dress with sand to achieve a level, and thereafter to lay washed sod on top. However the difficulty with this, he said, was that as the result of this procedure pockets of sand inevitably formed under the grass, thereby creating instability and defeating the purpose of adding Netlon, as over a period the mesh elements became buried deeper within the surface they were meant to bind. He made the point that with sand-mesh horse racing tracks (which appears to have been the forerunner for the use by the Jockey Club of sand mesh in this pitch) there is not the same need to produce the same exacting levels because there is no concern over consistent ball roll.

139.Mr Tingley, whose broad grasp struck me as authoritative, also referred to drainage difficulties and water retention problems encountered on this pitch, wherein during heavy rainfall water would gush through the profile, leaching nutrients in the process, but that, except in very dry periods, the root zone high up in the profile generally remained saturated, which had the knock-on effect of depriving the roots of oxygen and inhibiting growth. Oddly, however, the top of the pitch nevertheless would remain dry and require irrigation in advance of sporting events in order to create stability; if the surface was not to be thus watered, he said, there would be considerable lateral movement of the surface consistent with the lateral movement of the players as their studs penetrated the ground in the course of a game, and the consequent creation of excessive, and highly noticeable, divots in the turf.

140.This recitation of the problems inherent in this pitch was substantially mirrored in the evidence of Mr Lyons and Mr Frost. Mr Lyons, an Australian now living in Perth, had concluded that, as the visiting experts, Dr Beard and David Powell, also had indicated, there was a problem with the perched hydration system of the pitch; in addition Mr Lyons further referred to a fundamental design flaw in the irrigation system as installed which prevented the ground staff from using the sprinkler system to water the centre of the field at a different rate from the sides of the field, which were shaded by the east and west grandstand canopies. In fact, this issue of growth difficulties caused by shading and poor light intensity, to which the Bermuda grass is particularly susceptible, was an issue upon which both Professor Adams and Dr Gibbs were agreed as representing a key problem arising both from the construction of this particular stadium and as a function of the Hong Kong climate.

141.Mr Lyons also referred to the saturated state in which the entire pitch profile remained, in particular during the wet season, resulting in surface ponding and algae growth. He recalled "numerous operations" which the Jockey Club carried out in 1994 in a bid to solve the problems which were manifesting with the pitch, including the use of a Verti-Drain machine, the hand raking of algae and the regrassing of a number of areas. He said that the use of the Verti-Drain machine, which has the capacity to aerate the profile of the pitch to a depth of 12 inches by means of plunging metal tines into the surface, caused problems specifically relating to the Netlon mesh, the pieces of which continually clogged the tines of the machine during this 'deep-tining' process, thereby requiring the cessation of the operation and the removal of the pieces of attached mesh.

142.Mr Lyons stated that he had expressed his concerns about this process to Mr Halliday of the Jockey Club, who was present at the time, since he was worried that the enforced removal of a significant amount of mesh elements would cause needless disruption to an already frail root system - a concern, he said, that was shared not only by the visiting Mr Powell of Southern Turf Nurseries, but also by Mr Tim Oliver of Netlon Ltd, whom he also had consulted by telephone. It was at about this time, also, said Mr Lyons, that Mr Halliday witnessed the excessive moisture retention within the profile and subsequent surface flooding, and that as a result he had had installed a 'Cuming Moisture and Nutrient Meter' to monitor the situation; Mr Lyons noted that this device had recorded a constant state of saturation even when no irrigation was being applied.

143.Mr Frost, who ultimately took over from Mr Lyons and whom, in tandem with Mr Wayland Lee, had worked on the stadium pitch from December 1994 until the end of Wembley's involvement in May 1998, was perhaps as uncompromising as a dour Lancastrian can be about the fundamental problems which, in his opinion, were posed by this pitch. His thesis was that the profile inconsistencies in the pitch, in particular the lack of uniformity in depth of layers and contamination of other layers, problems which in his view stemmed from the manner in which the pitch had been constructed, combined to obstruct the efforts made to achieve reasonable root growth; in this regard he noted that the inconsistencies increased from south to north, which he understood had been the direction in which the pitch had been laid. Mr Frost was adamant that, in his words, the pitch "was not perching properly", and that the high moisture content of the pitch did not assist growth of the Bermuda grass which, he stated, was prone to spread laterally in its initial growth and was "lazy" in putting down vertical rooting in search of water when there was so much immediately available moisture within a pitch whose profile was frequently saturated. Mr Frost noted that the adverse pitch condition, and the excessive divoting, very much depended upon the time of year - he stressed that the pitch generally was good between October and April - but said that when conditions became poor the construction of the profile "would work against us and maintenance practices could not make up for this."

144.There was a notable consistency within the evidence of the groundsmen who had been employed by Wembley to look after this pitch. It might perhaps be said that persons collectively criticized inevitably tend to close ranks and, in effect, to 'talk their own book', although in my view in this instance any such criticism would be unfair. A striking feature of this case is that each of these three gentlemen is on contemporary record, during his respective period of tenure with Wembley, in voicing the type of criticisms that each now has made in this court.

145.There can thus be no suggestion of any element of 'recent fabrication' in the face of hostile litigation. Mr Tingley wrote a number of internal memoranda for the attention of the Wembley directorate in 1993 espousing his concerns over the type of pitch, the use of Netlon and the difficulties of levelling the surface, whilst in their period of service as groundsmen both Messrs Lyons and Frost went on record with their misgivings. I have earlier referred to a fax of 24 October 1996 from Mr Frost to the Stadium Pitch Technical Committee wherein he made reference to the lack of growth beyond the top organic layer, and counselled against merely laying more washed sod.

146.For his part, shortly before his departure, in June 1995 Mr Lyons wrote a lengthy memorandum to Mr Murray of Wembley based upon his experience and information gained since the official opening of the pitch in March 1994. In my view this is a telling document, replete with contemporary insight from a witness who impressed me as careful, reflective and not given to unjustified embellishment. At the outset of this memorandum Mr Lyons commented that never at any stage had the pitch profile been explored in detail by on-site observation, the only exception being the April 1995 visit of Dr Beard, "who took the opportunity to see first hand the lack of uniformity in construction, along with sand migration evidence, through the gravel and into the underlying drainage system", although time restraints had prevented Dr Beard from viewing a greater number of locations within the field. A review of the decisions of the Stadium Pitch Technical Committee is also set out in Mr Lyons' memorandum, along with comments upon the turf back-up nursery, trial grasses and the proposed summer renovation. This document presciently concludes :

"I am of the opinion that not enough research into the original design and construction has been undertaken by a specialist organization. Under no circumstances will the purchasing of unproven gimmicks alleviate or correct any major deficiencies that may exist within the structure. It would be fair to say Mr Halliday is far happier to follow this route, as opposed to proper and thorough research being conducted. Nearly a year has passed, and it would appear the [Stadium Pitch Technical Committee] are no closer to resolving this embarrassing situation. It is my belief that until Wembley International can assert their authority on this matter, a poor quality surface will remain."

147.In fact, as has been established on the evidence, throughout the history of Wembley's tenure the pitch structure never was researched as thoroughly as Mr Lyons had hoped, despite the profusion of experts who variously attended, and despite that which emerges on the contemporary documents as consistent advice from Wembley that major surgery was required on this pitch. I am not sympathetic to the submission that Wembley's attitude in this regard in effect constituted no more than the 'bleatings' of an incompetent turf manager who found this pitch to be beyond its capabilities and expertise. The evidence of the three Wembley groundsmen called to assist this court with that which factually occurred is consistent, both then and now; moreover it is clear on the evidence, which I accept, that, as Mr Tingley pointed out, Wembley also sought to comply with the advice of Dr Beard and the other visiting experts brought in by the Jockey Club to provide counsel with regard to matters such as irrigation, fertilization and mowing, and yet matters still failed to improve. Thus it appears unlikely, on the probabilities, that the pitch condition simply could be attributed to a maintenance or usage problem as opposed to fundamental structural deficiency. The irony in all this, of course, and a matter to which I will return, is that at the time it indeed was recognized by the Urban Council that there was a structural problem, and at the time the Jockey Club was prepared to provide the funds, to the tune of some HK$12 million, to reconstruct the pitch, but the opportunity was lost.

148.As to the manner in which this pitch had been constructed, which represented a collateral aspect of the case Wembley put forward, I have referred earlier in this judgment to the problems associated with that construction, or at least those problems which can be gleaned from the discovered documentation. I bear in mind particularly that I have not had the opportunity to hear from anyone within Dragages and Gregori, the contractor and sub-contractor respectively who actually were involved in doing the job, and absent such input the court naturally is reluctant to express a definitive view.

149.On the probabilities, however, I am satisfied that the available documents do nothing to discourage the view that the construction of this pitch, in all probability with materials not always up to par, must have taken place under severe time constraints, not least with the actual laying of the Bermuda sod. I note that a memorandum dated 22 April 1993 from Peter Chan of the Jockey Club to M. Paoli of Dragages advised that the turf would require a minimum of two and one half months to grow in winter, and that since the official opening of the stadium was scheduled for 12 March 1994, "your turf must be completely laid before the end of December 1993". Dragages was asked to schedule its sand mesh pitch formation and sodding accordingly.

150.It is a matter of record, however, that the stadium pitch was not fully laid until late January 1994, a delay which in the circumstances must have been more than usually relevant given that it cannot have been advisable to lay down Bermuda Tifton 419 sod, a warm season grass, in the middle of Hong Kong's winter period, when the lower prevailing temperatures induce dormancy, or at least a very significant level of dormancy, in this particular species, which will not grow and lay down roots in such cooler temperatures.

151.As to the actual laying of the sod, I have earlier quoted the Jockey Club reservations contained in a fax of 5 November 1993. This was followed up a few days later in a letter from the Jockey Club to HOK from Peter Chan as Project Manager, who noted :

"In our meeting at [Dragages'] office on 4 November 1993, I discovered that Gregori International was in fact not fully aware of the characteristic of the contact surface between the washed turf and the sand mesh. RHKJC had then given a very detailed description of what is required to ensure proper germination of the roots to the sand surface. The method statement described by Gregori International was somehow not carefully thought out ... I do not believe that [Dragages] should allow Gregori International to plant this rather expensive sod on an unprepared surface (i.e. Without the Bem-net to hold the mesh down) ... Before this job was awarded to Gregori International, [Dragages] had told me that Gregori International was a world-renowned turf contractor. I appreciate that they may not be so familiar with every finite detail of the sand mesh turfing, however I would expect them to gain the valuable experience and use it in the course of the work when told ..."

152.In terms of the construction of the layers of the sub-turf profile there is less contemporaneous material in the documents, although it now is clear, notwithstanding earlier erroneous impressions, that no 'blinding layer' ever was included within the profile. In any event, notwithstanding his apparent misunderstanding in this regard, in his report of May 1994 Dr James Beard noted that the field samples which had been analysed demonstrated a variability among the four locations from which the samples had been taken which suggested "a lack of uniformity in the construction procedures", in that two of the four sites assessed for infiltration rate, which had come from the northwest corner and the north middle area, had exceeded the upper maximum infiltration limit by in the order of 50%, and he called for an adjustment in irrigation and fertilization practices accordingly. He further concluded that "a properly functioning perched hydration zone will partially alleviate the excessively high infiltration rates in selected areas of the field".

153.In the same report Dr Beard expressed a view that the fertilization programme had not been adequate, especially in terms of key major nutrients, and recommended the nitrogen, phosphorous and potassium levels be raised, albeit at the same time he expressed concern at the "near-phytotoxic levels" of iron and manganese levels detected, and mused upon whether the sand used had been sourced from a site containing industrial waste. Dr Beard also noted that the irrigation system design and installation was inadequate to meet the needs of proper turf management; he pointed out the inbuilt shading problems, which meant that the rates of evapotranspiration from differing areas on the pitch differed greatly, thereby requiring different rates of water replacement via irrigation, a situation compounded by the substantial variations in infiltration rates across the field. He also noted the presence of a black algae layer, which was "difficult to avoid" due to the limitations of the irrigation system, and asked rhetorically whether the architects had allowed this design in view of the differential shading produced by the stadium roof design.

154.I have reminded myself that, absent the chance to see and hear a witness, to accord undue weight to a report such as this of Dr Beard is perhaps unwise. However, I have rehearsed in a little detail the opinions expressed by Dr Beard at the time because it is significant that they gel substantially with the anecdotal evidence of Messrs Tingley, Lyons and Frost, thus providing a picture of a pitch which demonstrably did not function correctly from the outset.

155.In terms of the construction itself, reference in this case has also been made to a number of different profile pits which were excavated at different areas of this pitch at differing times. For example, in January 1995 Mr Tingley had dug 10 profile pits at intervals down the east and west touchlines of the pitch, and included his findings in a Memo to Mr Murray of Wembley dated 18 January 1995, which document also reported on his trip to the Sports Turf Research Institute in Yorkshire to obtain the view of the STRI on the specification and materials used in the construction of the pitch 'as built' by Gregori.

156.In this memorandum Mr Tingley reported that so far as the specification was concerned the STRI were "satisfied" with the profile with the exception of the absence of a blinding layer, as was the situation with the materials used in construction apart from the capillary porosity and organic matter content of the rootzone material, albeit they had also raised the issue of inconsistencies within the profile which had prompted his excavation in 10 areas around the pitch. He expressed the view that "the construction of the pitch itself seems to be probably the greatest concern", and in this regard he further reported that as the result of his profile pit surveys he had uncovered what he considered to be considerable inconsistencies within the profile with, inter alia, a gravel layer ranging from 45 to 100mm, the pure sand layer ranging from 75 to 125mm, and the sand mesh layer from 130 to 205mm. He also stated that notwithstanding the design absence of a blinding layer of coarse sand there in fact appeared to be such a layer in some areas of up to 45mm in places, and that where there was no blinding layer there were signs of sand migration into the gravel layer.

157.Accordingly, Mr Tingley's conclusion to Mr Murray was that the absence of the blinding layer meant that the profile was likely to remain too moist because of the migration of the sand into the underlying gravel layer, and that for this reason the pitch was unlikely to perform to the required standard due to the fact that the rootzone would not dry out and allow the necessary development of roots, which was the paramount concern when growing turf on sand rootzones. He also stated that in his view the only two consistencies within the entire profile were the original excavation and the top dressing, and that the lack of uniformity within the other areas of the root profile would only encourage varying turf growth. His opinion was that the only way to ensure having a pitch to the required standards would be to close the stadium in the summer and to reconstruct the pitch to include a blinding layer and to ensure strict quality control measures to achieve uniformity.

158.It is a matter of record that further profile pits were excavated in this pitch in 1998 and 2001; in this connection 9 profile pits were taken by the New Zealand Sports Turf Institute in late April 1998, after being commissioned by the Director of Urban Services to carry out an independent assessment of the pitch, and 28 profile pits were dug in 2001, after the Hong Kong Department of Justice approached the NZSRI to report on the design and construction of the pitch. The results of these excavations appear in Dr Gibbs' report. The thickness of the gravel layer in the 9 pits taken in 1998 varied between 50mm and 125mm. There had been sand migration in varying depths into the top of the gravel, one of the gravel rafts was not in working order and another was expected to function but was "far from ideal". Of the 28 pits taken in 2001, the depth of the gravel layer varied from 54mm to 103mm, whilst 24 were considered to be in reasonable working order and 4 were shown to have contaminated gravel and were working poorly. The clean working depth of the gravel in the 24 pits ranged from 28mm to 95mm, and for the 4 contaminated pits, the clean working depth of the gravel ranged from 0 to 34mm. Clearly, therefore, there was a demonstrable lack of uniformity in the thickness of the gravel raft, with some evidence of contamination.

159.In terms of the rootzone layer, the measured deviation was less substantial. Within Mr Tingley's 10 pits, the thickness of the rootzone layer in 9 varied between 255 and 295mm, with one pit where the depth of this layer was 235mm, less than the minimum acceptable 250mm. So far as the 9 pits dug in 1998 are concerned, the total thickness of the rootzone layer was between 300 and 430mm, with the thickness in the remaining 2 pits between 230 and 240mm. In terms of these latter measurements, there is clearly a need for caution, given what must have been a huge amount of top dressing which had been applied since construction. As to the 28 pits dug in 2001, which of course was well after Wembley had departed, the renovation works on the pitch performed by the USD in 1998 (which, on the evidence, had involved the removal of a considerable amount of Netlon mesh from the rootzone, together with the application of crushed limestone) must mean that measurement of rootzone depth after such renovation is of little probative significance - so far as the top layers at least are concerned, this was a very significantly changed pitch from that for which Wembley had had responsibility.

160.It seems clear, therefore, that its undoubtedly hurried construction had resulted in a pitch which, to put it at its lowest, was laid without the element of precision required when sports fields are built. In this regard I bear in mind the observations of HOK, the stadium architect which, as the history shows, took pains to distance itself from the design and construction of this pitch; in what turned out to be a prescient internal memorandum, dated 8 June 1993, and which addressed the "reluctance' of HOK to provide specifications for the pitch, the writer noted that HOK was conservative with unproved and/or unknown products and methodologies - reference was here made to Netlon and to an unknown proposed additive to the rootzone called "Biomix" - and observed :

"The playing field is a complex system which, to perform correctly, requires that all its parts are in top working order. To accommodate this, we have very tight controls on the testing and sizing of materials found in the root zone, skin and trench areas. Additionally, we have included considerable quality assurance measures during and after construction to monitor the entire playing field system ..."

161.If anything is apparent from the documentation available, it is that the desired element of quality control, whether in terms of labour or materials, does not seem to have been achieved during the construction of this pitch. The reported comment of Mr Oram of Wembley to the effect that, if this pitch had not been provided by the Jockey Club, there would be litigation with the contractors, strikes me as containing more than a grain of truth. Nor did Mr Eeds, the director of the Sports Facilities Group within HOK, appear to have been impressed with the overall standard of work on this project. In a letter of 13 April 1994 to M. Paoli of Dragages, which seems to have been part of an ongoing dialogue as to defects, Mr Eeds wrote :

"As stated, this is a prestigious project and it is somewhat complete, but as to the successful part I must take exception. In fact, this project exhibits a very marginal standard of workmanship. It is HOK's position that had sufficient control, supervision and coordination of direct works and the various subcontractors been effected by Dragages, the standard of workmanship would have been substantially more satisfactory and defects/outstanding works significantly reduced. It is very apparent that commercial aspects have been allowed to hold sway over quality."

Possibly this letter may be characterized as part of the usual post-project 'argy bargy' which frequently occurs in major construction jobs. Nor, to be fair, is it clear that Mr Eeds necessarily has the work on the pitch specifically in mind, and of course he was not available to be asked. Nevertheless the sentiments expressed in this letter are at the least consistent with the other known circumstances surrounding the pitch construction.

162.I return, therefore, to the respective views of the two experts, Professor Adams and Dr Gibbs, and in particular to that to which earlier I have referred as the 'kernel' of the difference between them, namely that Dr Adams is prepared to essay a view that the design and construction of this pitch did contribute to the subsequent problems of the performance of the pitch although, as he fairly pointed out, once a pitch is constructed it is absolutely impossible to know, as a matter of hard empirical evidence, without digging the whole thing up whereas the broad stance of Dr Gibbs is that, even taking into account the unusual design and the obvious inconsistencies which occurred when the pitch was laid, as a scientist he does not find any hard evidence that these matters in fact contributed to the behaviour of this pitch.

163.It may be that on this occasion that the lawyer's focus on probability, and the scientist's desire for precision, do not happily coincide; perhaps it is fortunate that scientific 'proof' is not the currency with which the law has to deal. I have reflected at length on the evidence of Professor Adams and Dr Gibbs. I have weighed the design of this pitch, with the insertion of the 75mm gravel layer almost as an afterthought in response to the difficulty of sourcing the correct specification of sand, and the manner in which the pitch evidently was constructed. I have considered the agreement of the experts that in a pitch which functions as a suspended water table it is universally accepted that a 100mm gravel raft is necessary, if only to provide the essential safety margin to ensure that there is at the minimum a 'clean' 50mm gravel layer. I have borne in mind, also, Professor Adams' insistence as to the necessity of a 'blinding' layer of coarse sand, and Dr Gibbs firm opposing view that such a layer now is no longer considered necessary. In this regard I have concluded that whilst such a layer may no longer be essential, the significance of the absence of such a layer is increased by use of a gravel layer that is too shallow and non-uniformity in depth of root zone, a proposition which met the approval of Professor Adams and with which (I think) Dr Gibbs was minded to agree in principle certainly Dr Gibbs accepted that he had never had the experience of the omission of a blinding layer when at the same time the industry standard 100mm gravel layer had been reduced by 25%. I have further reflected upon the arguments as to the depth of the root zone, and the effect on maintenance and performance of the use of the Netlon mesh, together with the views expressed about the use of that product which is no longer used in sports pitches in the United Kingdom and which, as Dr Gibbs accepted, might well add to the difficulty of pitch management in terms of localized pitch replacement, levelling and topdressing.

164.At the end of the day, notwithstanding the marshalling of vast amounts of detail, the argument over precise specifications, sometimes down to the nearest 10mm, the significance (or insignificance) of non-compliance with other, established models, and the obvious problems encountered in the process of construction, it is neither possible nor productive to seek to resolve the present debate with anything resembling scientific precision, nor is it possible to seek to persuade the differing experts into a unified stance although in this regard I bear in mind that the manner in which questions are framed often goes some way towards determining the response, and I do not overlook the fact that one of the terms of reference posed to Dr Gibbs by those instructing him was whether the depth of the gravel layer was 'fatal' to pitch performance, a question he felt able to answer in the negative in the sense that grass would not be prevented (as indeed it was not) from growing on the surface : "I am saying I did not find evidence to say that there was any effect deep down on the top".

165.Nor, for that matter, does this court need to essay any concluded view about the precise cause, or causes, of the problems which dogged this pitch. That is not the issue before it. Such a definitive exercise now is almost certainly impossible, and the overwhelming probabilities are that numerous factors interacted - vide the large number of differing problems variously identified by experts since the outset - and combined to play their part at different times and in different ways in contributing to the difficulties as were encountered. Moreover this is not Wembley's case, which, at bottom, is that this particular design as it had evolved, taken together with the manner in which this pitch was constructed, combined to produce a pitch which was susceptible to recurrent problems which all reasonable efforts at care and maintenance could not consistently overcome.

166.As Professor Adams succinctly remarked, he was not saying that grass could not be grown on this pitch - on occasion palpably it was grown successfully, and to good effect, particularly when overseeded and when conditions were favourable - but that of which he was convinced, notwithstanding the inabilility scientifically to 'prove' it, was that the deficiencies of this pitch would have had an impact upon pitch quality in terms of wear tolerance, susceptibility to divoting and so forth. Professor Adams' emphatic view was that the importance of the absence of a 'blinding' layer was greatly increased by the use of a gravel layer that was too shallow and by the non-uniformity of the root zone. He stressed that profile unevenness posed substantial problems, noting that consistency of root zone depth in a suspended water table construction was very important, and that there was evidence that this was not achieved; his view was that the variation in rootzone evidenced by Dr Gibbs' data was a very big variation and "totally unsatisfactory", and he further stated that he would be "very concerned" by the idea of a third of the pitch having a shallower root zone than the optimum.

167.After some reflection I have accepted the opinion of Professor Adams, which on balance seems to me to be justified in all the circumstances. Thus I have favoured his view over that of Dr Gibbs, although on analysis I do not consider that ultimately there was a great deal between them. Accordingly, at the end of the argument, after taking into account all the evidence, both expert and factual, I have concluded upon a balance of probabilities that the broad issue which has been raised by Wembley regarding this pitch has been established. I so find.

168.It follows from this, therefore, that Wembley's skill in turf management is to be assessed against the background of the conclusion that this was a particularly difficult pitch to manage, and which had within it a number of inbuilt problems. It is also worth bearing in mind - and this is a matter which does not always appear to have been appreciated by the plaintiff - that it did not behove Wembley, as the incoming manager of this new pitch, to guarantee or otherwise to ensure the good performance of this pitch whatever its inherent problems or defects. As Mr Huggins SC observed, its duty was to maintain the pitch, not to transform it into something that it never was, and any implicit suggestion that Wembley had somehow undertaken, and was contractually obliged, to make a silk purse out of a sow's ear was untenable. I accept that submission. The obligation upon Wembley was to exercise the due care and skill of a turf manager of reasonable competence and expertise. Whether the plaintiff has established that Wembley failed to discharge the obligation which lay upon it is the issue to which I now turn.

The plaintiff's allegations : deficient 'cultural practices'

169.First, a question of definition. The term 'cultural practices', which seems to have originated from the evidence of Dr K.C. Chau, has been liberally used in this case as a form of umbrella term to denote modes of dealing with turf management problems, whether such be the appropriate use of irrigation, proper fertilization, the control of pests and so forth. In fact, it became a form of verbal shorthand which at various times covered a multitude of perceived management sins, although the particular matters of which complaint now is pursued have helpfully been summarized by Miss Li SC and her team in the plaintiff's closing written submissions.

170.From the plaintiff's standpoint the only witness speaking to this aspect of the case was Dr Chau. On the defendants' side Professor Adams responded to Dr Chau, whilst the three groundsmen involved, Messrs Tingley, Lyons and Frost had their factual say with regard to the criticisms which were put to them.

171.In this exercise the plaintiff did not confine itself to the condition of the pitch as it was in May 1998, and submitted that the pitch was in poor condition "during substantial periods between 1994 and mid-1998". The plaintiff argues that it is legitimate to draw an inference from the poor condition of the pitch at these times, and that Wembley "must have failed" to exercise proper skill care and attention in the maintenance of the pitch, in particular in respect of problems which "could easily have been addressed by proper cultural practices."

172.This does not strike me as representing a satisfactory approach, either as a matter of logic or intrinsic fairness, since the moving force within the proposition appears to be that since the pitch was bad at these times then ex hypothesi it was Wembley's fault. The highest that it can be put, it seems to me, is that the poor condition of the pitch serves to place an evidential burden upon Wembley to give an explanation of why the pitch was as it was at certain times. In no sense, however, is the plaintiff able to discharge its legal burden of proof as to the absence of due care and skill by reliance, without more, upon the fact of poor pitch conditions and inference sought to be drawn therefrom.

173.Demonstrably this is not a case wherein there is any room for the application of the maxim res ipsa loquitur. There is no absence of explanation by Wembley as to the condition of the pitch upon the dates complained of by the plaintiff, which in its final submissions has spotlighted several distinct periods, namely in 1994, in particular the period post-opening until mid-August of that year, the period October to December 1996, between June and September 1997, and thereafter in April 1998 until termination of Wembley's contract. I briefly comment upon each period in turn, before focusing upon the particular accusations which are levelled against Wembley in terms of its allegedly deficient management of this pitch.

(i) 1994

174.It is remarkable, in the circumstances as now revealed, that the first complaint which is made sounds to problems which were encountered with the pitch at the outset, that is, in 1994. Very soon after the handover of the pitch there was a relatively heavy mixed schedule of both sporting and non-sporting events (the latter necessitating the covering of parts of the pitch with Terraplas) during March and April 1994 to celebrate the stadium opening, and disconcertingly the pitch was being extensively damaged by long turf divots being ripped out of the surface in the course of football matches.

175.Why it should now be considered appropriate to lay this problem, which essentially was one of absence of proper root growth, at Wembley's door is unclear. This was an entirely new pitch, wherein the turf, some of which clearly was in poor, and quite possibly diseased condition, had been laid late and in a hurry, all matters which fell entirely outside Wembley's control. As Mr Tingley has noted, and as I accept, given that the Bermuda grass was laid late and in winter it was essentially in a dormant condition, and there had been little degree of root penetration. In fact, the papers demonstrate that, upon the specific instructions of Mr Halliday prior to the pitch handover, and in recognition of the delay in laying the pitch, it had been oversown with winter rye. This gave it an aesthetically pleasing appearance, although the oversown rye also possessed little root growth, so that when the pitch was mown, at Wembley's insistence, prior to handover (pushing the actual handover date back by one day to 3 March 1994), much of the rye failed to hold and was torn out and lost in the mowing process.

176.The Pitch Reports relating to the situation as at July 1994 clearly explain the position as it then existed, as do the other reports which came into existence, both from Wembley and from the visiting experts commissioned by the Jockey Club to inspect the pitch. Notwithstanding the input of the visiting experts during the summer of 1994, the condition of the pitch failed to improve, even though by then little activity was taking place upon it, so that in the circumstances it is not easy to discern any reasonable foundation for the plaintiff now to criticize Wembley for proposing reconstruction "less than 5 months after the handover". In light of Wembley's earlier expressions of view to the Jockey Club regarding this particular design, and the problems as now were being encountered, for Wembley to be pressing for the entire rebuilding of the pitch in light of the problems as then were occurring strikes me as entirely consistent.

177.Evidently the Urban Council agreed with this view, and a proposal so to reconstruct was embodied in a recommendation contained in an Urban Council Memorandum put up to Board of Governors. Thus, on Tuesday 20 September 1994 at 8:20 a.m. at a meeting of the Board of Governors, chaired by Dr Ronald Leung, it was unanimously agreed to recommend the 'entire rebuilding option', Option B, to the Standing Committee of the Whole Council for endorsement, the other option, Option A, a Gregori remedial proposal, being rejected; at 8:38 a.m. on the same day the Standing Committee in turn unanimously agreed to adopt this course.

178.The documents show that shortly thereafter, the Stewards of the Jockey Club met, on 26 September 1994 and "agreed in principle" to meet the entire cost of the rebuilding of the pitch and the drainage system at the new Hong Kong Stadium, subject to certain administrative conditions, principal among which was that the reconstruction fund would have to be reasonable and that the Jockey Club would not get involved in the supervision of the project, and that the Board of Governors and /or Wembley were to decide upon the type of pitch to be provided and to select and supervise a contractor to carry out the work.

179.We now know, of course, that such agreed rebuilding did not take place. A Memorandum dated 28 September 1994 was presented to the Board of Governors recounting the history to-date, and the Board was asked to decide the issue quickly in order to keep disruption of the stadium to a minimum. However in this Memorandum the Board was reminded of the HKFA's request for use of the stadium in late January and late February 1995 for important soccer matches, the need for the stadium for the Rugby Sevens tournament in late March 1995, the confirmed bookings for the remainder of 1994 which had to be honoured, and the fact that according to past experience the winter season in December 1994 to February 1995 was not conducive to turf growth. Instead this Memorandum recommended that interim turf be laid in late 1994 for use during January to April 1995 (Phase I of the proposed Action Plan) and that Phase II of the Action Plan, the laying of the permanent turf and the rebuilding of the drainage system, "if found to be necessary", should now be planned for implementation in April to July 1995, a course which was approved by the Board on the same day.

180.In the circumstances, therefore, the rebuilding nettle was not grasped. Notwithstanding the unanimous agreement as to such rebuilding, and the consequent agreement of the Jockey Club to financially underwrite this stated aim, as a matter of expediency the matter was deferred in order to accommodate the immediate operational requirements of the stadium. Phase II of the Action Plan never was implemented, not least because the greatly improved condition of the pitch in the period October 1994 to March 1995, with the satisfactory development of the overseeded rye grass, lessened the perceived impetus for any reconstruction. Although it does not greatly matter, in this regard I suspect that Mr Tingley may well be correct in his suggestion that the greatly improved condition of the pitch at this stage was "latched upon" by the Jockey Club and the Urban Council as a reason for not proceeding with a reconstruction, notwithstanding Wembley's view that, irrespective of its currently improved condition, there remained fundamental defects in this pitch.

181.Against this undisputed background, I am unable to comprehend why it should now be asserted that the condition of this pitch in 1994 is reflective of a lack of due care and skill on Wembley's part, and I reject as firmly as I may any case founded on this basis. At the time, no suggestion whatever was made to this effect; to the contrary, by accepting the USD recommendation to rebuild, the Board of Governors gave every appearance of being satisfied that the problems as were being encountered represented difficulties of a far more fundamental nature than inadequate care and maintenance. Indeed, that the problem was recognized as one requiring reconstruction was confirmed in the latter utterances of the Board in 1997. In my view the assertion that Wembley were responsible for the problems as were encountered in 1994 represents the nadir of the plaintiff's case.

(ii) 1996

182.The next assertion of lack of due care and skill falls in the period September to November 1996 ,when the plaintiff points to Wembley's own pitch reports for those three months as demonstrating that root growth continued weak, and the fact that the divot counts during matches had not decreased, although the pitch report for January 1997 recorded that the pitch was in acceptable condition after a period of renovation.

183.Once again it is difficult to discern a basis for any inferential finding such as this court is asked to make, and I decline to do so. I am not sure that this particular period has ever figured large in this case - it is the condition in 1998 that has attained the highest profile - and in fact the comment in evidence from Mr Frost was that Wembley's turf maintenance had been so successful up to 1997 that what was effectively a difficult profile construction had been turned into a very usable pitch during the season required by the main hirer, the HKFA, which basically was from September to late May. Mr Frost made the point, however, that with the installation of the 'Sub Air' system in the summer of 1996, and the coincident stolonisation of the pitch with Tifton 419 sprigs, that once again the pitch had had insufficient time to 'knit', a situation compounded by the ever-present problems; in any event, he said, all eyes at this stage were looking forward to the activities which would obviously be taking place at the stadium to celebrate the change of sovereignty, so that there was no question of any reconstruction taking place in 1996 or 1997.

(iii) 1997-1998

184.I come, therefore, to the 1997 to 1998 period. The plaintiff complains that between June and September 1997 the pitch had come under severe criticism both from players and press - the significant divoting problem manifested at very high profile events, including the HKFA Cup Final on 8 June 1997, in late March 1998 at the Rugby Sevens and in the Asian Cup in early April - and earlier I have referred to the critical correspondence with the Chief Executive from the respective governing bodies after these events. Looking at the matter in the round, it is clear that the negative publicity which surrounded the performance of these events produced, no doubt understandably in human terms, a ground swell of criticism regarding Wembley's ability to deal with this pitch, public criticism which ultimately was responsible for the summary action that was taken by the Urban Council in May 1998.

185.Since he was the groundsman in place at the time, Mr Frost was severely taxed in this trial about these issues. He clearly did not feel that the storm of criticism had been justified. He made the point that commencing in mid-April 1997 the pitch had been entirely returfed and covered with a sand top dressing, effectively thereby advancing the annual maintenance of the pitch from the normal June to August period, and that Wembley had emphasized that this programme was to be temporary only in an attempt to provide a reasonable surface for the events marking the handover of the territory, and certainly would not obviate the need for a subsequent complete reconstruction. He noted that the 'window' thus allowed for the returfing simply had been too short in order to allow the pitch to establish; he said that he had met the HKFA in March of that year in an attempt to persuade them not to hold the Cup Final at the stadium in June, but that they had declined his request - the anticipated attendance at the new stadium was over 20,000, and the alternative, Mongkok Stadium, was simply too small and would have produced insufficient revenue.

186.Mr Frost emphasized that 1997 was the wettest and darkest year on record in Hong Kong and that the weather, and the extensive use of the new pitch surface during the handover events (some of which involved coverage with Terraplas, thereby incurring turf recovery time) were the "deciding factors" for 1997, and thus he was consigned to a whole year of problems with the pitch. He said that for the first time since 1994 the large divoting problem had returned for the 1998 Sevens, which was unfortunate in that historically the pitch for that event for the previous three years had been when it had been in its best condition. He noted that the usual winter overseeding with rye during the latter part of 1997 had not been sufficient, since so much of the Bermuda had been lost during the handover events, so that there was little stability remaining within the pitch surface. His view was that had Wembley been given sufficient time to allow the returfing to bed down in mid-1997, and had there been a lesser degree of usage during the handover events, then the pitch would not have been in the state that undoubtedly it was in by May 1998.

187.I come shortly to the condition of the pitch in May 1998. However, I accept Mr Frost's evidence as to the factors that had combined to produce the poor surface for the 1998 Sevens and the Asian Confederation Cup. There can have been no groundsman or greenkeeper in Hong Kong, faced with the deluges of 1997 and the constantly overcast conditions and lack of sun, who would have had any success in tending Bermuda, let alone Bermuda which had been but recently laid and then had had to undergo a heavy programme of events coincident with the handover of sovereignty. As earlier noted, I was much impressed by the evidence of Dr Gibbs, with which Professor Adams agreed, as to the strikingly adverse effect of poor light conditions upon the growth of Bermuda grass. It seems to me, with respect, that if ever there was a climatic recipe for extreme turf problems - quite apart from the fact of heavy usage upon a recently-returfed pitch which since its inception had had more than its share of inherent difficulties - then the incessantly wet and gloomy conditions of the summer of 1997 undoubtedly fits the bill.

188.It follows from the foregoing, therefore, that I consider that the poor conditions in 1997 and 1998, as have been prayed in aid by the plaintiff, do not warrant the view now urged upon the court that it all must have been Wembley's fault and that, in effect, the thing speaks for itself. To adopt such an approach strikes me as unfair and unrealistic, not least in circumstances in which, as Mr Frost pointed out, by the beginning of 1998 it had seemed certain that the pitch, which Wembley admits by then was in a very poor state, was going to be entirely reconstructed in any event. Such a total reconstruction did not of course occur, given the impasse that subsequently arose in April 1998 between the Board of Governors and Wembley as to the conditions upon which such anticipated rebuilding was to proceed.

189.Against this background, therefore, it strikes me as unjustified now to heap criticism upon the pitch manager for an admittedly poor pitch as at the date of Wembley's termination in May 1998 when but a few weeks prior to that date there had been acceptance by the Board of Governors, and by the Urban Council, of the necessity fully to reconstruct after several years of what realistically can only be described as 'patching up and making do' in order to cater for the immediate and pressing demands for stadium usage.

190.Having thus placed the 'cultural practices' debate into factual context, I come now to the detailed case which is advanced in this regard. Such an examination necessarily brings into focus the evidence of Dr K.C. Chau, who was put forward as an expert witness on this element of the case on behalf of the plaintiff, with the interests of the defendant under this head being represented by Professor Adams. Somewhat surprisingly, given the breadth of his experience, Dr Gibbs was not retained to deal with, and did not speak to, this aspect of the case. In a sense, also, Dr Chau further acted as a witness of fact, in that he was able to speak to the physically poor condition of the pitch as he found it when, acting on the instructions of the Urban Council, he had made three visits to the stadium on dates in May 1998.

191.However, it was in the capacity of expert witness that I found difficulty with Dr Chau's evidence. I do not wish to be ungenerous, but I have to state that I had very considerable reservations about Dr Chau's expertise in the area of sports stadium turf management. He has no academic qualifications in this area, holding degrees in geography and geology, with a doctoral qualification in forestry, and the entirety of his experience of turf management relates to positions he held first at Clearwater Bay Golf Club, where he had joined the course staff with no prior experience, and latterly for a period of some 9 to 10 years at the Royal Hong Kong Golf Club, Fanling, where he was in charge of the golf courses at that establishment. The short point is that Dr Chau had had no experience with, and had never taken charge of a soccer pitch, or a playing surface within a multi-use stadium, and apart from one experimental golf tee which he said he had installed at Fanling, he had had no experience with Netlon either.

192.Notwithstanding his many admirable qualities, therefore, Dr Chau had never grown grass, nor had had experience of maintaining grass, upon anything that was analogous to this particular pitch at this particular stadium, a proposition which, to be fair, he was happy to accept. There was stark comparison between Dr Chau's experience on the one hand and, on the other, the directly relevant academic qualifications and immense practical expertise of Professor Adams, whose background in, and grasp of, building sports pitches and of maintaining turf is impressive. In addition, Dr Chau's apparent willingness to express views on matters that he felt he was not properly qualified to comment upon - for example, he initially opined that the gravel layer of 75mm was not too thin, but under cross-examination expressed reservations about his qualification to express such an opinion - did nothing to instill confidence in his evidence.

193.Expertise and experience aside, however, in my judgment the most intrusive difficulty with Dr Chau's evidence took the form of what appeared to be a manifest lack of objectivity and independent thought. It struck me with some force throughout the course of his evidence that Dr Chau had not understood that the dominant purpose of an expert witness is to educate, and not to seek to persuade. Once again, I do not wish to be in any way ungenerous or unkind. However the hard fact is that in a case of some dimension and complexity Dr Chau was called as an 'expert', for the first time in his career, to comment upon the maintenance and care of a multi-purpose stadium pitch - as to which he had no background experience - and without, as he told me at the conclusion of his evidence, ever having had the purpose of expert evidence explained to him. Absent such explanation it is perhaps unsurprising that he permitted himself to become an enthusiastic advocate for, and proponent of, his client's cause. I note in this context, also, that Dr Chau had not examined the design and construction of this particular pitch, and had little background knowledge thereof, and I remain at a loss to understand, in the absence of such background knowledge, how Dr Chau felt himself in a position to make the widespread hindsight criticisms that he was willing to advance as to Wembley's 'cultural practices', nor to comprehend how he was able simply to dismiss the argument that deficiencies in design and construction may well have caused or contributed to the very real problems which ensued with this pitch.

194.At this stage let me also dispose of a related matter. At one point there appeared to be an argument afoot - which seemed to emerge during Dr Chau's evidence - to the effect that it was in some way possible to 'extrapolate back' from the admittedly poor condition of the pitch in 1998, a condition Dr Chau insisted was due entirely to Wembley's deficiencies in care and management, in a bid to establish a like absence of care and skill in the earlier years for which complaint also was made by the plaintiff. To be fair Miss Li SC ultimately sought to sidestep this approach, and even Dr Chau appeared to recognize the inherent difficulties therein, but for the avoidance of doubt I reject any such argument as firmly as I may. The condition of the pitch in May 1998, which Wembley accepts was poor, represents no more than an historical snapshot, and in my view provides no probative evidence that its condition at that time was representative of its condition in previous years.

195.In terms, therefore, of evaluating the expert evidence as it dealt with the care and maintenance of this pitch (as opposed to the aspects of design and construction) I have no hesitation whatever in accepting the views proffered on the subject by Professor Adams. His opinion was that, having examined the criticisms raised, he had concluded that the defendants had implemented due care and skill in the management of the pitch. In his viva voce evidence I considered Professor Adams to be authoritative in his command of his subject, and nothing in his evidence supported the conclusion that in any particular aspect of the care and maintenance of this pitch that the plaintiff had demonstrated that Wembley had fallen below the requisite degree of care and skill to be expected of a professional turf manager in its position.

196.I turn now to the detailed criticisms ultimately made on behalf of the plaintiff during final submissions, wherein it was asserted that Wembley had failed to exercise proper skill, care and attention in the maintenance of the pitch "in at least" five distinct areas. I note that these distinct areas of complaint did not represent the totality of the complaints regarding care and maintenance as variously were advanced during this case, but I decline to deal with matters upon which the plaintiff does not finally seek to address the court. I take these particular complaints in the order in which they were mounted.

(a) Incorrect timing of overseeding of rye grass

197.It is said that having regard to Hong Kong's climate and the characteristics of Bermuda - which will become dormant when there is a period of about a week of temperatures in the region of 10-15 degrees Celsius - that overseeding with rye should be carried out late enough in the autumn to avoid excessive competition between the grasses. It is further said that no record has been adduced by Wembley to demonstrate that it had monitored the stadium soil or air temperature to enable determination of the best time for overseeding, although in the joint report of Professor Adams and Dr Chau it was agreed that the optimal time for overseeding should be between the third week of October and early December.

198.Following from this, it is said by Dr Chau in his written report that under Wembley's management, rye was overseeded on 27 September 1994, which "obviously" too early, on or between 1 and 29 March 1995, which was too late, on 2-3 April 1996, which again was obviously too late, and in May 1998, again too late, and that as a consequence there was excessive competition between the Bermuda and the rye, thereby inhibiting the healthy growth of the Bermuda, which in turn perpetuated the problem in the next growing season.

199.Aside from the fact that these matters were not put in detail to the particular groundsman who had been involved at these dates, and putting aside for a moment that part of the oral evidence of Dr Chau to the effect that in itself overseeding was wrong and unnecessary because in Hong Kong Bermuda "never" goes fully dormant - a proposition I continue to find surprising - and placing to one side also the fact that no effort is made specifically to relate the proposition thus advanced to the differing problems with the pitch as occurred following these particular dates, this effort to second guess, from a distance of some years, and in one instance of a decade, the times chosen to overseed by the stadium groundsman on the spot strikes me as prime an example of 'reaching' as I have ever encountered.

200.The unassailable and undisputed fact is that on this pitch a 'dual grass' system was employed, and had been employed at the outset, with overseeding as an inevitable practice. It was used from time to time by Wembley as a strategy to 'green up' and to improve the pitch, particularly with the problems which were experienced with the growth of the Bermuda. Issues of timing and rates of overseeding are matters of judgment to be determined according to the conditions prevailing at any given time and with regard to the anticipated usage; the professional groundsman assesses the conditions and does his best. Sometimes he gets it right, sometimes he gets it wrong, which is a risk assumed by groundsmen and greenkeepers throughout the world.

201.It is abundantly clear that, on occasion, there was a necessity to use rye grass outside the 'ideal' season in order to put the pitch into an acceptable state. In 1994, for example, the evidence is that Wembley originally had set aside the October-November period to overseed, but that Mr Halliday of the Jockey Club had required the overseeding to take place earlier, from the end of September. In this context Darren Lyons noted that the early 1995 stadium programme, including the Hong Kong Sevens in late March 1995, was accommodated on a pitch consisting almost entirely of pure rye grass, which in that instance was exceptionally successful and produced one of the best pitches the stadium had seen - and which, he said, turned out to be the reason why the Jockey Club, together with the USD, ultimately decided not to proceed with Phase II of the then existing action plan to reconstruct the pitch.

202.Professor Adams was in no doubt, given the underperformance of the Bermuda on this pitch, that Wembley had no choice but to use perennial rye to "nurse" the pitch into an acceptable presentational condition, which on occasion necessitated using rye outside the optimum period. He noted that the overseeding in September 1994 was but one example of this, and stated that the possibility of the Bermuda competing strongly with the rye at the time was of little relevance because if the Bermuda had been of good quality there would have been no reason to overseed in the first place.

203.Professor Adams further said in his evidence that overseeding in April 1996 should have had no ill effect, whilst overseeding in October and December 1996 was not excessive and that overseeding in May 1998 could be justified purely for the purpose of improving presentation in the short term. His evidence was that, unlike warm season Bermuda, there is no time of year in Hong Kong when the weather is too cool for perennial rye, and although he did observe, in his oral evidence, that there may have been occasions when overseeding could not be seen to have been the "wisest of decisions", nevertheless there were "key occasions" when there was simply no alternative : "they either overseeded and got a decent rye grass cover, or they did not have any grass there at all".

204.Having reviewed the available evidence, and taking into account the history of events, I have little difficulty in concluding that no case has been made out under this head.

(b) Failure to control the growth of algae

205.The issue here is the extent of the algae on the pitch in May 1998, shortly before Wembley's termination, when the evidence of Dr Chau, who inspected the pitch, was that the pitch had extensive algae cover, which in places had developed into a 'scum' which had begun to peel off.

206.In this instance the inquiry is limited to this date. There is no doubt that at this time, as the photographs indicate, and as Wembley accepts, that the pitch was in poor condition albeit, as earlier observed, it had been anticipated that it would be fully reconstructed in 1998 before negotiations between Wembley and the Board of Governors came to an acrimonious end. Mr Frost, the groundsman at the time, accepted that the algae at that stage had developed to an excessive degree, but he was in no doubt that because of the history, from July 1997 onwards, that this pitch effectively was on its last legs and required extensive and fundamental surgery. He commented that there was always algae on Hong Kong pitches, to a greater or lesser extent, and noted that the only way consistently to subdue algae was to have dense grass coverage, which of course was not present in May 1998, and which was one of the reasons for the planned reconstruction that so recently had been anticipated.

207.I accept this evidence, and note the further evidence that even after the USD had taken over in May 1998, and fundamentally had rebuilt the surface and root zone of the pitch, algae nevertheless had remained a consistent problem, a matter which is evident from Dr Chau's factual reports; indeed Dr Chau acknowledged that a widespread algae infestation in May 2001 had been contributed to by humidity, cloud cover and rainfall in September 2000, which in broad terms was precisely the type of problem encountered by Wembley, with an algae infestation in May 1998, following even more severe and adverse climatic conditions in the summer of 1997.

208.The short point, as Mr Frost commented, is that algae is always present on pitches in Hong Kong, and whilst it was particularly bad immediately prior to Wembley's cessation of management, as Wembley accepted, in the circumstances I do not accept the contention that in itself this was indicative of negligent care and maintenance.

(c) Weeds and pest infestations

209.The case here is that in May 1998 the pitch was extensively covered by weeds and that there was pest infestation, matters which were directly observed by Dr Chau in his visits to the stadium in that month. It is then but faintly said that "the available records during the period from 1994-1996 suggest that the frequency of spray against insects and fungal diseases was low".

210.What is the relevance of the latter observation, culled from one of Dr Chau's reports, I am unsure, although it strikes me as a sythesis of prejudicial comment allied with an effort to 'extrapolate back', a concept that earlier I have rejected. In any event, it is said that the "clear inference" that can be drawn from this situation is that Wembley failed to exercise due care and attention to the maintenance of the turf "at least in or about May 1998", which itself constituted a serious breach of Wembley's duties under the Management Agreement.

211.In my view this is nonsense. This particular pitch had quite evidently come to the end of its tether and was anticipated to be rebuilt at the end of a sequence of events, both climatic and in terms of usage, which had rendered its condition poor indeed. In fact, it was subsequently rebuilt, albeit not as completely as may have been expected. Professor Adams' comment on this allegation regarding weeds is that he believed the plaintiff was struggling to find something to criticize; not only was it anticipated that the pitch would be reconstructed, but in any event the weed infestation was behind the goal line in an area not played upon, and was irrelevant to the quality of the playing surface. When taxed in cross-examination about whether the presence of weeds was indicative of negligence, Dr Chau replied "Yes and No if you see what I mean".

212.I am unable to understand this response. This complaint, in the circumstances in which it is made, does not assist the plaintiff's case, and it is rejected if and in so far as it is seriously pursued as evidence of breach.

(d) Fertilization programme

213.The submission under this head, as finally made, appears to Dr Chau's analysis of the available records wherein he observes that during Wembley' management of the pitch "the dose rates were inconsistent and fluctuated significantly without apparent justification"; in particular the period from March 1994 to May 1995 is spotlighted for the excessive application of fertilizer, specifically nitrogen and potassium, and it is further said that the applications of nitrogen for the months of June, July and September 1996 were inadequate.

214.These matters emanate from Dr Chau's examination of fertilizer records, and it is unclear how it is said (or indeed if it is said) that such criticism (which was not developed to any degree in cross-examination) sounds in terms of what would have been the result if fertilizer had been applied as now it is suggested should have been the case, as opposed to that which actually occurred, save that now it is simply asserted that the magnitude of dose is too large/inconsistent for professional turf management. If this understanding be correct, neither is it clear what damage or vice is said thereby to have resulted.

215.The uncontradicted evidence is that Wembley's fertilizer programme, certainly during Mr Lyons' tenure, was based upon advice received by the various experts who had been procured by the Jockey Club to advise; for example, in late May 1994 Dr Beard had given Mr Lyons a programme, which had been followed, and that prior to that time Wembley had followed a fertilizer programme directed by the Jockey Club. I note also that Dr Chau additionally suggested that Mr Lyons had applied fertilizer at a rate of between four to ten times higher than had been recommended by Dr Beard, although this was not put to Mr Lyons.

216.Professor Adams' broad view was that for periods for which there were records he could not fault Wembley's fertilization practices : "the ratios were right, the frequency of application, the use of both slow-release, water soluble and foliar fees was amongst the mix ..." and whilst there were not full records available, he opined that in general "groundsmen do not suddenly change to being negligent from actually having a very good programme." Moreover, when taxed as to whether periods of poor pitch performance could be related to bad fertilization he stated that he was as confident as he could be that they were not.

217.I accept this view, and reject the allegation, but sparsely and sparingly developed, of poor or incorrect fertilization. This is an area in which, absent a dramatic and clear event, such as, for example, the loss of turf which can directly be linked to an obvious error in fertilization, such as where the ground is 'burned', I fail to see how hindsight commentary upon fertilization records can begin to establish negligent care and maintenance. The short point is that the groundsman on the spot has to make the call, and I fail to grasp how he can be said to be negligent on the basis of 'expert' opinion voiced almost a decade later and absent any attempt to relate the hindsight critique to conditions as they then prevailed.

218.I reject this allegation also in so far as it be relied upon by the plaintiff to make a case of serious breach.

(e) Irrigation

219.The case now put forward in the plaintiff's final written submission appears focused on Dr Chau's assertion in his report that the irrigation rate of 12-24mm on alternate days during the period from October 1995 to April 1996 was excessive. I have difficulty in taking this seriously. What Dr Chau may or may not think about an historical irrigation pattern from the vantage point of years later strikes me as less than persuasive, nor do I understand what it is said would have been the case if less water had been applied during this period. In fact, in this regard I have difficulty following Dr Chau's thinking on this subject at all, since at one stage in his cross-examination he stated expressly that Wembley had not been negligent in relation to irrigation, albeit he maintained that he would have used a different amount : "I would find out the right and suitable amount myself, given the years", only to revisit the issue, at his own request, on the following day to baldly assert, on his analysis of the records, that "part of the reason" for the adverse condition of the pitch was due to faulty irrigation.

220.I have paid little attention to this contradictory evidence. I note that in his evidence, which I have accepted, Professor Adams stated that he saw no signs, on all the available evidence, that Wembley had been negligent with regard to irrigation. He noted, for example, that the period of November 1995 to January 1996 was extremely dry, and accepted that additional irrigation may have been needed to prevent areas drying out if the pitch profile was not behaving as a suspended water table. The only possibly adverse observation by Professor Adams was that on the documents he had seen he wondered whether one of Wembley's groundsmen, Mr Wayland Lee (who could not be located, and whom had not been called) correctly understood data on soil moisture levels or the concept of measurement of the rate of evapotranspiration, and thus whether he was able to tailor irrigation to the optimum level. In the event this inquiry could not be pursued, and Mr Lee was not able to be asked about it, although in any event an observation in passing about apparently questionable methodology in measurement of evapotranspiration does not equate to negligent behaviour.

221.I note, also, that in his 1994 report Dr James Beard had referred to 'excessive irrigation', but had accompanied that comment with a recognition that it was probably difficult to avoid due to physical limitations in the irrigation system as then installed. This particular aspect represented another theme which permeated the evidence of the Wembley groundsmen. The thrust of this evidence was that, as initially installed, the pitch irrigation system, which was dogged by mechanical problems in the early days before being in part replaced, had consisted of sprinklers at regular intervals over the relevant area, and thus did not permit the irrigation of different parts of the pitch at different rates. Accordingly it was a case of 'all or nothing' in terms of water dispersion, which must have made life extremely difficult given the shading problems inherent within the design of the stadium. The evidence of Mr Lyons, which I accept, was that given the manner in which the pitch was behaving, aggressive irrigation nevertheless was required at certain times in order to achieve a semblance of stability to the surface of the pitch, an aspect that has not been attacked as representing an approach which would have fallen outside the ambit of the practice of a reasonable and competent turf manager operating in like circumstances.

222.I therefore reject any case based upon excessive irrigation.

223.It follows from the foregoing that in my judgment no case has been established by the plaintiff in terms of its allegation that in the care and maintenance of this stadium pitch that Wembley was in breach of its obligation to exercise due care and skill, or that it was in serious or persistent breach in that respect. I accept the submission made by Mr Huggins SC on behalf of the defendant that the plaintiff had failed to identify any action or course of action on the part of the manager which an expert was able seriously to say was an action or course of action which no turf manager of competence and expertise would have adopted in like circumstances, or that in the circumstances in maintaining this pitch that Wembley had acted outside the boundaries of that which any turf manager of competence and expertise would have done.

224.I say this after consideration of all the evidence, in particular the admittedly poor condition of the pitch as at the date of Wembley's termination, which has given me pause for thought. I find that this particular condition was the result of the combination of several factors to which earlier reference has been made, that is, the 'stop-gap' returfing and change in maintenance period in 1997, the intensity of usage, and the appalling climatic conditions during that summer, which severely hampered the development of the newly-sodded Bermuda. I bear in mind, also, the fact that it was considered inevitable, and indeed had been agreed, that following the FA Cup Final on 24 May 1998 that this pitch, which clearly was on its last legs, would be reconstructed. I accept the evidence of Mr Frost that by this time the pitch had effectively become "unmanageable," given the lack of Bermuda regeneration and the oversown rye grass dying out, which had exacerbated the other problems in terms of algae development and so forth.

225.As a matter of history, of course, the pitch was torn up by the USD very shortly after Wembley's departure, although the full reconstruction which earlier had been anticipated did not take place, the renovation works then undertaken focusing upon a substantial alteration to the rootzone of the pitch. From the evidence of Mr Choy and Mr Lee it is possible to piece together what actually was done, in general terms at least. The dead turf was removed, together with 50mm of sand - which clearly formed the residue of the frequent top-dressings which had been laid down - and cultivation performed down to 200 or 250mm (the figures given by Mr Choy and Mr Lee differ) and a significant amount of the Netlon was removed (a figure of about 100 large bags was given) although some of the mesh apparently was put permitted to remain in place. Mr Frost, who says that he watched what was occurring from a nearby vantage point overlooking the stadium, says that a dolomitic limestone mix was added to the rootzone content, and in fact the tender specifications for this renovation, which are available within the case papers, refer to the introduction of "powdered liming material high in calcium carbonate content" into the root zone to adjust the pH level, together with other pre-turfing fertilizer, before levelling the surface and laying thereon 9,620 sq metres of washed turf sods; apparently also, in terms of the specifications, the pitch was to be overseeded with Bermuda seed.

226.Accordingly the extent of the renovation is tolerably clear. Whilst not an entire reconstruction, this undoubtedly was an extensive procedure which significantly altered the existing pitch profile. In this connection Mr Frost noted, and I accept, that after these works the operation of the root zone would have been different from that with which Wembley had had to deal, and from his own observations the pitch now behaved more like a soil pitch than previously, so that if the problems with the pitch had been contributed to by inconsistent construction of the root zone or too shallow a sand layer, such changes in themselves would have altered the performance of these layers.

227.It is also significant that these 'post-Wembley' renovation works finished in mid-June 1998, and that the first time that the pitch thereafter was used was on 30 September 1998, a consolidation period which I note that even Dr Chau accepted was the first time since 1994 that the pitch had been accorded a reasonable 'establishment' period both in 1994 and in 1997, of course, the imminent usage demands of the stadium had precluded such an approach. I also bear in mind the evidence that when the USD took over the stadium the events usage dropped significantly, as both Mr Hill and Mr Frost pointed out; in the period March 1994 to March 1998, for example, the annual rate of events was 41 to 50, whereas for the succeeding four years, from April 1998 to end of March 2002 the number of events ranged from 24 to 32 per year.

228.At the outset of this case Miss Li SC made the submission to the effect that Wembley's complaints about this pitch, and the difficulty in managing it, could not be well-grounded because, since taking it over, the USD has had no such problems. This argument does not, on the face of the final submissions at least, appear to be persisted with, for the entirely justifiable reason, I imagine, that it is clear that the pitch as it exists post-1998 is not the same pitch as existed up to May 1998, due to the works performed on it, and also because of the difference in intensity of usage.

229.It is also worth bearing in mind that not all problems with this pitch have gone away. Some have continued to occur. There has, for example, been a persistent algae problem, which culminated in a critical infestation in May 2001, whilst Dr Chau accepted that the levels of available nitrogen in the pitch in September 1998 were very low, indicating low fertility, and it is clear that there continues to be dependence upon rye grass overseeding. In fact, Professor Adams notes that photographs taken in August 1999 show that grass cover was about 50% on the pitch, with small bare areas and the turf appearing weak and thin, whilst photographs taken in June 2000 show that the quality of the Bermuda was still poor with very sparse cover in some locations, which Adams stated again demonstrates the thin and weak growth of the Bermuda in the summer when the overseeded rye has died out. He also observed that core sections of the pitch collected on 26 July 2000 demonstrated the presence of sulphide which is produced in waterlogged soil, and is toxic to grass roots. Thus it seems not unfair to conclude that anaerobic conditions within this pitch do not appear to have occurred solely upon Wembley's watch.

230.At the end of the day the short point, it seems to me, is thus. This was (and I suspect remains) a difficult pitch to manage successfully. Whilst good conditions undoubtedly were achieved within certain periods, notably when the oversown rye was in its pomp, from the outset the Bermuda turf consistently demonstrated weakness to varying degrees of severity. It is not necessary for this court to reach a concluded view as to why this should be the case, and I do not seek to do so. Suffice to say that the weight of the evidence assembled before this court points to underlying problems in design and construction within a sand-based system, which when allied with adverse climatic conditions, in terms both of excessive rainfall and poor quality of light - the latter being exacerbated by the inbuilt 'shading' problem - served to create significant difficulties in maintenance, difficulties which in turn were enhanced by heavy usage demands within this multi-purpose stadium.

231.Against this backdrop the plaintiff has sought to establish that Wembley failed in its contractual duty to use all due care and skill. It is understandable that frustration arose when difficulties with this pitch continued to occur, and it is also unsurprising that in any given case a pitch manager (or greenkeeper) should be first in line for nomination as whipping boy; many turf managers have been shown the door because the end product consistently fell short of client expectations, and this, no doubt, is a hazard that comes with the job. It may well be that Wembley made mistakes at certain times in its care and maintenance of this pitch. Expertise does not connote infallibility. Absent the aid of a reliable crystal ball, no turf manager can be correct all the time, and the fact remains, as this case amply has demonstrated, that hindsight confers a level of critical certainty that is not the available to the manager, whom in the exercise his competence and expertise must make judgment calls as best he can according to the conditions as he encounters them at any given time. A professional does not always have to be right, but he has to be careful.

232.The only issue in this case is whether Wembley has been shown, on the evidence as placed before this court, to have acted with less than the requisite degree of professional care and competence for which it was engaged. In my judgment the plaintiff signally has failed to demonstrate that this was the case.

233.Pitch maintenance records

233.The issue of deficient records regarding the maintenance of the pitch is ancillary to consideration of the substantive allegations regarding Wembley's allegedly deficient maintenance. In this regard it is submitted that Wembley failed to keep proper records, which itself is said to constitute a serious or persistent breach of its contractual obligations under the Management Agreement.

234.The evidence is that on 1 May 1998 Wembley was requested, for the first time in the four years in which it had been in place as manager, to provide by 6 May information and data in respect of its maintenance of the pitch. Given that by this stage there had been agreement in principle to reconstruct the pitch in its entirety, it seems tolerably clear that this request, made on behalf of the Board of Governors, was made with a view to utilizing deficiencies in such records for the purpose of mounting the case to dismiss Wembley. Certainly the contemporaneous correspondence provides a clear flavour of this, wherein it is stated that failure to provide information within the time frames stipulated would be regarded as a breach of the Management Agreement, and indeed such has proved to be the case. Moreover the particular pitch to which such records related was, as we have seen, the subject of substantial renovation after Wembley's departure at the end of May 1998; accordingly it is not evident what is the causative significance of such absence of full records given that the pitch the USD thereafter was to maintain, from June 1998 onwards, was in substantial part different to that which Wembley had been charged with maintaining.

235.In addition, since this court has found, for the reasons earlier adumbrated, that Wembley has not been shown to have been in contractual breach in terms of the actual maintenance of the stadium pitch, it is not easy to appreciate why the absence of complete maintenance records should in itself be thought to achieve that which the evidence regarding the substantive issue of care and maintenance manifestly has failed to do.

236.The evidence is that pitch maintenance records had been kept from the start of Wembley's tenure, but that when this sudden and urgent request came for this information some of those records were missing and could not be located. In the event Wembley did provide, between 7-19 May 1998, such of the information requested as was readily available, but the most recent detailed records for the period November 1996 to April 1998, which had been kept by Mr Frost on a 'floppy' computer disk, apparently could not be retrieved, although Mr Frost, who demonstrably was not a computer expert, could not really explain why. Mr Frost was embarrassed by this situation, but I am not prepared to find that he was lying to the court in his version of what had transpired. It was in any event conceded, the lost records notwithstanding, that irrigation records had not been kept, and I accept the evidence that these would be of little use to anyone, because they do not provide an accurate picture of how much water is actually absorbed into the ground; in this connection Mr Lyons asserted that irrigation records do not tell a successor which parts of the pitch need water more than others, and Professor Adams clearly doubted the utility of such records, nor did he consider keeping such records to be the norm.

237.I further accept the evidence of Mr Hill that given the short and unreasonable time-frame, and the ongoing stadium events with which Wembley had had to cope at the time, that Wembley acted reasonably in supplying such records as it was able to do at such short notice. The fact remains, also, that upon summary termination of the Management Agreement, and ejection of Wembley from the stadium, that a large amount of documentation was immediately boxed-up without indexing or tabulation, as Mr Choy accepted, and he clearly did not know what had been thus provided at the time, and indeed whether there were any maintenance records therein.

238.At the end of the day I cannot and do not consider that the 'records issue' merits the degree of seriousness with which the plaintiff apparently wishes to invest the point. It is clear, and I so find, that this was a self-serving demand by or on behalf of the Board of Governors with the aim of providing a further reason to dismiss Wembley - looked at in the round the circumstantial evidence cannot be regarded otherwise - and whilst true it is that there are gaps on the records regarding the maintenance of the pitch, this is not an instance of no records having been kept at all. Accordingly I do not regard failure to provide all the pitch records at such short notice as constituting a "serious or persistent" contractual breach sufficient in itself to justify termination of the entire relationship.

239.On the principal basis propounded for justifying termination of the Management Agreement, the issue of the pitch, together with the ancillary matter of the pitch maintenance records, I find against the plaintiff and in favour of the defendants. I move finally to the remaining contention prayed in aid as a basis for Wembley's termination, the issue which throughout has been referred to as that of the 'non-contractual payments'.

Non-contractual payments

240.The plaintiff complains of certain payments made to the Hong Kong Rugby Football Union during the period of Wembley's management tenure. These were all payments made in relation to the annual Rugby Sevens tournament. Initially they were referred to somewhat loosely as 'kick backs', but it is important to note that this term is a misnomer in so far as it bears a connotation of dishonesty or underhand conduct. No allegation of dishonesty was levelled against Wembley, or any officer of Wembley, and it is undisputed that these payments were made by Wembley to the HKRFU in the course of Wembley's management of the stadium; all invoices underpinning such payments are available, and the expenditure was reflected within the stadium accounts, although it is acknowledged that in those accounts the specific sums in question were not accorded individual line treatment.

241.These payments fall into three broad categories : first, food and beverage commissions totalling HK$1,846,571 in relation to the five Sevens tournaments played between 1994 and 1998; second, an advertising signage payment in the sum of HK$285,000 in relation to the 1994 Sevens tournament; and third, the sum of HK$1,855,542 in what are described as 'equalising payments' made with reference to the 1997 Rugby Sevens World Cup. At issue here, therefore, is the total sum of HK$3,985,113.

242.It is said that in making these payments to the HKRFU during the 1994-1998 period that Wembley was in breach of Clause 19.1(a)(vi) of the Management Agreement, and that such breaches were serious and persistent, thus justifying termination. This clause reads :

"19.1 Providing that at all times it acts within the parameters from time to time laid down by the Board of Governors then :

(a) ... the Manager should have the duty to negotiate, execute (in its own name and not in the name of the Council) and perform all contracts including but not limited to ....

(vi) the hiring on booking of the Stadium or any part of it."

243.In fact, termination of Wembley on this basis was not relied upon at the date of termination, given that it is asserted that these breaches had not been discovered by the Urban Council by 26 May 1998, and thus this issue was not specified in the letters of that date. Nevertheless it is submitted that this fact does not preclude the plaintiff from now relying on these matters in this action on the basis of the doctrine of 'after-acquired' knowledge, that is, information obtained after the dismissal which, had it been known at the time, would have been additionally relied upon as a ground for termination : see Chitty on Contracts, 28th Ed., Vol 1, at para 25-013.

244.It is fair to say that throughout the trial, and until the stage of final submissions at least, that this point had remained very much in the shadow of the major dispute about the pitch. There was to be a sting in the tail, however, since this issue, and in particular the scope of permissible argument thereunder, was suddenly to produce controversy about the scope of the plaintiff's pleaded case.

245.It is a matter of some irony that after years of dispute between these parties, the pleadings having been subject to repeated amendment on both sides, the bases for termination having been repeatedly refined down to the final two, and the court having ordered that at trial both sides should formally open their respective cases before evidence was called - the better to ensure that the issues were fully identified and canvassed from the outset - that the conclusion of this case nevertheless should be beset with heated debate as to the proper ambit of the 'non-contractual payments' issue. It strikes me that this case would provide grist to the mill for the growing body of critics of the adversarial system.

246.In the event on the final two days of the trial the court heard argument de bene esse on the permitted ambit of this issue, reserving a decision to this final judgment. Shorn of detail, the point is short. The making of these undisputed payments by Wembley to the HKRFU spawned two separate lines of argument : first, whether these payments had been made on a contractual basis or whether they were merely gratuitous; and second, whether such payments, as and when made, were made without authority in that they were made without permission and fell outwith parameters laid down by the Board of Governors.

247.It is this latter argument that caused the difference of view between the parties. For the plaintiff Miss Li SC maintained that she was entitled to make this argument, which she said was identifiable on the pleadings, and that she had put questions going to the issue of lack of authority to the witnesses called on this issue on behalf of the defendant. She expressly declined to apply to amend, and stood firm upon the terms of her existing pleading.

248.For the defendants Mr Huggins SC strongly demurred; he was granted the right of reply on the point when it became clear that now it was sought to run an argument as to Wembley's lack of authority to make these payments. His address on the issue was extensive. In summary he submitted that this 'new point' on breach of authority required to be pleaded, that it was inconsistent with the existing pleading in relation to these payments, and that absent amendment it would be wrong for the court to permit the plaintiff now to mount this case. He stated that were there to have been any attempt to amend in these terms (which in the event there was not) Wembley would have been irremediably prejudiced, since it had not come to court to meet this particular case. His fall-back position was that in any event, on the evidence adduced, the plaintiff could not succeed on the point as to departure from parameters laid down by the Board of Governors.

249.The pleadings, in re-re-amended form, provide the obvious starting point. The plaintiff's pleaded case is in short form. Paragraphs 116-118 of the Statement of Claim rehearse the categories of payments as made, paragraph 119 asserts the absence of any provision within the 1994-1998 Rugby Sevens Agreements between Wembley and the HKRFU entitling the Union to such payments, and states that "in the premises, the 1st defendant should not have made such payments to the HKRFU". Paragraph 120 alleges breaches of sub-clause 4.2 of the Management Agreement (failure to manage the stadium in a responsible and attentive manner), sub-clause 5.8 (failure to use all due care and skill as an expert ... in the management of the stadium), and sub clause 19.1(a) (failure to execute and perform contracts for the hiring of the stadium). Paragraph 121 asserts that as the result, the plaintiff has suffered loss and damage in the sum of HK$3,985,113.00.

250.To this plea the re-re-amended Defence, at paragraphs 222-232, condescends to considerable detail regarding the circumstances of these payments. As to the food and beverage situation, the pre-1994 background is prayed in aid, wherein the Urban Council had made agreements with the HKRFU regarding stadium catering, resulting in the Urban Council receiving a commission upon the hirer's catering revenue, it being pleaded, pursuant to clause 19 of the Management Agreement, that Wembley was responsible for negotiating, executing and performing contracts for the hiring of the stadium; thereafter the negotiations between Wembley and the HKRFU are rehearsed, which negotiations resulted in various agreements having been reached - in 1994, for example, it had been agreed to compensate the HKRFU for the net loss of catering profits resulting from Wembley, rather than the Union, providing the catering for the 1994 Sevens event, which sum had been calculated by reference to the net revenue (taking into account commission previously paid by the Union to the Urban Council) received by the HKRFU from catering concessionaires for the 1993 Rugby Sevens event. Similar agreements are pleaded in like detail for successive years in terms of food and beverage commissions, including that for the 1997 Rugby World Cup.

251.As to the advertising signage payment, for 1994 alone, clause 12 of the Agreement for the Hire of the Stadium is prayed in aid, in particular that pursuant to clause 12.4 that Wembley was obliged to provide a 'clean bowl', and that in consideration of being permitted to retain certain existing advertising signage Wembley paid to the Union the sum of HK$285,000. With regard to the 1997 World Cup expenditures, the Defence pleads the agreements entered into with the HKRFU, which in this instance acted on behalf of the Rugby World Cup; in this connection it is asserted that consequent upon such agreement, and the staging of the 1997 World Cup Sevens, substantial benefits were secured for the stadium.

252.Whilst it is admitted that there is no clause in the 1994-1997 hiring agreements between Wembley and the HKRFU, nevertheless it is asserted (at paragraph 230) that the Union was entitled to claim such conditions and payments by reason of the agreements entered into with the HKRFU by Wembley, and that in the premises it is denied that such payments ought not to have been made. It is further pleaded that in entering into these agreements with the HKRFU, and in securing the benefits consequent thereon, that Wembley was acting pursuant to its obligations under clause 2.2 of the Management Agreement to use its best efforts, within any necessary constraints arising under the relevant Operating Plan, to manage the stadium in order to fulfil the Urban Council's objectives and policies with regard to the stadium. Accordingly, the plaintiff's pleaded allegations of contractual breach and of loss and damage are denied.

253.In response to this extensive pleading, the Re-Amended Reply is brief. Paragraph 145 (a) does not admit the existence of the agreements pleaded by Wembley to have been entered with the HKRFU, and puts Wembley to strict proof thereof. In addition, subparagraph 145(b) pleads that "the 1st defendant has never informed or consulted the Board of Governors in respect of the alleged agreements and the Board of Governors has never consented to the same."

254.In the context of the instant argument I apprehend that it is this latter averment which has caused the difficulty. It is no more than an 'hanging averment', if I may use that term. No pleaded reason is advanced as to why there is or was a necessity so to consult the Board, or to obtain its consent, and no consequence is stated to follow in the event of any such absence of consent. However it is this averment which is used by Miss Li to justify the argument she wished to mount as to Wembley's absence of authority in making these payments and that in so doing Wembley had exceeded parameters laid down by the Board.

255.Mr Huggins says that the defendants have approached this case, and have prepared their evidence, on the basis of the pleadings as they stand, and that on the face of the Statement of Claim it appeared that the case being advanced was that the payments to the HKRFU should not have been made because they were non-contractual, that is, that these were payments made gratuitously without there being any enforceable agreement so to do, or possibly (and alternatively) because these agreements were oral rather than written, although in this instance there obviously was no requirement, within clause 19 of the Management Agreement, that the agreements negotiated by Wembley necessarily should be written. He noted, further, that the only breaches specifically alleged in making these payments were breaches of clauses 4.2, 5.5 and 19(1)(a) of the Management Agreement - the latter being an alleged failure to execute and perform contracts for the hiring of the stadium and that there was not a whisper of breach of any 'parameters' laid down by the Board of Governors, which omission was the more significant given that the carriage to clause 19(1) of the Management Agreement referred to the necessity to act at all times within such parameters.

256.It was clear, also, he said, that the defence to the plaintiff's case on these payments had addressed no case of want of authority (which had never been raised) but simply had responded to the pleaded case that Wembley had not made these payments under any contractual obligation so to do. It followed, submitted Mr Huggins, that Wembley was now taken by surprise, and that if this argument were now to be allowed it would be grossly unfair and Wembley would be hopelessly prejudiced. In fact, he said, if there had been an amendment to plead that which it was now wished to put forward as to lack of authority there would have been strenuous objection. His clients would have had to reconsider the scope of their evidence for this trial in terms of calling further witnesses, for example Sir Brian Wolfson and Robin Oram, former senior executives of Wembley, on the issue of alleged limitation of authority and the alleged parameters, and possibly would have sought in addition to call audit evidence upon the issue of knowledge, actual or constructive, of these payments. Indeed, had it been appreciated that this line was being taken, he said, Mr Murray would have been re-examined as to his consultations with the Board; as it was, questions which had been asked of this witness in cross-examination simply had been left alone, because they were not perceived as going to any pleaded issue.

257.I viewed this development as highly unfortunate, coming as it did at the end of a complex and hard-fought case, and I have reflected on the cases as they appear on the pleadings, and upon the arguments on the point which were advanced on both sides. I have considered, also, the manner in which this case was opened, both in writing and orally, on behalf of the plaintiff, wherein the point does not appear to be mentioned; in fact, during the opening I have been able to locate no specific reference to want of authority in terms of these payments, and no reference to breach of the 'parameters' referred to in the carriage to clause 19(1). On the other hand the defendant's opening clearly proceeded upon the basis that the case to be met in this regard was as to the contractual, as against the gratuitous, nature of these payments, and it seems clear that as far as the defendants were concerned there had been no direction from the Board of Governors preventing Wembley from negotiating the commercial arrangements that indeed were entered into with the HKRFU and had resulted in the payments at issue. Nor for that matter do the plaintiff's written closing submissions make reference to want of authority due to departure from 'parameters' laid down - the manner in which it is put is that prior to the 1994 Sevens the Board of Governors "had to establish their policies which would govern contracts which Wembley made with hirers of the stadium ...", and there is thereafter a detailed summation of evidence assembled with a view to demonstrating Wembley's alleged flouting of these policies.

258.On this issue, I have concluded that the defendant's objections are well-founded, and that, absent amendment, the plaintiff is not to be permitted to advance the argument as to want of authority. In my view the prejudice which would accrue to Wembley by permitting the argument now sought to be made is patent, given that Wembley has been deprived of the opportunity of considering, and specifically preparing for, a case on this basis. The matter can perhaps be tested thus : had an application been made at the outset by Miss Li to amend in terms of the argument that she wished to develop at the conclusion of this case, I do not consider that there is any possibility that, in face of objection, such an amendment would have been permitted without necessitating an adjournment, with consequential costs implications. I am not, of course, aware of when this 'want of authority' point first acquired the profile that subsequently it has assumed - I suspect that the increasingly obvious difficulties thrown up in the course of the plaintiff's case regarding the pitch may have had something to do with it - but in any event it seems clear that Miss Li made the decision to stand on her existing pleading, and to finesse the present argument on that basis, because it must have been apparent that any late amendment in terms of the want of authority allegation would have been doomed to fail.

259.Even at this stage it is not clear what are, or were, the 'parameters' laid down by the Board of Governors to which reference has been made, a factor which appears to me to emphasize the necessity for a clearly pleaded issue. The court also had expressed concern during the hearing as to the manner in which the case on 'non-contractual payments' had emerged at all, in particular as to whether there existed client instructions on the point, not least because the Urban Council was dissolved in 1999. A minute of a legal conference which was produced did nothing to defray this concern, and looked at in the round it is hard to avoid the impression that this issue is merely one in a long list of issues developed in order to bolster the case for termination.

260.I am bound to say, in addition, that I have considerable reservations in this instance about the justification for invoking the doctrine of 'after acquired knowledge'. The only evidential basis appears to be the evidence of Mr Choy, the senior staff officer within the Urban Council during the final year of Wembley's tenure. In his witness statement he speaks of the 'discovery' - he does not say by whom, perhaps he means by himself - that these payments had not been included within the formal hire agreements between Wembley and the HKRFU. This is unsurprising because it is common ground that the arrangements made were not the subject of formal written agreement, and the fact remains that no-one from the Board of Governors has been called to assert ignorance of these payments. In my view it is highly improbable that the existence of the payments, of which much now is sought to be made, remained unknown to the Board until after Wembley's termination, not least because the invoices reflecting these payment to the HKRFU are all in existence, and were available for scrutiny by the Urban Council staff who had visited the stadium on a monthly basis during Wembley's tenure and whose duty was to oversee Wembley's accounts and accounting documentation. In my view, also, the overwhelming probability in the circumstances is that Dr Leung must have learned, at least in general terms, of the 'equalizing payments' made in connection with the Rugby Sevens World Cup, an event which not only produced high revenues but which proved a magnificent success for Hong Kong in the most important year in its history, and which it would have been a patent dereliction of duty to permit Hong Kong to lose.

261.These matters strike me as significant considerations, given that the 'after acquired knowledge' principle itself is subject to established exceptions, of which the most prominent are waiver and estoppel : see Chitty, op cit, at paragraph 25-013. Had the pleading clearly asserted Wembley's want of authority in making these payments - as I now have ruled should have been the case - it is highly likely that the crucial issue of knowledge, leading to the defences of waiver and estoppel, would have assumed an importance which did not exist when it appeared that the sole pleaded issue was whether these payments were non-contractual in the sense of being merely gratuitous. In the context of a case in which a large number of diverse allegations have been levelled at Wembley, it is axiomatic that the defendants should have had the opportunity fully to consider and to respond to all aspects of this allegation, had such been properly and squarely raised, instead of the issue being introduced, effectively by a side wind, in the manner which occurred.

262.The consequence of the court's ruling on this point is that the plaintiff's case on 'non-contractual payments' is considered solely on the basis of whether these payments could be classified as such, which remains the present pleaded position.

263.The provenance of, and the making of all the payments in question, were issues canvassed within the evidence of Mr Hill and Mr Murray of Wembley, together with Mr Peter Duncan and Mr David Roberts, the gentlemen who respectively held honorary and executive office within the HKRFU at the relevant times.

264.Mr Roberts, formerly Chief Executive Officer of the HKRFU and tournament manager for the Rugby Sevens from 1992 to 1999, gave evidence about the origin of the food and beverage commission payments, and the negotiations he conducted with Sir Brian Wolfson and Robin Oram of Wembley over the tendentious issue of whom should have control over the catering at the new stadium, and whom should receive the sales revenue. It was eventually agreed, he said, in return for Wembley retaining catering control and receiving catering revenue, that the HKRFU should be compensated for the profit, which previously had been their profit, which now had been lost by reason of Wembley taking over the catering operations, such compensation being based on the profit that the HKRFU had made from the 1993 Sevens event. Mr Roberts noted that he had no doubt that this agreement was legally binding, and that had Wembley reneged thereon, legal redress would have been considered. He further stated that had this concession not been made, serious consequences would have ensued, possibly even going so far as to refuse to hold the event in the new stadium, in that there was no reason why the HKRFU should simply have handed their valuable product, the growing Sevens tournament, to the new stadium manager without any form of compensation and to the obvious detriment of financial assistance towards the development of Hong Kong rugby. Mr Roberts said that the pattern thus established as to catering compensation payments was continued for subsequent Sevens events, with the amount being increased annually by 10% in line with the increase in beer and ticket prices at the stadium.

265.As to advertising signage, Mr Roberts said that as part of the negotiations for the 1994 Sevens, the HKRFU had been granted a "clean bowl" and the right to sell advertising space at the stadium. In fact, Wembley had sold some permanent advertising signage which they wished to remain on display during the 1994 Sevens, and it had been agreed with the HKRFU that a fee would be payable to permit this signage to remain on display, which fee was based on the revenue that the HKRFU would have received if it had been able to market this signage itself; this agreement, he said, represented a straightforward commercial arrangement between the parties.

266.The situation regarding the 1997 Rugby World Cup was a matter dealt with both by Mr Roberts and by Mr Duncan. Mr Roberts noted the high profile of the tournament within the rugby world, and the fact that it attracted huge media interest. Hong Kong, along with a number of other countries, had tendered for the right to hold the tournament in 1997, and in 1995 the Rugby World Cup Committee had advised that, subject to suitable terms being agreed, the World Cup would be held in Hong Kong. There were a number of matters to be negotiated, of which the most important was the demand by the World Cup Committee that the hire charge for the stadium had to be a flat fee rather than a percentage of various commercial components. This had caused significant difficulty, he said, because Wembley had advised that the standard policy for hiring the stadium was that the hirer pay 20% of ticket revenue. Negotiations ensued, and the commercial compromise arrived at was that the 20% fee would be set as per the hire agreement, but that ancillary compensation would be paid by Wembley to the Rugby World Cup Committee for the provision of various services, with the proviso that the net final amount paid by the World Cup Committee for staging the 1997 World Cup would be equal to the fee paid by the HKRFU for the 1996 Sevens, plus 10%. Mr Roberts said that the commercial agreement thus reached was an essential part of the agreement which was reached to hold the World Cup in Hong Kong in 1997, and that had Wembley not been prepared to compromise and enter into such an agreement, the World Cup would simply have gone to competing countries eager to host the event, such as Japan or Singapore. In fact, the services which were provided by the HKRFU and for which Wembley agreed to pay compensation included in particular the preparation of the stadium for the tournament, and the provision of merchandising clothing for stewards for that event.

267.For his part Mr Peter Duncan, the Chairman of the HKRFU at the relevant time and Chairman of the Rugby World Cup Steering Committee, gave evidence as to a meeting on 31 March 1996, the final day of that year's Sevens, in the boardroom of the Hong Kong Stadium which had been arranged so that Dr Ronald Leung, then Chairman of the Urban Council, could meet the directors of Rugby World Cup Limited with a view to resolving what Mr Duncan described as an "intractable issue" regarding the terms of stadium hire for the 1997 World Cup. By this stage there had been extensive negotiations between the HKRFU, Wembley and the Urban Council concerning the proposed holding of the event, and given the necessary lead time required, it was essential that consensus was reached with the Urban Council without delay as to such terms. Undoubtedly the main issue, said Mr Duncan, was that of the stadium hire fee, with the Urban Council being concerned that they were not seen to create a precedent by granting any concession to the standard hire charge of HK$150,000 per event day or 20% of gross ticket sales receipts, whichever was the greater. Mr Duncan stated that he had suggested a formula to break the deadlock, which allowed for the standard hire charge to remain in place, subject to compensatory payments to Rugby World Cup Limited of such an amount as to ensure that the Urban Council received the agreed fee; at this same meeting an alternative formula for a guaranteed sum of HK$5 million also was put forward.

268.It was Mr Duncan's evidence that Mr Leo Williams, a director of Rugby World Cup Limited, had shortly and forcefully stated that if the matter of the stadium hire fee could not be resolved to the satisfaction of the HKRFU, and thus RWCL, there was no doubt that the tournament would be moved to another Asian venue, probably Tokyo, and that the World Cup would not be coming to Hong Kong. The upshot, said Mr Duncan, was that it appeared that the issue of the stadium hire fee would be resolved quickly, and that the HKRFU had the personal support of Dr Leung in terms of either of the two fee proposals which had been put up at the meeting to break the deadlock, and that he was confident that the issue over the hire fee would be satisfactorily resolved (as proved to be the case) given Dr Leung's support. Mr Duncan said in cross-examination that it had never occurred to him that the 1997 payments were in the nature of 'kickbacks', or were in any way dishonest or underhand.

269.I accept the evidence of Mr Roberts and Mr Duncan.

270.As to the payments issue, both Mr Murray and Mr Hill, as former Wembley executives, gave detailed evidence. They were unchallenged in their assertions that they did not believe that the payments of which complaint now is made were made otherwise than in good faith, or were made in contravention of the Management Agreement. I accept their evidence also.

271.The complaint as to the 1997 World Cup payments strikes me as particularly egregious. Mr Murray gave evidence of Dr Ronald Leung's clear grasp of the fact that it was essential for the commercial success of the stadium that the Rugby Sevens World Cup be brought to Hong Kong; indeed he said that Dr Leung had not been alone in realizing the need for Wembley to secure the event since, after a Board of Governors meeting on 11 April 1996 (wherein the RWC proposal for a flat hiring charge for the event at the 1996 charge plus 10% had been rejected by the Board) he had been approached by one or two other Board members with regard to the importance of ensuring that the World Cup was to be held at the stadium. It was after this Board Meeting, Mr Murray said, that he had been telephoned by Dr Leung whilst he was travelling back to the stadium, and he had returned the call. In that ensuing conversation Dr Leung had stressed the importance of Wembley securing the event, and that Dr Leung had stated that Wembley should be 'creative' in its negotiations with the RWC, and that the clear thrust of the conversation was that Wembley should do all that was necessary to find some way of meeting the requirements of the RWC over the stadium hire charge without setting a precedent by stating other than a 20% hire charge in the contract - which was precisely the type of arrangement which was effected, and yet now was the subject of litigation. All the payments thus made, said Mr Murray - for stadium preparation costs, advertising of the USD logo, physiotherapy costs and stewards merchandising clothing - were payments accurately recorded within the stadium accounts against proper RWC/HKRFU invoices, and the agreement to pay for these services (as also was the case with the catering commissions and the advertising signage payment) could not in any sense be considered 'non-contractual'.

272.In the event Mr Murray's evidence about his dealings and conversation with Dr Leung was undisputed. As part of the plaintiff's preparation for this case Dr Leung had provided a witness statement which on its face contradicted the evidence of Mr Hill and Mr Murray as to the contractual arrangements reached for the 1997 World Cup; in particular it is recorded therein that the allegations made in Mr Murray's witness statement as to the telephone calls (to Mr Merritt and thereafter to Mr Murray) of 11 April 1997 were "totally fabricated and untrue", and that he had not been aware of any proposal to compensate RWCL "in other ways", as had been suggested. Regrettably, however, Dr Leung did not appear to give evidence, leading counsel for the plaintiff being placed in the unusual position of having to inform the court not only that those instructing her could not locate her witness, but that Dr Leung's personal solicitors did not know where he was either. Accordingly the court did not have the benefit of that which, at least on the face of the witness statement, was anticipated to be Dr Leung's strident rebuttal of Wembley's version of what had transpired. Nor, of course, did Mr Huggins get the opportunity to cross-examine Dr Leung, who was Chairman of the Board of Governors at the time of Wembley's termination, upon what I suspect would have been a wide range of other issues arising in this case.

273.I reject the plaintiff's case based on 'non-contractual' payments. These plainly were not gratuitous payments as asserted. The undisputed evidence is that they were agreed by Wembley with the HKRFU in each of the relevant years as a result of commercial negotiations between these two entities. The agreements leading to the payments complained of appear to have been commercially justifiable and to have been made in good faith in the best interests of the stadium, as Wembley was required so to do pursuant to its responsibility to negotiate, execute and perform contracts for hiring or booking the stadium. I discern no contractual obligation within the Management Agreement precluding such contractual arrangements, and for the reasons earlier given I have ruled that on the pleadings as they stand that no case now can be advanced as to absence of authority on the part of Wembley to make those payments.

Conclusion

274.This has not been attractive litigation. The case as mounted by Government sought to level every possible allegation which could be identified against the former manager of the stadium, hence the myriad of pleaded complaints reflecting a determined trawl through the documents by persons charged with finding reasons for termination. The background to, and motivation for, this case is not a matter of surmise. Mr Cheung, the Government's first witness, frankly stated that in early 1998, largely because of the poor condition of the pitch, "there was growing discontent within the Provisional Urban Council and among the public about the performance and competence of Wembley", and that despite that which he described as the "helpful and tolerant attitude" of the Urban Council, Wembley's performance was disappointing and showed no sign of improvement. Hence the Urban Services Department was asked by the Board of Governors to review Wembley's performance since 1994 in respect of their obligations under the Management Agreement. The extraordinary number and diversity of complaints raised represents the product of that review.

275.The manner in which this case has been conducted strikes me as ill-considered at best, and at worst little short of oppressive. A defendant with lesser resources may well have been forced to fold its tent and creep away. Government having chosen, somewhat unusually in that circumstances, to assume the role of plaintiff, and to seek declaratory relief justifying termination of the Management Agreement, each and every allegation thus asserted to justify such termination - no less than 23 heads of complaint appeared on the face of the pleading, of which, after final reamendment, 15 remained at the commencement of the trial - necessitated a considered and detailed response at what must have been huge cost to the defendants in terms both of legal fees and executive time. On the second morning of the trial independent counsel prevailed and resulted in the outstanding issues being reduced to two, of which in my view but one, the issue of the pitch, was worth powder and shot.

276.In my judgment the plaintiff's claim upon both remaining issues has failed, and the plaintiff thus has not established that there was an entitlement to terminate Wembley's management of the stadium. It follows from this, therefore, that the defendant must succeed in its counterclaim for damages for wrongful termination of the Management Agreement.

Agreement as to quantum

277.At the outset of this judgment I referred to an agreement having been reached between counsel on each side in relation to quantum, contingent in either instance upon determination of liability.

278.The court has been given a document which sets out the agreed quantum of damage upon the 1st defendant's counterclaim. In substance, three basic sums are agreed, as follows :

(a)	Incentive fee for the period 1 April 1997 - 31 March 1998	HK$1,483,732
(b)	Basic and Incentive fees for the period 1 April 1998 - 11 March 2004, less expenses	HK$20,049,442
(c)	Severance and other payments less set-off of funds remaining in the Stadium Operating Account and Provident Fund Scheme	HK$322,528.34

279.It has further been agreed that interest on these various sums is to run at the rate of 1% over prime for the relevant periods reflected by the sums so specified.

Order

280.The plaintiff's claim is dismissed.

281.There is to be judgment for the 1st defendant on the counterclaim in the sum of HK$21,855,702.34.

282.Absent agreement thereon, I will hear counsel on the issues of interest, calculated at the agreed rate upon the constituent elements of the award, as to costs, and also as to the form of the order.

283.I should be grateful if junior counsel thereafter would prepare a draft order for engrossment.

Representation:

Miss Gladys Li, SC leading Mr Anderson Chow and Sean H.J. Fang, instructed by the Department of Justice, for the Plaintiff

Mr Adrian Huggins, SC leading Mr Alexander Stock, instructed by Messrs Barlow Lyde & Gilbert, for the Defendants