Coronation Electronics Ltd. v. Tharoomals (Hong Kong) Ltd.

CACV000026A/1986

IN THE COURT OF APPEAL

BETWEEN

______

Coram: Cons, V.-P., Fuad, J.A. & Clough, J.

Date of Hearing: 18th July 1986

Date of Judgment: 18th July 1986

___________

JUDGMENT

___________

Fuad, J.A.:

1. This is an application for leave to appeal to Her Majesty in Council under the Order in Council which regulates appeals from this Court to Her Majesty in Council.

2. The background of the matter is fully set out in the separate judgments that we delivered on 22 May 1986 and I do not propose to review the background of the case again or to restate the order that we made.

3. It has been submitted to us on behalf of the Applicant that the order that was drawn up as a result of our judgment was a final order in terms of the Order in Council and gave the Applicant an appeal as a right to Her Majesty in Council.

4. Mr. Bokhary for the Applicant cited Haron bin Mohd. Zaid v. Central securities ⁽¹⁾ and drew our attention to the fact that their Lordships commended the approach of the Malaysian Courts in deciding whether an order was final or interlocutory. Sir William Douglas giving the advice of the Board said at page 27:

"Their Lordships are unable to find any error in this reasoning: on the contrary their Lordships feel entitled to say that the test is both sound and convenient. .......  Thus the effect of the practice adopted by the Federal Court in such cases is in line with the English practice as established by statute since 1925."

Earlier at page 25, Sir William Douglas quoted from the judgment of Lord Justice Fry in Salaman v. Warner ⁽²⁾ and also from the judgment of Lord Alverstone in Bozson v. Altrincham Urban District Council.⁽³⁾  These judgments formulated two different tests. It seems that the Malaysian Courts have consistently adopted the test formulated by Lord Alverstone whereas, as we know, the Court of Appeal in England followed Lord Justice Fry's test. There is a great deal of jurisprudence in Malaysia about the test to be applied which we do not have in Hong Kong because section 14 of the Supreme Court Ordinance gives a litigant an appeal, subject to certain exceptions, as of right to the Court of Appeal from every order of the High Court in any civil cause or matter. The right to appeal does not depend on whether the order is final or interlocutory.

5. Mr. Bokhary drew our attention to one instance in our Rules of Court where interlocutory orders are mentioned and that is 0.59, r.4(a) which governs the period within which the Notice of Appeal must be served under the preceding rule.

6. So far as this Court is concerned, we have consistently applied Lord Justice Fry's test over the years and I will merely cite one judgment which indicates this approach, given by this Court on 28 May 1985: Perak Pioneer Limited v. Bumiputra Malaysia Finance Limited and Others. ⁽⁴⁾

There I said:

"Whether an order is final or interlocutory has troubled the courts for many years, but I think that there can be no doubt that the appropriate test must now be regarded as settled both in England and in Hong Kong, so that we must have regard to the nature of the application and not the nature of the order made, as restated in White v. Brunton [1984] 1 Q.B. 570 which applied Salter Rex & Co. v. Ghosh [1971] 2 Q. B. 597. The test, therefore, is that an order must be regarded as interlocutory unless it is made on an application which will have the effect, whatever order is given on the application, that it would finally dispose of the controversy which divides the parties."

7. Mr. Bokhary has suggested to us that in the light of the opinion of their Lordships in Haron's case ^(l) we should look again at that test and consider whether it would not be right to regard an order refusing unconditional leave as a final order. In other words, that orders arising out of Order 14 proceedings should have a special test applied to them.

8. As I understand the opinion of Sir William Douglas in Haron's case ^(l) , he was not holding that the test adopted by the Court of Appeal in England and by this Court was wrong and should be re-considered. If that were so, then of course the decision would be binding on this Court. It seems to me that it would be quite wrong to apply a different test depending on the nature of the proceedings. It would, in my judgment, cause confusion and would be a departure from the consistent line that we have taken in the past.

9. I recognise that the decision in Haron's case ⁽¹⁾ is rather different because there their Lordships were considering the test applied in connection with proceedings that terminated in Malaysia and not proceedings of a kind that we have here which would go from us to their Lordships in the Privy Council. But I am bound to say that even applying Lord Alverstone's test, the order that we made appears to me to be an interlocutory order because it did not finally dispose of the rights of the parties. We have no statutory provision on the lines now re-enacted in section 18(2)(a) of the Supreme Court Act 1981 of the United Kingdom.

10. In my judgment, the order that we made was interlocutory according to the practice applied by this Court and that leave can only be given in the discretion of this Court if, in our opinion, the question involved is one which, by reason of its great general or public importance or otherwise, ought to be submitted to Her Majesty in Council.

11. The point that Mr. Bokhary sought to be raised before their Lordships has been formulated in this way:

"In the absence of bad faith and given that a court has concluded that a defendant should not be shut out from defending, is it permissible or right for the court, in setting aside a regular judgment obtained against him in his absence, to impose conditions which the court could not or would not impose after hearing an application for summary judgment on an inter partes basis and coming to the same conclusion, namely, that he should not be shut out from defending?"

12. I am quite unable to say that the matter intended to be referred satisfied the test in the relevant part of the Order in Council and, therefore, I would refuse the application.

Cons, V.-P.:

13. My Lord has drawn attention to the comments he made in Perak Pioneer Limited v. Bumiputra Malaysia Finance Limited and Others.⁽⁴⁾ I must confess that looking now at the judgment I then gave it is clear that I confused the circumstances in White v. Brunton⁽⁵⁾ with those in Bozson v. Altrincham Urban District Council.⁽³⁾ Nevertheless, I accept that my Lord there correctly set out the practice of this Court.

14. But even were we to apply in this instance what Sir John Donaldson in White v. Brunton ⁽⁵⁾ called the "order test", it seems to me that the order we made was not an order which finally disposed of the rights of the parties. That is more obvious if one looks at the situation, not from the Defendant's point of view, having failed to comply with the conditions imposed, but from what would be the Plaintiff's point of view if the conditions had been complied with. For myself, I cannot conceive that the nature of an order can be different when viewed from different sides or can be dependent upon what might happen subsequently.

15. Mr. Bokhary, if I understand his argument correctly, suggests that any order made as a result of an Order 14 application is, ipso facto, a final order regardless of what general test is normally applied. I do not see why that should be so. In any event, it seems to me that what we are concerned with is not a normal Order 14 order, i.e. an order granting judgment, but rather one setting aside a judgment already obtained. The confusion, perhaps, stems from a loose use of the words "leave to defend".

16. If it is then an interlocutory order, I would agree with my Lord that we should refuse leave. The argument of Mr. Bokhary seems to be based on the suggestion that in giving our judgment last time, we ruled that conditions imposed when setting aside a judgment should, as a general rule, be more onerous than those imposed when one is simply giving leave to defend. In my view, we laid down no such rule. It was merely emphasised that the two situations are not the same, and the fact that judgment has already been regularly obtained is a factor to be taken into account when conditions are considered. I do not find that any point of great general or public importance is involved.

Clough, J.:

17. I agree with both judgments and have nothing to add.

(1)    [1983] 1 A.C. 16

(2)    [1891] 1 Q.B. 734

(3)    [1903] 1 K.B. 547

(4)    Civil Appeal No. 62 of 1985

(5)    [1984] 1 Q.B. 570

Representation:

Kemal Bokhary, Q.C. & A.J. Hatton (M/S Y.K. Poon & Co.) for Defendant/Appellant.

Nigel Aiken (N/S Stevenson Wong & Co.) for Plaintiff/Respondent.