The Bank of East Asia, Ltd v. Labour Building Ltd and Others

Read the full judgment text of CACV 138/2004 on BabelCite. This Court of Appeal judgment was delivered on 12 November 2004.

1. This is an appeal from a ruling of Deputy High Court Judge Muttrie given on 27 April this year whereby he struck out paragraphs 27 and 30 of the defence and counterclaim of the 1st and 2nd defendants on the basis that they had not provided further and better particulars despite orders to do so.

Case No.CACV 138/2004
Court
Court of Appeal
Date12 Nov 2004
Judge
Case Document
100%Judiciary

CACV138/2004

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 138 OF 2004

(ON APPEAL FROM HCMP NO. 769 OF 2002)

______________________

  IN THE MATTER OF Order 88 of the Rules of the High Court.
  and
  IN THE MATTER OF the property known as No. 11 Changsha Street, Kowloon (All those portion of Kowloon Inland Lot No. 7339).
  and
  IN THE MATTER OF a Debenture dated the 29th day of October 1999.
  and
  IN THE MATTER OF a Tenancy Agreement dated 20th October 2001 made between Labour Buildings Limited and China States Limited.
  and
  IN THE MATTER OF a Sub-Lease dated 16th November 2001 made between China States Limited and Hongkong International Fraternity Association of Heilongjiang Limited.
  and
  IN THE MATTER OF a Sub-Lease dated 22nd November 2001 made between China States Limited and Chance Land International Limited.
  and
  IN THE MATTER OF a Sub-Lease dated 19th November 2001 made between China States Limited and Yim Shui Fong.
  and
  IN THE MATTER OF a Sub-Lease dated 28th November 2001 made between China States Limited and Invest China Limited.
  and
  IN THE MATTER OF 2 Sub-Leases respectively dated 23rd January 2002 and 29th January 2002 made between China States Limited and World Honest Holdings Limited.
  and
  IN THE MATTER OF a Sub-Lease dated 29 January 2002 made between China States Limited and Daisy Decorative Tin (Hong Kong) Limited.
  and
  IN THE MATTER OF a Sub-Lease dated 29th January 2002 made between China States Limited and South Metal Construction.
  and
  IN THE MATTER OF a Sub-Lease dated 5 February 2002 made between China States Limited and Christian Cornerstone Church.
  and
  IN THE MATTER OF a Sub-Lease dated 9th February 2002 made between China States Limited and Maltese Music Art And Education Center.
  and
  IN THE MATTER OF a Sub-Lease dated 29th January 2002 made between China States Limited and Lau Shut Hon.
  and
  IN THE MATTER OF 2 Sub-Leases respectively dated 9th February 2002 and 21st February 2002 made between China States Limited and Cosmos Energy International (HK) Limited.
  and
  IN THE MATTER OF a Sub-Lease dated 28th February 2002 made between China States Limited and Idealtours Center Limited.
  and
  IN THE MATTER OF a Sub-Lease dated 27th February 2002 made between China States Limited and Golf (China) Limited.
  and
  IN THE MATTER OF a Sub-Lease dated 1st March 2002 made between China States Limited and Sasa Bridal Salon Company.

______________________

BETWEEN

  THE BANK OF EAST ASIA, LIMITED Plaintiff
  and  
  LABOUR BUILDING LIMITED 1st Defendant
  CHINA STATES LIMITED 2nd Defendant
  HONGKONG INTERNATIONAL
FRATERNITY ASSOCIATION OF
HEILONGJIANG LIMITED
3rd Defendant
  CHANCE LAND INTERNATIONAL LIMITED 4th Defendant
  YIM SHUI FONG 5th Defendant
  INVEST CHINA LIMITED 6th Defendant
  WORLD HONEST HOLDINGS LIMITED 7th Defendant
  DAISY DECORATIVE TIN (HONG KONG) LIMITED 8th Defendant
  SOUTH METAL CONSTRUCTION (a firm) 9th Defendant
  CHRISTIAN CORNERSTONE CHURCH 10th Defendant
  MALTESE MUSIC ART AND EDUCATION CENTER (a firm) 11th Defendant
  LAU SHUT HON 12th Defendant
  COSMOS ENERGY INTERNATIONAL (HK) LIMITED 13th Defendant
  IDEALTOURS CENTER LIMITED 14th Defendant
  GOLF (CHINA) LIMITED 15th Defendant
  SASA BRIDAL SALON COMPANY (a firm) 16th Defendant

_______________________

Before:  Hon Rogers VP and Le Pichon JA in Court

Date of Hearing:  12 November 2004

Date of Judgment:  12 November 2004

__________________

J U D G M E N T

__________________

 

Hon Rogers VP:

1.This is an appeal from a ruling of Deputy High Court Judge Muttrie given on 27 April this year whereby he struck out paragraphs 27 and 30 of the defence and counterclaim of the 1st and 2nd defendants on the basis that they had not provided further and better particulars despite orders to do so. 

2.   The material part of the pleading so far as this aspect is concerned is that in paragraphs 27 and 30 it has been pleaded that the plaintiff acted in concert with directors of the 1st defendant and those in control of people who were in control of the 1st defendant.  The particulars that were asked for were, “Whether the plaintiff is alleged to have acted in concert with the director of the 1st defendant and those in control of APH pursuant to any agreement with the said persons”.  

3.   The answer which was given was that the plaintiff was not entitled to those particulars.  At the hearing before the judge below - and we have been shown the transcript - it seems to be quite clear that what was argued was along the lines, “Well, it’s quite clear that there was an agreement, but we’re not going to give any particulars relating to it”.  Mr Tong SC, who appeared for the 1st and 2nd defendants in this court  but did not appear in the court below, has made it quite clear that the 1st and 2nd defendants are not relying on any agreement as such and he has very clearly stated that he considers that the words ‘in concert’ as they appear in paragraphs 27 and 30 of the pleadings and any allegation of deliberate agreement on the part of the plaintiff or their officers should come out.

4.   This, of course, is not the way the case was run in the court below, but these are interlocutory proceedings and the purpose of interlocutory proceedings is to prepare a case for trial and not to have interminable skirmishes about whether orders have been complied with or not complied with and whether unless orders should be made or not made and so on and so forth.  It seems to me that that is the end result which should be come to in this case.  

5.   The right approach of this court seems to be that the order of the judge below should remain to the extent that the paragraphs 27 and 30 should be struck out, but this court should make it clear and should make it part of its order that it should be without prejudice to an application to amend the defence and counterclaim to include allegations based on breach of fiduciary duties which are not based on a conspiracy or an act done in concert.  If this court makes that order, it seems to me that that suffices to get this case proceeding to trial in a proper manner.  That is the order that I would propose.

Hon Le Pichon JA:

6.I agree.

(Anthony Rogers) (Doreen Le Pichon)
Vice-President Justice of Appeal

Mr Robert Whitehead SC and Mr Steven Kwan, instructed by Messrs Wilkinson & Grist, for the Plaintiff/Respondent

Mr Ronny Tong SC, Mr Kenneth C K Chow and Mr Kenneth Lee, instructed by Messrs David W T Chan & Co. for the 1st and 2nd Defendants/Appellants