Read the full judgment text of CACV 000108/2004 on BabelCite. This Court of Appeal judgment was delivered on 25 January 2005 before Woo VP, Stone J.
Civil procedure – striking out – abuse of process – want of prosecution – inordinate and inexcusable delay – order 18 rule 19 RHC – commercial list action – expressway joint venture – escrow shares distributed under clause 6 of Escrow Agreement – indemnity chain through Century City and Shenyin Wanguo – Evercheer as vehicle plaintiff with NCHK Group as nominal plaintiff suing as trustee – whether delay alone constitutes abuse of process under Grovit v Doctor – whether wholesale disregard of rules with full awareness of consequences required – whether breach of court order or contumelious conduct necessary – whether change of tactical stance after failed speedy trial application amounts to abuse – whether non-expiry of limitation period is a factor of great or conclusive weight – whether size of claim relevant to inference of intention to continue – scope of abuse of process jurisdiction post-Birkett v James, Grovit v Doctor and Arbuthnot Latham – whether Grovit v Doctor line should be confined to exceptional cases amounting to an affront to the court – whether defendants' alternative remedy of summons for directions renders strike out application inappropriate – whether preparatory steps by incoming dominus litis negate inference of settled intention not to proceed – whether evidence of Century City's financial difficulties admissible as explanation for delay. The Court of Appeal held that the deputy judge erred in finding abuse of process: mere inordinate and inexcusable delay, absent breach of any court order and absent any warning to the plaintiffs, was insufficient to support an inference that the plaintiffs had no intention of bringing the action to trial. The plaintiffs' payment of $1 million security for costs, two changes of solicitors, and the genuine preparatory steps taken by Shenyin Wanguo from late 2001 to acquire Evercheer and obtain London counsel's advice demonstrated a continuing intention to prosecute the action. The change of tack from aggressive pursuit of a speedy trial to relative inaction was explained by changed commercial circumstances and the change of dominus litis and did not amount to abuse of process. The non-expiry of the limitation period was a matter of great weight militating against striking out, as the limitation statute confers a right that should not lightly be undermined. The Court further held that the Grovit v Doctor line of authority should be confined to cases of an exceptional nature where the conduct amounts to an affront to the court and its rules, and cautioned against its use as a ready alternative to the Birkett v James doctrine. The defendants' alternative remedy of taking out a summons for directions meant the strike out application was tactically opportunistic. Appeal allowed with costs to the plaintiffs here and below, with a certificate for two counsel.
Legal issues: Whether inordinate and inexcusable delay without more amounts to abuse of process warranting striking out · Whether the change of tack from seeking speedy trial to inaction constituted abuse of process · Weight of non-expiry of limitation period in deciding whether to strike out for abuse of process
Outcome: Appeal allowed; the order of Deputy Judge Poon striking out the plaintiffs' claim and dismissing the action for abuse of process was set aside.
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