Sitec Electronics Ltd and Others v. Chan Kwok Keung t/a Chap Yau (Keung Kee) China HK Transport Co

DCCJ1456/2004

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 1456 OF 2004

BETWEEN

Coram:  Deputy District Judge Mimmie Chan in Chambers

Date of Hearing: 20 April 2006

Date of Delivery of Decision: 20 April 2006

Date of Handing down Reasons for Decision: 11 May 2006

D E C I S I O N

1.This is an appeal against the decision of Master T. Chan dismissing the Plaintiffs’ summons dated 14 September 2005 for an unless order that unless the Defendant provides further and better particulars of the Defendant’s second answer pursuant to the decision and order given by His Honour Judge Chow on 13 August 2005, as per the Plaintiffs’ request dated 14 September 2005, which I will refer to as the Third Request, paragraphs 18 and 24 of the Amended Defence be struck out.  This is, in effect, a re-hearing of the summons dated 14 September 2005.

2.The series of requests for particulars stem from the Amended Defence dated 30 May 2005.  Paragraph 18 thereof pleads: “It is an express and/or implied term of the said Agreement that compensation (if so proved) is limited to the price of each transportation.”  The “said Agreement” is defined in paragraph 17 of the Amended Defence as a written Chinese agreement entered into between the Defendant and the 3rd Plaintiff in or about April 2002.

3.Quite naturally and to be expected, the Plaintiffs requested, by their solicitors’ letter of 31 May 2004, particulars of the “express and/or implied term of the said Agreement”, requesting the Defendant to state with full particularity all facts and matters relied upon by the Defendant in support of the contention that there was an express and/or implied term of the Agreement that any compensation is limited to the price of each transportation.  The Plaintiffs’ solicitors also issued a summons for such particulars, returnable on 6 July 2005.

4.By way of answer the Defendant filed, on 30 June 2005, an Answer which states: “Where the said term or condition is implied it is implied from the true construction of the term and condition of the said Agreement (referred to in paragraph 17 of the Amended Defence) and/or from the nature of the agreement between the Defendant and the 3rd Plaintiff and/or by business efficacy and/or as a matter of law and/or from the fact that neither of the Plaintiffs had at any time notified, whether expressly or impliedly, the value of the goods to be transported or the value of seven cartons of the Cargo.”  The Plaintiffs were not satisfied with the Answer given.

5.On 6 July 2005, Master S.T. Poon ordered that the particulars sought by the Plaintiffs should be given, noting that the Answer was obviously inadequate but without stating why it was so.  Not clear as to what further particulars to give, and not receiving any clarification from the Plaintiffs’ solicitors, the Defendant failed to file any further particulars.  On 15 July 2005 the Plaintiffs applied for an order that unless the Defendant sufficiently answers the request of 31 May 2005, as ordered by Master Poon, paragraphs 18 and 24 of the Amended Defence be struck out.  They also appealed against the order of Master Poon. 

6.When the appeal was heard by his Honour Judge Chow on 13 August 2005, it was dismissed by Judge Chow who thought that Master Poon had reached the correct decision with regard to the inadequacy of the particulars furnished.  Judge Chow expressed his view as to the particulars which were lacking and which ought to have been furnished pursuant to the request of 31 May 2005.  These relate to further particularising the agreement between the Plaintiffs and the Defendant, and the nature of the alleged agreement, and to the material contents of the business efficacy relied upon by the Defendant.

7.The Defendant filed a second answer to the request pursuant to the decision and order of Judge Chow, and this was on 18 August 2005.  On 22 August 2005 the Plaintiffs made the Third Request for particulars of the second answer.  This request led to the ultimate issue of the summons on 14 September for an unless order.  The request sought particulars of whether the agreement for carriage of goods between the Defendant and the 3rd Plaintiff was in writing, if so, the date of the agreement, and if the agreement was not in writing, to state that the agreement was made  orally, identifying the parties who made the agreement and stating where and when the agreement was made.  The Third Request also sought the Defendant to identify the term of the agreement which entitles the Defendant to limit its liability and giving full particulars of how the term is incorporated into the agreement.

8.By letter dated 29 August 2005, the Defendant’s solicitors replied to the letter of 22 August, to say that the agreement for carriage of goods was in writing and made on or around 22 September 2002.  A copy of an undated Chinese agreement was shortly thereafter supplied by the Defendant’s solicitors under cover of their letter of 31 August 2005. 

9.As counsel for the Plaintiffs has pointed out, this is a different date to that of the agreement pleaded in paragraph 17 of the Amended Defence.  At the hearing before me, counsel for the Defendant confirmed that the date of 22 September 2002 is a mistake and that the date of the agreement should be April 2002.

10.Although the letter of 29 August 2005 supplied the answers to request A1 and request B4, the letter is not in the proper form required under Order 18 rule 12(7), as elaborated in paragraph 18/12/66 of the White Book.  The particulars should not be in the form of a letter and the date given in answer to request A2 is confirmed now to be inaccurate.  The letter of 29 August 2005 cannot form part of the proper pleadings.  Request A3 is not applicable as the Defendant has answered that the agreement was in writing.

11.In relation to request B4 of the Third Request, the plaintiffs asked the Defendant to identify the term of the agreement which allegedly entitles the Defendant to limit his liability.  In the letter of 29 August 2005 from the Defendant’s solicitors, they answered: “The Defendant avers that he is entitled to limit his liability by implied term(s) of the agreement”.  They then referred to the Answer to Request for Further and Better Particulars filed on 30 June 2005 and to Answer (b) of the second Answer dated 18 August 2005.

12.As for Request B5 and the giving of particulars of how the term is incorporated into the agreement between the 3rd plaintiff and the Defendant, the letter of 29 August 2005 pointed out that this was answered in the Answer filed on 30 June 2005 and answer (b) of the second Answer dated 18 August 2005.  Counsel for the Defendant confirmed at the hearing that all the facts to be relied upon by the Defendant to support the implication of the term have been set out in the two Answers. 

13.Whether or not these facts, as particularised by the Defendant, do support the argument at the end of the day that the term of limitation of liability is to be implied as a matter of law and has been incorporated into the contract between the 3rd Plaintiff and the Defendant is a matter for trial when it can be fully argued.  The summons issued on 14 September 2005 was issued under Order 18 rule 12 and not under Order 18 rule 19 for striking out the defence for disclosing no reasonable defence.  The issue for determination is whether the material particulars of the Defendant’s pleading in paragraph 18 of the Amended Defence have been furnished.  The Defendant has supplied the facts relied upon by the defence in the first and second Answers and in the letter of 29 August 2005.  Whether it can be argued to give rise to the implication and incorporation of the term remains for trial. 

14.The original Answer is not the best model or specimen of particulars furnished and that has given rise to subsequent requests.  If the Defendant has come right down, from day one, to clarifying that there is no express term relied upon, a lot of correspondence and costs might have been saved.  It was not until the letter of 29 August 2005 that the Defendant’s pleas become clear in my view, but the position was not greatly assisted by the style of the correspondence from the Plaintiffs’ solicitors. 

15.As the Defendant has yet to furnish the correct date in answer to Request A2, and as the other answers given in the letter of 29 August 2005 are not in the required form, I will order that the Defendant do file and serve, within 14 days from today, under the title of the action and in a proper form, further and better particulars in answer to the Request dated 14 September 2005. 

16.In answer to Request B5, the Defendant should state all the facts relied upon by the Defendant as to how the said term is allegedly incorporated into the agreement between the 3rd Plaintiff and the Defendant. 

17.I will order costs of the appeal, including the costs reserved at the last hearing, to the Plaintiffs with Certificate for Counsel.

Mr Colin Wright, instructed by Messrs Crump & Co., for the 1st, 2nd & 3rd Plaintiff

Miss Yanky Lam, instructed by Messrs Eddie Lee & Co., for the Defendant