Kai Hon Electroplate (Shenzhen) Co Ltd v. Marble Watch Manufacturing Ltd

DCCJ2192/1999

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 2192 OF 1999

BETWEEN

Coram: HH Judge Ng in Court

Date of Hearing: 12 June 2006

Date of Delivery of Decision: 12 June 2006

R U L I N G

1.Today is the first day of trial.  Miss Gwilt, for the defendant, informs the court that the defendant has filed a supplemental list of documents on 9 June 2006, i.e. one working day before the trial, and a hearsay notice for the documents therein.  Mr Sher, counsel for the plaintiff, initially objects to the late discovery.  Eventually, the differences are narrowed down to Items 17 and 18 of the defendant’s supplemental list of documents.  Given the lateness of the defendant’s further discovery, the defendant should have anticipated that the plaintiff may complain.  I have referred Miss Gwilt to the guidance by Deputy High Court Judge Lam, as he then was, in Hong Lok School and Another v Chau Sai Yiu and Another HCA17139/1999 and 19001/1999, unreported, 2 July 2003, that:

“it behoves a litigant giving discovery at the eleventh hour (as in the case of the plaintiffs here) to provide the court and the other side with full and accurate information at least as to the following to enable the court to exercise its discretion properly in dealing with possible objections from its opponents,

(a) the reasons why these documents were not disclosed earlier;

(b) the provenance and makers of these documents;

(c) the relevance of these documents to the issues before the court;

(d) the availability or non-availability of the makers to attend trial for cross-examination in case his opponents make an application under section 48 of the Evidence Ordinance.”

2.In that case, the counsel was unable to deal with the matters fully and the court directed the plaintiffs to produce an affidavit to account for the late discovery.  The need for an affidavit to account for the lateness was accepted in Guangzho Green-Enhan Bio-Engineering Co. Ltd. and Another v Green Power Health Products International Co. Ltd. and Others HCA4651/2002, HCA2802/2003 and HCMP74/2004, Lam J, unreported, 22 July 2004. 

3.No affidavit to account for the lateness of the application is presented by the defendant today.  Miss Gwilt says that although the defendant’s witness statements filed on 29 March 2006 refer to test reports done on 3 November 2004, it was only discovered last week that the test reports have not been included in the list of documents.  I am not persuaded that the defendant’s explanation is satisfactory.  It is the duty of the handling solicitor to ensure that his client’s case is properly prepared for trial, and careful consideration and attention should be given to the completion of the checklist, with counsel’s advice, if necessary, before the case is set down.

4.Here the checklist by the defendant’s solicitor, dated 25 November 2005, states that discovery has been completed.  As Lam J said, in paragraph 19 of Wong Siu Yeung v Chiu Kwong Wing & Others HCA5249 of 1999, unreported, 20 May 2005,

“the court should be able to rely on the diligent conduct of solicitors in the preparation of his client’s case for trial otherwise it will make a mockery of our case management system.”

5.Given my view on the explanation offered, there is no reason to incur further time and costs to reduce the reasons for the lateness in a supporting affirmation, but litigants should adhere to this good practice in future. 

6.Despite the lack of good explanation, whether the court should allow use of the further discovery is a balancing exercise and the court must exercise its discretion fairly in light of all the circumstances and the explanation given.  There is a need to strike a balance between the timetable laid down for making discovery which promotes the expeditious dispatch of litigation and the principle that the adjudication of claims on merits should not be denied as a result of procedural default unless the default causes prejudice to its opponent for which an award of costs cannot compensate.

7.Here, what the defendant proposes to adduce are two test reports by the Dongguan Institute of Metrology and Quality Supervision Testing. As first Miss Gwilt suggests they are not expert reports or evidence but merely tests.  It is apparent from the face of the reports that not only were tests done but the institution that conducted the tests gave opinion as to the quality of the test sample.  They plainly constitute expert opinion and reports. 

8.By the order of Her Honour Judge C.B. Chan, dated 19 July 2004, it was ordered that all expert evidence intended to be used at the trial be mutually exchanged and filed within 42 days.  Plainly, this has not been complied with. 

9.Miss Gwilt informs me that it is not intended to call the makers of the test reports, but there is no application by summons before me to seek leave under Order 38 rule 41 for directions that the civil hearsay procedures to apply to the expert reports.  Although I am persuaded there is no intention to hide the reports, it is plain the plaintiff will be prejudiced by the lateness of the discovery of the expert reports.  It will not have the opportunity to cross-examine on a matter which is entirely within the knowledge of the makers of the reports.  The disadvantage is compounded by the fact that none of the 40 test samples or particulars of the test standard, QB/T2268-1996, adopted by the testing institution will be placed before the court.  The plaintiff is unable to fairly consider the basis of the assertions of “不符合要求” or “不合格” in the reports.  Miss Gwilt also confirms the defendant does not seek any adjournment to have any of the above matters resolved. 

10.Mr Sher makes the point that given the testing was done in 2004, which is some seven years after the alleged complaint as to the quality of the products, there is grave doubt as to whether the products are the plaintiff’s.  The absence of the test samples gives rise to concern. 

11.Mr Sher makes the further point that the model number of the goods A888G and A888L had nothing to do with the plaintiff’s claim.  There is no merit in this argument for the purpose of this application, which is concerned with relevancy to the issues and not to the ultimate merits.  The defendant’s witness has explained in his witness statement why the numbers were adopted in respect of the goods, being the subject of the counterclaim.

12.Mr Sher also submits I have no jurisdiction to deal with the complaints and the test reports because the applicant and the manufacturer stated therein is a PRC entity unrelated to the present claim.  As it turns out, the name of the applicant and the manufacturer is the name of the defendant’s PRC factory.  It is accepted by both parties that the watch components were manufactured by the defendant’s PRC factory and, indeed, after electroplating by the plaintiff the goods were delivered back to the defendant’s PRC factory.  I see no substance in this argument for the purpose of this application.  However, that is not to say that I have formed any view on the ultimate merits.  The present application is only related to the question of relevancy to the issues.

13.Even so, I am not persuaded to grant leave under Order 38 rule 41 of the Rules of the District Court to allow the defendant to adduce the expert test reports by hearsay, bearing in mind that the prejudice to the plaintiff, as explained above, cannot be compensated by costs.

14.I also note there is no evidence or even submission before me that the plaintiff was ever invited to participate in the testing or invited to inspect any of the alleged defective goods kept by the defendant.

15.Looking at all the circumstances and considering both parties’ submissions, I am not prepared to allow the defendant to rely on Items 17 and 18 of the supplemental list of documents.

(Discussion on costs)

16.Costs of the application for late discovery be paid by the defendant to the plaintiff, to be taxed if not agreed, with certificate for counsel.  Trial time of one hour and 50 minutes is apportioned for this application for the assistance of the taxing master.

Representation:

Mr Sher Hon-piu, instructed by Messrs Y.L. Yeung & Co., for the Plaintiff

Ms Angela Gwilt, instructed by Messrs Huen & Partners, for the Defendant