Mak Siu Bo v. Yeung Wai Fan t/a Wai Hing Trading Co

DCCJ4057/2004

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 4057 OF 2004

______________________

BETWEEN

Coram: HH Judge Marlene Ng in Chambers (Open to the Public)

Date of Hearing: 4 December 2006

Date of Ruling: 4 December 2006

R U L I N G

1.Today is the first day of trial.  However, as evident from a memorandum of notification of an application for legal aid dated 1 December 2006, the defendant applied for legal aid just one and a half working days before the trial.  Pursuant to section 15 of the Legal Aid Ordinance, the present proceedings are automatically stayed.  However, despite the automatic stay, the plaintiff and its legal representatives attended the hearing today.  He is represented by his counsel, Mr Ng.  The defendant is absent.

2.In fact, the plaintiff, by its solicitors, has applied by letter to my clerk on 1 December 2006 to lift the automatic stay pursuant to section 15(7) of the Legal Aid Ordinance.  The said letter on its face was copied to the plaintiff, his counsel and the Director of Legal Aid.  It does not appear that such letter containing the application to lift the stay was copied to the defendant.  On the same day I raised requisition on the said application, namely, that the plaintiff should justify why the application was made ex parte by letter. 

3.On 2 December 2006 the plaintiff’s solicitors issued an inter partes summons for lifting the legal aid automatic stay and for abridgement of time for service of the summons.  The supporting affirmation of Mr Chan Kin-sang, a partner of the plaintiff’s solicitors, was filed on the same day.  At the hearing, Mr Ng has handed to me an affidavit of service which he confirms that the plaintiff’s solicitors will file today verifying that the summons and the supporting affirmation have been sent by ordinary post to the defendant’s Sheung Shui post box on 2 December 2006.

4.At the hearing before me today I have queried Mr Ng on the matter of service of the inter partes summons for lifting the automatic legal aid stay for it appears that it has not been served in time for the hearing returnable today.  As will be seen below, the defendant gave the Sheung Shui post box as his address for service.  No attempt has been made by the plaintiff to apply for disclosure by the defendant of a proper address for service or, failing that, to seek substituted service on the defendant’s usual or last known address.

5.In any event, service to a Sheung Shui post box will have to be by post.  According to the Practice Direction 19.2, delivery in the ordinary course of ordinary post under the relevant rules of court in the District Court shall be deemed, subject to proof to the contrary, to be effected on the second working day after posting.  Mr Ng has not adduced any proof to the contrary.  So even if the summons for lifting the legal aid automatic stay and the supporting affirmation were posted on 2 December 2006, which is a Saturday, and Sunday not being a working day, in the ordinary course the postal service will only be effected tomorrow.

6.After standing down the case to enable Mr Ng to consider the matter and to take instructions, Mr Ng decides to make the application to lift the automatic stay on an ex parte basis.

7.To understand the background of such application it is necessary to look into the history of the case. 

8.The Writ of Summons was issued on 6 August 2004.  The defendant defended the proceedings through solicitors.  On 11 April 2005 the defendant filed a Notice of Intention to Act in Person, giving an address in Tsuen Wan as his address for service.  He filed his witness statement on 21 October 2005 but did not attend an interlocutory hearing before a master in chamber on 26 October 2005.  He was again absent at the checklist review hearing on 20 December 2005.

9.On 13 February 2006, fresh solicitors filed a Notice to Act on behalf of the defendant in these proceedings.  At the pretrial review hearing on 14 February 2006, Master T. Chan set the case down for trial to be heard on 21 and 24 April 2006.  But on 18 April 2006, i.e., shortly before the trial, the defendant filed a Notice to Act in Person and gave the Sheung Shui post box  as his address for service.  He also applied for legal aid and a memorandum of notification of an application for legal aid was filed.

10.On 20 April 2006, Deputy Judge S.T. Poon directed that all proceedings be stayed and the trial be vacated and refixed to a date after 42 days.  On 22 May 2006, in the absence of the defendant, the trial was refixed by the listing clerk to today.  The court issued notice of trial to both parties.  On the face of the notice, it was addressed to the defendant’s Tsuen Wan address as well as the Sheung Shui post box.  No affidavit of service has been filed by the plaintiff in respect of service of notice of the trial hearing.

11.On 18 August 2006, by memorandum of notification that a party has been refused legal aid, the Director of Legal Aid informed the court that he had declined to grant legal aid to the defendant.

12.On 29 November 2006, the plaintiff filed a summons for leave to amend the Reply.  Such summons was served by ordinary post on 30 November 2006 to the Sheung Shui post box.  As explained above, the defendant applied for legal aid on 1 December 2006.

13.Mr Recorder Kwok, SC, in Bank of China (Hong Kong) Ltd v Fu Ming Kong Michael & Anor HCA 7769 of 2000 and HCMP3909 of 2000, unreported, 24 June 2005 stated that:

“The purpose of the statutory stay under section 15 of the Legal Aid Ordinance is to allow sufficient time:-

(a) for the Director to process an application for legal aid; and

(b) in the event of legal aid being granted, for the assigned lawyer(s) to effectively represent the assigned client, and, where appropriate, to apply for more time.

The statutory stay is an aid in, and not an obstacle to, the administration of justice ………”

14.The Court of Appeal in Lee Shiu Ming v Yeo Hiap Seng (Hong Kong) Limited CACV39/1993, unreported, 14 July 1993, set out the principles for the court’s guidance when considering whether to lift the legal aid automatic stay.  The guiding principle is to do what is fair and just between the parties.  Yuen J, as she then was, in Re Ip Lai Fan and Re Ip Lam On HCSD 10 and 11 of 2000, unreported, 3 November 2000, summarised Nazareth JA’s guidance in Lee Shiu Ming’s case as follows:

“ ……. the court should be slow to lift a stay before an application for legal aid is determined, especially if a point of law had to be dealt with by a layman.  However, if the court was satisfied that the application for legal aid was an abuse of process, then the court should exercise its discretion to lift the stay.”

15.The principles referred to above are no different from those referred to by Deputy High Court Judge Chan in Ma Pui Tung v Leung LitOn HCA4492 of 2003, unreported, 23 July 2004, a case cited by Mr Ng.  This is a case where both parties were present and the court had the opportunity to hear the plaintiff’s explanation on his delay in applying for legal aid.  Indeed, the learned judge accepted his explanation and refused to lift the stay. 

16.The first issue here is whether the application to lift the automatic stay should be allowed to proceed ex parte, service of the relevant summons not having been effected on the defendant as yet.  Mr Ng argues that the defendant’s application for legal aid on 1 December 2006 is an abuse of process and an attempt to frustrate the trial which had been adjourned once.  He submits that the defendant has been intermittently represented by two separate solicitors’ firms at different times; if the application for legal aid were a genuine attempt to seek legal assistance, such application should have been made a long time ago rather than a day or so before the adjourned trial. 

17.Mr Ng asks me to bear in mind that the defendant has adopted a similar tactic previously and the legal aid was refused on that occasion.  The defendant has not filed any further documents for the purposes of the trial.  The only outstanding matter, apart from the trial proper, is the hearing of the plaintiff’s summons referred to above that dealt with minor amendments to the Reply “which involved clarification over certain legal points”.  Mr Ng submits that there are no further documents or information relating to these proceedings (in short, no change of circumstances) to justify a further application for legal aid or further adjournment of the trial.  It is nothing more than a delaying tactic.

18.In my view, the result of the filing of a memorandum of notification that the defendant has applied for legal aid is a statutory stay of the proceedings unless otherwise ordered by the court (see section 15(4) of the Legal Aid Ordinance) and the prescribed period during which the proceedings are stayed is 42 days.  There is no need to have the trial dates formally vacated although the Director of Legal Aid took the courtesy of informing the court and the plaintiff’s solicitors of the defendant’s application for legal aid on 1 December 2006.

19.In my view, although Mr Ng was painted a suspicious picture by his submissions, I need to carefully remember that I have not had the opportunity of hearing the defendant’s explanations for the present application for legal aid at all.  I bear in mind that an application to lift the automatic stay is calculated to frustrate the object of section 15 of the Legal Aid Ordinance, the more so when Mr Ng is asking me to lift the stay and proceed directly with the hearing of the plaintiff’s summons to amend pleadings and with the trial in the absence of the defendant.

20.The issue at hand is to do what is just and fair between the parties.  In this respect I have to consider and compare the prejudice that will be suffered by either party if the stay were lifted in the exercise of my discretion.

21.Abuse of process is not a light inference to draw.  Although Mr Ng has fallen shy of acknowledging that on an ex parte application the cogency of the evidence should point to an irresistible inference, he accepts that the evidence must be compelling and the court must be satisfied that there is such abuse.  In my view, it is not possible to do so or, in other words, to come to the conclusion that the defendant is trying to abuse the process of the court by delaying the making of the second legal aid application without at least hearing from him or granting him the opportunity to explain the reasons for making the present application for legal aid.

22.Mr Ng submits that there are no new matters that will affect the exercise of my discretion.  It is true that the defendant has not filed any further witness statements or documents in these proceedings, but the whole purpose of a legal aid stay is to grant sufficient time for the Director of Legal Aid to process the application to see if legal aid and hence legal representation should be granted to deal with the proceedings, whether in relation to existing or new documents or witness statements or otherwise on behalf of the defendant.

23.I do not forget that the plaintiff has a summons newly issued shortly before the trial, i.e., two days before the defendant’s application for legal aid.  Whilst Mr Ng submits it relates to a simple amendment of pleadings, the amendment, as acknowledged by the plaintiff’s solicitor, Mr Chan, in his affirmation, essentially raises matters of law, namely, the legal basis of severing interest from principal and the impact of section 25(1) of the Money Lenders Ordinance.  I do not know whether the defendant’s present application for legal aid is prompted by the plaintiff’s last-minute summons or otherwise.  It is futile to descend into speculation, but in light of such background I am uneasy in coming to a conclusion that the defendant’s conduct in applying for legal aid on 1 December 2006 cannot have been anything but an abuse of process. 

24.I note also that although the plaintiff’s proposed amendment is in relation to his Reply, the reference to section 25(1) of the Money Lenders Ordinance is essentially an application by the plaintiff to re-open an extortionate transaction to do justice between the parties.  It is at the very least arguable that even if leave is granted to the plaintiff to amend the Reply, the defendant should have an opportunity to file further pleadings and/or make consequential amendments to existing pleadings to aver material facts to respond to such application.  It is therefore by no means certain that had the stay been lifted and the summons dealt with the trial will necessarily proceed today.

25.Mr Ng suggests that I can lift the legal aid automatic stay, proceed to deal with the plaintiff’s summons and the trial, leaving the defendant to apply to set aside the above hearings and consequential orders if so desired at a later date and for the court at that stage to consider the matters afresh if it considers appropriate.  However, there is no need for me to deal with this argument since I am not confident that I can safely deal with an application to lift the automatic stay on an ex parte basis.

26.There is no doubt from Mr Ng’s submissions that the plaintiff feels aggrieved and I have carefully considered all Mr. Ng’s arguments.  But I am afraid that the legal aid automatic stay has to remain in place until the plaintiff, if he so wishes, sees fit to restore the summons to lift the automatic stay on an inter partes basis.  This means that the trial will not proceed today.  However, given that this is the second adjournment of the trial, I order that there be a direction for a speedy trial and the trial should be refixed to the earliest possible date before a bilingual judge upon expiry or lifting of the stay.

[Discussion on whether the summons will be pursued on an inter partes basis]

27.So leave to the plaintiff to withdraw the plaintiff’s summons dated 2 December 2006 with no order as to costs.

[Discussion on refixing hearing dates]

28.The Plaintiff’s summons dated 29 November 2006 be adjourned for hearing to 10 a.m. on 19 January 2007 at Court 44 before a Master in Chambers (open to the public) and the trial of the present proceedings be re-fixed to 9:30 a.m. on 22 March 2007 at Court 16 before a bilingual District Judge in court with 23 March 2007 reserved (estimated length of trial is two days).

Mr Alan Ng, instructed by Messrs Kelvin Cheung & Co., for the Plaintiff

Defendant, in person, absent