Tianjin Jinfu Expressway Co Ltd v. Lucky Money Ltd and Others

HCA447/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 447 OF 2006

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BETWEEN

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Before : Hon Waung J in Chambers

Date of Hearing : 17 July 2007

Date of Judgment : 17 July 2007

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J U D G M E N T

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1.This is an application by what I will call the intervener Kwong Ian (Hong Kong) Construction and Real Estate Development Company Limited (“Kwong”). Kwong has been given leave by Madam Justice Kwan to take part and to defend in this Order 14 summons by the plaintiff against the defendants for the recovery of debt.

2.Today’s application by Kwong is to be allowed to put in a 2^nd affidavit of Lao Yuan Han so as to exhibit principally a report done by an independent accountant.  

3.The Order 14 was taken out by the plaintiff against the three defendants for the recovery of some $170 million said to be advanced to these defendants.  Affidavits evidence were filed by the parties pursuant to this Order 14 and order for the filing of affidavits including the order that no further affidavit evidence to be filed without leave of the court after the reply affidavit of the plaintiff was also made.

4.The case has been set down for hearing before me on 30 July with three hours reserved.  The sequence of the affidavits that had come in pursuant to the Order was June 2006 (affidavit in support), August 2006 (affidavit in answer by the defendants or Kwong) and October 2006 (affidavit in reply by the plaintiff).  So it was some eight or nine months ago that the affidavit in reply was put in and this application now being heard before me where Kwong seeks the leave of the court to put in this additional affidavit to exhibit the report was only issued recently.  The application is opposed by the plaintiff and in the course of the hearing, it becomes clear why Kwong now wishes to rely on this report.

5.Discovery of this report was sought by the plaintiff from Kwong in correspondence as early as July 2006 and discovery was refused.  In the letter of refusal at page C529 it was expressly said that :“the discovery sought is not necessary either for disposing fairly of the cause or matter or for saving costs”.  The view obviously taken was that the report is totally not relevant although the report covered this very subject matter of the loan or rather one aspect of the report created for the purpose of seeking leave from Madam Justice Kwan was the question of the loan.  I think in reality it is plain to everyone today that Kwong has changed its mind, and that it has taken a different view and it now wishes to rely upon the report.

6.This last minute change of mind (although it might be said was not so last minute because it gave the report some time in May) is, I think, so that Kwong hopes to booster up its case by the contents of the report, in particular on chapter 6 which was read to me during the course of the hearing by Mr Ng for the defendants at paragraph 6.8.1 at page C057 under “Conclusion” of the report : 

“	To determine whether the Alleged RMB250m Loan is valid, the transaction should be properly supported by underlying documentation.  In the absence of sufficient supporting documents, one may raise a doubt as to the validity of the transaction.”

That, of course, is the opinion view of the independent accountant. 

7.What should the court do with this last minute application to rely on the report?  In my view, it seems to me that Mr Yu for the plaintiff is quite justified in taking strong objection to this application.  There are at least three grounds he has advanced why this should not be permitted.  First, relying upon Secretary of State for Trade and Industry v. Bairstow [2003] 1 BCLC 696, he says the opinion evidence in the report is not admissible.  Mr Ng has not sought to contradict that.  No contrary authority was cited to me nor did Mr Ng seek to advance any argument to the contrary. 

8.The reason why opinion view of another tribunal or court is not admissible is that it really does not help the court.  Primary facts are to be litigated and it is for the court to determine these primary facts.  The view of another tribunal only retain does not assist in achieving the purpose of fairly disposing of the cause.  I do not need to go into the law on this as the principle relied upon by Mr Yu is not opposed.  It seems to me that this objection may be a complete answer to the application. 

9.Secondly, Mr Yu relies also in support that in this case, a particular objection to the application is that Kwong did not even condescend to say what are the primary facts in chapter 6 that it relied upon and why Kwong therefore has made a mistake in not relying on the report and now wants to come back in with the report.  A general reliance on the Report is wholly unacceptable according to Mr Yu, and I agree.  I think it will not help me in the three hours that we have on 30 July to have that kind of diversion of our attention.  Our attention should be on the primary facts and not on the Report.

10.Thirdly, Mr Yu says, perhaps in echo to what I indicated earlier during the hearing that it is a question of discipline.  The discipline is that there is in existence an order of the court which says “no further affidavit without leave”.  A timetable for affidavits was set and we are supposed to follow the timetable.  Now, this is not even the case of someone making a mistake and therefore wanting to correct his mistake, and therefore wants to come in with new affidavit evidence.  This is a case of judgment that had been exercised by Kwong who says : we don’t want the report at all for the Order 14.  Now, may be a different team with Mr Ng has come on and says : we want to rely upon it.  How can a court allow this just because there is a change of a view and a change of team?  It seems to me that the order should be respected, and in doing this, I should take note that there are no special circumstances at all to justify the court in giving leave for a rejoinder.  Furthermore, having regard to the general nature of just a report that had been sought to be put in, it seems to me that it is wholly wrong to accede to the application.  I will be left at the hearing to attend to unnecessary or peripheral matters of the Report when I should be concentrating on the primary facts.  Further, it seems to me that it is much too late in the day for this application to come in. 

11.This is of course largely a case management exercise because I am the judge in charge of hearing the Order 14 application.  I therefore must decide what is the best way of dealing with this for the hearing which is to take place in less than two weeks’ time.  In my view, it is quite wrong for any leave to be given as sought by Kwong.  The application therefore must be refused with costs.  

Mr Benjamin Yu, SC and Mr Kenneth Chow, instructed by Messrs Ho & Ip, for the Plaintiff

Mr Peter Ng, SC, instructed by Messrs Gallant Y.T. Ho & Co., for the Defendants / Kwong