Yuan Yin Industrial Works Ltd v. Wong Man Yiu Anthony and Another

DCCJ 2961 / 2007

 IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 2961 OF 2007

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BETWEEN

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Coram:    His Honour Judge Thomas Au in Chambers

Date of Hearing: 9 May 2008

Date of Handdown Judgment: 16   May 2008

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JUDGMENT

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I.   Introduction

1. The Defendants (“Wongs”) as vendors agreed to sell to the Plaintiff (“Yuan Yin”) as purchaser certain property under an agreement dated 30 April 2007 for the sum of $1,360.00.00.   Yuan Yin paid $136,000.00 as deposit under the agreement.  The transaction however did not complete, as Yuan Yin says the Wongs could not give and prove title to the property. 

2. This is the hearing of Yuan Yin’s application for summary judgment against the Wongs for the return of the deposit, $136,000.00.   Yuan Yin’s application is made under O. 14A and O.86^[1] of the Rules of District Court (Cap 336).

3. In essence, Yuan Yin says the Wongs had agreed under the First Schedule (“the First Schedule”) of the formal agreement to sell an interest in one undivided share of the subject matter building.   Wongs say they had not so agreed.   The issues between the parties are essentially:

(1)      Whether on the proper construction of the meaning of the First Schedule, it includes in the property to be sold an undivided share in the relevant building.

(2)      Alternatively, whether there should be rectification of the First Schedule by deleting the reference to the undivided share.

4. To understand how the dispute arises and the contentions raised by the parties, it is necessary for me to set out the relevant background facts as follows.

II.    Background

5. Unless otherwise stated, the following background facts are undisputed.

6. By way of the Crown Lease dated 10 May 1929, the Inland Lot No. 2794 was demised to the crown lessee Fok Lau for 99 years (i.e., up to the year 2028), with an option to renew for another 99 years.

7. The building (“the Building”) known as No. 163 Hennessy Road was subsequently erected on the Lot some time in 1981.  By then Jessie Tam, Eileen Barbara Yang and William Nixon Thomas Ching Tam (collectively “the First Lessors”) were the registered owners of the Lot.

8. A DMC dated 28 April 1981 was created for the Building.  Under the DMC, the Building was notionally divided into 50 equal and undivided parts or shares, which have been allocated to the units and parts of the Building as set out in the Third Schedule of the DMC. 

9. Apparently, unlike the usual way of selling outright the legal and beneficial interests in various units and parts of the Building, the First Lessors disposed of their interest in them by way of leases, reserving the reversionary interest unto them upon the expiry of the leases. 

10. Thus, by way of a lease dated 1 May 1981 (“the Sublease”), the First Lessors demised to one Wong Hong Chung ALL THAT FLAT A on the EIGHT FLOOR Together with the Plant Troughs and Canopy thereof of the Building TOGETHER WITH the right to the exclusive use occupation and enjoyment of the said demised premises subject to any exceptions and reserves provided in the Crown Lease and DMC for a term of 45 years commencing from 20 March 1981  (i.e., up to the year 2026).  It is pertinent to note that the Sublease makes no reference to any demise of the one undivided share allocated to Flat A on the 8^th Floor under the DMC.

11. The said Wong Hong Chung by way of an assignment dated 26 June 1985 assigned his interest in the demised term of the Sublease to Kwok Lui Kit and Sou Soi Ieng, subject to and with the benefit of the DMC.

12. By way of another assignment dated 6 April 1988, Kwok Lui Kit and Sou Soi Ieng further assigned their interest in the residue term of the Sublease to the Wongs.

13. On 16 April 2007, the Wongs and Yuan Yin signed a preliminary agreement dated 16 April 2007, whereby the Wongs agreed to sell to Yuan Yin Flat A on 8^th Floor together with the Plant Troughs and Canopy of the Building.  Yuan Yin accepts for the present purpose that it was aware of the fact that it was only purchasing a subslease from the Wongs in relation to this unit, with a term of 45 years commencing from 10 March 1981.  

14. As mentioned above, on 30 April 2007, the parties signed the formal agreement.  By now, Yuan Yin had paid the Wongs a total of $136,000.00 as deposit.

15. Under clause 1 of the formal agreement, it is expressly provided that the Wongs shall sell to Yuan Yin the property more particularly described in the First Schedule, subject to and with the benefit of the DMC.  The property is then defined under clause 1 as the “Property”.

16. Clause 6 of the agreement also provides expressly that the Wongs shall give good title to the “Property”.

17. The First Schedule describes the Property as follows:

“ALL THAT 1 equal undivided 50^th part or share of and in ALL THAT piece or parcel of ground situate at Hong Kong and registered in the LAND REGISTRY as THE REMAINING PORTION OF INLAND LOT NO 2794 AND of and in the messuages erections and buildings thereon now know [sic] as NO. 163 HENNESSY ROAD (‘the Building’) TOGETHER with the full and exclusive right and privilege to hold use occupy and enjoy ALL THAT FLAT A on 8^TH FLOOR together with Plant Troughs and Canopy thereof of the Building for the residue of the term created by a Lease registered in the Land Office by Memorial No. UB2084216 and SUBJECT to and with the benefit of a Deed of Mutual Covenant and a Management Agreement respectively registered in the Land Registry by Memorial Nos. UB2079132 and UB2075390.”  (emphasis added)

18. The Wongs’ then solicitors drafted the formal agreement.  The First Schedule so drafted by Wongs’ then solicitors was not amended at all by Yuan Yin’s solicitors.

19. It is not disputed that, about 11 days after the formal agreement was signed, on 11 May 2007, Wongs’ then solicitors provided to Yuan Yin’s solicitors the title documents, including a copy of the Sublease.

20. On 16 May 2007, Yuan Yin’s solicitors raised their first set of requisitions.  One of these was asking Wongs to prove that they had title and were able to assign the 1 equal undivided 50^th part or share of and in the Lot as set out in the First Schedule of the agreement.  It was pointed out in the requisition that, from the copy of the assignment of the Sublease provided, the Wongs themselves had not been assigned with that undivided share.

21. Wongs’ former solicitors replied on 25 May 2007, saying that the assignment of the Sublease was the evidence proving title to the one equal undivided share and that the Wongs were able to assign the same on completion.

22. Yuan Yin’s solicitors then replied and disagreed, pointing out again that the Wongs were not previously assigned with the undivided share under the assignment of the Sublease.

23. That followed a series of exchange of letters whereby effectively Wongs’ former solicitors stated that (a) the reference in the First Schedule to the one undivided share was clearly a “clerical error” and the Wongs were prepared to delete the reference, and (b) even without the assignment of the undivided share, Yuan Yin would not suffer any loss and damage, and their enjoyment of the property was not affected.  Yuan Yin’s solicitors however insisted that it had always been Yuan Yin’s expectation that it would be assigned with the undivided share, and that there was nothing to indicate that it would not become the “legal and beneficial owner” of the property on completion.

24. When completion failed, Yuan Yin’s solicitors wrote to Wong’s former solicitors putting on record that the Wongs had failed to show and prove good title in accordance with the formal agreement.  As such, it accepted Wongs’ repudiation of the agreement and demanded for the return of the deposit.

25. The Wongs refused.  Hence the present litigation.

III.  The claim and defences

Yuan Yin’s claim

26. Yuan Yin’s claim is premised on the basis that, by way of clauses 1, 6 and the First Schedule of the formal agreement, the Wongs had contracted to sell, and to give and prove good title, to, inter alia, one equal undivided share of and in the Building.  It is Yuan Yin’s case that the Wongs simply have no title to any interest in the undivided share, and thus they are in breach of the agreement.   Yuan Yin is therefore entitled to accept the repudiation and to claim for the return of the deposit.

Wongs’ defences

27. The Wongs’ defence as raised in the Defence and Counterclaim, and in the affirmations filed in opposition of the present application, can be summarized as follows:

(1)      On a proper construction of the First Schedule, and with reference to the common background that Yuan Yin knew that the Wongs held the subject matter unit under a sublease, the property that Wongs agreed to sell did not include the one undivided share in the Building.

(2)      Alternatively, the Wongs are entitled to rectification of the First Schedule to delete any reference to the undivided share, since the obvious and continuing intention of the parties was only to buy and sell the sublease without the undivided share.

IV.    The present application

28. As mentioned above, Yuan Yin proceeds with the present application under O. 14A and O. 86.

Applicable principles

O14A and O86

29. O.14A r 1(1) provides that an application thereunder is only appropriate, where the question is suitable for determination without a full trial of the action, and such determination will finally determine (subject to possible appeals) the entire cause or matter or any claim or issue therein.  See also: Hong Kong Civil Procedure 2008, paras 14A/2/2, 14A/2/4.

30. The principles governing whether to grant summary judgment under an O.14 application also applies to an application under O.86:  Summary judgment is only for cases where there is clearly and obviously no defence.  On the other hand, it is for the defendant to show a triable defence, which is not frivolous and is worthy of belief.  The defendant should also descend to particulars in his defence.  Hong Kong Civil Procedure 2008, paras 14/4/1 – 14/4/4, 14/4/8-14/4/9, 86/4/1.

Proper construction of an agreement

31. The following are the well established on the proper construction of a contract.

32. As a general principle, the interpretation of a legal document involves ascertaining what meaning it would convey to a reasonable person having all the background knowledge which is reasonably available to the parties:  Homburg Houtimport BV -v- Agronsin Private Ltd [2004] 1 AC 715 at para 73, p. 754D per Lord Hoffman.

33. The approach to construction is an objective one.  The question is what a reasonable person (taken to have knowledge of the surrounding circumstances or factual matrix as known to the contracting parties) would understand the parties to mean by the words of the contract to be construed.  The principles have been summarized by Lord Hoffman in Investors Compensation Scheme Ltd -v- West Bromwich Building Society [1998] 1 All ER 98 at pp. 114e-115e as follows:-

“My Lords, I will say at once that I prefer the approach of the learned judge.  But I think I should preface my explanation of my reasons with some general remarks about the principles by which contractual documents are nowadays construed.  I do not think that the fundamental change which has overtaken this branch of the law, particularly as a result of the speeches of Lord Wilberforce in Prenn v Simmonds [1971] 3 All ER 237 at 240-242, [1971] 1 WLR 1381 at 1384-1386 and Reardon Smith Line Ltd v Hansen-Tangen, Hansen-Tangen v Sanko Steamship Co [1976] 3 All ER 570, [1976] 1 WLR 989, is always sufficiently appreciated.  The result has been, subject to one important exception, to assimilate the way in which such documents are interpreted by judges to the common sense principles by which any serious utterance would be interpreted in ordinary life.  Almost all the old intellectual baggage of ‘legal’ interpretation has been discarded.  The principles may be summarised as follows.

(i)     Interpretation is the ascertainment of the meaning which the document would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract.

(ii)     The background was famously referred to by Lord Wilberforce as the ‘matrix of fact’, but this phrase is, if anything, an understated description of what the background may include.  Subject to the requirement that it should have been reasonably available to the parties and to the exception to be mentioned next, it includes absolutely anything which would have affected the way in which the language of the document would have been understood by a reasonable man.

(iii)     The law excludes from the admissible background the previous negotiations of the parties and their declarations of subjective intent.  They are admissible only in an action for rectification.  The law makes this distinction for reasons of practical policy and, in this respect only, legal interpretation differs from the way we would interpret utterances in ordinary life.  The boundaries of this exception are in some respects unclear. 

(iv)     The meaning which a document (or any other utterance) would convey to a reasonable man is not the same thing as the meaning of its words.  The meaning of words is a matter of dictionaries and grammars; the meaning of the document is what the parties using those words against the relevant background would reasonably have been understood to mean.  The background may not merely enable the reasonable man to choose between the possible meanings of words which are ambiguous but even (as occasionally happens in ordinary life) to conclude that the parties must, for whatever reason, have used the wrong words or syntax (see Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] 3 All ER 352, [1997] 2 WLR 945).

(v)     The ‘rule’ that words should be given their ‘natural and ordinary meaning’ reflects the commonsense proposition that we do not easily accept that people have made linguistic mistakes, particularly in formal documents.  On the other hand, if one would nevertheless conclude from the background that something must have gone wrong with the language, the law does not require judges to attribute to the parties an intention which they plainly could not have had.  Lord Diplock made this point more vigorously when he said in Antaios Cia Naviera SA v Salen Rederierna AB, The Antaios [1984] 3 All ER 229 at 233, [1985] AC 191 at 201:

‘... if detailed semantic and syntactical analysis of words in a commercial contract is going to lead to a conclusion that flouts business common sense, it must be made to yield to business common sense.’”

Rectification

34. As to the law of rectification, the principles are also well established, and following are those which I regard as relevant for the present purpose:

(1)      A prior (that is prior to the signing of the agreement in respect of which rectification is sought) common intention between the parties, where:

(a) such intention was still effective when the agreement was actually signed;

(b) due to a mistake, the agreement failed to carry out such an intention; and

(c) if rectified as claimed, the agreement would carry out the intention.

See:   Joscelyne - v- Nissen [1970] 2 QB 86; and Frederick E. Rose (London) LD - v - William H Pimm Jnr & Co LD [1953] 2 QB 451.

(2)      The burden of proof is always on the party seeking rectification and, while the standard required is the civil standard the court requires “convincing proof” sufficient to counteract the cogent evidence of the parties’ intention as displayed by the instrument itself:  Crane - v - Hegeman-Harris Co Inc [1939] 1 All ER 662; Earl - v - Hector Wayling [1961] Lloyds Rep 459.

(3)      There can be no rectification where there is a unilateral as opposed to a common mistake. Rectification will only be granted if one party executed the document knowing that the document did not give effect to the common intention of the parties and that mistake was calculated to benefit the party having such knowledge or to be detrimental to the other party.  This is because executing a document without bringing a recognised mistake to the attention of the other party amounts to unconscionable conduct or unfair dealing so that equity will intervene: Riverlate Properties Limited - v - Paul [1975] 1 Ch 133.

V.    Discussion

Is O14A the inappropriate procedure adopted in the present case

35. The legal questions posed under the O.14A application by Yuan Yin are as follows:

“1.    that the following question of construction may be determined, namely, whether under the [formal agreement], properly construed, the Defendants had to convey the full description of the property in the First Schedule of the [formal agreement], namely ‘ALL THAT 1 equal undivided 50^th part or share of and in ALL THAT piece or parcel of ground situate at Hong Kong and registered in the LAND REGISTRY as THE REMAINING PORTION OF INLAND LOT NO 2794 AND of and in the messuages erections and buildings thereon now know [sic] as NO. 163 HENNESSY ROAD (‘the Building’) TOGETHER with the full and exclusive right and privilege to hold use occupy and enjoy ALL THAT FLAT A on 8TH FLOOR together with Plant Troughs and Canopy thereof of the Building for the residue of the term created by a Lease registered in the Land Office by Memorial No. UB2084216 and SUBJECT to and with the benefit of a Deed of Mutual Covenant and a Management Agreement respectively registered in the Land Registry by Memorial Nos. UB2079132 and UB2075390.’

2.      that if the answer to the said question of construction be in the affirmative, that final judgment be entered for the Plaintiff against the Defendants for amount claimed of HK$136,000.00 being the balance of the Statement of Claim with interest and costs.”

36. Ms Ho for the Wongs take a preliminary objection that the present dispute is not appropriate for an O.14A determination in the questions as posed by Yuan Yin.  It is so because, as submitted by Ms Ho, given Wongs’ alternative defence on rectification, even if the first question is to be answered affirmatively in Yuan Yin’s favour, it does not follow, as set out in the 2^nd question, that judgment should be entered against the Wongs. 

37. Further, Ms Ho submits that even for the first question, it is not suitable for an O.14A form of construction, since the proper construction of the First Schedule must take into account of all the relevant background facts known or reasonably should have been known to the parties.  As such, the construction sought is not apt for summary disposal under O. 14A.  Counsel cites in aid the observation made by the Court of Final Appeal in Shell Hong Kong Ltd v. Yeung Wai Man Kiu Yip Co Ltd [2003] 3 HKLRD 62 at 69G-I as follows:

“It must also be noted that it is inappropriate to use his procedure [O.14A] if the issues of facts are interwoven with the legal issues to be determined.  For obvious reasons, the question of law or construction of document cannot be dealt with on assumed or hypothetical facts.  And if it is necessary for the court to hear evidence to resolve a factual dispute in order to come to a determination on the question of law or construction of documents, it would not normally be suitable to invoke O.14A.”

38. I think there is some force in Ms Ho’s above submissions.  However, given that Yuan Yin is also proceeding with their application under O. 86, the debate is one which is more of technicality rather than substance. For the present purposes, I am satisfied that the best way to proceed is to deal with the application before me as one made under O. 86 but not under O.14A.  There is also no prejudice caused to Yuan Yin in determining the application in such a way.

39. In the premises, the principal issues I need to determine are:

(1)      Whether the Wongs have raised a triable issue on the construction of the First Schedule as contended by Yuan Yin.  I call this the construction defence.

(2)      Whether the Wongs have raised a triable issue on whether there should be rectication of the First Schedule by deleting the reference to the undivided share.  I call this the rectification defence.

The construction defence

40. It is accepted (I think fairly so) by the Wongs that they do not have any interest in the one undivided share to sell or to convey to Yuan Yin, as they themselves have not acquired any under the Sublease. 

41. Mr Ho for the Wongs however submits that, when one takes into account of all the relevant background circumstances and facts leading to the formal agreement, which the Court should do, the proper and objective construction of the First Schedule should mean to a reasonable objective reader (having the knowledge of these relevant background facts) that it could not have been intended by both parties to buy and sell any interest in the one undivided share, and that the reference to the one undivided share was only to describe the land associated with the subject unit of the sublease under sale.

42. It is further submitted that as such, there must be a triable issue on the proper construction of the First Schedule, since the whole circumstances leading to the formal agreement (except the subjective intention and the negotiations) and their effects on construction, are matters which can and should only be explored at trial.

43. In relation to this, Wongs’ evidence as to what circumstances or background facts they say would support a triable case of their construction are contained in Wong Ming Ho’s Affirmation dated 25 February 2008 at paragraphs 13 and 19:

“13.    I note that in the Plaintiff’s Reply dated 8 August 2007, the Plaintiff admitted its awareness of the duration of enjoyment of the Property.  When taking the whole circumstances of the sale, the special length of the residue term, the selling price, and all relevant documentary evidence into consideration, it is clear that Plaintiff was fully aware of the essence of what he was going to purchase and it should not be allowed to renege on the agreement by relying on unreasonable interpretation of words subsequently used in the transaction document.

…

19.    I am advised by the Defendants’ solicitors and verily believe that:-

(a)    On reaching the true construction of the relevant terms of the Agreement, the Honourable Court is required to look into all the circumstances of the case, including but not limited to the intention of the parties concerned, and the facts leading to the conclusion of the such relevant terms; and further…” (emphasis added)

44. In substance, leaving aside the references to the subjective “intention” (which is irrelevant to objective construction) and “whole circumstances” and “relevant documentary evidence” (which are unparticularized and thus unhelpful), the Wongs rely on the following relevant background facts to support their construction defence:

(1)      The transaction involved a sublease,

(2)      The special length of the residue term, and

(3)      The selling price.

45. In my view, given that the parties knew from the very beginning that they were dealing with the sale of a sublease concerning the subject unit, it is at least arguable that on proper construction of the First Schedule with this fact known to the reasonable objective reader, the only subject matter for sale is the Sublease, and the reference to the undivided shares was only to describe the land associated with the subject unit, of which the Sublease was related to.

46. As I believe the matter should go to trial, I do not think it is appropriate for me to attempt to set out any detail reasons as to the merits of the arguments advanced by the Wongs.  I would however state briefly below why I have come to this conclusion:

(1)  An undivided share is a concept created to deal with the co-ownership in multi-storey building. It relates to the ownership of certain share of the legal estate in the concerned property.   As said by Rogers JA (as he then was) in Jumbo King Ltd v Faithful Properties Ltd[2]:  “An undivided share is just what it says: it is an undivided share in the legal estate of the whole property.”

(2)  On the other hand, a lease (or for the present purpose, a sublease) is generally understood to refer to the granting to the lessee by the lessor a right to exclusive possession and use of the subject unit under the lease, but does not involve or deal with any transfer or conveyance of a legal ownership of a property.  In other words, a lesser generally does not and cannot expect to acquire the legal ownership of the premises by way of the lease created over it.

(3)  In the premises, I cannot say there are no triable issues here as to the proper meaning of the First Schedule when it is to be read and construed with reference to the specific common background fact that the transaction involved only the sale and purchase of a sublease created over the subject unit.  As submitted by Yuan Yin in their skeleton submissions, the assignment of the various units in the Building by way of subleases instead of the usual form of assignment is unusual and exceptional. 

47. I therefore accept that there is a triable defence in relation to the proper construction of the First Schedule.  I am satisfied that the matter should go to trial to ascertain the true and proper construction of the First Schedule with reference to all the background facts then available to the parties.  In coming into this conclusion, I have particularly in my mind the observation made by Lord Hoffman on construction in Jumbo King Ltd -v- Faithful Properties Ltd [1999] 3 HKLRD 757 (CFA) at pp. 773F-774B:

“...The construction of a document is not a game with words.  It is an attempt to discover what a reasonable person would have understood the parties to mean.  And this involves having regard, not merely to the individual words they have used, but to the agreement as a whole, the factual and legal background against which it was concluded and the practical objects which it was intended to achieve.  Quite often this exercise will lead to the conclusion that although there is no reasonable doubt about what the parties meant, they have not expressed themselves very well.  Their language may sometimes be careless and they may have said things which, if taken literally, mean something different from what they obviously intended.  In ordinary life people often express themselves infelicitously without leaving any doubt about what they meant.  Of course in serious utterances such as legal documents, in which people may be supposed to have chosen their words with care, one does not readily accept they have used the wrong words.  If the ordinary meaning of the words make sense in relation to the rest of the document and the factual background, then the court will give effect to that language, even though the consequences may appear hard for one side or the other.  The court is not privy to the negotiation of the agreement - evidence of such negotiations is inadmissible - and has no way of knowing whether a clause which appears to have an onerous effect was a quid pro quo for some other concession.  Or one of the parties may simply have made a bad bargain.   The only escape from the language is an action for rectification, in which the previous negotiations can be examined.  But the overriding objective of construction is to give effect to what a reasonable person rather than a pedantic lawyer would have understood the parties to mean.  Therefore, if in spite of linguistic problems the meaning is clear, it is that meaning which must prevail.”

The rectification defence

48. In light of my above ruling, it is strictly speaking not necessary for me to determine whether the rectification defence is also triable.  However, as the parties have argued it fully, and in case I am wrong above, I will deal with this defence shortly as follows.

49. The factual matters relied on by Ms Ho for the Wongs to support an arguable case of rectification are again that (a) the transaction involved the sale and purpose of only a sublease concerning the subject unit, and (b) the parties were fully aware of this before the formal agreement. 

50. It is submitted that because of these facts:

(1)      It was and must have been also the intention, and within the knowledge, of Yuan Yin that the transaction would and could not involve any sale of any interest in the undivided share.

(2)      As a result, it must have been appeared to Yuan Yin that the reference to the one undivided share in the First Schedule, insofar as it purported to represent that the undivided share would be part of the subject matter of the sale, was a mistake.

(3)      In the circumstances, the First Schedule should be rectified to delete any reference to the undivided share to reflect the true intention of the parties.

51. Ms Ho further submits that since the defence of rectification is fact sensitive, this must be a matter for trial.

52. With the reasons set out at paragraph 46 above, and applying the principles governing the law of rectification, I am also satisfied that this is a triable defence.  Given the common fact that the purchase was only for a sublease, the Wongs should be entitled, and be given an opportunity, to explore at trial whether it was, or must have been, apparent to Yuan Yin that the reference to the undivided share in the First Schedule was a mistake.  This is particularly so since in deciding whether rectification should be granted, the Court is (unlike in the construction of the meaning of a document) entitled to look at the evidence concerning the negotiations between the parties leading to the agreement[3].

VI.  Conclusion

53. I am satisfied that unconditional leave should be given to the Wongs to defend, and I so order. 

54. I also grant an order nisi that costs of this application is to be in the cause, with certificate for counsel.  The nisi order would become absolute 14 days from today unless any of the parties applies in writing to vary it.

Ms. Joyce H.S. Leung, instructed by Messrs Chung & Kwan, for Plaintiff.

Ms. Jane T.C. Ho, instructed by Messrs Anthony Ho & Co., for 1^st and 2^nd Defendants.

[1] In the marginal note of the Amended Summons, Yuan Yin proceeded with its application under O. 14 and O.14A of the RDC.  As rightly pointed out by Ms Ho, counsel for the Wongs, it is procedurally incorrect for Yuan Yin to proceed under O. 14 as it is claiming the return of deposit.  The proper procedure should be for the application to come under O. 86 of the rules.  Accepting this, Ms Leung, counsel for Yuan Yin applies for leave to further amend the summons to make it an application under O.14A or alternatively O. 86.  I grant leave to so amend the summons, since this is clearly only a procedural irregularity, and no prejudice is caused to the Wongs if it is so amended.

[2] [1999] 2 HKC 507, at 524.  See also the late Godfrey JA (as he then was) observations at 521.

[3] See: Lord Hoffmann’s observation in Jumbo King cited at paragraph 48 above