Advance Pacific Investments Ltd v. Zen Chung Hei Hayley and Others

DCCJ 5975/2005

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 5975 of 2005

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Coram: Deputy District Judge Robert Pang in Court

Date of hearing: 21 November 2008

Date of ruling: 24 November 2008

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RULING ON PROPOSED AMENDMENT TO THE AMENDED
 REPLY AND DEFENCE TO COUNTERCLAIM

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1.This is my ruling on the Plaintiff's application to amend its Defence and Counterclaim in response to the 1st Defendant's Re-Amended Defence and Counterclaim.

2.The 1st Defendant's Re-Amended Defence and Counterclaim came about because of a late amendment on the 4th day of trial (although the Court had been informed that an application would be made late on the 3rd day of trial).

3.The amendment was sought by the 1st Defendant on the one part in conjunction with the 2nd and 3rd Defendants on the other part. They each sought to serve contribution notices against the other, ie D1 against D2 & 3 and vice versa, and sought amendments to their respective Defence and Counterclaims to reflect this claim for contribution.

4.As a result of the Defendants' application for leave to amend, the Plaintiff was given leave to make consequential amendments, if any.

5.The Plaintiff has sought to put in an amendment to its Amended Reply and Defence to Counterclaim against the 1st Defendant. The controversial part of such amendment is to introduce into the Reply and Defence to Counterclaim the failure of the 1st Defendant's property agent to provide a copy of Form 1 under the Estate Agents Practice (General Duties And Hong Kong Residential Properties) Regulation (it is not so defined in the proposed pleading but which I understand to be the case from the evidence called thus far).

6.The 1st Defendant objects. The 1st Defendant complains that this is not a consequential amendment. It is an attempt to introduce a cause of action for breach of statutory duty by the back door. The 1st Defendant is prejudiced in that he did not have any opportunity to raise this matter with the Plaintiff's witness Mr. Clifford, who was the controlling mind of the Plaintiff.

7.The Plaintiff says that this is simply to put the "matrix of fact" before the Court so that the Court can decide whether and to what extent the maxim 'caveat emptor' applies. It is a consequential amendment because it arose out of the application to amend and as a result of which evidence was led and examined about the provision or otherwise of the Form 1.

8.I consider that this is not  a consequential amendment. This amendment was not caused, nor necessitated by the amendment to the 1st Defendant's Amended Defence and Counterclaim.

9.If one looks at the 1st Defendant's Re-Amended Defence and Counterclaim, there is no reference at all to Form 1. The substantive amendments were simply to seek contribution against the 2nd and 3rd Defendants, and to that end, to rely also on the matters pleaded against them in the Amended Statement of Claim.

10.There is a reference to an estate agent's duties under the Estate Agent's Ordinance in the amendment to the 2nd and 3rd Defendant's Defence and Counterclaim. However, this Reply and Defence to Counterclaim is not a pleading in response to that Amended Defence and Counterclaim.

11.That is enough to dispose of the application. However, even if the Plaintiff were able to argue that the proposed amendment was a consequential amendment, I would still have refused leave because it is an immaterial and useless averment in the context of the Plaintiff's claim against the 1st Defendant, and the 1st Defendant's counterclaim.

12.The Plaintiff's case against D1 was placed fairly and squarely on the footing of a misrepresentation. Failure to provide a copy of the Form 1 is a statutory requirement, and if anything should be the subject matter of a claim for breach of statutory duty.  (assuming this is sustainable at law)

13.Even though Mr. Finley sought to say that it was part of the "factual matrix", this simply cannot avail the Plaintiff for the simple reason that it was never a matter in the Plaintiff's mind, or rather that of Mr. Clifford. No evidence was led upon it. Indeed, Mr. Clifford's evidence was to the effect that he had not even known that a building plan could be easily retrieved by his property agents (the 2nd and 3rd Defendants). He had not made any mention of the Form 1. It is apparent to me that Mr. Clifford was unaware of the duty to provide a Form 1, otherwise he would have mentioned that matter in his evidence, particularly in relation to the claims he had against the 2nd and 3rd Defendant.

14.An action for misrepresentation can only rest upon a representation which was known and acted upon by the representee. In the present case, the representee simply was not aware of the existence of a Form 1, this could not have any bearing on any representation to him.

15.In the circumstances, I rule that the proposed amendment is not consequential upon the 1st Defendant's amendment, and I decline to grant leave to amend for the reasons given.

Plaintiff: S. Finely of Messrs. Finley & Co. for the Plaintiff

1st Defendant:    Mr. Adrian Lai instructed Messrs Wong, Fung & Co.

2nd & 3rd Defendant: Mr. Damian Wong instructed by Messrs. So, Keung,  Yip & Sin.