Huang Ping, Owen v. Burswood Ltd and Another
Read the full judgment text of DCCJ 5239/2008 on BabelCite. This District Court judgment.
1. There are four summonses taken out under the Rules of the District Court before me as follows:
Cited by 1 case · Cites 6 cases
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DCCJ 5239/2008 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION CIVIL ACTION NO. 5239 OF 2008 ------------------------ BETWEEN
------------------------ Coram: Deputy District Judge Raymond Tsui in Chambers (open to the public) Date of Hearing: 27th March, 9th, 14th, 16th April 2009 Date of Handing Down Judgment: 9th September 2009 -------------------- DECISION -------------------- 1.There are four summonses taken out under the Rules of the District Court before me as follows:
2.By an order dated of 23rd January 2009, the Order 12 Summons and the Order 14 Summons were adjourned. The Order 12 Summons was adjourned for substantive hearingwith one day reserved. Because of the nature of the Order 12 Summons, the Order 14 Summons clearly was adjourned before me to be dealt with depending on the determination of the Order 12 Summons. Subsequently, the Order 21 Summons and the Order 26 Summons were also taken out returnable at today’s hearing. 3.The Plaintiff has acted in person since the commencement of the present action. He appeared before me without legal representation. He argued at the hearing that the Order 14 Summons should be heard first. He was perhaps under the impression that if the Order 14 Summons application was allowed and judgement given in his favour, he would not have to worry about the applications of the Defendants. This is misconceived because first there was no evidence on the merits of the application as no directions for filing of affirmation evidence on the Order 14 Summons had been given; secondly, even if the Order 14 Summons is heard before the other Summonses, the Defendants could still put forward the same arguments relating to the Order 12 Summons as a defence to the summary judgement application. At one stage of the hearing, the Plaintiff even suggested that the proceedings be disposed of by way of an Order 14A application. No questions were framed for the determination of the court. If we were to deal with the same issues as raised in the Summonses before the court, I see no point in expanding the argument to an Order 14A application. 4.The second affidavit of one Mr Preston dated 18th March 2009 and the second affidavit of Mr Dobby, solicitor appearing for the 1st and 2nd Defendants, also dated 18th March 2009, were filed out of time. It is clear that if there was anything new in these two affidavits, the Plaintiff could have replied in his eighth affirmation. I do not see any prejudice caused to the Plaintiff. I granted leave to the 1st and 2nd Defendants to file these two affidavits out of time. 5.A great number of affirmations/affidavits were filed by the parties. The Statement of Claim and the affirmations of the Plaintiff are prepared in Chinese. English translation is provided by the Defendants. When considering the contents of the Statement of Claim and the affirmations of the Plaintiff, I invariably refer to the Chinese versions to avoid any argument as to the accuracy of the translation. 6.As a general observation, it is, however, unfortunate that not all the affirmations of the Plaintiff, the Interrogatories and the orders of the court were put into the hearing bundle. I had to frequently refer to the court file when preparing this judgement and a lot of logistic difficulties were created. The Plaintiff’s Claim 7.The Plaintiff acts in person and the Statement of Claim is apparently not drafted by lawyer. It appears from the Statement of Claim that the Plaintiff’s claim is for payment of referral fees due to him from the 1st Defendant (“Burswood Limited”). 8.The reliefs claimed by the Plaintiff include the following:
9.It is obvious that orders under paragraphs (1) and (2) above are beyond the ambit of these proceedings. 10.The pleaded case of the Plaintiff is that in 2001, he submitted a form entitled Registration of Agent (Referral Programme) (the “Registration Form”) at the Hong Kong office of Burswood Limited. He was accepted as a referral agent. His relationship with Burswood Limited was governed by the Referral Programme Agent’s Terms & Conditions (the “Agent Terms & Conditions”). Pursuant to the Agent Terms & Condition and since 2001, the Plaintiff had referred a number of players to Burswood Limited and had been commended by Burswood Limited in its Status Report. 11.The Plaintiff alleges that in January 2004, he referred a total number of 19 players to Burswood Limited. Some of the players were Hong Kong residents and it is pleaded that they did not normally reside in Hong Kong. Some of the players were Chinese living in China. All those players had signed Chinese documents drafted by Burswood Limited which are now in the possession of Burswood Limited and which confirm that those players were referred to Burswood Limited by the Plaintiff. The total sum lost by those players was about AUS$ 2.5 to 3 million. He alleges that Burswood Limited used dishonest, delaying and fraudulent means to withhold payment of the referral fees due to him. The amount of referral fees due is not pleaded. Nor is the rate or the formula whereby the amount could be arrived at. 12.The Plaintiff claims that in 2004, the 2nd Defendant (“Crown Limited”) wrote to the Plaintiff and requested the Plaintiff to ask one of the 19 players, who owed Burswood Limited gambling money, to deposit the money owed into a personal bank account in China. The Plaintiff claims that this was money laundering. 13.The Plaintiff also alleges that there was another instance in 2005 whereby the Defendants asked one of the players to deposit the money owed into an account other than the one in the name of Burswood Limited. 14.Finally, the Plaintiff claims that in September or October 2008, the Defendants used an excuse that one of the players still owed gambling money and refused to pay referral fees to him when in fact Crown Limited had sent someone to China to collect the same from that player. Order 12 Summons 15.The Order 12 Summons was filed without any affirmation in support and was contrary to Order 12 rule 8(4). Such non-compliance is irregularity that could be cured. (See Carmel Exporters (Sales) Ltd v Sea-Land Services Inc [1981] 1 WLR 1068) When the Order 12 Summons came before Master Lo, two unsigned draft affidavits were prepared. The Defendants were allowed to undertake to file the affidavits. I consider that as an exercise of the power of the court under Order 2 rule 1 to cure the irregularity. 16.Three grounds are stated in the Order 12 Summons. They are first, the purported service of the Writ of Summons was irregular or invalid; secondly, Hong Kong court is not the appropriate forum under the principle of forum non conveniens; thirdly, there are no reasonable causes of action pleaded in the Statement of Claim against the Defendants. Service of the Writ of Summons 17.The Plaintiff said in his affirmation of service that he personally served two copies of the Writ of Summons together with other necessary documents on the Defendants at Room 2802-3, 28/F, China Merchant Tower, Shun Tak Centre, 168-200 Connaught Road Central (the “Shun Tak Office”). He said that the Shun Tak Office was the principal place of business of the Defendants in Hong Kong. A person by the name Wong Ying Ying received the relevant documents and showed the Plaintiff her name card as the Defendants’ “Operation Manager – Hong Kong”. The name card was not exhibited to any affirmations of the Plaintiff. 18.The Plaintiff also served the Writ of Summons via electronic means to the principal person in charge of the Defendants on 21st November 2008. The Chairman of the Defendants replied by an e-mail acknowledging receipt of the Writ of Summons. The Vice President of the Defendants phoned the Plaintiff and confirmed the receipt of the Writ of Summons. Needless to say, service by electronic means is not an accepted mode of service. 19.To better understand the case, it would be useful to look at the corporate structure of the Defendants. Burswood Limited, the 1st Defendant, is an unlisted Australian public company with its Registered Office, Head Office and Principal Place of Business in Australia. It is a holding company with subsidiaries which engages in the operation of the Burswood Entertainment Complex (whose trading name before 2004 was Burswood International Resort Casino) which comprises hotels, convention centre restaurants etc all of which situated in a complex in Western Australia. The subsidiaries of Burswood Limited include Burswood Nominees Limited, Burswood Catering and Entertainment Pty Ltd and Burswood Property Pty Ltd. The subsidiary that operates the Burswood Entertainment Complex is Burswood Nominees Limited. 20.Crown Limited, the 2nd Defendant, incorporated on 31st May 2007, is a listed public company with its Registered Office, Head Office and Principal Place of Business in Australia. Crown Limited is an international casino and gaming entity. 21.Searches conducted at the Hong Kong Companies Registry reveal that there is no company bearing the name of Burswood Nominees Limited. The results also reveal a local listed company by the name Burswood Limited but it is not in any way related to the 1st Defendant. The searches also show a company by the name Crown Limited which has been dissolved in 1968 and is not related to the 2nd Defendant. 22.According to the Defendants, the Shun Tak Office is the address of Crown Resort Pte Ltd which is a Singapore based company. The Shun Tak Office is also the representative office of Crown Melbourne Limited which is ultimately a subsidiary of Crown Limited. 23.Order 10 of the Rules of District Court allows service of a writ of summons to be served personally on a defendant or, if the defendant is within the jurisdiction, by registered post at the usual or last known address or by inserting the writ of summons through a letter box at that address. Order 65 r3(1) of RDC provides that “[p]ersonal service of a document on a body corporate may, in cases for which provision is not otherwise made by written law, be effected by serving it in accordance with rule 2 on the chairman or president of the body, or the clerk, secretary, treasurer or other similar officer thereof.” Rule 2 provides that “[p]ersonal service of a document is effected by leaving a copy of the document with the person to be served”. Since the Companies Ordinance, Cap. 32 contains provisions for service of documents on body corporate, one must look at the relevant provisions of the Companies Ordinance. 24.There is no dispute that both Defendants are not Hong Kong companies. Section 338 of the Companies Ordinance contains provisions governing the service of documents on non-Hong Kong companies. Since there is no suggestion that any names had been delivered to the Registrar as the authorized representatives of the Defendants, subsection (1) does not apply. Subsection (2) allows service to be effected by leaving the document or by sending it by post at any place of business established by the company in Hong Kong. Since there is no suggestion that there had been any registration of address under section 333(1), section 338(2)(b)(i) does not apply. If the company no longer has a place of business in Hong Kong and if there has been no registration of address under section 333(1), the document may be served by leaving it at or sending it by post to any place in Hong Kong at which the company has had a place of business within the previous 12 months under section 338(2)(b)(ii). 25.The burden is on the Plaintiff to prove that the Shun Tak Office was the registered office or the place of business of the Defendants in Hong Kong for the purpose of section 338(2)(a) or had been the place of business of the Defendant within the previous 12 months for the purpose of section 338(2)(b)(ii). (See Guangdong International Trust & Investment Corporation Hong Kong (Holdings) Ltd v Yuet Wah (Hong Kong) Wah Fat Ltd & Anr [1997] HKLRD 489) Save the affirmation of the Plaintiff, there is no evidence proving that the Shun Tak Office was or is the place of business of the Defendants in Hong Kong. 26.The meaning of “place of business” was discussed in Elsinct (Asia-Pacific) Ltd v Commercial Bank of Korea Ltd [1994] 3 HKC 365. “Place of business” was then defined in section 341 of the Companies Ordinance as follows:
27.Chan J, as he then was, was of the view that “business” could be interpreted in the narrow sense to commercial transactions or in the more general sense to activities. His Lordship observed at p. 372G-373C that:
28.It could be seen that the discussion of the meaning of “place of business” by Chan J was very much influenced by the then definition. It must be noted that s 341 was amended and the present version is as follows:
29.The Twenty-fourth Schedule contains one exclusion which is “[a] local representative office established or maintained with the approval of the Monetary Authority under section 46 of the Banking Ordinance (Cap. 155) by a bank as defined in section 46(9) of that Ordinance”. 30.It is obvious that the definitions of “place of business” in 1994 when Elsinct (Asia-Pacific) Ltd was decided and today are very different. I do not think the construction of the then s 341 would still be applicable. Having said that, however, I believe that the construction put on the word “business” in the general sense by Chan J is still applicable. And it is clear from a comparison between the two versions of s 341 that the wide exclusion in the old version is now replaced by a much narrower exclusion. It must mean that the legislature intends that “place of business” should bear a wide meaning. This lends more support to the view that the word “business” should be construed in the general sense. 31.But no matter how wide the meaning has become, it is a still a matter of fact as to whether a company has established a place of business in Hong Kong. Negative results from relevant searches do not necessarily mean that a particular company has not established any place of business in Hong Kong. I respectfully agree with the observation of Chan J in Elsinct (Asia-Pacific) Ltd that, to determine whether a place of business has been established in Hong Kong, “a broad common sense approach should be adopted” (p.373B). A company, for example, which has no employees in Hong Kong and only maintains an enquiry counter at a corner of the office premises of an associated company which provides staff to forward the enquiries to the company’s office outside Hong Kong could not be said to have maintained a place of business in Hong Kong. 32.In English Sewing (H.K.) Ltd and Others v Eastern Shipping Lines, Inc [1984] HKLR 5, Hooper J quoted from the judgement The Artemis [1983] HKLR 364 which in turn quoted a passage from Okura & Company Ltd v Forsbacka Jermwerks Aktiebolag [1914] 1 KB 715. It appears from p.9D-E of the judgement of English Sewing (HK) Ltd that the circumstances that the court should consider are that first, the length of time the acts showing the company was carrying on business in Hong Kong; secondly, the existence of a fixed place of business; and thirdly, the existence of an agent who did the company’s business for the company in Hong Kong. Again, one must be cautious because the definition of “place of business” at the time of English Sewing (HK) Ltd was also different from the one today. But these considerations accorded with the broad common sense approach suggested by Chan J in Elsinct (Asia-Pacific) Ltd. 33.The position of the Defendants is that both Defendants did not have any business, office or presence in Hong Kong at which a writ of summons could be served. None of them had any employee in Hong Kong. By reason thereof, both Defendants are not capable of being served in Hong Kong. They admitted that the extent of any involvement of Crown Limited or Burswood Limited (or Burswood Nominee Limited) in Hong Kong is limited to any incidental or indirect marketing and promotion of entertainment facilities based in Australia. There is no evidence showing that the Shun Tak Office was the office of the Defendants. Nor is there evidence proving that there were employees working at the Shun Tak Office. There is no evidence as to whether the activities admitted to have been undertaken by the Defendants took place at the Shun Tak Office. In any event, there is no evidence as to how and by what means those activities were carried out. 34.In order to prove that Crown Limited maintained a place of business in Hong Kong, the Plaintiff produced a document entitled “Non-Exclusive Overseas Gaming Promotion Agreement” which is a document of Crown Limited. He quoted the case Crown Limited v Wong Hon Chee David (HCA No. 9593/2000) in support. He said that the Non-Exclusive Overseas Gaming Promotion Agreement mentioned in paragraph 4 of the judgement was the same document he produced. There is no such evidence. Even if I am prepared to assume that the two documents are the same, it does not help the Plaintiff’s case. Wong Hon Chee David is not concerned about service of writ. There is also a very important difference between Wong Hon Chee David and our case, namely, in Wong Hon Chee David, Crown Limited was the plaintiff. There was no need for a plaintiff to have a place of business in Hong Kong in order to commence any civil proceedings. 35.Before discussing another argument of the Plaintiff, it is necessary to know more about Crown Limited. In or about 2007, there was a demerger of Public Broadcasting Limited (“PBL”) whereby the gaming and the media businesses were split up and taken over by Crown Limited and Consolidated Media Holdings Limited respectively. The Plaintiff produced a booklet which was issued to the shareholders of PBL recommending approval for the resolution for the demerger. The “Fundamental Demerger Principle” introduced in the booklet states that Crown Limited would have the “entire economic and commercial risk and liabilities of the Gaming Business as if Crown [Limited] had owned and operated the Gaming Businesses at all relevant times”. As to matters relating to litigation, also recorded in the booklet is the “Litigation Management” which states that “[c]onsistent with the fundamental Demerger principle outlined above, Crown [Limited] will manage existing and new litigation matters relating to the Gaming Businesses …”. 36.In fact, according to the booklet, there should be a Demerger Deed between PLB and Crown Limited incorporating into it the “Fundamental Demerger Principle” and the “Litigation Management”. No copy of the Demerger Deed has been produced. Without a copy of the official legal document, I have great reservations as to the weight that could be put on the booklet. And in the absence of the Demerger Deed, I am simply not in a position to understand the legal positions of all the companies within the Gaming Business and their relationship with the creditors. 37.Furthermore, instead of exhibiting the whole booklet, the Plaintiff chose to exhibit only some pages of the booklet. What is more important is that the definition section or the section that contains the definition of “Gaming Business” is not exhibited. There is, therefore, no evidence showing that the Gaming Business applies to our case. 38.I am prepared to assume for the purposes of these applications that the Gaming Business includes the casino to which the Plaintiff had referred players. The Plaintiff argued that because of the “Fundamental Demerger Principle”, Crown Limited was liable for the businesses of its subsidiaries and thus liable for the claim of the present action. Since Crown Resort Pte Limited was part of the Gaming Business referred to in the booklet, service of the Writ on Crown Resort Pte Limited at the Shun Tak Office was good service on the Defendants as Crown Limited was the owner and operator of the Gaming Business. 39.For a start, without the Demerger Deed, it is not known whether Crown Limited has taken up all the liabilities of its subsidiaries as suggested by the booklet. Not being a party to the Demerger Deed, the Plaintiff could not rely on the Demerger Deed to pursue against Crown Limited for any liabilities of the subsidiaries. There is no expert evidence on Australian law to explain this possibility or the positions between the companies of the Gaming Business and their creditors. In any event, if the claim is against the Defendants, service of the Writ on a subsidiary or an associated company at the Shun Tak Office does not mean the requirement on service has been satisfied. Furthermore, the fact that Crown Limited now manages the litigation of the subsidiaries because of the “Litigation Management” principle does not mean that it has become the defendant. Nor, assuming that Crown Limited has maintained a place of business at the Shun Tak Office, has the address of Crown Limited become the address for service for its subsidiaries. 40.The Plaintiff also suggested that since the employees at the Shun Tak Office were licensed under the Casino Control Act of Australia. They were employees of Crown Resort Pte Limited which was a company belonging to the Gaming Business and since Crown Limited bore all the risks and liabilities of the Gaming Business because of the Demerger Principle, those employees would be authorized to accept service for Crown Limited. First of all, there is no evidence whether those employees were so licensed. Even if they were so licensed, it does not follow that, even if they were not employees of Crown Limited, they could accept service on behalf of Crown Limited by virtue of being licensed employees. 41.The Plaintiff also argued that the e-mails produced by him show that the casino was actually operated by Burswood Limited, which is contrary to the case of the Defendants that the casino was operated by Burswood Nominees Limited. I do not agree. Nothing in those e-mail messages supported the contention of the Plaintiff. 42.The Plaintiff said that after he had been accepted as a referral agent, he maintained business contact with the office of Burswood Limited in Hong Kong. He quoted a Status Report of the office of Burswood Limited in Hong Kong in which it was reported that the Plaintiff was “considered as one of the most supportive and loyal agent for Burswood”. The Status Report was not produced. It is not known what kind of contact is being referred to by the Plaintiff. It certainly has not been affirmed by the Plaintiff that he attended the Hong Kong office of Burswood Limited or for that matter, the Shun Tak Office. The e-mail messages exhibited to the affirmation of the Plaintiff do not contain anything indicating that they originated from the Hong Kong office of Burswood Limited or the Shun Tak Office. 43.The Plaintiff submitted that Burswood Limited had 5 overseas offices, one of which was located in Hong Kong. In or about 2004 or 2005, the office of Crown Limited was combined with the overseas office of Burswood Limited and the combined office was the Shun Tak Office. He then referred me to an annual report 2005 of PLB. However, the address shown in that annual report was at New World Tower in Central but not the Shun Tak Office. Upon being pointed out the address was at New World Tower, the Plaintiff then said that the joint office moved from New World Tower to the Shun Tak Office. There is no documentary evidence in support of the Plaintiff’s allegation. I am not convinced by this sudden change of position. 44.It is the affirmation of Mr Michael Fu which refers to 5 overseas offices of “Burswood”. The Plaintiff tried to point out the inconsistency between Mr Fu’s affirmation and Mr Preston’s affidavit the latter of which deposed to the effect that Burswood Limited did not have any office in Hong Kong. However, “Burswood” is defined as Burswood Nominees Limited in the affirmation of Mr Fu. There is thus no inconsistency. 45.I am not satisfied that the Plaintiff has proved that the Shun Tak Office is or has been the place of business of the Defendants. I would rule in favour of the Defendants on this ground. Forum non conveniens 46.The second ground of Mr Dobby is that the service of the Writ should be set aside because leave would not have been granted to the Plaintiff to serve the Writ out of the jurisdiction. The burden of proving that Hong Kong is a forum conveniens in an application under Order 12 is on the plaintiff. (See New Link Consultants Ltd v Air China [2005] 2 HKC 260, 275I) 47.Deputy Judge Poon, as he then was, made the following helpful observation at p. 274E-G in New Link Consultants Ltd:
48.The standard of proof required is a good arguable case. Based on the judgement of Chung J in Martin McParland v Brinton Global Management Ltd (HCA No. 3153 of 2002), it is commented in paragraph 11/1/8 Hong Kong Civil Procedure 2009 as follows:
49.The position of the Defendants is that there was no referral agreement with the Plaintiff. Even if there was such a referral agreement, the contracting party was not Burswood Limited or Crown Limited. Mr Dobby did not expressly say that if there were any referral agreement, the contracting party would be Burswood Nominees Limited. But since it was Burswood Nominees Limited which operated the casino, if there were any referral agreement, the contracting party must be Burswood Nominees Limited. From the Statement of Claim and the affirmations filed, it is clear that the Plaintiff’s claim is one based on contract. I am prepared to consider sub-paragraphs (d) and (e) of Order 11 rule 1. 50.According to the Defendants, a potential agent was required to register by completing the Registration Form referred to above with Burswood Nominees Limited. The international operations of the casino had five overseas offices located in, among others, Singapore and Hong Kong. Before 2004, the Registration Forms might have been distributed to potential referral agents at these overseas offices of Burswood Nominees Limited. The completed Registration Form would be approved by the Executive General Manager at the Head Office in Western Australia who was an employee of Burswood Nominees Limited. A standard approval letter would be issued to the successful applicant which set out the terms whereby the agent would be engaged. 51.The Defendants exhibited a sample approval letter which consisted of two pages and set out the terms and conditions. The first page of the sample approval letter is dated 13th May 1998 and the second page is dated 6th May 1998. This letter provided, inter alia, that the players referred to by the agent must first confirm in writing that they were introduced to the Burswood International Casino by the referral agent and that they authorized the payment of referral fees to the referral agent. The Plaintiff disputed the authenticity of this sample approval letter. He exhibited a document entitled “Referral Programme --- Agent’s Terms & Conditions (Guidelines)” which did not include the condition provided in the sample approval letter. I think as the word Guidelines suggest, this document may not contain all the applicable terms and conditions. Mr Dobby also submitted that there was no date on these Guidelines which made it unclear as to when the “Guidelines” were applicable. The Plaintiff submitted at the hearing that the Defendants did not use any contract in the referral programme. He had only been given the said Guidelines. 52.The Plaintiff cited a case Kakavas v Crown Limited [2007] VSC 526 in support of his proposition that, as Crown Limited owned and operated the Gaming Business, it was the proper defendant. First of all, Kakavas is a case concerned with the operation of the Casino Control Act. There is no expert evidence as to how that Act would apply to the relationship between the Plaintiff and the Defendants in the present case. More importantly, it seems that the cause of action of the plaintiff in Kakavas was based on the unconscionable conduct of Crown Limited in inducing the plaintiff to return to the casino. But such allegation arose from the fact that, as casino operator, Crown Limited was forbidden from promoting gaming under section 77A of the Casino Control Act. In other words, Crown Limited itself as operator of a casino, was allegedly in breach of the statute. Crown Limited was alleged to have been in breach of its primary duty as an operator of a casino. It was thus named as a defendant in its own right but not as a result of the Fundamental Demerger Principle. Kakavas does not help the Plaintiff. 53.The Plaintiff also said that the letter with the letterhead “International Room” was evidence that Burswood Limited was the other party to the referral contract with him on the basis that the “International Room” was part of the business of Burswood. He further cited in support the annual report 2000 of Burswood Limited which recorded that upon international marketing restructure, new customers networks throughout North Asia, Hong Kong and Taiwan were established. To me, these two documents are about completely different matters, one being an acknowledgement letter issued by Burswood International Resort Casino which was operated by Burswood Nominees Limited (but not Burswood Limited) whilst the other being a record on international marketing. 54.The intended signatory of the sample approval letter was one Mr PL Yeap. The Plaintiff said that it was Mr Alan Khoo who approved his application. Mr Alan Khoo, according to the annual report of Burswood Limited for 2000, was then located in Singapore. According to the same annual report, the said Mr Yeap had already resigned before the Plaintiff made his application in 2001. The Plaintiff thus suggested that his approval was not made in Australia but in Singapore. But I believe the important point is the approval was not made in Hong Kong. Moreover, even if it was Mr Alan Khoo who approved the registration of the Plaintiff as a referral agent, it does not necessarily follow that the referral agreement was made between the Plaintiff and Burswood Limited. 55.It could be seen from the above that the Plaintiff could hardly prove that his referral agreement was made with the Defendants. 56.The place and time of the conclusion of the alleged agreement between the Plaintiff and Burswood Limited depends on the mode of communication of the acceptance of the offer. It means in this case how the approval of the Plaintiff as a referral agent was communicated to the Plaintiff. There is, however, no evidence as to how the approval was communicated to the Plaintiff. It thus could not be concluded whether the alleged agreement between the Plaintiff and Burswood Limited was concluded in Hong Kong or in Australia. This rules out sub-paragraph (d)(i) of Order 11 rule 1. 57.Nor does the Plaintiff’s case fall within sub-paragraph (d)(ii) as it is not the case of the Plaintiff that the agreement was made between him and an agent of Burswood Limited trading or residing in Hong Kong, his case being that he made the contract directly with Burswood Limited. 58.Assuming that there was a referral agreement between the Plaintiff and Burswood Limited or Crown Limited whose business is operating casinos, gambling being illegal in Hong Kong and the sole purpose of the referral agreement being in furtherance of the gambling business, naturally the applicable law to that agreement would not be Hong Kong law. This rules out sub-paragraph (d)(iii). The Plaintiff argued that his duty did not involve gambling and he was only obliged to refer players. There was thus nothing illegal about his duty. I do not agree. His reward for referring the players depends on gambling turnover of the players. In other words, his reward is directly linked with the gambling activities. It must be tainted with illegality. Thus, to be enforceable, the referral contract must be governed by Australian law. 59.Sub-paragraph (d)(iv) is out of the question as neither party has produced any agreement. 60.The said Guidelines also provided that the referral agent would be paid in cash, by cheque or by telegraphic transfer as requested by the agent. Payment by cash or cheque could be made in Hong Kong or Australia. But payment by telegraphic transfer could presumably only mean transfer made in Australia to Hong Kong. The point is the performance of the Gaming Business, and thus the breach of the agreement in case of failure of performance, could take place in Hong Kong or Australia. There is no evidence from the Plaintiff on the mode of payments made by Burswood Limited. Some of the exhibited e-mail messages recorded payments were paid into the account of the Plaintiff in Hong Kong. There is no evidence to show whether those payments were made in Hong Kong or from Australia. Thus the Plaintiff has failed to prove that the alleged breach was committed in Hong Kong. The Plaintiff’s case thus does not fall within Order 11 rule 1(e). 61.The principles relating to forum conveniens stated by the House of Lords in Spiliada Maritime Corp v Consulex Ltd, The Spiliada [1996] AC 460 were summarized by the Hong Kong Court of Appeal in The Adhiguna Meranti (owners of cargo) v The Adhiguna Harapan (owners of ships) [1988] HKLR 904. A summary of the three-stage test was propounded in The Lanka Muditha [1991] 1 HKLR 741, 744B-D:
62.I also note that the jurisdiction of the court under Order 11 rule 1(1) would not be lightly exercised. (See Tay Choo Wah v The Singapore-Johore Express (Pte) Limited [1992] 1 HKLR19, 30) 63.It was further observed by Deputy Judge Poon in New Link Consultants Ltd (p. 281D-E) that “the approach in forum non conveniens applications is not just an exercise in loading up with factors which point to any particular jurisdiction in abstract. The court is required to focus on the appropriateness of a forum from the point of view of the trial of the action. The court is to identify a forum which the action the most real and substantial connection.” 64.The substance of the dispute in the present case is relatively straight forward: the Plaintiff claims referral fees for 19 players introduced to, according to him, Burswood Limited in January 2004. 65.One of the considerations that I should take into account is the connecting factor which should not be determined in the abstract. The court would determine “whether such factors will lead to the conclusion that another forum is more appropriate for the trial of the action. (See par. 18 of judgement in Xinjiang Xingmei Oil Pipeline Co Ltd v China Petroleum & Chemical Corp (HCCL No. 6/2004)). 66.I have considered the applicable law above. I agree with the observation of Stone J in Xinjiang Xingmei Oil Pipeline Co Ltd that even though Hong Kong court was in as good a position as the foreign courts in applying the law of that foreign country with the help of experts, no court could apply another system of law as surely as the home court. I have also borne in mind the observations made by Recorder Ma SC, as he then was, in Rambas Marketing Co LLC v Chow Kam Fai David [2001] 3 HKC 250, 266I-267A that it “does not follow at all that once it is shown that issues of foreign law arise, that this will necessarily be a powerful, much less a decisive, factor in favour of a stay. On the other hand, however, it is unrealistic not to acknowledge the fact that complicated issues of foreign law may arise with which the Hong Kong courts will not feel itself confident to deal. It is all a question of degree.” 67.The foreign law issues were not identified by the parties. But from what I have gathered from the arguments, the foreign law issues would probably involve the inter relationship among the companies within the Gaming Business and their relationship with the creditors. The relevant statutes, for example, the Casino Control Act, would likely to be examined. I could not find any cases decided by the Hong Kong courts relating to the gambling law of Australia. Thus the Hong Kong courts may not be familiar with this aspect of the Australian law. 68.Witnesses from the Defendants would all come from Australia as the players were received in Australia. Records of cash chip turnover of those players would be produced by employees of the casino in Australia. If Mr Alan Khoo is called to testify, he would come from Singapore. The Plaintiff suggested that the staff of the Defendants in Hong Kong such as Yvonne Lau and Minnie Ho etc did not reside in Australia. There is no evidence that they live in Hong Kong either. In fact, save for one or two e-mail messages from Yvonne Lau which appeared to have been originated from Hong Kong, the other e-mail messages originated, on the face of it, from e-mail addresses in Australia and Singapore. On the Plaintiff’s side, some of the 19 players live in China and the others do not normally reside in Hong Kong. It would seem that the only witness that has any real connection with Hong Kong is the Plaintiff. 69.The Plaintiff submitted that his witnesses (i.e. the 19 players) could only speak Mandarin and that they did not have Australian visa. I do not think language is a barrier in court. I am sure interpretation services would be provided. As to visa, if they could obtain visa to visit the casino in Australia, I do not know why there would be difficulties for them to obtain visa to visit Australia again. 70.According to the Guidelines mentioned above, the duty of a referral agent would have been discharged once the introduction of the players to the Gaming Business is completed. The Plaintiff argued that there were no requirements stated in the Guidelines requiring him to perform any duties in Australia. His performance of the agreement with Burswood Limited thus took place in Hong Kong. He also said that the e-mail messages produced by him supported his contention as they showed that arrangements were made in Hong Kong. 71.It is probably true that some parts of the referral work were performed by the Plaintiff outside Australia. But that is not the end of the matter, a referral fee would be payable to the Plaintiff based on the cash chip turnover of a player. It means that the players would have to gamble in the casino in Australia so that there would be cash chip turnover upon which the referral fees could be calculated. Thus even if it may be argued that once the players were introduced, the Plaintiff had performed his duty, the fact that the players would have to gamble in Australia so that the Plaintiff could receive referral fees suggests that some important and substantial activities would still have to take place in Australia. 72.The Plaintiff submitted that the letter with the letterhead “International Room” would only be signed by players who had a big turnover. The Defendants suggested that the letter had to be signed by the players before referral fees were payable. Even if I accept the Plaintiff’s version (which in fact is not supported by any affirmation evidence), it is indisputable that the players still had to play in the casino before the referral fees were payable. 73.The Plaintiff said that all his performance of the agreement took place outside Australia because the Goods and Services Tax in Australia was not applicable to the work of a referral agent. The Plaintiff put forward a document entitled “Non-exclusive Overseas Gaming Promotion Agreement” of Crown Limited which provided, inter alia, that a junket organizer’s obligations would be performed entirely outside Australia. Quite apart from the fact that there is no expert evidence on this aspect of the Australian law, there is also no pleaded case against Crown Limited. Nor is it pleaded the “Non-exclusive Overseas Gaming Promotion Agreement” applies to the Plaintiff. In any event, it is a question of fact as to whether the performance actually took place in Australia or not. 74.The referral fees allegedly payable by the 1st Defendant also leads to another consideration, namely, the location of the relevant documents, if any, relating to those 19 players. In all likelihood, if these documents exist, they would be in Australia and in the possession of the casino. 75.The Plaintiff had not identified any juridical disadvantage that he would suffer should the case proceed in Australia. 76.In my view, the Plaintiff has failed to satisfy the three-stage test in The Lanka Muditha. I would rule in favour of the Defendants on the ground of forum non conveniens. Reasonable Cause of Action 77.The third ground of the Defendants in relation to the Order 12 Summons is that the Statement of Claim discloses no reasonable cause of action. 78.Mr Dobby submitted that as far as Crown Limited was concerned, there was no pleaded cause of action against Crown Limited. That must be right. It is clear that the Plaintiff claims against Burswood Limited for referral fees. References to Crown Limited in the Statement of Claim relate to the alleged money laundering activities of Crown Limited. The relief claimed in respect thereof is a conviction or an order of condemnation. The Plaintiff also claims an order that the both Defendants are “guilty of cheating”. Of course, the criminal jurisdiction of this Court is not invoked by these proceedings. Even if I assume that “cheating” bears the meaning of fraud, all that is pleaded is the Defendants used some excuses to refuse payments. That does not constitute a valid cause of action in fraud. 79.As far as the cause of action pleaded against Burswood Limited is concerned, there are no doubts that some particulars are missing. But I could still see the basic framework of a claim based on contract allegedly between the Plaintiff and Burswood Limited from paragraphs 1 to 5 of the Statement of Claim. I bear in mind the comment in paragraph 18/19/6 of Hong Kong Civil Procedure 2009 that “[w]here a pleading is defective only in not containing particulars to which the other side is entitled, application should be made for particulars under r. 12, and not for an order to strike out the pleading under this rule. Even a serious want of particularity in a pleading may not justify striking out if (1) the defect can be remedied, and (2) the defect is not the result of a blatant disregard of court orders …” I am of the view that the cause of the action against Burswood Limited as pleaded could be cured by a request for further and better particulars. 80.Mr Dobby suggested that Australian law being the governing law of the contract and not pleaded, the cause of action against the Burswood Limited as pleaded is not complete. I do not agree. Illegality is to be raised by the defendant although if the court is aware of the illegality, it may refuse to enforce the contract. I do not think the position is that whenever there is an element of illegality, the court would definitely refuse to enforce the contract. The court would still have to look at the circumstances of the case before deciding whether the agreement should be enforced. (See paragraph 32-230, Dicey, Morris & Collins, The Conflict of Laws, 14th edn) I am not satisfied that the cause of action against Burswood Limited could be struck out for disclosing no reasonable cause of action. Submission to Jurisdiction 81.The Plaintiff also argued that by virtue of taking out the Order 21 Summons discussed below, the Defendants had submitted to the jurisdiction of the Hong Kong court. 82.In Lee Fai trading as Fai Kee Timber v Chan Kui (CACV No. 84/1997), it was held by the Court of Appeal that a defendant who wished to dispute the jurisdiction of the court over him had to be careful and should not take any step in the action which might be considered as a submission to the jurisdiction of the court. If he invoked the jurisdiction of the court to his advantage, he waived his right to any earlier irregularity unless the same was fundamental. Thus it appears that if the irregularity is fundamental, a defendant would not be caught by this rule. Whether an irregularity is fundamental depends on the facts of individual case. 83.A defendant would only become amenable to the jurisdiction if he has been served with the originating documents within the jurisdiction. If the service of the writ on the defendant is not proper and is set aside, that would be the end of the proceedings. In our case, if the Defendants did not have a place of business in Hong Kong or leave would not have been granted under Order 11, the Defendants would not become amenable to the jurisdiction of the Hong Kong court. Viewed from this perspective, the irregularity is fundamental and the Defendants would not be caught the principle in Lee Fai. 84.Even if I am wrong on the fundamental nature of the irregularity, the facts in Lee Fai case are quite different from the present case. In Lee Fai, when the plaintiff applied for an extension of the validity of the writ, the defendant chose to contest, unsuccessfully, the application. Default judgement was entered against the defendant when he failed to acknowledge service of the writ. He took out a summons to set aside the default judgement which was described as a regular judgement in the summons. In doing so, he had to, and did, show, unsuccessfully, a defence on the merits. Later the defendant even appeared by his solicitors at the hearing for the assessment of damages. At no stage had the defendant made an application under Order 12 rule 8. The submission to jurisdiction was clear. 85.In the present case, the Defendants had taken out the Order 12 Summons. The Order 21 Summons was taken out with the express qualification that it was without prejudice to the Defendants’ application under the Order 12 Summons. The qualification was reiterated in the affirmation in support of the Order 21 Summons. The Order 21 Summons was based on a settlement agreement which was also on a without admission of liability basis. The settlement agreement was independent of the subject matter of the dispute as it was not related to the referral fees payable. I do not think that prosecuting the Order 21 Summons amounts to submission to the jurisdiction of the Hong Kong court. 86.From the above discussion, I am satisfied that the Order 12 Summons should be allowed either on the ground that there was no proper service of the Writ or that Hong Kong court is the forum non conveniens. Australian court is clearly and distinctly the more appropriate forum. In the case of Crown Limited, the Order 12 Summons would also be allowed on the ground that there is no reasonable cause of action disclosed against it in the Statement of Claim. Order 21 Summons 87.By the Order 21 Summons, the Defendants ask for, inter alia, the following orders:
88.The basis of the application of the Defendants is that there was a settlement agreement between the parties so that an order could be made by the court under Order 21. In short, the Defendants’ case is that, on a without admitting liability basis, the Defendants sent to the Plaintiff a cheque in the sum of HK$147,803.60 (being the equivalent of AU$28,000.00) as full and final settlement of the claim in the present action. There were some disputes on another cheque sent earlier to the Plaintiff but on which the Plaintiff’s name was wrongly written. But nothing turns on that earlier cheque. Some letters were sent by the Defendants’ solicitors, the last being dated 31st December 2008. In the said last letter, the offer of settlement was said to remain open for 14 days. The affidavit evidence of the Defendants’ solicitor is that the solicitor had informed the Plaintiff on the telephone on 21st January 2009 and 6th February 2009 that the offer remained open. The said cheque was in fact cashed by the Plaintiff on 23rd January 2009. 89.The Plaintiff did not deny that he had deposited the said cheque. He denied that the solicitor for the Defendants had informed him on the telephone that the offer remained open. He said that the letter in which the settlement offer was made contained the following terms:
90.He argued that the settlement agreement would be valid only if these two conditions were satisfied, namely, the offer was accepted and the cheque was deposited. He said that as the conditions had already lapsed after 14 days, depositing the said cheque could not amount to a settlement agreement as only one condition had been satisfied. 91.The Defendants cited the case Bell v Galynski and A Kings Loft Extensions Ltd [1974] 2 Lly Law Rep 13 for the proposition that where a plaintiff, without demur or qualification, deposited a cheque sent by the defendant as full and final settlement, must be regarded as excluding him from claiming any further damages. 92.Even if I accept the version of fact and the legal proposition of the Defendants, I still think the Order 21 Summons is misconceived. The purpose of Order 21 is to allow a plaintiff in a claim or a defendant in a counterclaim to seek leave from the court to discontinue the claim or the counterclaim. As to the rationale for this requirement, it is succinctly pointed out in paragraph 21/5/10 of Hong Kong Civil Procedure 2009 that the requirement for leave is that “after proceedings have reached a certain stage the plaintiff, who has brought his adversary into court, should not be able to escape by a side door and avoid the contest, since he is no longer dominus litis and it is for the court to say whether the action should be discontinued and upon what terms…” 93.An application under Order 21 is for leave to discontinue the action by a plaintiff as opposed to for an order to force the plaintiff to discontinue his action. If there is any settlement agreement, the defendants could set up the same as a defence to the claim of a plaintiff. 94.I would dismiss the Order 21 Summons. Order 26 Summons 95.After filing the Order 26 Summons, the Plaintiff had at different stages filed several versions of the Interrogatories he wished to put forward to the Defendants. It of course could not be right for the Plaintiff to change the Interrogatories he wished to administer without a court order or an agreement with the party on which the Interrogatories were to be administered. Mr Dobby agreed to deal with the Interrogatories (1st Revision) dated 2nd March 2009. I would deal with the Order 26 Summons on that basis. 96.The Defendants are yet to file their Defences, pending the outcome of the applications I am dealing with. 97.It is trite law that interrogatories would only be allowed if the court considers them necessary for disposing fairly of the cause or matter or for saving costs. 98.In UCB Bank Plc v Halifax (SW) Limited (In Liquidation) Formerly Colley Sampson Limited (Trading as Hepper Robinson) and K A Ralphs [1997] EWCA Civ 1827 (10th June 1997), the plaintiff’s claim was for professional negligence. The plaintiff was provider of mortgage finance. Another company applied to the plaintiff for a loan to be secured by way of a mortgage of its property. The plaintiff instructed the 1st defendant to provide a valuation of the property. The 2nd defendant was employed by the 1st defendant as a surveyor and valuer to write a valuation report on the property. The company failed to make repayments for the loan and the plaintiff took possession of the property which was then sold at a price substantially below the valuation made by the 2nd defendant. The plaintiff claimed against the 2nd defendant that he was negligent in the provision of his valuation report. The plaintiff administered interrogatories on the 2nd defendant relating to the 2nd defendant’s methodology adopted and materials relied on in the valuation report. When the interrogatories were served, the further and better particulars of the defence had not been served and there had been no inspection of documents or exchange of witness statements. 99.Butler-Sloss LJ referred to the cases Det Danske Hedeslskabet v KDM [1994] 2 Lloyds Reports 534 and Hall v Sevalco Ltd (The Times, March 27 1996/[1996] PIQR 344). His Lordship quoted the following passage from Det Danske Hedeslskabet:
100.His Lordship further quoted from Hall v Sevalco Ltd the following passages:
101.After quoting from those judgements, Butler-Sloss LJ commented as follows:
102.In Mercier v Cotton (1876) 1 QBD 442, the interrogatories were delivered at the same time with the statement of claim. The defendant took out a summons to strike out the interrogatories. The application came before Pollock B who struck out the interrogatories without reading the same. In affirming the decision of Pollock B, the Court of Appeal confirmed that even though, as the Rules then stood, the plaintiff was entitled to serve the interrogatories with the statement of claim, the interrogatories must serve a litigious purpose. At the stage before the defence was filed, there was no occasion for delivering interrogatories. 103.I respectfully agree with the views expressed by Butler-Sloss LJ and the Court of Appeal in Mercier v Cotton. 104.In the present case, as already noted, the two Defendants are yet to file their Defences. It is not even known what their cases would be. The answers sought by the Plaintiff may be contained in the Defences to be filed by the Defendants. It may even be possible that after the issues have been identified by the pleadings, the answers sought are not needed at all. To that extent, I think administering the Interrogatories at this stage would not be necessary and would only lead to unnecessary costs instead of saving costs. The Plaintiff had failed to demonstrate that there were very special circumstances in this case which justified the administering of the Interrogatories at this stage. On this ground alone, I would dismiss the Order 26 Summons. 105.There are 5 Interrogatories, each of which is sub-divided into a few questions. I do not intend to look into them in detail as a result of my ruling above. It is sufficient for me to say that the questions do not seem to be relevant even by reference to the Statement of Claim of the Plaintiff. In fact, as far as Interrogatory 1 is concerned, the same is directed against Crown Limited. But as mentioned already, no cause of action is pleaded against Crown Limited. It could hardly be argued that it is a necessary interrogatory. Interrogatory 5 asks for names and contact information of the witnesses of the Defendants. Until the issues have been identified by the parties, there is no way the Defendants know which witnesses to be called. In any event, an interrogatory as to the names of the witnesses would not be allowed. (See paragraph 26/4/13, Hong Kong Civil Procedure 2009) 106.The Order 26 Summons also asks for production of documents relevant to the case of the Defendants. The Plaintiff clearly has employed the wrong procedures as the right mechanism should be Order 24. What in effect the Plaintiff is asking for is a List of Document and an inspection of the documents which would be done at a later stage of the proceedings if the case goes on. Order 14 Summons 107.As I have allowed the Order 12 Summons, the Order 14 Summons could not proceed any further. I would thus also dismiss the Order 14 Summons. Adjournment on 27th March 2009 108.At the hearing on 27th March 2009, and after about one hour of submission of Mr Dobby, the Plaintiff suddenly informed the court that he did not have the hearing bundle. As such, I had to adjourn the hearing so that the Plaintiff could collect the hearing bundle from the solicitors for the Defendants. I also directed that the audio recording of the hearing on the 27th March 2009 be made available to the Plaintiff. Parties argued where the blame should lie. I directed affirmations to be filed on the service of the hearing bundle by both parties. 109.From the affirmations filed, the Defendants’ solicitors confirmed that the hearing bundle was served at the address of the Plaintiff. The Plaintiff explained that his residential unit shared a common entrance with another unit. There was only a small letter-box which was not big enough for the hearing bundle to be inserted. If the bundle was placed on the floor, it could have been taken away as the entrance was near the refuse collection point. 110.After reading the affirmations in respect of the service of the hearing bundle, I do not think that I should find fault with either party as to who is to blame for the adjournment. I would thus not make any specific cost order in relation thereto. In any event, as no counsel was instructed to appear for the parties, I do not think significant costs were wasted. Orders to be made 111.As a result of the above discussion, I shall make the following orders:
112.As far as costs are concerned, costs should follow the event. The Defendants had submitted a Statement of Costs on the last day of the hearing. But given the circumstances of this case, I think a taxation order would be more appropriate. The cost orders nisi are:
Representation: The Plaintiff, appearing in person. Mr. Dobby of Messrs Lovells for the 1st and 2nd Defendants. |
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