Lam Mable v. World Peace Ltd and Others

HCA 4699/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 4699 OF 2001

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BETWEEN

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Coram : Before Master Roy Yu in Chambers

Date of Hearing : 5 September 2011

Date of Judgment : 30 September 2011

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J U D G M E N T

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1.This is an action taken out by the Plaintiff against the Defendants for possession of a small village house (“丁屋”) built on Lot 1002 DD 220 (“the Land”), and for mense profits.  The Defendants have filed a defence denying that the Plaintiff is the owner of the Land or entitled to possession of the Land.

2.After the Plaintiff has taken out an order 14 summons and after Master Ho determined that no judgment would be granted in favour of the Plaintiff in 2005, the Plaintiff has failed to take any further action in these proceedings until late 2010 when the Plaintiff filed a summons for leave to amend the Statement of Claim.  The Defendant issued a summons to strike out the Plaintiff’s Statement of Claim and to dismiss this action for want of prosecution.  To better understand the issue in dispute and to determine if the Defendant’s application should be allowed, I start with some background history, which are not really in dispute.

3.There is one key character in this set of proceedings, one Mr. Ho Ngau (“Ho”) who is an indigenous villager.  He is entitled to have a piece of land from the government for the erection of a three storeys village house.  In 1992, he has entered an agreement with one Tak Lei Development Limited (“Tak Lei”) whereby Tak Lei agreed to let him have Lot no. 769 DD 220 to facilitate him to apply for a small village house.  Ho agreed that upon completion of the small village house to assign the same to Tak Lei.  While it is questionable if this agreement is against public policy or void, this is not an issue before me today.

4.In 1993, Tak Lei transferred the benefit of the agreement to one Mr. Cheung Shek Kong (“Cheung”).  The assignment was with the consent of Ho.

5.In 1994, Ho had another agreement with Cheung when Cheung agreed to provide Ho with Lot No. 1002 DD 220 for Ho to get the approval from government to build a small house.  Ho agreed to assign the small house to Cheung at the consideration of $350,000.

6.On 10 June 1994, Cheung as the attorney of Ho entered into a provisional sale and purchase agreement with the 1^st Defendant for sale and purchase of the small village house to be erected on the Land at the consideration of $8,000,000.

7.From documents now exhibited to the various affirmations in support of this application, Ho surrendered Lot 769 DD 220 to the government in or about 14 September 1995 in exchange for Lot 1002 DD 220 to erect a small village house.  Restrictions on alienation was imposed by the government in the related Grant, being New Grant no 8629.

8.Pending removal of the restriction on alienation and completion of the sale and purchase between Ho (acting through Cheung) and the 1^st Defendant, the 1^st Defendant was allowed to enter into the possession of the Land after he had paid part consideration in the sum of $2,400,000.  The 2^nd and 3^rd Defendant were allowed to occupy the Land as sub-licensee of the 1^st Defendant.  And the Defendants had been staying in the property until now.

9.Letter of comply was issued by the District Land Office on or about 22 May 2000, upon which the restriction against alienation has been removed.  And by letter dated 12 May 2000, the 1^st Defendant’s solicitor called upon Ho or Cheung for completion within one month.  No completion took place. The 1^st Defendant, through its solicitor claimed the failure amounted to a repudiation on the part of Ho and it accepted the repudiation on 5 October 2000.

10.On about 19 October 2000, Ho through his solicitor called upon the 1^st Defendant for completion.  On 20 October 2000, the 1^st Defendant refused and claimed that the agreement has been repudiated by Ho which had been accepted by the 1^st Defendant.  Accordingly, the 1^st Defendant had no obligation to complete.  Upon the agreement having been repudiated, the 1^st Defendant also demanded refund of the deposit paid in the sum of $2,400,000.  Further, the 1^st Defendant refused to deliver vacant possession until the said deposit has been refunded.

11.Ho considered that the 1^st Defendant was in breach of the sale and purchase agreement.  On 23 October 2000, the solicitors for Ho accepted the Defendants’ repudiation and gave notice to forfeit all deposit.  They also demand vacant possession of the Land.  On 24 November 2000, Ho issued an action in the High Court being HCA 10132 of 2000 against the 1^st Defendant for possession of the Land and for damages.

12.The above history seems to be the dispute between Ho and/or Cheung with the 1^st Defendant and has nothing to do with the Plaintiff.  Indeed, the Plaintiff only came into picture on 30 November 2000.

13.On 30 November 2000, the Plaintiff entered into a sale and purchase agreement of the Land with Ho whereby Ho agreed to sell the Land to the Plaintiff at the consideration of HK$4,380,000.  By an assignment of the same date, Ho assigned the Land to the Plaintiff.  It is the Plaintiff’s case that by this assignment, she has become the registered owner of the Land.  She also claims that Ho has terminated the licence to the 1^st Defendant, and hence the sub-licence of 2^nd and 3^rd Defendants has been terminated at the same time.  She also claims that in the alternative, the licence in favour of the 1^st Defendant would have been revoked when Ho assigned the Land to her. 

14.The Plaintiff only issues this action on 31 October 2001.  And the writ together with the Statement of Claim has only been served on the Defendant in August 2002.  Acknowledgment of service has been filed by the Defendants on 29 August 2002.

15.The Defendants have prepared a chronology of proceedings in this action.  Mr. Cheung, counsel for the Plaintiff also prepared a chronology which set out in greater details of the proceedings, which I find to be correct.  At this stage, I need to mention only two matters.  After the Defendants have filed an acknowledgment of service, they applied for extension of time to file the defence.  Before they obtained leave of this court, the Plaintiff has entered default judgment against the Defendants.  On the hearing before Master Brock, the default judgment has been set aside and retrospective leave was granted to the Defendants to file the defence and counterclaim (which has been filed in court on 19 October 2002 without leave).  The matter was taken on appeal on the issue of costs and was resolved by Deputy High Court Judge A. Cheung (as he then was) on 17 February 2003.

16.After disposing of the issue on default judgment, the Plaintiff took out an order 14 summons on 30 June 2003.  Direction for exchange of evidence and setting down for argument was given by Master Lung (as he then was) on 14 July 2003.  There were further directions on filing of affirmation, and the last affirmation in issue, the 2^nd Affirmation of Ho was filed on 27 March 2004.  No further action was taken by the Plaintiff until 6 April 2005 when she filed a notice of intention to proceed.  The 3^rd Defendant applied for legal aid and there were other interlocutory application.  The order 14 summons was only heard by Master Ho on 28 September 2005.  No order was made on the summons and no direction on further conduct of this Action had been given by Master Ho as the parties would like to amend their respective pleadings.  The order/direction given expressly reserved to the Plaintiff the right to take out a fresh order 14 application.

17.Since the order of Master Ho, the Plaintiff had taken no steps in these proceedings.  In fact, the Plaintiff only filed a Notice of Intention to Proceed on 20 December 2007.  No fresh proceeding has been taken out thereafter.  The Plaintiff filed yet another Notice of Intention to Proceed on 22 September 2009.  On 25 August 2010, Messrs. Choi & Liu the present solicitors for the Plaintiff filed a Notice of Change of solicitors.  And a summons to amend the Statement of Claim has been filed on 9 November 2010.  The Defendants objected to the application and the summons had been adjourned for argument.  And on 2 December 2010, the Defendants took out this summons to strike out the Plaintiff’s Statement of Claim and the Action for want of prosecution.  The Plaintiff’s summons for amendment has been adjourned for argument but to be heard after determination of the Defendants’ summons for striking out.

18.The 3^rd Defendant has filed her 6^th and 8^th Affirmations in support of this summons.  The Plaintiff has filed her 4^th Affirmation.  It is only in July 2011 when the Plaintiff took out a summons to apply for leave to adduce further affirmation for today’s hearing.  The Defendants object to the application.  Having heard the submission by Mr. Cheung, I am not convinced there is any special reason for putting in the late application.  In fact, Mr. Cheung cannot explain why, since the 3^rd Defendant filed her 8^th Affirmation in January 2011, the Plaintiff has not applied to this Court earlier for leave to put in the proposed 7^th Affirmation of the Plaintiff.  Accordingly, I dismiss the application with costs to the Defendants.

19.I shall now come to this substantive application by the Defendants.  The Defendants seek to strike out the action on three alternative grounds. Firstly, the Defendant complained that the Plaintiff has been guilty of inordinate and inexcusable delay, which delay has caused and is likely to cause substantial prejudice to the Defendant and/or there is a real risk that a fair trial is impossible.  They further added that conduct of the Plaintiff is contrary to the underlining objectives of the new rules under the Civil Justice Reform.  I shall first deal with this ground of application. 

20.It cannot be disputed, and in fact it is admitted by the Plaintiff that there is a period of inactivity from 28 September 2005, i.e. the order of Master Ho, until 9 November 2010 when the Plaintiff took out a summons to amend the Statement of Claim.  Mr. Cheung does not dispute the fact that the filing of notice of intention to proceed is not an action in the proceedings.  The new Rules of High Court under the Civil Justice Reform come into effect on 2 April 2009.  For the last 19 months of the period of the inactivity, the new Rules applied.

21.The Defendants also complain that there is inactivity for the period from November 2003 to March 2005.  And if I adopt the chronology prepared by Mr. Cheung, after filing of the 2^nd Affirmation of Ho on 27 March 2004, there is no activity until June 2005 when the Defendant requested for further and better particulars of the affirmation of the 3^rd Defendant.  Taking into account the application by the 3^rd Defendant for legal aid in early May 2005, there is a period of inactivity for about 14 months.

22.The Defendant also complained that there is another period of inactivity between December 2002, when the Plaintiff should have taken out summons for direction under the old Rules of High Court to June 2003 when the Order 14 summons was taken.  I give the benefit to the Plaintiff that during this period, there is appeal against the order of Master Brock and I do not take into account this period of inactivity.

23.The Defendants also complain that the Plaintiff has failed to serve the Writ after it has been issued.  The Writ which was issued in October 2001 has only been served on the Defendants in August 2002.  Again, I am not prepared to take this period into consideration.  Technically, the Defendants are not parties to this proceeding until they have been served with the Writ.  The Plaintiff is of course entitled to decide whether they want to proceed with the proceedings by serving the writ on the Defendant.  If the Defendants feel aggrieved, the proper recourse is to make application to this court for direction that the Writ be served upon them and failing which the Action be struck out.  I do not take such a period of inactivity into account for any application for striking out on the ground of want of prosecution.

24.The Defendants also complain that the Plaintiff has failed to issue the Writ after they became the owner of the Land.  I accept the submission of Mr. Cheung that the pre-action delay should not be taken into account.

25.Summing up the above chronology, there have been periods of delay summing up to about 74 months, of which 19 months is pro-CJR.  As I mentioned in court, a delay of over 5 years is a substantial delay.  Prima facie, it is an inordinate delay and short of explanation, it is inexcusable.

26.It is explained by the Plaintiff that she has not proceed with the case because of two reasons.  Firstly, she claimed that she had financial difficulties during these 5 years.  Secondly, it was attributable to the expenses she has to pay in order to support her son who is born with learning difficulties.  She provides this court with some evidence on the school fees that she has to pay for her son studying in the USA, and the costs of maintaining a maid to take care of him in the USA.  But the Plaintiff has not disclosed to this court her monthly earning.

27.The Plaintiff also claims that she had health problem.  She has been diagnosed to suffer from heart disease and has spent around HK$100,000 for medical expenses.  There is no detail of her medical condition and there is no suggestion that because of her health, she cannot proceed with the proceedings.  This is not an excuse for not proceeding with the case.

28.On the income of the Plaintiff, the Defendants has adduced evidence to suggest that at the material time, the Plaintiff has properties and she has sold some of them.  I do not need to go as far as to infer that the Plaintiff would have sufficient funding.  But by merely showing the Court her expenses without giving this Court information of her assets and income, the Plaintiff does not begin to prove that she has financial difficulties.

29.The last reason offered by the Plaintiff is that, her previous lawyers are not getting things done fast enough.  This is not an excuse and the Defendants should not suffer if her lawyers do not proceed with the case properly.

30.In fact, Mr. Cheung has not offered much explanation for the delay.  I appreciate his difficulty.  But with the above evidence, I conclude that the periods of delay are inordinate and inexcusable.

31.On application to strike out the want of prosecution, I believe the leading case is Birkett v. James [1978] AC 297 it is said by Lord Diplock in the judgment that: -

“The power should exercise only where the court is satisfied either (1) that the default has been intentional or contumelious, to a peremptory order of the court or conduct amounting to an abuse of the process of the court; or (2)(a) that has been an inordinate and inexcusable delay on the part of the Plaintiff or his lawyers; and (b) that such delay will give rise to substantial risk that it is not possible to have a fair trial of the issue in the action or such is likely to cause or to have caused serious prejudice the Defendants either between themselves and the Plaintiff or between each other or a third party.”

32.I understand that the Defendants indeed rely on both limbs as set out in the judgment of Lord Diplock.  I shall come to the abuse point later in this judgment.  For this part of the application, I found that the Defendants have established that there is an inordinate and inexcusable delay.  But the Defendant has to satisfy the court that there is serious prejudice to the Defendants.

33.I refer to the Defence filed in this action.  The Defendants claimed that Ho is still the registered owner of the Land.  They claimed that Cheung and the Plaintiff, through one Mr. William Chu, on about November 2000 misled and/or deceived Ho to execute the assignment of the Land to the Plaintiff. Further no consideration has been paid by the Plaintiff to Ho as claimed or at all.

34.I was referred to an Affirmation of Ho dated 4 November 2003 filed by the Defendants in opposition in the order 14 application taken out by the Plaintiff.  Ho stated in paragraph 2 of his Affirmation that: -

“ (1) 本人從來沒有把南山村163號之業權售賣給原告人。對於原告人所說本人於2000年11月30日簽署的買賣合約及同日簽署的契據亦不知情。如本人確有在該等文件上簽名，乃因為受誤導的情況下才會簽署，該等文件在法律上無效。

(2) 本人絕對沒有收受原告人所指的438萬作為賣樓的金額。本人從來不認識原告人，也沒有接受過原告人任何金錢利益。原告人須拿出真確的證據，不可隨便捏造事實。

(3) 由於本人並沒有售樓予原告人，所以本人在法律上並沒有任何責任要把南山村163號交吉予原告人。

(4) 本人亦沒有如原告人申索陳述書之第5段所說於2000年12月23日或其他任何時間終止第一被告人世和有限公司對於南山村163號的特許與及其管有權。本人對於被告人繼續居住或使用該樓宇並無反對。”

35.The Defendants claimed that the evidence of Ho is material to their defence.  If they could establish that Ho has been misled to execute the assignment, the Plaintiff is not the rightful owner of the Land and accordingly, the Plaintiff’s case must fail.  As the incident took place more than 10 years ago, the Plaintiff invited me to draw the inference that the memories of the relevant witnesses must inevitably fade.

36.In reply, Mr. Cheung submitted that the evidence of Ho is well documented.  In particular, Mr. Cheung referred me to paragraph 3 of the said Affirmation of Ho: -

“另外，本人曾於1995年簽訂一份授權書，授權張錫剛先生處理有關售賣本人經權與協助發展商在西貢220約1002地段的物業發展事宜。於1995年至2000年間，張錫剛曾透過一位朱家樂先生，多次著本人簽署多份英文文件。所有文件的簽署都是由朱家樂安排，本人沒有與張錫剛先生見過面。”

37.Mr. Cheung submits that Ho has admitted giving a power of attorney to Cheung in relation to the sale of the small house to be built on the Land in his Affirmation.  And he has admitted signing certain English document.  The affirmation is in such details that could assist Ho to refresh his memory.

38.The Defendants referred me to a comment by Mr. Justice Au in a case Cheung Sai Kit v Wong Chiu Kit HCA 1611/2005, when his Lordship commented that although the defendant could have the benefit of the affirmation filed in the order 14, it does not mean that the Defendant would not suffer the risk of an unfair trial by reason of the inordinate delay, in particular in cases where the affirmation were filed for interlocutory purpose which may not have suffered many of the details of the event to be recorded.  But each case must turn on its own fact.

39.For today’s application, Ho has not filed any affirmation to suggest that he has difficulties in recalling the relevant transactions.  I have to say that, having read through the Chinese Affirmation of Ho filed for the order 14 summons, he has set out most of the details.  I agree with Mr. Cheung that the evidence is well documented.  I am not convinced that Ho would suffer from fading memory to such extent that no fair trial is possible.

40.The Defendants further submitted that prejudice could take different form.  They claim that the health condition of both the 2^nd and 3^rd Defendant were negatively affected with the litigation hang over the heads for over 10 years.  The 3^rd Defendant had been diagnosed with cancer in January 2010.

41.While accepting this is a form of prejudice, I do not conclude this is serious prejudice to the extent that this court should dismiss the Plaintiff action.

42.The Defendants also complained that this action deprive the 1^st Defendant the opportunity to settle the dispute with Ho in HCA 10132/2000.  Pausing here, HCA 10132/2000 was instituted by Ho to claim termination of the sale and purchase argument with the Defendants and for possession.  It is apparent from the evidence before me that the action is commenced by Cheung as attorney for Ho.  Subsequently, Ho revokes the power of attorney and the action is in abeyance.

43.However, there is no detail of what had been offered by Ho or the Defendants to Ho to settle the matter.  I am not in a position to assess if any opportunity for settlement has been affected by this action. 

44.In conclusion, the Defendants fail to establish prejudice.

45.Further, even if the Defendants could establish serious prejudice, the Court has to decide whether it is an appropriate case to exercise the discretion to strike out the Action.  Mr. Cheung submitted that the Plaintiff’s main claim is for possession of the Land.  The limitation period is 12 years from the time the cause of action first arises.  The Plaintiff’s right to bring the action accrue in November 2000.  Accordingly, if I strike out the Action today, the Plaintiff is entitled to bring a fresh action tomorrow.

46.Mr. Cheung has referred me to a number of cases in Hong Kong and the United Kingdom when it is commented that the Court is slow to exercise the discretion when the limitation period has not expired.  I agree.

47.The Defendant submitted that the limitation period for the claim for mesne profit is 6 years.  Accordingly, at least part of the mesne profit claim by the Plaintiff is time-barred.  They further submitted that I have to consider the application in the spirit of the Civil Justice Reform.  Since the introduction of the new Rules of High Court under the Civil Justice Reform, it is imperative for the Court to have regard to the underlying objectives which are set out in the order 1A rule 1 of the Rules of High Court.  It serves as a caveat to litigants and the legal advisers that the parties’ conduct of the proceedings has to be viewed in accordance with the new Rules and with regard to the underlying objectives as set out in Order 1A.

48.In fact, I have no disagreement with this submission.  The question before me is whether in light of the Civil Justice Reform, the dismissal of the Plaintiff claim in the circumstances of this case can properly achieve the objectives of the Rules of High Court.  And the fact that the main claim of the Plaintiff for possession is not time-barred must be a significant factor for me to take into account to decide whether I should exercise my discretion to strike out the Plaintiff’s action.  The action would be started again and that would not be a waste of time and costs for me to strike out the action.  I do not consider this is an appropriate case to exercise my discretion, even if I am satisfied that there is prejudice to the Defendants.

49.On the exercise of my discretion, Mr. Cheung also referred me to the judgment of Deputy High Court Judge Seagroatt in HCA 66/2000.  This is a dispute over tenancy matter.  The defendant in that case applied to strike out the case of want of prosecution.  The application was dismissed by Master Levy and the matter went on appeal to the Honourable Deputy Judge.  The Honourable Deputy Judge referred to the judgment of Neuberger J (as he then was) in Annodeus Entertainment Limited and another v Gibson and another, Chancery Division, 2 February 2000.  Neuberger J set out nine factors that a court should take into account when considering a dismissal for want of prosecution.  Three of the factors are considered by Deputy Judge Seagroatt: -

“Seventhly, the CPR enable the court to adopt a more flexible approach. The previous “all or nothing” extremes of either dismissing the claim for delay or permitting it to continue are now merely the two ends of a spectrum. The court has other sanctions at its disposal which it can and, in appropriate cases, should impose, rather than adopting one of the two extreme positions. Those weapons, those sanctions, are discussed in the judgment of Lord Woolf in Biguzzi at pages 1933D to 1934C of the [1999] 1 WLR 1926 report, and I do not propose to set them out here save to mention that they include payments into court, providing for no interest in favour of the claimant or for high rates of interest in favour of the defendant and for appropriate directions and supervision for the future conduct of the trial. As the decision of the Court of Appeal in AXA Insurance Co Ltd v Swire Fraser (Unreported) 9 December 1999, shows, it is also possible for the court to exercise its jurisdiction to strike out parts of the claim (see per Tuckey LJ at para 25).

Eighthly, in light of general principle and the overriding objection (see CPR, r 1.1(2)) the sanction, if any, to be invoked by the court to deal with a particular case of delay should be proportionate. To dismiss a claim where the claimant appears to stand a reasonable chance of success and of recovering substantial damages is a strong thing to do. [my emphasis] Particularly so bearing in mind art 6(1) of the European Convention on Human Rights, a point touched on, in somewhat different circumstances, by Laddie LJ in Re Swaptronics Limited (unreported, 24 July 1998) and Evans-Lombe in Arrow Nominees Inc and another v Blackledge and others, The Times 8 December 1999. In those cases the question was whether to strike out a claim in circumstances where the claimant had been in contempt of court, in the latter case the contempt being directly related to documents concerned with the action.

Ninthly, it appears to me that it is normally relevant to consider the following factors. First, the length of the delay; secondly, any excuses put forward for the delay; thirdly, the degree to which the claimant has failed to observe the rules of court or any court order; fourthly, the prejudice caused to the defendant by the delay; fifthly, the effect of the delay on trial; sixthly, the effect of the delay on other litigants and other proceedings; seventhly, the extent, if any, to which the defendant can be said to have contributed to the delay; eighthly, the conduct of the claimant and the defendant in relation to the action; ninthly, other special factors of relevance in the particular case.

50.This principle is adopted by the Honourable Deputy Judge in the case.  The defendant as tenant has the uninterrupted use of the land in issue.  The structure on the land may be illegal but it is not to be determined by the Hon. Deputy Judge at this stage.  His Lordship commented that: -

“To put an end to these proceedings would be to occasion enormous prejudice to the plaintiffs and potentially give the defendants an undeserved benefit of significant proportions, and as a consequence prevent the examination of alleged fraudulent activity. It will leave an unhealthy vacuum.”

51.It is not dispute that HCA 10132/2000 is still ongoing.  As submitted by Mr. Cheung, this Court should take the proportionality into consideration to decide whether we should exercise the discretion in favour of the Defendants.  

52.And according to the evidence before me, the Defendants have repudiated the sale and purchase of the Land with Ho (or Cheung).  They may be entitled to a purchaser lien, but not for possession pending repayment.  The Defendants are only relying on a licence given to them by Ho.  It is highly questionable if they could maintain the licence as it is their own case that they have repudiated their agreement with Ho, which must be part and parcel of the sale and purchase agreement.  

53.If I struck off this case, the Defendants would in effect be entitled to possession of the Land without paying the full consideration they have committed to pay in their contract with Ho.  On the basis that if Ho could not set aside the assignment in favour of the Plaintiff and I am not aware of any application made by Ho  herein or in any action, and if I strike out the Action, no one will be entitled to recover the Land from the Defendants.  They will have a windfall that they are not entitled to. 

54.I am not at this stage making any ruling.  But looking at the issue that in dispute, I have to say that the loss to the Plaintiff if I strike out the case is not proportionate to the prejudice to the Defendant.  This is yet another factor I should take into account.  With the fact that limitation period for possession has not expired, this is not a just case to exercise my discretion even if there is prejudice to the Defendants.

55.I shall now move on to the second limb of the Defendants’ argument, that the action should be struck out on abuse.

56.It is recognized that there is a separate and long established power that the court may dismiss an action for abuse of process by virtual of its inherent jurisdiction.  It is an abuse if the Plaintiff brought an action with no intention to bring the case to trial.  This I believe is also the first limb in the Birkett’s case and has been confirmed by Lord Whoolf in Grovit v Doctor [1997] 1 WLR 640.  Borrowing the words of Lord Whoolf, “the court exists to enable parties to have their disputes resolved.  To commence and to continue litigation you have no intention to bring to conclusion can amount to an abuse of process.”

57.The Defendants also referred me to the judgment of Mr. Justice Au in Cheung Sai Kit v Wong Chiu Kit HCA 1611/2005.  His Lordship commented that: -

“The inactivity of Mr. Cheung in taking any steps in the action for 22 months (which is a long period) bounds to prima facie evidence of his lack of intention to continue the action to a conclusion.”

58.It is the complaint of the Defendants that, by the inactivity of the Plaintiff for a period of over 5 years, that amount to prima facie evidence of his lack of intention to continue.  The burden rests on the Plaintiff to satisfy this court that there is not the position.

59.Mr. Cheung refers me to the judgment of Mr. Justice Woo given in New China Hong Kong Group Limited v AIG Asian Infrastructure Fund LP [2005] 1 HKLRD 383.  His Lordship found that if a litigant brings an action without intention to bring it to trial but simply use the action to put pressure and anxiety on the other parties, it is an abuse.  However, “short of this kind of conduct, an inordinate and inexcusable delay on a part of the plaintiff, without proof of intention to abuse the court process, cannot be a ground to strike out or otherwise the right to make claim within the limitation period, as accorded by statute would be removed.”

60.Mr. Cheung submitted that the matter complain of against the Plaintiff is nothing more than delay.  It is not sufficient to establish that the Plaintiff has no intention to continue with the action and to bring it to a trial.

61.The Defendants argue that the excuse given by the Plaintiff for inactivity, including lack of finance or change of solicitors are not acceptable excuse for an undue delay and it cannot rebut the prima facie evidence that the Plaintiff has no intention to advance this action to trial. They submitted that after the unsuccessful order 14 application, the Plaintiff realizes that she had a weak case.  They submit that she consciously chooses to warehouse her case as long as possible until the memory of witnesses and bank records all faded into obscurity.

62.I am not convinced that there is evidence to suggest the Plaintiff deliberately warehouse the case until a convenient time.

63.There are matters which have not been properly answered.  To begin with, the order 14 application come to an end when the usual direction should be given by the hearing master.  In this particular case, Master Ho did not give necessary direction for future conduct of the case on the basis that the parties expressed to him that they have to amend their respective pleadings. The Plaintiff must be under a duty to proceed with the amendment as soon as possible.

64.Secondly, if no amendment has been taken out, the pleading would have been closed after the time filing a reply.  Strictly speaking, Plaintiff would be duty bound to take out the direction summons, or under the Civil Justice Reform to issue a case management summons.  None of this has been done.

65.In light of the above, the Defendants submit that the conduct of the Plaintiff can amount to an abuse.  But I have to bear in mind that these are not unless orders.  Although it is prudent for the Plaintiff to have taken out the necessary application on time, having taken all the complaints into consideration, I do not agree that the Plaintiff’s conduct amount to an abuse of Court proceedings. 

66.Further, if there is abuse, the court still have to consider whether it is fair to exercise the discretion to strike out the action, and particular in light of the Civil Justice Reform, whether the dismissal of the Plaintiff’s claim in the circumstances can properly achieve the objective of the Rules of the Court.

67.In the consideration of exercising of my discretion, I come to the same argument as analyzed above.  Given the fact that the action is not time-barred, and on the added consideration of proportionality, I repeat my finding above mentioned that this is not an appropriate case that I should exercise my discretion.

68.I now turn to the other complaints of the Defendants.  They complain that the Defendants has abused the Court proceedings.  They referred to the argument before Master Brock when the default judgment has been set aside.

69.Further, they complain that when the Plaintiff took out an order 14 application, she stated in the supporting affirmation that she believes the Defendants has no defence to this action, and she cannot make such an averment honestly.

70.The last complaint that the Defendant is the Plaintiff now seeking to amend the Statement of Claim.  By the amendment, it only shows that the Plaintiff now agreed that she was pleaded in the original Statement of Claim is false.

71.On the summons for amendment, it is sufficient for me to say that, looking at the amendment, the Plaintiff is still rely on the assignment as the basis of the claim of possession.  It is quite clear that she has added some details which are missing in the original Statement of Claim.  Such might be commented but I am not convinced its amounts to abuse or deliberate covering up or lying to this Court.  Having considered all the matters and all the argument, I am not convinced there is other ground to support the Defendant’s application to strike out on the ground of abuse.

72.I consider the written submission and I heard the oral argument. However I am not convinced this amount to abuse.

73.In conclusion, I refuse the application of Defendants.  Nevertheless, given the history of this case, I believe it is one of those cases which this court cannot leave the case without giving a stringent timetable for the Plaintiff to comply with various directions.  To begin with, the Plaintiff is obliged to restore the summons for amendment within the next 14 days to a master on the usual 3-minutes call-over list.  If the Plaintiff fails to restore the summons for amendment within 14 days, the claim should be dismissed.

74.Further, within 14 days, the Plaintiff should take out a case management summons returnable at the same time as the summons for amendment.  Direction for further conduct of the case could be given.  And this Court may impose sanction against, in particular the Plaintiff, for failure to comply with any time set. With further directions on case management, I am sure the case could be brought to trial within a reasonably short period of time.

75.On question of costs, although the Defendant failed in the case, this is one of those cases which I see no reason why the Plaintiff should not bear the costs of the Defendants.  It is mainly on the consideration whether I should exercise my discretion when I refuse to strike out the Plaintiff’s claim.  In such a situation, I grant order nisi that the Plaintiff should pay the costs of the Defendants forthwith to be taxed if not agreed.

Mr. Adonis KW Cheung, instructed by Messrs. Choi & Liu, for the Plaintiff

Defendants appearing in person