Hongkew Holdings Ltd and Another v. Kongson Securities Ltd and Others
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CACV000106/1992
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----------------- Coram: Hon Penlington and Hon Nazareth, JJ.A. and Hon Liu J. in Court Date of hearing: 30th October 1992 Date of delivery of judgment: 30th October 1992 Date of handing down of reasons: 6th November 1992 ------------------------ J U D G M E N T ------------------------ Liu, J. 1. In this action, the plaintiffs' claim against all six defendants arose from 10 million shares of Kee Shing (Holdings) Limited purchased for some $13m. in November 1990. This action was commenced in July 1991. In September, 1991, the 1st to the 4th defendants caused to be filed their Defence and only the 1st and the 2nd defendants counterclaimed. 2. By a summons filed on 30th October 1991, the plaintiffs sought particulars from the 1st - 4th defendants on the Defence. On 12th March 1992, Master Cannon granted 12 requests for further and better particulars under 9 paragraphs, including paragraph 51 which is in fact part of the Counterclaim. 3. On 17th March 1992, a Notice of Appeal was lodged by the plaintiffs, and it came before Deputy Judge Fung on 4th June 1992. Of the 12 requests granted, 2 were upheld by the Deputy Judge. They are request (1) under paragraph 7(1) of the Defence and a request under paragraph 51 of the Counterclaim. All the orders made in consequence of the plaintiffs' said summons for particulars against the 1st - 4th defendants were confined to the 1st and the 2nd defendants who were the parties prosecuting the instant appeal. 4. The plaintiffs raised multifarious claims against all the defendants after the disposition of these 10 million shares allegedly without the plaintiffs' knowledge or consent. The 1st - 4th defendants deny the plaintiffs' allegations and resist their claims. 5. The case of the 1st - 4th defendants is that the loss of the said 10 million shares to the plaintiffs was caused by, inter alia, wrongful acts of the 5th and/or 6th defendants or by their instructions given allegedly on behalf of the plaintiffs to the 1st and 2nd defendants. It is also a defence that the plaintiffs had held the 6th defendant out as their agent both orally and in writing. Part of the particulars pleaded in support of the alleged ostensible agency authority is that the 6th defendant was the "liaison person" dealing with the 1st and the 2nd defendants on behalf of the plaintiffs in a prior share placement exercise in 1990. On all the allegations in the Defence and Counterclaim, in particular, the alleged wrongful acts or instructions of the 5th and/or 6th defendants in respect to the passing over the said 10 million shares to the 6th defendant, the 1st and the 2nd defendants counterclaim for an indemnity from the plaintiffs for whatever loss the plaintiffs have thereby sustained. 6. Paragraph 7 of the Defence and the particulars at issue read :-
The plaintiffs asked of the 1st - 4th defendants, inter alia, the following further and better particulars of the aforesaid pleaded Particulars
7. An Order was made in terms by the Deputy Judge. In effect, the 1st and the 2nd defendants were ordered to furnish further and better particulars of the Particulars so given for a holding out plea under paragraph 7 of the Defence. But, evidently Particulars (1) must be considered on its own, though in the context of an estoppel plea, for deciding as to whether the plaintiffs are sufficiently put on notice what case they have to meet. Particulars (1) are particulars for alleged ostensible authority, but it is not pleaded in what way the 6th defendant is said to have been involved. It is not even specified, if there be a holding out, whether he was put forward as or himself claiming to be the "liaison person" on behalf of the plaintiffs in the share placement exercise in 1990. It is also not disclosed what animal a liaison person was. The allegation is, in these Particulars, simply that the 6th defendant "was the liaison person ... on behalf of the plaintiffs" during the share placement exercise. (Emphasis added) It is decidedly a material averment of past conduct made in support of the alleged holding out, which could take a great many forms and manifest itself in a variety of capacities. In this fully-fledged contest, the prolific accusations and counter-accusations in the exceedingly long pleadings would themselves call for clearly defined and well particularised issues, especially against the matrix of shares transactions. 8. The manner in which the Deputy Judge dealt with a similar request for further and better particulars under another head cannot have any significant relevance. For the assertion in Particulars (1), the plaintiffs would need to know the legal capacity in which such alleged "liaison person" acted and, if pertinent, the principal whom the 6th defendant in that capacity is said to have served. In these areas, the generality of the words "on behalf of the plaintiffs" is momumentally unhelpful. 9. Before proceeding to give reasons, the Deputy Judge pronounced his ruling enjoining the 1st and the 2nd defendants to deliver further and better particulars under paragraph 7(1), request (1) of the Defence. A right decision for the wrong reason would provide but cold comfort to these defendants. The Deputy Judge noted the submission of counsel that the particulars sought had already been sufficiently pleaded in the body of the Defence. "Unfortunately", the Deputy Judge in effect observed, "(in any case the) Answer does not say so." As we know, these defendants' Answer to the request was : "The plaintiffs are not entitled to the particulars (so) requested". The Deputy Judge was agreeable that if the particulars requested had in fact been sufficiently pleaded in the body of the Defence, the request could be taken as met. Therefore, not only should these defendants not have assumed a different stance from that in their served Answer, they ought to have pleaded sufficiently to the allegation for which better particulars were requested. The particulars sought may be so sufficiently pleaded elsewhere in the body of the Defence, but a general reference to these particulars in the Defence would not suffice. In the body of the Defence, the Deputy Judge found it difficult to identify, unaided, sufficient pleading of particulars with the allegation of "liaison person", and he ordered these defendants to better particularise their assertion. 10. There is always room for refinement in an ex tempore decision, but the rationale of the Deputy Judge is tolerably clear otherwise he would not have made the ruling he did. 11. The suggested particulars in counsel's submission are buried in a maze of allegations in the Defence, and the1st and the 2nd defendants are obliged to clearly state facts on which they seek to maintain their allegation in those particulars in paragraph 7(1). The plaintiffs should not be left to search for better particulars, however included, in the body of the Defence. In my view, the Deputy Judge's decision is clearly right and his reasoning, understood in the proper context, is supportable.
These defendants' counterclaim for an indemnity is, therefore, based on all the premises advanced in the Defence and Counterclaim which embody perambulating and wide-ranging assertions. Some paragraphs in the Defence are clearly irrelevant to the claimed indemnity. More proximately, paragraph 48 of the Counterclaim postulates the possibility of an ambiguity in the instructions given by the 5th and/or 6th defendants on behalf of the plaintiffs to the 1st and the 2nd defendants in respect to the 10 million Kee Shing shares. Leading counsel for these defendants was quite undecided even before us as to whether his clients would seek to make much of ambiguity, if any. There is a need for the 1st and 2nd defendants to condescend upon particulars as to the nature of their claimed indemnity. 12. The plaintiffs' request for further and better particulars of paragraph 51 of the Counterclaim is couched in general terms :-
Mr Hatton for the plaintiffs directed our attention to Selangor United Rubber Estates Ltd. v. Cradock and Ors., [1965] Ch.D.896 where particulars of the nature of an alleged duty were applied for and granted. Mr Hatton submitted that like further and better particulars were requested of the nature of the alleged indemnity here. Evidently the request could have been better formulated, but there was no misunderstanding before the Deputy Judge. As fully appreciated by all, it was the particulars of the nature of the alleged indemnity which were demanded. Counsel then appearing for the 1st and 2nd defendants cited paragraph 47 of the Defence as a source for the requested particulars in terms of instructions given by or through the 5th and/or 6th defendants to the 1st and the 2nd defendants for the plaintiffs in respect to the delivery of the 10 million Kee Shing shares to the 6th defendant. The decision of the Deputy Judge is well-reasoned. He acknowledged that law need not strictly be pleaded. The Deputy Judge found the nature of the indemnity, so peripherally maintained, obscure. The Deputy Judge was assisted from the Bar that the claimed indemnity stemmed from the 1st and the 2nd defendants' alleged reliance on and implementation of the plaintiffs' instructions said to have been given through the 5th and/or 6th defendants. these defendants did not apparently invoke all the premises pleaded but their case was said to be wholly encapsulated in paragraph 47 of the Defence. The Deputy Judge was receptive to the suggestion that a mere reference made in the Answer to paragraph 47 of the Defence would likely meet the request for particulars made under paragraph 51 of the Counterclaim, but he underscored the broad principle that "the nature of (these defendants') claim for indemnity (must be) precisely (stated) so that the same could be understood and pleaded to". Therefore, the 1st and 2nd defendants must sufficienly disclose the nature of their indemnity claim in further and better particulars. Despite leading couusel's final gallant attempt, no point can truly be said to have been taken in the Notice of Appeal on the form of the request or the terms of the Deputy Judge's Order. Particulars of the nature of the claimed indemnity were the core issue, and in effect these defendants were ordered to furnish these particulars. The Deputy Judge's endorsement of the plaintiffs' request made under paragraph 51 of the Counterclaim cannot, in my view, be faulted. 13. As for costs, of the 12 requests, only 2 were sustained by the Deputy Judge. In considering these two requests granted by the Deputy Judge, the whole of the Defence and Counterclaim must have been brought into focus and reviewed. Paragraph 51 of the Counterclaim then called in aid all "the premises". The Deputy Judge had the advantage of the actual time consumed in the debates of separate disputed issues. He ordered costs before him to be costs in the cause. We were unable in this appeal to interfere with his discretion. Costs of this appeal, by general consensus, followed the event. 14. We ordered the appeal to stand dismissed with costs to the respondents against the lst and the 2nd defendants in any event. We informed counsel of our intention to hand down our reasons, and on my part this I now do. Nazareth, J.A. 15. I am indebted to my Lord Liu J. for his exposition of the somewhat involved nature of this matter. 16. As to the request for further and better particulars of Particulars (1), 1 have some sympathy for Mr Edward Chan's complaints about its terms in that these appear to be posited upon agency in pursuance of actual authorisation, whereas the averment in paragraph 7 of the Defence is that the 6th defendant was held out by the plaintiffs to be their agent. However that may be, Mr Chan cannot now be heard to complain for there is nothing in the Notice of Appeal of this. And as to his submission that the particulars sought are already to be found in the pleadings, I would have none of it, for the answer actually given was that the plaintiffs were not entitled to the particulars. Indeed Mr Chan goes further and submits that that is the same as saying that the.particulars are already pleaded in the defence. Those who indulge in such unhelpful semantic games which waste the courts' time should not expect any sympathy, particularly when there are no merits in their stance. I will add only that if the particulars are indeed somewhere in the Defence buried in a mass of averments, so that the defendants' legal advisers' assistance is required to identify them, it must obviously be right that the defendants be required to particularise them. No more need be said. 17. Proceeding to the request for further and better particulars of paragraph 51, I confess that at first sight it seemed to me that this was better designed to secure particulars of the legal nature of the claim for indemnity than of the material facts relied upon. However, I was persuaded on the authority of Selangor United Rubber Estates v. Cradock and Ors. that the request must be regarded as being in order. It was contended on behalf of the defendants that particulars should be refused as they were to be found in paragraph 47 of the Defence. That contention was made with reference to the claim for indemnity founded upon the entire 49 paragraphs of the Defence, narrowed down in a sense only by the words "in particular, paragraphs 46 to 48" in paragraph 50. That has only to be noted to wholly justify the Deputy Judge's order to'provide particulars. Again no more need be said. 18. For those reasons, in my view, the appeal had to be dismissed. 19. As to costs, I concurred in the reasons given by my Lord for the order made. Penlington J.A. 20. I have read the judgments of my Lords Liu and Nazareth herein. I agree with them, for the reasons given, that this appeal should be dismissed and with the order for costs proposed.
Representation: Mr A. Hatton, inst'd. by M/s Hampton, Winter & Glynn for 1st and 2nd Plaintiffs/Respondents Mr Edward Chan, Q.C. and Mr Andrew Chung, inst'.d. by M/s Ng & Fang for 1st and 2nd Defendants/Appellants . |