Chow Shing Kee Investment Company Limited v. The Incorporated Owners of Malahon Apartment and Others
Read the full judgment text of HCMP 1729/2011 on BabelCite. This High Court CFI judgment was delivered on 2 November 2012.
1. On 5 May 2010 Sakhrani J made an Order (“the Order”) in HCA No 816 of 2004 (“the Action”) by which the defendant in the Action was required to remove certain soil water pipes from the premises of the plaintiff. The order was made at the conclusion of a trial of some seven days duration. As at the date of this judgement the soil pipes in question (generally referred to here as “the pipes”) have not been removed from the premises of the plaintiff and these proceedings have been initiated in c
Cited by 3 cases · Cites 1 case
|
HCMP 1729/2011 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE MISCELLANEOUS PROCEEDINGS NO 1729 OF 2011 -------------------------------
-------------------------
----------------------- J U D G M E N T ----------------------- INTRODUCTION 1.On 5 May 2010 Sakhrani J made an Order (“the Order”) in HCA No 816 of 2004 (“the Action”) by which the defendant in the Action was required to remove certain soil water pipes from the premises of the plaintiff. The order was made at the conclusion of a trial of some seven days duration. As at the date of this judgement the soil pipes in question (generally referred to here as “the pipes”) have not been removed from the premises of the plaintiff and these proceedings have been initiated in consequence. 2.The proceedings before Sakhrani J were brought on behalf of three plaintiffs only one of whom is the plaintiff in these proceedings. The plaintiff here is the owner of premises on the ground floor of Malahon Apartments in Jaffe Road, Causeway Bay (“the Building”). Those premises are used as a supermarket. The defendant is the incorporated body of the owners of the Building, having responsibility under the Building Management Ordinance (CAP 344) for the management of the Building. The 1st defendant operates, as might be expected through a committee which I will refer to as “the Management Committee”. 3.The Order with which the 1st defendant was required to comply was in the following terms:
4.Although a period of six months for compliance had been allowed by the judge the defendant was unable or unwilling to carry out the removal of the pipework within that time period and an application was made for additional time within which to comply. The judge granted that application, extending the time for compliance until 12 March 2011. 5.A further application for additional time was sought and, on 7 April 2011, refused. In refusing that application Sakhrani J expressed the view that the defendant was not seriously trying to comply with the Order. An appeal was brought by the defendant against the judgement of Sakhrani J, but this was dismissed on 9 June 2011. 6.The pipes in question remained in place and by 15 August 2011 the plaintiff apparently formed the view that there would be no compliance on the part of the defendant with the Order absent further court proceedings and the present application for committal of the defendant for contempt in failing to comply with the Order of the court was initiated by the plaintiff on that date. The plaintiff’s statement under Order 52, rule 2 (as amended pursuant to leave given by the Judge on 26 August 2011) contained the averment that:
The application for committal included the individual members of the Management Committee and leave was given to the plaintiff on 26 August 2011 to make the application for committal. 7.In the proceedings before Sakhrani J and subsequently it has been understood that removal of the pipes from the plaintiff’s premises, while satisfying the Order, is not a complete solution as far as the 1st defendant is concerned. The pipes are the mechanism by which sewage from the upper floors of the building is ducted to the public drainage system, and an alternative routing for the pipes is necessary. This is the aspect of the proceedings on which most evidence has focused, but this is collateral to the Order, not part of the Order. The proceedings before the judge and until recently have proceeded on the basis that the obvious way in which this requirement can be addressed is by putting the pipes back into the locations in which it appears they were originally constructed. 8.The defendant has perceived some difficulty (suggested to be a practical impossibility) in proceeding in this way however because the presumed original routing passes vertically downwards through the basement through areas which are understood at one time to have been common area, but which have now been converted to shop units and sold to private owners. Until very recently, as amplified below, there has been no investigation of alternatives to this routing. PROCEDURAL ASPECTS 9.As referred to above, the proceedings were commenced against both the 1st defendant and the individual members of the Management Committee. The hearing itself commenced on 22 March, 2012 and the plaintiff called evidence from a Ms Tam Wai Hing, a director of Speedy Gainer, one of the plaintiffs in the original action, and from Mr John Cock, an architect called as an expert witness. Both witnesses were cross‑examined by counsel for the various defendants, there being three sets of representation for the various defendants at that stage. 10.At the conclusion of that evidence each of the three defence counsel made submissions of no case to answer. Those submissions were the subject of a separate determination made by me on 27 April 2012, the consequence of which was that proceedings continued only against the 1st defendant. The proceedings had been adjourned pending that decision, and following delivery of the Decision a hearing dealing with the costs to that point and directions for the further conduct of the proceedings was held. 11.The hearing of the proceedings against the 1st defendant was resumed on 3 September 2012. At the resumed hearing I heard submissions from the parties on a summons taken out by the 1st defendant dated 30 August 2012 in which the 1st defendant sought the setting aside of the injunction order made by Sakhrani J upon the compliance by the 1st defendant with a plan of work which had been approved by the Buildings Department on 28 September 2011. It was submitted on behalf of the 1st defendant that this was within my jurisdiction because of the “liberty to apply” provision which had been included by Sakhrani J in the Order requiring the removal of the pipework. 12.I dismissed that summons on the basis that the liberty to apply provision provided only for reference to be made to the court for the purposes of working out the way in which, or perhaps the time within which, the order was to be performed. I did not agree that this entitled the court to revisit the question as to whether or not the Order was to be made or maintained. 13.Moreover, it appeared to me, that even if jurisdiction existed to reconsider the Order in this way, the work envisaged as being carried out so as to comply with the plan which had been approved by the Buildings Department would not begin to meet the requirements of the Order, nor remove the basis upon which the Order had been granted as set out in the judgement. In summary the work envisaged was the provision of fire protecting collars around the pipes where they passed into the plaintiff’s premises thus removing a non-conformance with relevant fire safety regulations. The pipes however would remain in place. Sakhrani J had held that the failure to provide such collars was a contravention of Buildings Ordinance. That was however only one aspect of the basis upon which the pipes were required to be removed. 14.At the resumed hearing the plaintiff sought leave to adduce in evidence a further report (in letter form) of 15 June 2012 which had been prepared by the plaintiff’s expert witness, Mr Cock. That report investigated and considered whether there was any alternative routing for the pipes once removed from the plaintiff’s premises other than the reinstatement to the presumed original routing vertically downwards through the basement. 15.At the stage of the “no case to answer” submissions the parties had debated whether it was for the plaintiff to specify the way in which the Order should have been complied with by way of a detailed allegation as to how the defendants were said to have failed in compliance, or whether this mode of compliance was a matter that was left to the 1st defendant. I concluded in the decision of 27 April 2012 that it was not for the plaintiff to specify the way in which the defendants were to comply with the Order. Mr Cock’s further evidence was not necessary therefore for the plaintiff to establish whether or not there had been compliance with the Order, but was, in my view, relevant to any consideration of the efforts made on behalf of the 1st defendant to achieve compliance with the Order and relevant to the position maintained by the 1st defendant that compliance was not possible. 16.Moreover, the potential availability of an alternative, and perhaps less contentious, routing for the pipes was, in my view, significant in promoting, ultimately, effective compliance with the Order. Accordingly I admitted the further report, and Mr Cock was recalled to attest to that evidence and to answer further cross‑examination. 17.The 1st defendant called factual evidence from an officer of the Buildings Department, Ms Pelene Ng attending under sub‑poena, and a handling solicitor, Mr Ngan Wai Ip. In addition, at the hearing the 1st defendant applied for leave (although submitting that leave was not necessary) to adduce an expert report from Mr Richard Cheung of Knight Frank. That report was dated 30 August 2012 and was purportedly in reply to the report of Mr Cock of 15 June 2012. However Mr Cheung’s report contained appendices which included a CCTV survey inspection of the existing underground drainage system that had been carried out by another company (Tai Hung Engineering) in or about January 2012, and a report on the drainage existing below the basement floor prepared by one Kwok Hauser & Partners (“Kwok Hauser”) in June 2012. The 1st defendant did not propose to call either the makers of the survey or the author of the Kwok Hauser report. As a matter of chronology as well as scope, neither the CCTV survey nor the Kwok Hauser report addressed the matters that were contained in the June report of Mr Cock. 18.Accordingly, I allowed Mr Cheung’s report to be adduced, but excluded these appendices, the contents of which appeared to me to be of no relevance, leaving aside matters of the timing of the production of this evidence. I have however taken note of the fact that the 1st defendant caused the survey to be undertaken early this year, and engaged Kwok Hauser & Partners in or about June this year. Mr Cheung gave oral evidence at the hearing. 19.The plaintiff’s opposition to the admission of the report from Mr Cheung was in part based on the fact that no notice of the report had been given and Mr Cock was not available to provide support to the cross‑examination of Mr Cheung within the time then reserved for the continued hearing. At the same time as I admitted Mr Cheung’s report therefore I acceded to an application, not opposed by the 1st defendant, to adjourn the expert evidence to a later date. I reserved the costs of that adjournment. 20.I also gave directions that the experts, Mr Cock and Mr Cheung, should meet with a view to reaching such agreement on their evidence as may be possible. As matters transpired they were able to reach an agreement as to a method by which the pipes could be rerouted, with minimal difficulty being anticipated by the experts in the performance of the work. This agreement was recorded in a joint statement dated 26 September 2012. 21.The hearing resumed on 3 October 2012 and on the resumption, Mr Cock was again recalled and confirmed the contents of his joint report, and Mr Cheung, when called, did likewise. 22.For completeness I should record that during the course of that resumed hearing, on 5 October 2012, I heard and dismissed a summons taken out by the 1st defendant seeking to adduce land search records evidencing the value of shop units in the basement. These seemed to me to be entirely irrelevant to the matters in issue. THE FACTUAL EVIDENCE 23.It is common ground between the parties that the offending pipes remain in place in the plaintiff's premises. As has been referred to above this is the thrust of the plaintiff's complaint as to non‑compliance with the Order, although this is embellished in the Order 52 statement with the assertion that there has been no attempt by the 1st defendant to comply with the Order. 24.The factual evidence on behalf of the plaintiff was that given by Ms Tam who affirmed that the Order had not been complied with and also (in the ex parte affidavit) her belief that the defendant had no intention of complying with the Order. It appears from her cross‑examination that Ms Tam had little involvement in the events and discussions leading up to the commencement of the committal proceedings. 25.The defendant’s factual witness evidence also shed little further light on matters. Ms Pelene Ng from the Buildings Department gave evidence as to the approval by the Buildings Department of a proposal to set fire collars to the pipes where they passed through certain structural walls in the building. She was able to confirm that there were other locations at which the pipes passed through walls which were not addressed in these so‑called “A&A” proposals, and gave evidence to the effect that the nature of the infringement of the Building Regulations in this case was treated by the Buildings Department as being of a relatively low priority. 26.Ms Ng was also able to confirm that the drainage plans for the building as it was constructed in 1964 were no longer available in the records of the Buildings Department. 27.Mr Ngan Wai Ip also gave evidence on behalf of the defendant. Mr Ngan is an assistant solicitor engaged in the firm handling matters for the defendant and has been involved in this matter since at least the delivery of judgement by the judge. Mr Ngan exhibited to his affirmation dated 4 November 2011 a chronology setting out steps taken by the 1st defendant to comply with the Order. This is a relatively lengthy document but in essence what is described is the process of initial internal meetings of the Management Committee and (on 8 July 2010) a decision by the Management Committee to engage the services of an expert (Knight Frank). The scope of that engagement is touched on below. 28.The initial draft report was issued by Knight Frank, it appears, on 11 October, 2010 and this was finalised on 15 December, 2010. This report brought to light the fact that there had been some additional drainage works carried out below the basement level which, in or about 1984 was converted for some period of time for use as a sauna. Four proposed alternative routes for the sewage system serving the upper floors of the building were suggested by Knight Frank. 29.In the period from December 2010 through to 7 April 2011 the focus of the 1st defendant’s activities appears to have been correspondence with the basement owners seeking consent to route the drainage pipes through their premises. I note in passing that the way in which it was approached on behalf of the 1st defendant was in effect to invite refusal since the correspondence expressly stated that a failure to respond would be considered to be a refusal of consent. 30.On 18 March, 2011 the 1st defendant received a letter from Knight Frank which stated that there was no option for reinstatement of the drainage system other than by way of the four proposals which had previously been advanced. 31.The 1st defendant’s 2nd application for a stay or an extension of time within which to comply with the Order was dismissed by the judge on 7 April 2011. From that date through until the hearing of the appeal against the Order on 9 June 2011 the only activity seems to have been some further correspondence with Buildings Department, and a proposal made to the plaintiff for a meeting between the experts. Regrettably perhaps the plaintiff seems to have brushed aside that proposal. 32.It appears only to have been after the dismissal of the appeal that the Management Committee gave instructions to Knight Frank to inspect the drain pipes in the basement. It was also decided at that stage to instruct Knight Frank to advise on the “feasibility” of the proposals contained in the plaintiff’s expert report. In essence this means to investigate the feasibility of re‑routing the pipework down through the basement. Correspondence with the owners of the basement units continued, including further letters to specific shop owners seeking permission to run the pipes through their premises. 33.Mr Ngan informed the court that Kwok Hauser had been appointed by the defendant in January 2012 (approximately five months after these committal proceedings were instigated) because the defendant wanted to have a second opinion as to its options. Therefore, he says, the two consultants (Knight Frank and Kwok Hauser) were working in parallel, not together. 34.He also informed the court that a set of protective writs had been issued against various individual shop owners in the basement regarding the proposed reinstatement of the sewage system through those premises. Advice was sought from counsel as to the merits of any such litigation, however the advice received was not encouraging. 35.As referred to above, on 15 June 2012 during the course of these proceedings Mr Cock produced his report proposing a re-routing of the relevant pipes so as to pass through common area to a new manhole to be located near the entrance to the Building, from which the drainage would run out to the public system in Jaffe Road. That was responded to by the defendant by the convening of a meeting of the owners which was held on 9 July 2012. In that meeting the owners resolved to appoint a contractor (one EG Engineering) to investigate and if appropriate carry out the work as generally described by Mr Cock. 36.In the same meeting the owners resolved not to pursue legal proceedings against the basement owners. Mr Ngan informed me that EG Engineering have been instructed to proceed with this work, but there is no evidence as to when completion is anticipated to be achieved. THE EXPERT EVIDENCE 37.As has been mentioned already the plaintiff called opinion evidence from Mr John Cock who is an architect, and the defendant from Mr Richard Cheung who is a surveyor. Mr Cock’s first report (“letter of opinion” dated 24 February 2012) dealt with various matters including the fire protection collars, and exhibited an earlier report made by him in the Action. The gist of Mr Cock’s letter and report was that reinstatement of the pipes to the presumed original routing via the basement was technically feasible albeit he acknowledged that there were potential legal issues arising out of the private ownership of parts of the basement floor. 38.Knight Frank’s report of 15 December 2010 was prepared by Mr Cheung and, as touched on above, described four alternative solutions by which the pipes could be re-routed away from the plaintiff’s premises. All were technically feasible, but all involved some intrusion into the property of other owners. It became clear from Mr Cheung’s cross‑examination that he had been asked to consider a solution that fell within certain constraints, as to remaining within the envelope of the building and making use of existing drains as far as possible. Both experts had therefore come to a conclusion that the pipes could be rerouted but that the basement owners would be disturbed by that re‑routing. 39.Mr Cheung confirmed to the defendant by a letter of 24 October 2011 that there was no other alternative routing available for the drain pipes other than the four routes described in his earlier report. Hindsight, at least, shows that this was wrong because having seen the routing proposed by Mr Cock in his report of 15 June 2012 Mr Cheung was able to agree (in his report of 30 August 2012) that there was an available route for the pipework that traversed only common parts of the building. 40.Mr Cheung further considered in his report the earlier proposals to re‑route the pipes through the basement and into the underground drainage system. In apparent contradiction to his earlier reports he stated in his report of 30 August 2012 that the existing underground drainage system could not be used for such a rerouting of the pipes because the underground system was not a sewage system. Under cross‑examination, when it was pointed out to him that his earlier report had proposed using those underground pipes, he clarified that this later reference was only to the parts of the underground system that had been inspected by Kwok Hauser. He acknowledged that there was an existing underground sewage system which might perhaps be used as part of any such re‑routing. SUMMARY OF THE EVIDENCE 41.The relevant matters can be summarised very shortly. The steps taken by the 1st defendant in performance of its obligations under the Order are set out in the chronology exhibited by Mr Ngan, and those referred to above as occurring subsequent to the preparation of that chronology. 42.It is common ground that there is a functional underground sewage system below the basement floor. An underground sewage system was constructed when the Building was built, but the routing of that underground drainage system as it was built in 1964 or thereabouts, and as it now exists or may exist is uncertain, and will remain uncertain so far as the present situation is concerned unless and until a detailed survey is undertaken of it. 43.The sewage system presently in existence below the basement is probably not the same or not wholly the same as the system installed when the Building was constructed. The capacity of the sewage system which currently exists to handle the outflow from the pipes which are presently traversing the plaintiff’s premises is also unknown, and again, will remain uncertain until it is properly surveyed or inspected. 44.It is agreed that any routing of the pipes down into the basement will involve the pipes intruding into parts of the building that are in the exclusive occupation of certain basement owners. Other routes are available for the pipework that would intrude on the premises of other owners instead at, for example, ground floor level. In one instance this would involve a route passing through premises owned by one of the plaintiffs in the Action. 45.Through the joint efforts of Mr Cheung and Mr Cock a route for the pipes has been found that does not involve intrusion on any private premises. 46.It is of course also common ground that the pipes that were the subject of the Order remain within the plaintiff’s premises. THE SUBMISSIONS 47.A consideration of the liability of the 1st defendant must start from the acknowledged fact that there has been no compliance with the Order by the 1st defendant. The question is whether the 1st defendant is liable because of that state of affairs. The submissions in this case require me to answer that question having regard to the nature of the proceedings, the terms of the complaint made against the 1st defendant, the attempts that have been made to comply and indeed, whether compliance is possible. Also raised for consideration by the 1st defendant is the question whether the proceedings are appropriate at all and whether they have been conducted fairly. The nature of the proceedings 48.An appropriate starting point therefore is the point, oft repeated on behalf of the defendant, that contempt proceedings are quasi criminal proceedings to which a criminal penalty attaches and in regard to which criminal procedural safeguards apply. It follows from these principles that the plaintiff’s complaint needs to be established beyond reasonable doubt. 49.The complaint contained in the Originating Summons is therefore analogous to an indictment in criminal proceedings and must be considered on its terms. Doing so, the 1st defendant submits that I should place emphasis on the part of the complaint that there was “no attempt” to remove the pipes. The 1st defendant paraphrases this as being a charge that no step has been taken, and submits further that since it is necessary to establish the charge beyond reasonable doubt there is no need to investigate the adequacy or sufficiency of such steps as have been taken. 50.The 1st defendant repeats the complaint it made at the stage of submissions of no case to answer to the effect that the plaintiff ought to have specified what it was that the defendant should have done in order to comply with the order. I disagree with that proposition and said as much in my decision in regard to the submission of no case. It is not for the plaintiff to set out the way in which the defendant ought to have complied with this Order. As emerged through the evidence there are various options. The complaint is not that any particular one or other of these has not been followed. The problem is that none have been implemented. 51.I do not agree that it is correct to understand the complaint set out in the Order 52 Statement as being solely that contained in the sentence on which the 1st defendant has chosen to focus therefore. The grounds for the application are those in paragraph 3 of the Statement and those are plainly that the Order has not been complied with without legitimate excuse. In submissions the plaintiff reminds me that the obligation imposed upon the defendant by the order of the judge was one which was made in mandatory terms and which was not qualified in any sense as to the undertaking of best endeavours. That does not mean that non compliance means the 1st defendant must be in contempt. But it does mean that the 1st defendant’s efforts to comply are relevant to the question. 52.The defendant submits however that both its ability to remove the pipework and the deliberateness of its decision not to remove the pipework must be established in order for the charge to be made out. As summarised in Arlidge, Eady & Smith on Contempt (4th Ed, at 12‑23):
53.The plaintiff submits, and I accept, that it is not necessary to establish that the 1st defendant’s conduct was a deliberate attempt to disobey the Order. In Howitt Transport v Transport and General Workers’ Union, Sir John Donaldson expressed the view that:
54.Liability may arise, provided a defendant has knowledge of the relevant facts, if the relevant act or omission was more than accidental. I accept that the mental element of contempt is such as to exclude acts which are casual, accidental or unintentional and that proof of a deliberate intention to flout the order in question need not be established. 55.This is the position that emerges from, for example, Stancomb v Trowbridge UDC [1910] 2 190 and from the decision of the Court of Final Appeal in Kao Lee & Yip v Koo Hoi Yan (2009) 12 HKCFAR 830 (paras 43‑53). In Re Mileage Conference Group of the Tyre Manufacturer’s Conference Ltd’s Agreement [1966] 1 WLR 1137 the court, after quoting Warrington J in Stancomb v Trowbridge UDC, said (at 162):
56.Accordingly I consider next the steps taken by the 1st defendant towards compliance. Attempts to comply 57.The chronology has been outlined above, and the 1st defendant takes the point that the members of the Management Committee are laymen with no relevant technical expertise of their own. As such, the defendant submits, it is necessary for the Management Committee to rely on the advice of its legal advisers and the technical experts. It is clear however, not least from the judgment of Sir Gerard Brennan in Kao Lee & Yip v Donald Koo referred to above (and as counsel for the 1st defendant accepted) that acting on the advice of others will not constitute a defence if the actions do not themselves lead to compliance with the Order. The fact that the 1st defendant may have been advised to follow a course of action that proved to be ineffectual in achieving compliance with the Order would not excuse the failure to comply except perhaps in circumstances in which the 1st defendant had good reason to suppose acting in that way would achieve compliance. Regrettably that cannot be said in the present case. Thus, for example the defendant received advice from Knight Frank as to four possible solutions to the rerouting and did attempt to seek agreement to some of those proposals. But in my view the evidence shows, to say the least considerable half heartedness on the part of the 1st defendant which was doing little more than the bare minimum in performing to its obligations. The actions taken were too little to have any serious prospect of achieving compliance. They were also taken too late and even then, too slowly. 58.Other than the receipt of advice, the steps which were taken by the 1st defendant were self‑evidently ineffective and the evidence leads me to agree with the plaintiff that the 1st defendant seems to have failed to appreciate the seriousness of the obligation it had to discharge once the Order had been made. 59.The evidence given by Mr Ngan was demonstrative of the ineffectiveness of the action taken to comply with the Order. Instructions given to Knight Frank appear to have been premised on removal of the pipework without any further litigation arising. As a first step this cannot be criticised, but taking one reasonable steps towards compliance is not sufficient. 60.The 1st defendant has, whether because of the advice it received or otherwise, focused too much attention on matters that could not themselves have achieved compliance with the Order. For example the instructions given to Knight Frank to investigate the provision of fire collars to the pipes passing through firewalls are said by the plaintiff to have been a waste of time, and I agree that this was of no relevance or assistance in terms of complying with the Order. Indeed the underlying premise behind this investigation would seem to be that the pipes would remain in‑situ notwithstanding the Order. The correspondence with the basement owners was premised on an assumption that the necessary co-operation would not be forthcoming. Two owners did not even reply in fact to the correspondence but there was no follow up on the part of the 1st defendant. That correspondence was not even initiated until two months after the expert report was received from Knight Frank. 61.I acknowledge that the 1st defendant was faced with difficulties in complying with the Order associated with the need to reroute the pipes. It seems plain that Sakhrani J was aware of this, hence his allowance of a period of time for compliance. The fact that the rerouting presented potential technical and legal challenges to the 1st defendant called for more urgency and attention on its part in my view, not less. Proceedings of last resort 62.The 1st defendant submits that contempt proceedings are proceedings of last resort such that if a reasonable alternative to an application for committal exists then that alternative should be adopted. In the present circumstances it is submitted that the plaintiff ought to have made an application to the court allowing it to carry out the necessary work on behalf of the 1st defendant at the 1st defendant’s expense. The 1st defendant further relies on this principle to submit that the last resort nature of the proceedings suggests that, at the very least, the plaintiff ought to have been “more cooperative” than it was in the various discussions between the parties as to performance of the Order. 63.So far as the plaintiff is concerned this is an irrelevance. The provisions of Order 45, rule 8 are to the effect that a plaintiff may apply for leave to perform an act which is required to be done under a court order. The act required to be done in this case was the removal of the pipes. Performance of this by the plaintiff would not assist with the practical problem of providing an alternative working sewage system. Had the plaintiff followed this course the defendant would still have been faced with the problem of providing an alternative system. It seems to me this analysis is correct. 64.The defendant points to the non-committal response on behalf of the plaintiff to the defendant’s proposal that there be a meeting of the experts at an early stage of the committal proceedings. It is suggested that had this meeting taken place then the Order could well have been complied with without the necessity of these proceedings running their course. This line of argument leads to the submission ultimately made that the plaintiff itself is the culprit behind the delay. It is submitted that the 1st defendant has throughout been eager to comply with the order. 65.The 1st defendant’s position may have been easier had the plaintiff taken steps to assist the 1st defendant in complying with the Order. But any lack of co-operation on a matter such as a meeting of experts cannot excuse non compliance by the 1st defendant unless perhaps it could be shown the absence of co‑operation prevented compliance. That is far from the present situation. Material non-disclosure 66.The defendant makes extensive complaint about what is said to have been a material non-disclosure on the part of the plaintiff at the ex parte stage of the committal proceedings. The complaint relates to the fact that the ex parte affidavits contained no reference to the difficulties to be faced by the defendant in complying with the Order, in particular the difficulty arising out of the disturbance to the basement owners. Also not disclosed when, it is said, it ought to have been was the defendant’s proposed joint meeting of experts and that this had not been agreed to by the plaintiff. 67.Also not disclosed, when according to the defendant it should have been disclosed, was the discovery by Knight Frank in December 2010 of the 1984 approved drainage plan. This is said to have been relevant to the availability, or otherwise, of re‑routing of the pipes through the basement. 68.The learned judge was well aware by the time that the Order was made that individual owners in the basement would be affected if the pipes were to be re‑routed that way. Being informed that further information had become available as to the underground drainage would not seem to me to be a significant factor in considering whether the Order, requiring removal of pipes from the plaintiff’s premises, ought to be enforced by committal proceedings. I can see no relevance in the proposed meeting of experts to this question at all. 69.The question whether or not Sakhrani J had been invited to grant leave on the basis of incomplete information was canvassed at the stage of the submissions of no case. I was not persuaded then that there had been any relevant non‑disclosure, certainly none that would merit the setting aside of leave, and that remains the position. Impossibility 70.Finally the 1st defendant submits somewhat cryptically that compliance with the charge (not the Order) is impossible. It is clear that if the task was impossible then the 1st defendant could not be in contempt for failing to perform. To try to bring itself in the realm of impossibility the 1st defendant, relies on the charge constituting a requirement to reroute the pipework through the basement only, and on impossibility having a definition more restricted than absolute impossibility. As the defendant acknowledges in engineering work absolute impossibility is relatively rare. The question according to the defendant is whether disproportionate cost would be involved. Also relevant to this question is said to be whether or not the work is wholly within the control of the defendant. In the present case, because the rerouting would involve the premises of the basement owners this impossibility is said to arise out of the refusal of consent by them. 71.Impossibility is also a matter that was considered by the trial judge, and is a matter on which he found against the 1st defendant. Moreover the judge did not make his order in terms that required a particular mode of compliance. The Order made no provision as to the re‑routing of the pipes once they were removed from the plaintiff’s premises. The defendant had a full discretion as to the way in which it was to achieve compliance. 72.So far as “disproportionate cost” is concerned, there is no evidence what it would cost to re‑route the pipes through the basement. The 1st defendant has not investigated this. Nor has the 1st defendant put any evidence before me to suggest that such limited actual refusals of consent as the basement owners have made results in any sort of impossibility of performance. I do not accept, in any event that a matter is impossible simply because its performance necessarily involves third parties in this way. 73.As the plaintiff submits, the alleged impossibility only arises out of a matter which is collateral to the Order itself. The 1st defendant’s difficulties are in relation to the provision of an alternative routing for the sewage pipework which is an obligation imposed on the 1st defendant by reason of its role as manager of the building, not by the terms of the Order. 74.Any suggestion of impossibility in fact is also given the lie by the fact that the experts have been able to agree a routing for the sewage system which is both technically feasible and reasonably practicable. Procedural irregularity 75.The defendant makes submissions as to irregularities in proceedings. There are three complaints. The first is the introduction into evidence of the rerouting proposal via the common areas to the front entrance of the building, introduced by Mr Cock subsequent to the conclusion of the initial close of the plaintiff's case. Secondly the defendant complains about the plaintiff’s questions in cross‑examination directed to Mr Ngan as to why the defendants had not negotiated with the basement owners to provide compensation for any disturbance to their premises, or thirdly perhaps for the purchase of those premises so as to enable the rerouting to take place. 76.These are described by the defendant as being in the nature of ambush tactics on the part of the plaintiff. I do not agree. These do not add or detract from the charge made against the defendant, but are simply matters going to test the evidence given on behalf of the defendant which was, to a significant extent, directed to the difficulties complying with the Order. CONCLUSIONS ON LIABILITY 77.As is perhaps apparent from the above not only has the 1st defendant failed to comply with the Order made by Sakhrani J, I do not believe the 1st defendant has made anything resembling an adequate attempt to comply with the Order. The 1st defendant was fully aware of the requirements of the Order but has, rather than complying, achieved little more than the initial steps towards compliance amounting in some respects to mere window dressing. I conclude that the 1st defendant has acted in contempt of the Order. PENALTY 78.The parties were agreed that submissions as to penalty ought to abide a determination in the first instance as to liability. Accordingly the proceedings were adjourned following the making of submissions as to liability and costs with liberty to the parties to restore. COSTS 79.There is no dispute that the “usual” order in cases of committal for contempt where liability is established is that there should be an order for costs on an indemnity basis. 80.The plaintiff in the present case seeks, in addition a Bullock Order in relation to the costs incurred by it in the proceedings against the individual members of the Management Committee such that the costs which the plaintiff is obliged to pay to those defendants be borne by the 1st defendant. The basis for the application is that the costs incurred by the plaintiff have only been incurred by the “steadfast refusal” of the defendants to comply with the Order. The proceedings were necessary to ensure compliance, and the plaintiff acted reasonably in proceeding as it did. 81.I do not agree. For reasons given at the earlier stages of these proceedings I do not accept that the 2nd to 11th defendants were proper parties, at least in the way the applications were made. Nor were they alternative defendants or defendants whose involvement in proceedings was necessary in order that the ‘correct’ parties be before the court. 82.Accordingly I decline to make the Bullock Order sought by the plaintiff. Save and except to the extent that prior orders as to costs have been made otherwise, the plaintiff is to have its costs against the 1st defendant in the usual form for such applications, that is, to be taxed on an indemnity basis. These costs are to include, for the avoidance of doubt the costs reserved on 4 September 2012. There is to be a certificate for two counsel.
Mr John Scott SC and Mr Colin Wright, instructed by Orrick, Herrington & Sutcliffe, for the plaintiff Mr Andrew Mak, instructed by Tung, Ng, Tse & Heung, for the 1st defendant | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Cases cited in this judgment
Other judgments that cite this case
Further hearings and rulings under HCMP 1729/2011