Tsai Wen Chin t/a Zhuang Ji Food Trade Co v. Zhao Yie

HCA 1191/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1191 OF 2011

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Before: Deputy High Court Judge Lok in Chambers

Date of Hearing: 18 September 2012

Date of Decision: 18 September 2012

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D E C I S I O N

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1.This is the defendant’s application to set aside the order of Burrell DHCJ for judgment entered against the defendant in default of defence on 14 February 2012.

2.In my judgment, the default judgment should be set aside because it is an irregular judgment.

3.First, the affirmation of service in support of the service of the writ is defective.  The plaintiff is seeking to rely on one of the alternative ways to serve the writ, ie by inserting through the letter box a copy of the writ enclosed in a sealed envelope addressed to the defendant. However, such mode of service is only permissible if there is a letter box for the relevant address (see: Hong Kong Civil Procedure 2012, vol 1, para 10/1/13).  In the plaintiff’s affirmation of service, the deponent has failed to mention specially that he had effected service by way of insertion through the letter box.  The absence of such material information in the affirmation of service is fatal to the plaintiff’s case, as the court cannot be certain that the writ was served by way of insertion through the letter box.

4.Further, it is trite law that in a case of the service of the writ by insertion through letter box, the affirmation of service must contain a statement that in the opinion of the deponent, the writ would come to the knowledge of the defendant within 7 days of a copy of it being inserted through the letter box.  It is a mandatory requirement (see: Hong Kong Civil Procedure 2012, vol 1, para 10/1/23).  The plaintiff’s affirmation of service does not contain such mandatory statement and so the affirmation of service is defective in the present case.

5.In the hearing, Ms Ng, counsel for the plaintiff, seeks to apply for an adjournment so that she can contact the process server to clarify the mode of service and to rectify the defects in the affirmation of service. However, even if the plaintiff can contact the process server and the writ was in fact served by way of insertion through the letter box, it does not disturb the fact that the affirmation of service was defective when the default judgment was granted by Burrell DHCJ on 14 February 2012.  In such case, an adjournment of the hearing cannot assist the plaintiff.  Further, Master Hui on 14 September 2012 had already refused the plaintiff’s application to file further affirmation in opposition of the defendant’s application, and so the court should not adjourn the hearing any further.

6.Second, it is clear that the defendant was not in Hong Kong when the writ was purportedly served on her.  Since the plaintiff is relying on the alternative way of serving the writ, the defendant must be within the jurisdiction at the time of the service of the writ (see: O 10 r 1(2) of the RHC).  Under O 10 r 1(3), the date of the service shall, unless the contrary is shown, be deemed to be the seventh day after the date on which the copy of the writ was inserted through the letter box.  The writ was served on the defendant’s purported address on 15 July 2011.  From the Statement of Travel Records exhibited by the defendant, it is clear that the defendant was not in Hong Kong from 10 July to 18 September 2011.  As the defendant was not in Hong Kong at the material time, the writ was not properly served on her.

7.The plaintiff claims that the defendant had notice of the writ by 22 July 2011.  However, it is trite law that the defendant’s notice of the proceedings is neither here nor there.  The requirement that the proceedings be brought to the notice of the defendant is not an alternative to the requirement that he must be within the jurisdiction. Whether or not the defendant had knowledge of the contents of the writ or originating summons through other means, the judgment obtained in the absence of the defendant within jurisdiction is still irregular (see: Bank of China (Hong Kong) Ltd v Regal Link Investment Ltd [2009] 3 HKLRD 203 at 211, para 30, Shanghai Land Holdings Ltd (In Receivership) v Chau Ching Ngai & Anor, HCA 2704/2003, unreported, 8 January 2004, at para 7 and Lu Wen Yun v Chen Ching Chih [2006] 4 HKLRD 663 at 668J-669B).

8.Since the service of the writ was never effected, this would render all the subsequent proceedings based thereon and the judgment entered wholly irregular (see: Hong Kong Civil Procedure 2012, vol 1, para 13/7/2.)

9.In opposing the application, Ms Ng refers me to two decisions: Barclays Bank of Swaziland Ltd v Hahn [1989] 2 All ER 398 and Wing Lung Bank Ltd v Ho Man Iam [1999] 3 HKC 368.  However, that two authorities only support the proposition that, if before the deemed date of the service of the writ as stated in O 10 r 1(3), the defendant is within the jurisdiction and has knowledge of the writ, then it is still good service.  However, it is clear that the defendant in the present case was not in Hong Kong on the alleged deemed date of the service of writ and any time before that, these two authorities cannot assist the plaintiff’s case.

10.As the default judgment is an irregular judgment, the defendant is entitled to have the judgment set aside as of right, and so it is quite unnecessary for me to address on the merits of defence. However, since the deponent in support of the plaintiff’s case and the defendant all come from the same family, there is a genuine dispute about the ownership of the alleged copyright material and the alleged goodwill in the business.  In order to determine the merits of the claim, there should be a proper trial to resolve the factual differences between the parties.  Hence, even if the judgment is a regular judgment, which is clearly not the case, the default judgment should still be set aside on the ground of the merits of the defence.

11.I therefore allow the defendant’s application to set aside the default judgment.

Ms Christina Ng, instructed by Benny Kong &Yeung, for the plaintiff

Mr Tony Chow, instructed by C L Chow & Macksion Chan, for the defendant