Chan Chi Tong v. Wong Fuk Chun
|
HCPI 741/2013 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE PERSONAL INJURIES ACTION NO 741 OF 2013
_____________ D E C I S I O N _____________ 1.This is an application by the defendant to strike out the claim on the basis that the plaintiff has already signed a discharge form before the commencement of the current action. I. Background 2.This is a road traffic accident case involving the plaintiff’s and the defendant’s car on 22 April 2012. In the subsequent police interview, the plaintiff had complained of damage to his vehicle as well as head and back pain. 3.The plaintiff in fact attended Tuen Mun Hospital on the day of the accident. Four days later, he also attended a private doctor, Dr Tsoi Chi-Wai, Danny. He was referred to undergo, amongst others, physiotherapy sessions. 4.The defendant’s insurance company was Falcon Insurance (“Falcon”). The loss adjuster acting for Falcon was Integrity Adjusters Limited (“Integrity”), Integrity wrote to the plaintiff on 22 August 2012. The letter stated, as translated:
5.The plaintiff did not reply to this letter nor contact Mr Cheung as suggested. 6.Falcon received a demand letter dated 20 September 2012 from Messrs Patrick Wong & Co (“PW”), which stated: -
7.Negotiation then commenced with communications between Falcon and PW. 8.In the meantime, the plaintiff had applied to Social Welfare Department for traffic accident victim assistance and had received allowances on 3 occasions (Notices of Approval of Application were dated 8 August 2012, 3 October 2012 and 5 November 2012) totally HK$109,440. 9.On 11 October 2012, Integrity sent another letter in form of a chaser to the plaintiff. This stated, as translated: -
10.The plaintiff again failed to reply to this letter or contact Mr Cheung as suggested. 11.The plaintiff has previously been notified by his own insurance company(ie Royal & Sun Alliance Insurance plc), in a letter dated 30 August 2012, that they have “assigned Thornton Consultants (“Thornton”) to pursue recovery of our incurred outlay and also the complimentary recovery service for your paid excess HK$7,000 on your behalf”. 12.The plaintiff then received a letter dated 26 October 2012 from Thornton enclosing, amongst others, a discharge form from Falcon and stating:
13.The discharge form stated (in English and Chinese): -
14.The plaintiff filled and signed the discharge form, dated it 31 October 2012 and returned it to Thornton. Presumably, a Mr Shum Ka Yin from Thornton subsequently signed as a witness and this signature was also dated 31 October 2012. 15.Falcon received the discharge form on 5 November 2012 and payment was made to PW, which passed on the payment to the plaintiff. 16.On 19 February 2013, Messrs Cheung & Liu, acting for the plaintiff, wrote a pre-action letter to the defendant claiming damages for personal injuries, and the current action was initiated on 29 August 2013. II. The issues in dispute 17.The defendant’s case is that the current case is covered by the discharge form and the claim has been settled, thus the plaintiff has no reasonable cause of action and has no chance of success. 18.The plaintiff’s case is that there have always been 2 sets of negotiations: one between Falcon and PW regarding vehicle repair claims, and the second between Integrity with the plaintiff directly regarding the personal injury claim. And the discharge agreement, now alleged by the defendant to cover settlements of both sets of negotiations, was either a common mistake by both parties which should be rectified, or a unilateral mistake which should be rectified or voided all together. In either case, this is not a “plain and obvious case” for striking out. 19.Mr Gidwani, counsel for the defendant, submitted that the discharge form should be construed as any other contractual document, that is, to objectively ascertain the parties’ intention and not their subjective state of mind (Bank of Credit and Commerce International SA v Ali [2002] 1 AC 251). 20.Further, he submitted that the wordings were clear that the scope of the discharge covered “all further claims of whatever nature and kind whatsoever.” In Arrale v Costain Civil Engineering Ltd [1976] 1 Lloyd’s Rep 98, at page 102, Lord Denning held:
21.Perhaps to further bring home the point about the plaintiff’s knowledge of his rights, Mr Gidwani suggested that the plaintiff was legally represented by PW at the time the discharge form was signed and thus should have received legal advice from them. His view was based upon the fact that PW negotiated with Falcon and had received the settlement money on behalf of the plaintiff. 22.I think here lies the problem. On the evidence before me, I do not think that PW has acted for the plaintiff at any time at all. 23.Firstly, of course, the fact that a solicitor firm received a sum of money on behalf of a party does not necessarily mean that the firm was instructed by that party. 24.Secondly, the letter from PW to Falcon dated 20 September 2012 clearly stated “We have instructions to act for Royal & Sun Alliance Insurance plc, the insurer of vehicle no. RF3173 in respect of the captioned accident.” There was no mentioned of PW acting for the plaintiff himself. 25.Thirdly, and more importantly, if it was the view of Falcon (and thus the defendant’s) that PW was acting for the plaintiff as well as the plaintiff’s insurer, this view must have been formed after receiving PW’s letter on 20 September 2012. Therefore, it would have been entirely inappropriate for Falcon’s loss adjuster, Integrity, to communicate with the plaintiff in person on 11 October 2012 instead of writing to PW. 26.As such, I am not convinced, on the evidence before me, that Falcon (and thus the defendant) ever held the view that PW was acting for the plaintiff at any time, including the time he signed the discharge form. 27.This rather leads to the question of whether the plaintiff signed the discharge form “with full knowledge of his rights” or, as the plaintiff alleged, he was mistaken and, importantly, whether the defendant was aware of this and was taking advantage of it. 28.Mr Lee, counsel for the plaintiff, argued that for the court to decide “whether there was a clear mistake, the Court is not confined to just reading the document (i.e. the discharge form in this case) without regard to its background or context. As the exercise is part of the single task of interpretation, the background and context must always be taken into consideration.” (Chartbrook Ltd v Persommon Homes Ltd [2009] UKHL 38, 125 ConLR1) 29.In Chartbrook, there was also discussion on the difficult task of distinguishing between what was factual background and what was prior negotiation. 30.However, in the current case, I do not even need to look into “prior negotiation” (that is, the negotiation between Falcon and PW). Indeed, I need not consider whether the settlement sum accepted by the plaintiff was a “bad bargain” or not, or whether this reflected that the plaintiff must have entered the agreement by mistake. 31.The wordings used by Integrity in its two letters provided the court with the factual background of how the plaintiff and Falcon (and the defendant) entered this agreement: -
III. Conclusion 32.To be perfectly fair, the plaintiff himself must take some blame for failing to reply to Integrity at all. There was no excuse that just because he was still receiving medical treatment that he could not give a “holding” reply to Integrity. 33.Nevertheless, I am not convinced that Falcon could reasonably entitled to make the “assumption”, within 8 days of the Integrity chaser, that the plaintiff did not suffer any personal injury (or has abandoned his claim in such), given that it (and Integrity) was aware of the injury in the first place. 34.Against this factual background, I find that the plaintiff has, at the very least, a good arguable case for unilateral mistake: that he has mistakenly entered the discharge agreement thinking that this was only for the vehicle repair claim, and that Integrity would continue to handle his personal injury claim separately, as it appeared to repeatedly emphasise in its letters. 35.I would think that a layperson would easily be mistaken when receiving such messages from Integrity, especially when he has also received the letters from his own insurer and Thornton which only dealt with the claim for vehicle repair. Of course, it was Thornton which sent him the discharge form. It would be reasonably understandable how the plaintiff would not, under the circumstances, suddenly realised that this discharge form should now cover both sets of negotiations. 36.Further, the speed which Falcon Insurance proceeded with the discharge form, the lack of warning from Integrity, together with the awareness that the plaintiff was acting without legal advice, would raise suspicion whether the defendant was actually (or should reasonably be) aware of this mistake and was taking advantage of it. 37.The least Falcon might have done, given the knowledge of the circumstances, was to put on inquiry to seek confirmation of its “assumption” which an honest and reasonable man would (George Wimpey UK Ltd v V I Construction Ltd [2005] EWCA Civ 77, at para 42). 38.Mr Gidwani submitted that Falcon was complying with the spirit of the CJR for speedy settlement of disputes. However, I do not think that the spirit of CJR values speed over fairness of any settlement. 39.This is the defendant’s application to strike out the claim. There is no application before me to void or rectify the discharge agreement so I need not deal with this. 40.Applying the well-established principle in striking out application, this is clearly not a “plain and obvious” case for the court to exercise such power. 41.I would therefore order that: -
Mr Kenneth Lee, instructed by Cheung & Liu, for the plaintiff Mr Victor Gidwani, instructed by Deacons, for the defendant |