Case Document

100%Judiciary

CACV000166/2003

CACV 166/2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 166 OF 2003

(On appeal from HCB 11186/2002)

_________________________

BETWEEN
	THE PRUDENTIAL ASSURANCE COMPANY LIMITED	Plaintiff (Respondent)

	AND

	HO EDWARD	Defendant (Appellant)

_________________________

Coram: Before Registrar Levy of Civil Appeals in Chambers

Date of Hearing: 22 October 2003

Date of Submission of Respondent: 30 October 2003

Date of Submission of Appellant: 14 November 2003

Date of Ruling: 19 November 2003

Date of Handing Down: 28 November 2003

_______________________

REASONS FOR DECISION

_______________________

1.On 19 November 2003, I ruled that the Notice of Appeal dated and served by the Appellant on 26 June 2003 was out of time. These are the reasons for my ruling.

The Nature of the Appeal

2.The present appeal, briefly stated, arises from a bankruptcy petition presented by the Respondent (the Petitioner) against the Appellant (the Debtor), which petition was heard by Deputy High Court Judge Poon on 19 February 2003. At the hearing, the Deputy Judge adjourned the Petition hearing to 10 March 2003 but ordered the Appellant to pay into court a sum of $23,951.97 on or before 8 March 2003("the February Order").

3.The Appellant complied with the February Order by making the payment into court on 8 March 2003 and at the hearing on 10 March 2003, the Deputy Judge ordered the said sum of $23,951.97 paid by the Appellant be paid out to the Respondent forthwith and he dismissed the Petition ("the March Order").

4.The February Order was not sealed until 30 May 2003 while the March Order was sealed on 19 March 2003.

5.Although the Notice of Appeal was served after both the February and March Orders were sealed, the Notice of Appeal, which is in Chinese, only sought to appeal against the February Order. While the Appellant sought in the Notice of Appeal an order that the said sum of $23,951.97, having been paid out to the Respondent by virtue of the March Order, be paid back to him, the Notice of Appeal does not seek to overturn or set aside the March Order.

6.I find therefore that the present appeal is a purported appeal against the February Order only.

Issue for determination

7.When the Appellant set the appeal down on 26 June 2003, an issue was raised as to whether the Notice of Appeal was served out of time. If the time limit for the appeal is to be determined in accordance with Order 59 r.4(1)(b) of the High Court Rules ("Order 59 r4.(1)(b)"), that is, 28 days from the February Order being sealed, the last day for serving the Notice of Appeal would have been 27 June 2003 and the Notice of Appeal which was served on 26 June 2003 would have been served within time.

8.On the other hand, the present appeal is an appeal against an order in bankruptcy matters, so that s.98 (2) of the Bankruptcy Ordinance (Cap.6) ("s.98(2)") is also applicable to the present appeal. Hence, the calculation of the time limit for commencing an appeal should be within 21 days of the date of the February Order made. Applying the said time limit to the Notice of Appeal, it would mean that the Notice of Appeal would be required to be served not later than 12 March 2003 and it would definitely be out of time.

9.The issue therefore which falls to be determined in the present case is whether the Notice of Appeal is governed by Order 59 r.4(1)(b) or s.98(2).

Which provisions prevail?

10.The respective provisions referred to above both contain express provisions governing the time limit for appeals. For the purpose of comparing the two provisions, I set out below the relevant provisions in full:

Order 59 r.4(1)(b):

"Except as otherwise provided by the rules, every notice of appeal must be served under rule 3(5) not later than the expiration of the following period beginning on the date immediately following the date on which the judgment or order of the court below was sealed or otherwise perfected, that is to say

...

(b) in the case of an appeal from an order made or given in the matter of the winding up of a company, or in the matter of any bankruptcy, 28 days." (emphasis added)

Order 98(2):-

"Every order of the court or the Registrar shall be subject to appeal to the Court of Appeal. The appeal shall be commenced within 21 days from the time when the decision appealed against is pronounced or made." (emphasis added)

11.The source of conflict stemming from these two provisions was elucidated by Rogers VP in Re Li Tat Kong [2003] 2 HKC 72, which concerns an application by the Official Receiver to the Court of Appeal to extend the time for filing a notice of appeal under s.98 (2) in respect of an order made in bankruptcy proceedings. In paragraphs 5 to 7, Rogers VP states:

"
5. I have to say that the time limits in respect of bankruptcy matters and appeals have become somewhat bedevilled in recent years, partly because the Rules Committee, of which I have to admit to being a member, has made a mistake in the rules. Under s.98 of the Bankruptcy Ordinance, as it was before and remains today, sub-s (2) provides that 'Every order of the court or the Registrar shall be subject to appeal to the Court of Appeal. The appeal shall be commenced within 21 says from the time when the decision appealed against is pronounced or made.'

6. That provision is different from virtually all the other provisions relating to times for appealing. Those are contained in the Rules of the High Court and they have been standardised in the last few years, effectively to be four weeks. Previously, there were different times for interlocutory appeals and final appeals. It was thought that in this day and age it was better to have one time and the Rules Committee purported to provide a time limit of 28 days for appealing in respect of all cases.

7. However, the provisions of s.98 were overlooked and it was not within the powers of the Rules Committee to vary that. Another important distinction between the Rules of High Court and s.98(2) is that the time limit in s.98(2) applies from the date when the order is pronounced, whereas the time limits in the Rules the High Court apply from the date when the order is sealed, and that can be very different date..."

12.The anomaly as explained by Rogers VP is due to an oversight when the relevant Rules of the High Court were amended. While Re Li Tat Kong is not a case deciding which two of these two conflicting provisions is to prevail, it has clearly confirmed that an appeal against a decision arising from bankruptcy proceedings has always been governed by s.98(2).

13.Applying the underlying dictum as expounded in Re Li Tat Kong, I am of the view that it is patently clear that s.98(2) applies to an appeal in respect of an order made in the bankruptcy jurisdiction.

14.Further, s.99(1) of the Bankruptcy Ordinance expressly confirms that statutory provisions in the Bankruptcy Ordinance are to prevail in the event of any inconsistency with the rules and practice of the High Court. The relevant part of s.99(1) of the Bankruptcy Ordinance provides:

"The rules and practice of the High Court for the time being for regulating the ordinary civil procedure of the court shall, so far as the same may be applicable and not inconsistent with the provisions of this Ordinance, be applied to bankruptcy proceedings..." (emphasis added)

15.In the circumstances, I rule that when an order appealed against is an order within s.98(2), the time limit for commencing the appeal is governed by s.98(2), not by Order 59 r.4(2), that is, 21 days after the date on which the order was made or pronounced.

Is the present appeal an appeal against an order within s.98(2)?

16.S.98(2) provides a statutory power to appeal in respect of "every order of the court..." (emphasis added). According to the definition section contained in s.2 of the Bankruptcy Ordinance, "court" is defined as "the Court of First Instance sitting in its bankruptcy jurisdiction".

17.In respect of the present appeal, the Notice of Appeal as I have found is an appeal against the February Order, which is clearly an order made by the Court of First Instance sitting in its bankruptcy jurisdiction.

18.For these reasons, I find the present appeal is an appeal against an order made under s.98(2) and the Notice of Appeal is out of time and leave to appeal must be obtained.

Conclusion

19.For the reasons above, I find that the Notice of Appeal should have been served by not later than 12 March 2003. The Notice of Appeal served on 26 June 2003 was clearly out of time. This unfortunate delay is most probably due to the Appellant's misconception that he could only commence an appeal after the February Order was sealed.

Summary

20.I summarize the general procedure below arising from the above analysis as a general guidance for commencing an appeal in respect of an appeal against an order made in respect of bankruptcy matters. I hope this would help alert the unwary appellant and practitioner of this nasty time limit trap:-

(1) An appeal against an order made by the Court of First Instance sitting in its bankruptcy jurisdiction is made to the Court of Appeal and is governed by s.98 (2).

(2) The time for commencing the appeal, that is, serving the notice of appeal, is 21 days from the time when the decision appealed against is pronounced or made. (There is therefore no need to wait for the concerned order to be sealed before commencing the appeal).

21.With the consent of the parties, I direct my Reasons for the Ruling to be published.

22.Lastly, I wish to particularly thank counsel for the Respondent, Mr. McLeish, for his helpful assistance in this matter.