Mitsubishi Elevator Hong Kong Co Ltd v. Marriot Engineering & Construction Co Ltd

DCCJ 3970/2011

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 3970 OF 2011

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BETWEEN

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DECISION
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1.This is the hearing of the plaintiff’s application to amend the Statement of Claim pursuant to RDC Order 20 rule 5.

THE CLAIM

2.The action concerns an alleged breach of contract. 

3.The following facts are common ground.

4.In April 2006, the plaintiff and the defendant concluded a contract for the supply and installation of a “Mitsubishi” lift.  The plaintiff was the supplier and the defendant the buyer. 

5.The lift was to be installed in a house which was to be constructed at 8-12 Peak Road.  The defendant was a contractor on that site.

6.The total contract price was $598,000.  Payment was to be made by four instalments:

(a) 20%, ie, $119,600, “on signing of Letter of Intent or award of contract, whichever is the earlier”;

(b) 20%, ie, $119,600, “on receipt of shipping advice”;

(c) 35%, ie, $209,300, “on arrival of equipment in Hong Kong”; and

(d) 25%, ie, $149,500, “on completion of the installation and issuance of the Lift Certificate by relevant Authorities.  In any case, the payment shall be made within 9 calendar months after the arrival of the equipment”.

7.Shortly afterwards, the defendant paid a sum of $114,600 to the plaintiff pursuant to the contract.  That is the only sum of money paid to date by the defendant to the plaintiff under the contract.

The plaintiff’s case

8.It is the plaintiff’s case that the above sum was $5,000 short of the first instalment (ie, $119,600 - $114,600).  Further, following receipt of the shipping advice, the lift equipment arrived in Hong Kong in September 2006.  Despite the plaintiff’s demands, the defendant failed to pay the second and third instalment sums of $119,600 and $209,300.  By then, the outstanding sum due from the defendant amounted in total to $333,900 (“the Outstanding Sum”).

9.On 7 December 2006, the plaintiff wrote to the defendant demanding that the Outstanding Sum be paid within 7 days, otherwise the plaintiff would terminate the contract forthwith and hold the defendant liable for all loss and damage sustained as a result.

10.The defendant did not pay as demanded.  On 19 December 2006, the plaintiff informed the defendant that the contract was terminated on 14 December 2006.

11.In the Statement of Claim, the plaintiff claims the Outstanding Sum and a sum of $8,013.60 representing the warehouse expense incurred for storing the lift equipment (the “Original Storage Expense”).

Statement of Claim

12.In order to fully appreciate the basis of the plaintiff’s application, it is necessary for me to set out the relevant paragraphs of the Statement of Claim and the prayer for relief in full:

“11. By a letter from the Plaintiff to the Defendant dated 19/12/2006, the Plaintiff informed the Defendant that as the Defendant had failed to pay the sum of HK$333,900.00, the said sub-contract had been terminated on 14/12/2006.

12. Subsequently, the Plaintiff has incurred further expenses on warehouse storage of HK$8,013.60.

13. As a result of the Defendant’s breach of the said sub-contract, the Plaintiff suffered loss and damages, in the total sum of HK$341,913.60 (HK$333,900.00 + HK$8,013.60).

…

And the Plaintiff claims against the Defendant:-

(a) The said sum of HK$341,913.60;

(b) Interest;

(c) Further and/or other relief; and

(d)  Costs of this action.”

13.I pause here to make a few preliminary observations on the plaintiff’s claim.

14.First, although §13 of the Statement of Claim alleges that the plaintiff suffered loss and damage as a result of the alleged breach, §(a) of the prayer seeks relief for a fixed sum, which is the aggregate of the Outstanding Sum and the Original Storage Expense.   

15.Secondly, on the front page of the writ, where the plaintiff was required to fill in the box entitled “Claim nature” in accordance with §7 of Practice Direction 24.1, the plaintiff’s solicitors classified the claim as “DEBT”. 

16.Thirdly, Form No 16 was attached to the writ. This is the form to be filled in by a defendant in the case of admission in respect of a claim for a liquidated amount of money.  Form No 16C should be attached instead where the claim is for damages.

17.It is difficult to see how the claim for the Original Storage Expense can be raised as a liquidated claim, as the amount was not fixed in the contract. However, in view of the above, it would seem that on the whole the plaintiff is making a liquidated claim, rather than a claim for unliquidated damages.

18.That said, however, as will be seen below, on the contrary, the plaintiff’s position is that it has all along intended to claim unliquidated damages in this action.

Defence and Counterclaim

19.The gist of the defence is that in accordance with the terms of the contract, the plaintiff was required to submit drawings to the defendant for approval before fabricating the lift.  The plaintiff did not obtain such approval and is therefore in breach of the contract.  As a result of the breach, the defendant says it is entitled to, and therefore counterclaims, the return of the sum of $114,600.

Reply and Defence to Counterclaim

20.In its reply, the plaintiff alleges that it had obtained such approval in accordance with the contract and denies the counterclaim.

HISTORY OF THE PROCEEDINGS

21.Notwithstanding that the plaintiff had on 19 December 2006 terminated the contract (see §10 above), it did not proceed to issue the writ until October 2011, almost five years later. 

22.The filing of the Defence and Counterclaim and the Reply and Defence to Counterclaim took place shortly afterwards in late 2011. 

23.Then, in June and early July 2012, there was a flurry of activities by both sides in the action.   As it will become clear below, some of what was said and done during this period has an important bearing on the merits of the defendant’s opposition in the present application. I therefore set out below a chronology of relevant events during this period:

(a) On 1 June 2012, the defendant’s solicitors wrote to the plaintiff’s solicitors making, amongst others, two points, namely, first, that the plaintiff was not entitled to claim the contract price and that if it had a claim it would be for damages; secondly, that the plaintiff had a duty to mitigate.  I shall refer to these two points below as “the defendant’s contention on the measure of damages”.  The defendant’s solicitors wrote:

“Where a contract is terminated for breach and not further performed, the claimant’s remedy is damages not the contract price. In this case the Plaintiff retained (at least in December 2006) the goods (a lift) which were the subject of the contract. Delivery of the goods to the Defendant never took place. Therefore, it is now not open to the Plaintiff to claim the contract price. If the Plaintiff has a claim it is for damages, the basic principle being it is entitled to recover such sum as is necessary to put it in the position it would have been had the contract been performed.” (emphasis added)

(b) On 8 June 2012, the defendant’s solicitors served on the plaintiff a Notice of Sanctioned Offer pursuant to RDC Order 22 rule 5.  The terms of the Notice are of importance in the context of the present application.  The relevant parts read:

“1. It is in respect of the whole of Plaintiff’s claim.

2. The Plaintiff do have leave to enter interlocutory judgment against the Defendant for breach of contract with damages to be assessed.

3. The Defendant’s Counterclaim be dismissed.” (emphasis added)

(c) In the covering letter enclosing the Notice, the defendant’s solicitors wrote:

“It appears very clear to us that the only real issue in this litigation is the assessment of the damages suffered by your client, and the related issue as to whether your client has complied with its duty to mitigate the damages. We would urge your firm and your client to focus on this issue to avoid the unnecessary expenditure of time and costs.” (emphasis added)

(d) It is noteworthy that even though the plaintiff’s claim as pleaded would appear on its face to be for a liquidated sum, the defendant obviously treated the claim as one for damages, as it specifically asked for “damages to be assessed” and interlocutory judgment, as opposed to final judgment, be entered.

(e) By summons dated 19 June 2012, the defendant applied to amend the Defence and Counterclaim. The defendant proposed to add one passage which, in gist, would incorporate into the pleading the defendant’s contention on the measure of damages, ie, the plaintiff not being entitled to claim the contract price and the plaintiff having a duty to mitigate.

(f) On 25 June 2012, the plaintiff’s solicitors wrote two letters to the defendant’s solicitors.

(g) One was in reply to the latter’s letter of 1 June 2012. The plaintiff’s solicitors quoted certain passages from Chitty on Contract (Hong Kong Specific Contracts) which deal with the measure of damages for non-acceptance of goods and suggest that where there is no “available market” for the goods, the seller’s loss is usually the difference between the contract price and the value of the goods to the seller at the time of the breach. They alleged that the plaintiff had tried to negotiate with the parties involved in the Peak Road project with a view to disposing of the lift but the project had not resumed and it had not been able to locate a new buyer in the market due to the unique oval shape of the lift (which shape was designed specifically for the Peak Road project).

(h) The second letter was in reply to, first, the Notice of Sanctioned Offer and, secondly, the defendant’s amendment summons. The plaintiff’s solicitors accepted the sanctioned offer but refused to accede to the amendment request.

(i) By letters dated 29 June 2012, the defendant’s solicitors disputed, amongst other things, that the lift and its related equipment had no value, which the plaintiff’s solicitors seemed to be suggesting in their earlier correspondence, and maintained that while the lift cabin might have been a special order item, there should be “standard or stock items which could have been used in any other lift installation”. Further, the defendant’s solicitors took issue with the adequacy of the plaintiff’s alleged efforts to mitigate its loss.

(j) Both parties then filed their respective Listing Questionnaires in advance of the Case Management Conference listed for 5 July 2012.

(k) In the plaintiff’s Listing Questionnaire, §A1 which read “I confirm my pleadings are in order and require no amendment.” was ticked.

(l) In the defendant’s Listing Questionnaire, the defendant’s solicitors reiterated the defendant’s contention on the measure of damages. The defendant’s solicitors wrote:

“In light of the above factual background, the current issues of this case are whether the Plaintiff has a right to claim, as damages, the HK$333,900.00, as the outstanding payment of the contract price (or other loss and damage) and HK$8,013.60 for warehouse storage expenses, and whether the Plaintiff has complied with the duty to mitigate the loss and damage.” (emphasis added)

(m) On 4 July 2012, the plaintiff filed and served a Notice of Acceptance of Sanctioned Offer.

(n) The CMC took place on 5 July 2012. Master K K Pang made a number of orders. The relevant ones are as follows. First, the master made an order reflecting the plaintiff’s acceptance of the defendant’s sanctioned offer. Hence, the plaintiff was given “leave to enter interlocutory judgment against the Defendant for breach of contract with damages to be assessed”. Secondly, the defendant was given leave to amend the Defence and Counterclaim as per its amendment summons and the plaintiff was given leave to “file and serve an Amended Reply, if so advised”.

(o) On 19 July 2012, the plaintiff filed the Amended Reply. The only amendment was the quotation of the content of its solicitors’ first letter dated 25 June 2012 – see §(g) above.

(p) At this juncture, it can fairly be said that while the parties, at this stage, disagreed on whether there was an available market for the lift and the related equipment and hence their value, and whether the plaintiff had taken adequate steps to mitigate its loss, there appeared to be no disagreement in principle as to the legal basis on which damages should be assessed. In other words, both parties seemed to agree that, as a matter of principle, the plaintiff had a duty to mitigate and that the availability of a second hand market is relevant to the assessment of damages.

(q) Subsequent to the CMC, there were a number of applications before the court as regards the adducing of expert evidence on the market value (if any) of the lift and the related equipment.

(r) The hearing bundle for the present application does not contain all the documents relating to the issue of expert evidence. But there is included in the bundle an affirmation made by the defendant’s handling solicitor dated 6 November 2012, in which he once again put forward, in essence, the defendant’s contention on the measure of damages.

(s) Despite leave being given, the defendant did not nominate any expert to conduct a joint examination with the plaintiff’s nominated expert. Pursuant to the terms of an unless order, the defendant is now debarred from adducing any expert evidence at trial. The plaintiff’s nominated expert made a report dated 21 December 2013 (“the Expert Report”). But it was not filed with the court until October 2014.

(t) Save for the filing of the Expert Report, the parties took no substantive step in the action between October 2013 and December 2014.

THE APPLICATION TO AMEND

24.By summons dated 9 December 2014, the plaintiff applies to amend the Statement of Claim in the form of the draft Amended Statement of Claim attached to the summons.  The major proposed changes affect §§12 and 13 and the prayer for relief.  Shortly before the hearing, the plaintiff lodged with the court a revised draft of the Amended Statement of Claim.  I shall refer to the revised draft, instead of the draft attached to the summons, in this judgment.

25.I set out the proposed changes below:

(a) §12 – the Original Storage Expense was increased from $8,013.60 to “HK$119,265.80 and continuing”.

(b) §13 – instead of the sum of $341,913.60 originally claimed, the plaintiff now claims the sum of $479,275.  The paragraph, with the proposed amendments, reads:

“As a result of the Defendant’s breach of the said sub-contract, the Plaintiff suffered loss, expense and damage. The Plaintiff claims the said lump sum of (HK$598,000.00 – HK$114,600.00 – HK$4,125.00 = HK$479,275.00) and HK$119,265.80 which is continuing and expenses to be incurred for disposing the said lift as scrap.”

(c)   The prayer, with the proposed amendments, reads:

“(a) The said sum of HK$479,275.00;

(b) HK$119,265.80 which is continuing to be assessed;

(c) Cost of disposing the lift as scrap to be assessed;

(d) Further or alternatively damages;

(e) Interest;

(f) Further and/or other relief; and

(g) Costs of this action.”

26.A number of matters are worthy of mention at this juncture.

27.First, it would seem from the new §(a) of the prayer that, similar to the original claim, the plaintiff is still claiming a liquidated sum.  But in the proposed amendments, it also claims damages – see the new §§(b) to (d).   (This is to be contrasted with how a pleading seeking relief for unliquidated damages is usually drafted. For a precedent of a claim for unliquidated damages for breach of contract, see, eg, Atkin’s Court Forms, Second Edition, Vol 12(2), 2013 Issue, Form [122], in which “Damages” is pleaded as a relief in the prayer and the particulars of loss and damage (including amounts of various heads of damages) are set out in the body of the claim; cf. Form [135] for a claim for a fixed sum.

28.Secondly, when the draft Amended Statement of Claim is read on its own, one would not have any idea on what the sum of $4,125 (appearing in §13) represents and one would not appreciate the relevance of the cost of disposing the lift as scrap, as there is no explanation of these two matters in the draft.  It is only when one reads the draft in conjunction with the Expert Report would one gain an understanding of the two matters. 

29.According to the plaintiff’s expert, there is no second hand market for the lift and its related equipment and the only feasible way of realising their value is to have them scrapped.  He estimated that the scrap value would be $4,125.  But he also pointed out that costs would have to be incurred for the scrapping exercise.

The plaintiff’s submissions

30.Mr Tim Kwok, counsel for the plaintiff, submitted that the proposed amendments relate to the measure of damages resulting from the defendant’s admitted failure to accept and pay for the lift.  The purpose is to “put right” the claim in accordance with the principles of damages.  In his oral submissions, Mr Tim Kwok said that the relief in the present Statement of Claim is not properly pleaded and confirmed that the purpose of the application is to correct the figures in the Statement of Claim.  Further, he submitted that the defendant has been echoing these principles throughout the proceedings.

The defendant’s submissions

31.Mr Dennis Kwok, counsel for the defendant, advanced five grounds to oppose the application.

32.First, the application is made very late.

33.Secondly, the application is only made after leave was given to enter interlocutory judgment against the defendant.  Under the present CJR regime, the court should only entertain such application if there are “exceptional justifying circumstances”.

34.Thirdly, the new relief in §§(a) to (d) are “new claims”.  None of these have been previously raised or demanded by the plaintiff.  As these “new claims” are made in December 2014, more than 8 years after the breach, these “new claims” are time-barred.

35.Fourthly, if the court is to allow the amendments, the defendant will suffer serious prejudice, namely:

(a) The legitimate expectation of the defendant is that all heads of damages should have been fully set out before interlocutory judgment was entered.  This expectation is violated if the plaintiff is allowed to put in “new claims” now.

(b) New evidence will have to be adduced in respect of these “new claims”.

(c) The defendant will be deprived of the agreement that it thought it was making with the plaintiff two and a half years ago when the sanctioned offer was accepted.  The interlocutory judgment will have to be set aside as otherwise it would be deeply unfair and prejudicial to the defendant not to have the opportunity to defend “what are entirely new and considerably increased claims”.  The “re-opening” of the plaintiff’s case will be at odds with the principle of finality of litigation.

36.Fifthly, if the court is to allow the amendments, further costs will be incurred, which is clearly disproportionate to the amount of the claim itself. 

Legal principles

37.Where a party seeks leave to amend its pleading pursuant to RDC Order 20 rule 5, the amendment ought to be made for the purpose of determining the real question in controversy between the parties or correcting any defect or error in the proceedings.  The court should not give leave to amend unless it is of the opinion that the amendment is necessary either for disposing fairly of the action or for saving costs: RDC Order 20 rules 8(1) and (1A).  Where the court considers that the requirement in the rules are met, the court still retains a discretion as to whether to allow or disallow the amendment, having regard to a wide range of factors, such as the stage at which the application is made, any delay in taking out the application, any potential prejudice that may be suffered by the other party and whether such prejudice can be compensated for by costs.  See, generally, Hong Kong Civil Procedure 2015 (Vol 1) at §§20/8/6 and 20/8/9.

Analysis

38.As pointed out in §17 above, the plaintiff’s claim, as presently pleaded, appears to be a claim for a liquidated sum.  It is however obvious from the various letters written by the plaintiff’s solicitors and the Amended Reply that the plaintiff has all along intended to claim general damages – see §§23(g) and (o) above.  Mr Tim Kwok’s submissions also confirm that that has been the relief which the plaintiff wishes to seek in this action.

39.In other words, the plaintiff made a mistake in the Statement of Claim as to the nature of the relief it wishes to claim and it now seeks to rectify that mistake by putting forward the “correct” relief in the draft Amended Statement of Claim. 

40.Accordingly, I am satisfied that the proposed amendments are made for the purpose of determining the real issue in controversy between the parties.  I am also satisfied that the proposed amendments are necessary for disposing of the case fairly, as they reflect the correct relief which the plaintiff wishes to seek against the defendant.  For the avoidance of doubt, I should stress here that when I say that the amended claim or relief is a “correct” one, I am merely saying that it correctly reflects the real claim of the plaintiff.  I should not be taken as expressing any view that the claim is correct in the sense that it should be held valid at the assessment hearing. (For instance, there was some discussion at the hearing as to whether labour costs for the installation of the lift, which were never incurred, should be taken into account in the assessment of damages.  But this is a matter for the assessment hearing and does not fall to be determined in the present application.)

41.It is therefore necessary then to deal with each of the defendant’s opposing grounds and determine whether I should exercise my discretion to disallow the amendments based on any of those grounds.

42.As regards the first and second grounds of opposition, I agree with Mr Dennis Kwok that the amendment application is a late one.  In their reply to the defendant’s solicitors on 25 June 2012 (see §23(g) above), the plaintiff’s solicitors had already identified the “correct” measure of damages.  This means that the plaintiff could have sought leave to amend the Statement of Claim as early as in June 2012.  It did not do so.  On the contrary, it made a positive confirmation in the Listing Questionnaire that its pleading was in order and required no amendment – see §23(k) above.   

43.The plaintiff has not been able to put forward any satisfactory explanation as to why it has taken it so long to make the present application. 

44.That said, however, I am unable to accept Mr Dennis Kwok’s submission that the plaintiff needs to demonstrate exceptional justifying circumstances before the court can grant leave to amend.  I do not consider that the decision in Wing Han Trading Company Ltd v Tang Yan Kit [1990] 2 HKC 445, relied on by Mr Dennis Kwok, is of any assistance.  That case concerns exemplary damages, which do not arise in this case.  Charlesworth v Relay Roads Ltd (in liquidation) [2000] 1 WLR 230, another authority cited by Mr Dennis Kwok, is of very limited relevance since the principle discussed in that case applies to the situation where a party seeks to amend his pleading after a full hearing and final judgment.

45.In my view, the lateness and the absence of justification for the delay is a factor which goes against granting the plaintiff leave to amend.

46.As regards the third opposing ground, I have no hesitation in rejecting the defendant’s submission that the proposed amendments give rise to “new claims” which are now time-barred.  The plaintiff is not alleging any new cause of action in the proposed amendments.  The draft Amended Statement of Claim refers to only one breach, namely, the failure to pay the second and third instalments, which is the same as the alleged breach in the existing pleading.  The proposed amendments only go to alter the remedy which flows from the very same breach.  There is no new cause of action in the proposed amendments and the issue of time bar does not arise.

47.As regards the fourth ground of opposition, insofar as the defendant suggests that it will suffer prejudice because the plaintiff is now allowed to make “new claims”, this submission has to be rejected because there are no “new claims” involved.  Hence, it cannot be said that the defendant’s legitimate expectation will be violated. 

48.Mr Dennis Kwok submitted that new evidence, which relates to the costs and the need to scrap the lift, will have to be adduced.  I do not think there is any merit in this submission, given that such evidence has already been adduced in the form of the Expert Report.  The defendant has chosen not to nominate its own expert and, by its own choice, is barred from adducing any expert evidence in this regard at trial. 

49.Further, I do not agree with the submission that the defendant will be deprived of the agreement that it thought it was making with the plaintiff in June 2012 if the proposed amendments are allowed.  What it had agreed with the defendant then was that, first, it accepted liability of the plaintiff’s claim; and, secondly, damages flowing from that liability would have to be assessed.  The proposed amendments, as I have found above, do not give rise to any new claims and they only concern the measure of damages flowing from the breach already pleaded in the Statement of Claim.  In the circumstances, they do not, in my view, in any way affect the agreement reached between the parties in June 2012, as the quantum of damages was, and of course remains, a “live” issue between the parties.

50.I have set out in §23 above at some length the correspondence exchanged between the parties’ solicitors and documents filed with the court in June and July 2012.  It is plain and obvious that the defendant’s solicitors have, throughout these proceedings, identified the issues to be, first, the measure of damages and, second, the duty to mitigate and the defendant has proceeded with, and fought, the case on this basis – see §§23(a), (c), (e), (l) and (r) above.  This is exactly the basis upon which the plaintiff now seeks to proceed with its claim by making the proposed amendments.  Expert evidence along these lines has been obtained.  The two issues were the “live” issues between the parties when the agreement on liability was concluded in June 2012 and they will remain the “live” issues between the parties after the proposed amendments are admitted.  That being the case, I fail to see how the defendant will be deprived of the previous agreement if I allow the proposed amendments.

51.In his oral submissions, Mr Dennis Kwok made a further point (which was not made in his written submissions) that the sanctioned offer was made on the basis that the defendant would not be liable for more than the sum of $341,913.60, namely the sum claimed in the original §(a) of the prayer, which amount may be reduced if the court finds in the course of assessing damages that the plaintiff had failed to mitigate. If the proposed amendments are now allowed, there is a possibility that damages would be assessed in excess of that sum and in that sense the defendant will be deprived of the agreement which it had made with the plaintiff. 

52.Similarly, I do not consider that there is any merit in this submission.  The terms of the sanctioned offer simply provided for “damages to be assessed” (see §§23(b) and (n) above) and said nothing about any cap on damages now contended for by the defendant.  Further, in none of the defendant’s letters or documents filed with the court in this action was such a cap referred to, whether expressly or implicitly.

53.In particular, as can be seen from the highlighted words in the defendant’s Listing Questionnaire (see §23(l) above), the defendant’s solicitors clearly contemplated that the plaintiff might try to claim, as damages, the Outstanding Sum “or other loss and damage”.  No money cap was mentioned there.

54.In my view, the contemporaneous documents show clearly that there was no agreement on any “damages” cap.

55.As regards the fifth and last ground of opposition, I do not consider it to be a valid complaint, given that there is no “new claim” involved.

Decision

56.In summary, I consider that only the first ground of opposition has been made out.  However, when this ground is weighed against the competing consideration to allow the plaintiff to put forward its real case for adjudication before the court, I am of the view that I should exercise my discretion to give the plaintiff an opportunity to rectify its mistake in the existing pleading. 

57.In coming to the conclusion, I have borne in mind the primary aim in exercising the powers of the court as set out in RDC Order 1A rule 2(2), which is to secure the just resolution of disputes in accordance with the substantive rights of the parties.  By seeking leave to incorporate the proposed amendments, the plaintiff is trying to put forward its “correct” claim, ie, the claim that it really wishes to pursue and has in fact been pursuing.  While the plaintiff is rightly criticised for being late in its application, there will be no real prejudice to the defendant by reason of the proposed amendments.  The real case of the plaintiff has all along been anticipated and opposed by the defendant.  The case has not yet been set down for trial.  No milestone date has yet been scheduled.  When the matter is looked at in the round, in my view, the balance weighs strongly in favour of allowing the plaintiff to amend its claim.

58.However, the draft Amended Statement of Claim is, in my view, still deficient in a number of respects, as remarked in §§27 and 28 above.  Therefore, as indicated at the hearing, I do not feel able to give leave to the plaintiff to amend as per the proposed draft.  I think the appropriate thing for me to do would be to give another opportunity to the plaintiff to revise its draft Amended Statement of Claim, solely to address the defects identified above.

59.By way of footnote, I do not accept the defendant’s two fallback positions if the proposed amendments are allowed. 

60.First it says that in such case the plaintiff should bear all costs in the assessment of damages which are not the subject of an express order to date and all costs thrown away by reason of the amendments. The rationale for this alternative position is that “the entire action will effectively be re-commenced on a new basis”.  I have already rejected this submission and I will also reject the defendant’s proposed costs order.

61.Secondly, the defendant says that if I am to allow the proposed amendments, the defendant will apply to set aside the order of Master K K Pang which granted leave to enter interlocutory judgment.  There was no proper application or submission made in this regard, namely, on what ground the order made by consent can legitimately be set aside.  I fail to see how this court can entertain the application to set aside at this stage.

DISPOSITION AND ORDERS

62.In the circumstances, I give the following directions for the further conduct of the summons dated 9 December 2014:

(a) The plaintiff do lodge with the court and serve on the defendant the draft Amended Statement of Claim, with such changes made to it as are appropriate to address the matters set out in §58 above, within 21 days of the handing down of this Decision;

(b) The plaintiff do, within 7 days thereafter, apply to restore the summons for a hearing returnable before me; and

(c) Costs of the summons incurred to date, including the costs of the hearing on 10 March 2015, be reserved and dealt with at the restored hearing.

Mr Tim Kwok, instructed by Mike So, Joseph Lau & Co., for the plaintiff

Mr Dennis W.H. Kwok, instructed by Francis & Co., for the defendant