Su Su v. Li Wing Chiu

HCA 2225/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2225 OF 2013

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REASONS FOR DECISION
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Introduction

1.Before the court were matters arising from this court’s judgment on 30 January 2015 in relation to P’s O14 Summons (“Judgment”).

2.In these Reasons, for easy reference, I shall adopt the same abbreviations in the Judgment, save otherwise indicated.

3.By way of brief background, prior to P issuing the writ herein, she had obtained the Mareva Order on 16 November 2013 on ex-parte basis restraining D from, among other things, dealing with a sum of HK$17m.  The Mareva Order had included a disclosure order against D. Subsequent thereto, on 19 December 2013, D had agreed to pay HK$17m into court and a further amount of HK$680,000 being provision of security of 2 months’ interest at 2 % per month, and all D’s then obligations under the Mareva Order were stayed pending the substantive hearing of P’s inter-partes summons to continue the Mareva Order.

4.D then paid into court a total sum of HK$17.68m on 19 December 2013.

5.Thereafter, on 18 February 2014, this court refused D’s application to set aside the Mareva Order, and further on 23 May 2014, this court refused D’s application for leave to appeal, and instead ordered the ceiling of the security in the Mareva Order be raised from HK$17m to HK$21.08m, to take into account contractual interest for 12 months.

6.P took out its O14 Summons in March 2014.

7.On 5 June 2014 and 17 July 2014, D respectively filed his 4^th and 6^th affirmations, explaining that due to his impecuniosity, he was not able to meet the increased ceiling of the Mareva Order, and purported to comply with his disclosure obligations under the Mareva Order.

8.The O14 Summons was eventually heard on 13 and 14 November 2014 (“O14 Hearing”), which then led to the Judgment.

9.In paragraph 133 of the Judgment, I had set out my order:

“(i) D shall be granted leave to defend on condition that he pays a sum of HK$21.08m into court;

(ii) The sum of HK$21.08m already paid into court as security by D shall remain as D’s payment into court to meet the above condition;

(iii) Costs be in the cause and there be certificate for two Counsel.  This is an order nisi, which shall be made final after 14 days.”

10.After the handing down of the Judgment, but before the order was sealed and perfected, on 3 February 2015, P’s solicitors wrote to the court reminding the court that D had actually paid only HK$17.68m into court and invited the court to hand down a corrigendum, inter alia, to require D to pay a further sum of HK$3.4m into court, to make up the total amount of HK$21.08m.

11.A copy of P’s solicitors’ letter of 3 February 2015 was sent to D’s solicitors which replied on 6 February 2015, drawing the court’s attention to D’s 4^th and 6^th affirmations, pointing out that the aggregate sum paid into court was only HK17.68m and that the figure of HK$21.08m in paragraph 133 should be replaced by HK$17.68m.

12.This was objected to immediately by P’s solicitors in their letter of 6 February 2015.

13.On 10 February 2015, this court indicated that it was not aware that the amount of security paid into court by D had not been increased to HK$21.08m, and that the court’s intention was that D was granted conditional leave to defend and the condition was the amount already paid into court was to remain as D’s payment to meet the condition. This court then directed that if there was no agreement between the parties, they should fix a further hearing for argument.

14.In light of the court’s above indication, D’s solicitors proposed that the order drawn up should reflect the amount of HK$21.08m be replaced by HK$17.68m.  P’s solicitors took objection and indicated that this would mean the court was to change its own reasons in the Judgment and this court had no jurisdiction to do so.

15.P’s solicitors further sent a long letter on 24 February 2015 pointing out that there were more complex issues to be considered by the court, and further it was their view that this court had no jurisdiction to order the HK$17.68m previously paid into court by D to be applied to satisfy the condition for leave to defend, as Thousand Jade through its liquidators (“Liquidators”) on behalf of the creditors potentially had a claim for HK$17m in HCA 1710 of 2014, and that this court should order D to make a fresh payment in the sum of HK$17m to be paid into court as the condition for leave to defend.  They further disputed D’s suggestion that the court should reduce the quantum of the condition from HK$21.08m to HK17.68m.

16.The above correspondence led to the hearing before this court on 14 July 2015.  Mr Alfred Liang appeared on behalf of P, and Ms Audrey Eu SC and Mr Kenneth Chan appeared for D.

17.In P’s skeleton Arguments, Mr Liang had sought to refer to P’s concern by recent discovery of various matters which indicated that D had in fact sided with the Liquidators in supporting the Liquidators’ case that the sum of HK$17m was wrongfully paid into court.  Mr Liang submitted that the court should make a determination of 2 issues:

i. Whether the Judgment should be corrected to make it clear that D was required to pay an additional sum of HK$3.4m into court in order to satisfy the condition for leave to defend, or as D submitted, the condition for leave be reduced to HK$17.68m;

ii. Whether, in view of the recent discovery of material facts concerning the Liquidators’ claim in HCA 1710 of 2014 and P’s stance in relation thereto, the court should modify the Judgment to bar D from appropriating the HK$17m of the HK$17.68m presently held by the court to satisfy the condition for leave to defend.

18.At the hearing, this court indicated that it was the court’s error arising from an accidental slip or omission that the figure was stated to be HK$21.08m instead of HK$17.68m in paragraph 130 and in paragraph 133 (i) and (ii), and that this court decided it would issue a corrigendum to this effect.

19.To allay P’s concerns, the court had proposed what could be added as clarification to the order, which had not yet been drawn up, were the words that “if there is a reduction of the sum of HK$17.68m held by the Court for whatever reason, D shall pay the shortfall into Court within 14 days after the amount has been reduced, to satisfy the condition” (“Additional Words”).  The Additional Words, as submitted by Ms Eu, are not really necessary, as it goes without saying.  Anyway, there was no real objection from Ms Eu to the Additional Words.  Mr Liang had indicated that if the court were not with P, and if the court were to issue a corrigendum, he would ask the court to include the Additional Words.

20.In the end, I decided that this court would issue a corrigendum with the Additional Words to replace HK$21.08m with HK$17.68m where it appeared in the Judgment.

21.I set out hereinafter the reasons for my decision.

The Law

22.Order 20 rule 11 of RHC states that:

“Clerical mistakes in judgments or orders, or errors arising therein from any accidental slip or omission, may at any time be corrected by the Court on summons without an appeal.”

23.Mr Liang had referred this court to what had been explained by Lam JA (as he then was) in Yau Wah Hing v Yuen Kay Ming CACV 46/2012 (19 March 2013)[1]:-

(i) It is necessary to distinguish the court’s power to (1) correct errors under the slip rule and Order 20 Rule 11, (2) clarify its order , and (3) re-open a case after handing down judgment (but before the perfection of the formal order) to entertain further contentions which had not been considered in the judgment.

(ii) The jurisdiction under the slip rule and Order 20 Rule 11 should be confined to cases which are truly inadvertent or accidental errors or omissions: the court cannot correct a mistake of its own in law or otherwise, even though apparent on the fact of the order[2].  Though it may also cover accidental omission on the part of counsel or solicitor, it cannot be relied upon to claim a relief which had not been canvassed in pleadings or evidence[3].

(iii) Apart from the slip rule jurisdiction, the court does have jurisdiction to clarify an ambiguous order by reference to the manifest intention of the court set out in the body of the judgment[4], and this can be done even after the order has been sealed.

(iv) Further, the court has jurisdiction to re-open a case even after a judgment has been handed down[5], and this power can only be exercised before an order has been sealed, and this power should only be exercised in exceptional circumstances[6]. Further, the discretion must be exercised in a way best designed to achieve justice, and even if the court is minded to re-open the case, a fair opportunity must be given to the parties to canvass submissions and, if necessary, to adduce further evidence, before a decision can properly be made on a new aspect of the case[7].

Whether the Judgment should be corrected to make it clear that D was required to pay an additional sum of HK$3.4m into court in order to satisfy the condition for leave to defend, or as D submitted, the condition for leave be reduced to HK$17.68m

24.Mr Liang had referred to paragraphs 5 and 130 of the Judgment to submit the manifest intention of the court was that the conditional leave was for D to pay HK$21.08m.

25.Mr Liang had further argued that the only “slip” on the part of the court was that the court was under the misapprehension that D had paid HK$21.08m into court, and thus the court should make it clear that D should be required to pay an additional HK$3.4m into court to top up the HK$17.68m already in court.

26.It was clear from Mr Liang’s above submissions that P had accepted that there had been a “slip” on the part of the court, and the only issue was what was the then “manifest intention” of the court.

27.Mr Paul Lam SC had appeared for P at the time of the O14 Hearing, while Ms Eu and Mr Chan had appeared for D.

28.At the O14 Hearing, Mr Lam had submitted towards the end of his opening submissions that P’s primary goal was to obtain summary judgment against D, but another option would be conditional leave be granted.  He then submitted that as Ms Eu had said that in fact D had already paid HK$17.68m into court under the Mareva Order, the issue was whether one could change the security paid under the Mareva Order to satisfy the condition.  Mr Lam had argued that as the beneficial owner of the amount held by the court was uncertain, if conditional leave were to be granted, D should be ordered pay an additional HK$17m plus interest into court.

29.When making submissions on the conditional leave, all along, the issue then was whether the amount paid into court could be for the satisfaction of the condition, or D had to pay an equivalent amount of the sum already paid into court in addition to satisfy the condition. This could also be seen from paragraphs 131 and 132 of Judgment.  The court had declined to order D to pay an additional equivalent amount to meet the condition. There was never any submissions made by Mr Lam that the condition should be for D to pay an additional HK$3.4m into court.

30.It was this court’s error in stating in the Judgment that the amount already paid into court was HK$21.08m. It was further this court’s manifest intention that whatever was already paid into court was to remain in court as D’s payment to meet the condition.  It was not the court’s intention that D should pay any additional amount other than what was already paid into court.  There was no order to this effect.

31.The court was not re-opening any matters, and notwithstanding no summons was issued by either party, for the above reasons, I am of the view that in view of this court’s own error, this court had jurisdiction to issue a corrigendum.

32.The Corrigendum will be issued on the day of the handing down of these Reasons.

Whether, in view of the recent discovery of material facts concerning the Liquidators’ claim in HCA 1710 of 2014 and P’s stance in relation thereto,  the court should modify the Judgment to bar D from appropriating the HK$17m of the HK$17.68m presently held by the court to satisfy the condition for leave to defend.

33.First of all, what P was seeking was a modification, or variation of the Judgment.  I indicated during the hearing that what was referred to by P were matters occurring after the Judgment.  I took the view that even though the order had not yet been perfected or drawn up, if P was seeking any modification or variation of the Judgment, it should take out a proper summons.  For these reasons, I declined to deal with this matter at the hearing.

Costs

34.Ms Eu had suggested that costs of the hearing should be costs in the cause.  There was no objection from Mr Liang.  I had thus made an order that costs of the hearing be in the cause.

Mr Alfred Liang, instructed by W K To & Co, for the plaintiff

Ms Audrey Eu SC and Mr Kenneth C L Chan, instructed by WT Law Office, for the defendant