STRAIGHT WAY GROUP LTD v. DAYTON INDUSTRIAL CO LTD AND ANOTHER

HCA 1754/2017

[2020] HKCFI 560

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1754 OF 2017

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J U D G M E N T

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Introduction

1.  On 26 July 2017, the Plaintiff (“P”) issued proceedings against the two Defendants (“the Ds”) claiming damages arising from the design, development and/or manufacture of certain electronic products.  The Statement of Claim was amended on 21 September 2018 (“ASOC”).  The Ds filed an Amended Defence (“AD”) on 14 January 2019.

2.  On 26 November 2018, P issued an O.14 summons for summary judgment against the Ds, supported by evidence from Mr Nicholas Anwyl Davies (“Davies 1”) and Mr Ross Benjamin Haffenden (“Haffenden”) on behalf of P; opposed by evidence of Mr Yuen Wei Man Andrew Stephen (“Yuen”) on behalf of the Ds; with reply evidence from Mr Davies (“Davies 2”).

3.  On 6 May 2019, Master Lawrence Hui dismissed the O.14 application.

4.  On 19 May 2019, P issued a notice of appeal from that decision pursuant to O.58 (“the Notice of Appeal”).

5.  The Master gave reasons for his decision on 20 May 2019:

“[P]’s case involves allegations of fraud. There are triable issues and arguable defences, which [P] should have known, as to [P]’s claims and damage thereto. The case is plainly not appropriate for Order 14. [P]’s Summons is thus dismissed with costs.”

6.  On 20 January 2020, P issued a summons (“the Amendment Summons”) seeking to:

a.  Amend the Notice of Appeal to (inter alia) add a claim for interim payment of two-thirds of the amount claimed in the O.14 application; and

b.  To have leave to adduce the 3^rd affidavit of Mr Davies (“Davies 3”) on behalf of P.

7.  P’s Notice of Appeal and P’s Amendment Summons were due to be heard on 11 February 2020.  As a result of the coronavirus outbreak, the hearing was adjourned.  The parties subsequently agreed to have these matters determined on paper.

8.  Further, P has on 13 March 2020 filed an affidavit of Wong Kam Chuen (“Wong”) seeking leave to issue an interim payment summons, in the form exhibited, to be heard with the Notice of Appeal.

9.  For the purposes of the determination on paper, the parties relied on P’s skeleton argument dated 31 January 2020, Ds’ skeleton argument dated 7 February 2020, and P’s reply skeleton dated 23 March 2020.

10.  I now have before me, for disposal on paper:

a.  P’s Amendment Summons;

b.  P’s Notice of Appeal;

c.  P’s informal application for interim payment.

P’s Amendment Summons

11.  Now that P seeks to issue an interim payment summons, I treat the application to amend the Notice of Appeal to include an interim payment application as abandoned.  For the avoidance of doubt, I agree with Ds that it is technically inappropriate for the application to be made in the Notice of Appeal.

12.  P seeks to adduce Davies 3 on this appeal.  

Relevant legal principles

13.  Order 58 rule 1(5) provides that no further evidence (other than evidence as to matters which have occurred after the date on which the decision by the Master was made) may be received on the hearing of an Order 58 appeal except on special grounds.  “Special grounds” requires all three Ladd v Marshall conditions to be satisfied – HKCP 2020, pp.1160 to 1162, §58/1/1 to §58/1/3.

14.  The first Ladd v Marshall condition is that the evidence could not have been obtained with reasonable diligence for use at the hearing below. The second is that the evidence must be such that, if given, it would probably have an important influence on the result of the case, though it need not be decisive. HKCP §58/1/3.

Application to the facts

15.  Insofar as P submits that Davies 3 is a summary of the previous evidence before the Master (which I do not accept as accurate), then it is unnecessary and in any event falls foul of the requirement for special grounds to be admitted.

16.  Insofar as P claims that Davies 3 refers to an expert analysis of defects, it does not satisfy the Ladd v Marshall requirements. 

a.  Davies 3 para. 48 states: “I have recently caused to have some of the Single Socket Monitors re-examined by Mr James Simon (an electronic products engineer).  He informed me and I verily believe there are basic design faults in the Single Socket monitors circuitry.”

b.  This fails to satisfy the Ladd v Marshall requirements as (1) it is not explained why such evidence could not have been obtained with reasonable diligence for use at the hearing below (2) the evidence would not have an important influence on the result as it consists of a bare hearsay statement.

17.  I dismiss the Amendment Summons. I will address costs after dealing with the Notice of Appeal.

P’s Notice of Appeal

18.  Two main questions arise:

a.  Is the fraud exception engaged?

b.  If not, is this an appropriate case for O.14?

Is the fraud exception engaged?

Relevant legal principles

19.  RHC O.14 r.1 (application by plaintiff for summary judgment) provides at paragraph (2): “Subject to paragraph (3) this rule applies to every action begun by writ other than ... (b) an action which includes a claim by the plaintiff based on an allegation of fraud...”

20.  In Zimmer Sweden AB v KPN Hong Kong Ltd [2016] 1 HKLRD 1016 Yuen JA stated:

“(1)  The court should determine whether “the fraud exception” applies at the time when the application for summary judgment is heard. Therefore the court should not be restricted to a consideration of the statement of claim only, but should examine all relevant materials existing at the time of the hearing, including subsequent pleadings and the affidavits. (It would be noted that in Pacific Electric Wire, the court even took into account the skeleton argument of the plaintiff's counsel at first instance. With respect I tend to the view that given the nature of skeleton submissions, they should be considered only where they serve to clarify an ambiguity in the plaintiff's case).

(2)  Having regard to all the relevant materials, the question to be asked by the court is “does this action include a claim for which an allegation of fraud would have to be made by the plaintiff in order to establish or maintain that claim?” If the answer is affirmative, “the fraud exception” is engaged and the court has no jurisdiction to hear the summary judgment application, even if the plaintiff seeks to hive off that claim from another claim (eg for dishonoured cheque) for which summary judgment would have been available. That consequence follows from the wording of “the fraud exception” (Pacific Electric Wire at [19]).

(3)  In considering whether an allegation of fraud would have to be made to establish or maintain a claim, one must look at the substance, and not the mere form, of the plaintiff’s case. If all the factual constituents of fraud are alleged and relied upon, it does not matter whether the actual word “fraud” has or has not been used (Newton p.1301).

(4)  The court must consider whether those factual constituents of fraud are relied upon in order to establish or maintain a claim. In Newton, the court accepted that the factual constituents of a Derry v Peek fraud had been set out in the pleadings. However in order to establish the plaintiff’s claims of breach of contract, breach of fiduciary duty and negligence, it did not need to make any allegations of fraud. On the facts of that case, the breach of contract, breach of fiduciary duty and negligence would still be established, even if the defendant had been completely honest, and was only mistaken (p.1302). It would appear from the report that the defendant had not pleaded a defence which the plaintiff needed to reply to by alleging fraud on the part of the defendant. This may be contrasted with A-1 discussed below.

(5)  It may be that originally a claim (eg breach of fiduciary duty) may be established without the plaintiff having to make an allegation of fraud (as in Newton). But the nature of the defence (whether disclosed in a pleading or an affidavit) may be such that in rebuttal (whether in a Reply or in an affidavit in reply), the plaintiff would have to allege fraud, in which case, “the fraud exception” would be engaged. So for example, in A-1 the defence was that there was no breach of fiduciary duty because the receipt of money was pursuant to a declaration of dividend. In reply to this defence, the plaintiff alleged that the declaration was an ex post facto fabrication. Consequently, by the time of the hearing of the summary judgment application, the plaintiff would have to make out an allegation of fraud by the defendant in order to maintain the claim for breach of fiduciary duty.

(6)  Finally, as to what is an allegation of fraud for the purpose of “the fraud exception”, this Court is bound by the judgment in Pacific Electric Wire to adopt the wide/liberal meaning. The rationale for adopting a wide meaning had been suggested by Kaplan J in Skink and adopted by this Court in the Pacific Electric Wire judgment. That judgment cannot be said to be plainly wrong. Further if the narrow meaning is adopted, the anomaly observed in Newton would arise, viz summary judgment would not be available for only one type of dishonest conduct, but available for all other types of dishonest conduct. To conclude, “the fraud exception” would be engaged where what is alleged is an intentional or reckless dishonest act (or omission) done with the purpose of deceiving.”

21.  In Pacific Electric Wire & Cable Co Ltd v Harmutty Ltd [2009] 3 HKLRD 94 Rogers VP, said (at 102, §19): -

“The wording of O.14 r.1(2)(b) makes quite clear that what is excluded is an action where there is a claim which is based on an allegation of fraud. Two matters are clear from that. The first is that there may be one or more claims in the action and the rule envisages that one of the claims may not be based on an allegation of fraud but another may be. In those circumstances it is clear that an application for summary judgment under O.14 will not lie. Secondly, the rule is not confined to excluding actions in which one of the claims is a claim for damages for fraud, what is excluded is any action where there is a claim in respect of which the underlying allegations on which the claim is based constitute an allegation of fraud.”

22.  Section 26(1) of the Limitation Ordinance(Cap. 347) (“the LO”) provides: -

“Subject to subsection (4), where in the case of any action for which a period of limitation is prescribed by this Ordinance, either—

(a) the action is based upon the fraud of the defendant;

(b) any fact relevant to the plaintiff’s right of action has been deliberately concealed from him by the defendant; or

(c) the action is for relief from the consequences of a mistake, the period of limitation shall not begin to run until the plaintiff has discovered the fraud, concealment or mistake (as the case may be) or could with reasonable

diligence have discovered it.”

23.  Kwan JA in Hotung Investment (China) Ltd v Ernst & Young (a firm) [2012] 5 HKLRD 421 at 431, §29 stated: -

“The fact that a plaintiff did not know or could not, even with reasonable diligence, have discovered the essential facts for pleading a cause of action is not, on its own, sufficient to postpone the commencement of the limitation period. Historically, s.26 was enacted to reflect the equitable principle that a statute should not be used as an engine of fraud and “deliberate concealment” was merely a species of fraud (Limitation Periods by Andrew McGee (6th ed., 2010), paras. 20-002 and 20-010).” [emphasis added]

24.  P submits that the above statement by Kwan JA is a wrong summary of the law, and to be per incuriam the UK House of Lords decision in Cave v Robinson Jarvis & Rolf [2003] 1 AC 384 at pp. 393-394 (per Lord Millett) and 400-401 (per Lord Scott).  Clearly, what is stated in the Hong Kong Court of Appeal is binding on this Court.  In any event, on the facts of this case, as addressed below, it is not necessary to consider whether everything which amounts to “deliberate concealment” for the purposes of s.26 of the LO would amount to a fraud.

Relevant materials

(i) The pleaded case

25.  In general terms, the action arises from dealings in about 2009 to 2012 whereby P wanted D1 to produce electricity monitors.  P’s intention was to have various different types of monitor: plug-in (Single Socket Monitors) and wireless (UHF models).

26.  The ASOC by its prayer claims damages for breach of contract, damages for breaches of duties of care, damages for negligent misrepresentation, and damages under the Misrepresentation Ordinance (Cap. 284) and damages for loss of reputation and effective loss of trade name.

27.  I turn to look at the substantive factual allegations made in the ASOC (emphasis in bold added):

a.  At paragraph 4 entitled “Duties in Contract” P pleads certain terms of contract (albeit without pleading any actual contract).

b.  At paragraph 5 entitled “Duties in tort” P alleges certain duties of care owed by Ds to P including duties not to willfully misrepresent the performance described in the specifications of each of the 5 products which D1 offered to develop and manufacture in bulk. As against D2, it is alleged D2 (inter alia) owed (1) a duty not to willfully hide or conceal the fact that each product to be developed and manufactured did not comply with the specifications and/or were defective; (2) a duty of care not to willfully hide or conceal the fact that the UHF products did not have the specified or agreed range, when to do so would cause P to suffer loss and damage by such deceit.

c.  At paragraph 6 entitled “History of the representations made by the [Ds] to the [P] in the development of electricity monitors and UHF based electricity monitors), P asserts various discussions and at 6.04 pleads that:

i.  On 17 September 2010, D2 represented to Mr Davies of P that D1 could produce 3 models of UHF-based monitor with the specified range of 100 feet or 30 metres indoors;

ii. On 18 January 2010 by email, D1 represented that a minimum range of 50 metres for the Whole House Meter was achievable.

d.  At paragraph 7.02, P pleads that in reliance on such representations, P agreed to place orders with D1 for the design, development and manufacture of UHF-based products.

e.  At paragraph 7.05, P alleges that it relied on specific additional representations relating to the functionality and battery life of the U-Vue Single Socket Monitors; and that there were UHF models with a range of 30 metres.

f.  At paragraph 8.06, P pleads that in reliance on representations made at paragraphs 8.02, 8.04 and 8.05 in relation to the defects of the Single Socket Monitors, P placed an order for 5000 units on 3 September 2010, instead of the 30,000 units it had wanted to order.

g.  At paragraph 10, P pleads that the representations in paragraphs 6 and 7 were continuing representations, and in reliance thereon, P continued to request Ds to develop further models in the U-Vue range and which were UHF-based, and D1 continued to charge P for such development costs.

h.  At paragraph 11, P alleges that D1 only delivered 4800 units of the U-Vue order and that they were defective leading to losses including lost future orders and lost marketing expenses.  P claims:

i.  loss of profits on the potential orders of 30,000 pieces in excess of US$250,000 (paragraph 11).

ii.  if D1 delivered a functioning product on time, it would have captured the market before competitors but instead it lost future orders claimed to be worth in the region of US$11.5 million (paragraph 12).

iii.  lost marketing expenses and other wasted costs totaling about US$1.3 million (paragraph 13).

i.  At paragraph 16:

i.  P alleges that Ds had willfully concealed the fact that the UHF models were not able to reach the minimum 100 ft/30 m range specification (16.01);

ii.  P only became aware on 15 June 2012 of the falsity of the representations by Ds which had been made willfully and/or carelessly or negligently (16.02);

iii.  P reserves the right to amend the ASOC in respect of the concealment of facts relating to battery storage abilities of the monitors after sale, defects in the circuit design of the Single Socket Monitors, and none of the UHF models attained the specified range (16.04).

28.  The Ds’ pleaded case as set out in the AD:

a.  In respect of the U-Vue Single Socket Monitor:

i.  The AD asserts that only 4800 units were produced as the 200 samples produced at P’s request had used the remaining necessary materials. (paragraph 8(6)).

ii.  D1’s AD pleads that any problems with the monitors were attributable to P’s design and/or decisions (paragraphs 6(7) and 8(8)). The AD particularizes relevant specification changes and decisions by P (paragraph 8(8)).

iii.  Further, P had failed to pay D1 US$47,000 odd for the 4800 units. (paragraph 8(7)).

b.  In respect of UHF Models:

i.  D1 asserts that whilst it issued costings for various models of UHF-based monitor, there was never any agreement between P and D1 that D1 would design, develop or manufacture monitors with the UHF 433 MHz feature, and in particular no agreement on the range for such monitors (paragraphs 6(4) and 7(2)).

ii.  D1 asserts that it agreed to explore the possibility of manufacturing for P models which had the UHF 433 MHz feature based on the designs and specifications of P (paragraphs 6(5) and 7(2)).

c.  In respect of limitation, Ds plead that any cause of action (which is denied) would have been time-bared by 26 July 2017 (the date of issue of P’s Writ) pursuant to s.4 of the Limitation Ordinance (Cap. 347).

(ii) The affidavit evidence

29.  I turn to look at the affidavit evidence (as directed by Zimmer Sweden) for the purposes of considering whether the fraud exception is engaged.

30.  Davies 1 states (emphasis in bold added):

a.  Para 2.04– “... our claims for deceit and misrepresentation are based in tortious liability...”

b.  Para 11.09– “... The Plaintiff reserves the right if this matter goes toa full trial, to claim the balance for a reasonable number of years thereafter, for loss of profits, as these contracts should have run on longer, and also because of mis-descriptions and willful concealment of the defects in the products, denied us the opportunity to go on selling marketable products...”

c.  Para 15.03– “... [D2] would have seen the sample packaging for the whole range of products including RF/UHF models. Thus, he was expressly thereby encouraging Ross Haffenden and myself to believe that the RF/UHF feature would work. Therefore, he participated in the deception and false representations that such would function as specified.”

d.  Para 19.04– “... Therefore, [D2 and D1’s staff] must have known about these faults from these inspections. And they concealed them from me and Ross Haffenden.”

e.  Para 22.01– “... Thus it can be seen that [neither D1 nor D2] ever produced Single Socket U Vue monitors without battery and circuit design defects... There were continuing representations that these products would work and were within specification and could be produced in bulk in due course. The lack of range of the UHF Models was deliberately suppressed until the 15^th June 2012...  These are matters I only became aware of in February 2018.  Thus, there were continuing breaches of contract, and willful concealment of the lack of range well within the limitation period.”

31.  Haffenden states:

a.  Para. 1.03 – “ [D1] and its staff made continuing representations about [D1]’s ability to produce single socket monitors and UHF433MHz monitors with a range of 100 ft indoors ... from May/June 2009 to 15^th June 2012.  They issued various BOM sheets offering to develop and produce these products with improvements etc., which turned out to be false.  [D1]’s staff and [D2] must have known the products were defective and the representations to be false.....  I verily believe that [P] has an unanswerable claim under the Misrepresentation Ordinance in these respects and have claims for damages in deceit.”

b.  Para. 15.01 – I travelled extensively between 2009 and June 2012 and I would not have that travel if I have known that [D1 and D2] had deliberately misrepresented the capabilities of monitors we were using and/or hiding defects in the circuits, batteries or range.”

c.  Para 19.01– “... They never admitted these UHF 433 Hz Monitors did not have the range required...  This behaviour was deceptive to say the least.”

d.  Para 19.02– “... I believe [D1] staff and [D2], knew the range problem all along, and deliberately concealed this from [P]...”

32.  Davies 2 states:

a.   Para. 16 (entitled “Wilful Concealment and Misrepresentation – and Limitation Issues”) :

i.  Para. 16.01 – “There was no denial that the range in particular could not be achieved. This admission came only ... on 15^th June 2012. Therefore [D1]’s staff must have willfully concealed from the start the fact the specified range could not be achieved....”

ii.  Para. 16.02 – “I am advised and verily believe... that in relation to the willful or reckless concealment, time only runs from the date such is discovered.  We only discovered this concealment in June 2012 and the limitation period runs thereafter...”

iii.  Para. 16.03 – “...we only discovered [t]he falsity of the misrepresentation in relation to range in June 2012 and time only runs from the discovery of the falsity of the misrepresentation...and the relevant periods are 6 years from the date”.

b.  At para. 17 (entitled “Discovery of the Wilful Concealment and/or Falsity of the Representations”): Para 17.03 – “...He had already represented something which could not be achieved by these products. He was thereby making false representations... If he had checked in November 2011, as he promised, then he further concealed the fact these RF/UHF monitors did not have range.”

(iii) P’s skeleton argument

33.  For completeness’ sake, I note that P’s skeleton states:

a.  At para. 5 that P is not pursuing its case in contract for O.14 purposes; and P maintains D’s liability sounds in tort for negligent misrepresentation, for which there is no need for a contractual agreement.

b.  At para 3(vi), after summarizing what it claims to be the essential indisputable facts, that P is making no allegation of fraud even in its widest sense.

Analysis

34.  Having regard to all the relevant materials, it is readily apparent that the action includes a claim for which an allegation of fraud would have to be made by P in order to establish or maintain that claim.

a.  P by its ASOC advances claims of fraudulent misrepresentation and deceit.

b.  Further, P relies on both false representations, indisputably fraud, and “willful concealment” in order to postpone the commencement of the limitation period.

35.  The fraud exception is engaged, and the Court has no jurisdiction to entertain an O.14 application.

If the fraud exception is not engaged, is this an O.14 case?

Relevant legal principles

36.  As stated at HKCP 2020, p.308, §14/1/5: -

“... Summary judgment will only be granted on the claims set out, and facts pleaded, in the statement of claim... The statement of claim must be complete and good in itself; any defect or omission (e.g. omission to state an agreement to pay interest) cannot be corrected or supplemented by the plaintiff’s affidavit... If the defect is one of substance, the application for summary judgment will be dismissed...”

37.  It is trite that O.14 is not suitable if there is an issue or question in dispute which ought to go to trial (O.14 r.3(1)).

Analysis

38.  It is readily apparent from the pleadings and the affidavit evidence that there are triable issues as to whether: (1) D1 produced defective Single Socket Monitors; (2) whether any defects were attributable to D1 or P; (3) whether D1 undertook any responsibility to P in respect of UHF-based monitors and if so, on what basis.

39.  In particular, P’s allegations are not only unsupported by the contemporaneous documents, but some documents relied on by P point the other way.  For instance:

a.  P says D1 was at fault for defective design.  However, there is no documentary evidence to clearly support these allegations. Contrary to the suggestion at 3.05 of Davies 1, exhibit “NAD 8” does not show that D1 confirmed an interest in developing the particular products, but rather indicates an interest in making them to P’s design.

b.  Davies 1 at paras. 5.01-5.06 assert design problems with the Single Socket Monitor, and at paras. 6.01 and 7.01 assert that D1 was responsible for the design faults and that D1 had to re-design elements of the product. Davies asserts this is borne out by exhibit “NAD 9”. However, that exhibit contains detailed costings and does not demonstrate on its face any change in design let alone the cause of such redesign. This would clearly be a matter to be explored at trial.

c.  Davies 1 states “NAD 12” (containing emails of January 2010) shows that D1 should have produced 30,000 units of the US version of single socket monitors by 22 March 2010.  However, the emails exhibited in support are inaccurately summarized in the affidavit.  They actually state “orders placed are for 30k US version, but looks like only 5k can ship before CNY.  Our planning for the first lot shipment is around 22^nd March 2010”.  (It is apparent from “YMAS-12” that D1 added the last sentence by way of comment in their 18 Jan 2010 email).

d.  Whilst Davies 1 at para 11.01 asserts that D1 agreed to deliver 30000 single sockets by the end of March 2010, the exhibit “NAD 19” relied on is in fact an email dated 15 September 2010 in which D1 states that they will review costs when they receive them from P, but they have already purchased 30k sets of electronic parts.  This makes quite clear that as at September 2010 there was no expectation of production of 30000 units by March (6 months previously).

e.  Davies 1 para 11.03 asserts that D1 asked P to reduce the initial order to 5000 on 3 September 2010, to which P agreed. However:

i.  It is clear from the January 2010 emails in “NAD 12” that it was known in January 2010 that the first order would be 5000.

ii.  Further “RBH-15” contains an email dated 25 August 2010 stating that for the Single Socket monitors, production of the first 5000 would be end September with a third party producing caseworks to be available to D1 on 10 September then production could start.

40.  I have not seen in the evidence any document which clearly shows what products had to be provided by D1 to P, with what specifications, and by what date.  Nor have I seen documents clearly evidencing who is at fault for any problems.

41.  P in affidavit evidence asserts their version of events, but Ds’ affidavit evidence dispute that on a substantial basis, with supporting documents.

42.  This appears to be a clear case for trial and not summary judgment. 

43.  It follows that I dismiss the appeal.

Costs

44.  This seems to me to a case where it was abundantly clear that the matter was not suitable for summary judgment.  I have regard to §18 to 24 of DHCJ Le Pichon’s judgment in Global Marketing Enterprise (GME) Ltd & Sandbox Trading Limited v Blue Box International Limited (HCA 1053/2015, 4 November 2016).  I make an order for costs against P in Ds’ favour in respect of the appeal on an indemnity basis.

45.  As to the Amendment Summons:

a.  I am prepared to accept that the application to add an interim payment application to the appeal was a technical error and costs should be awarded against P in favour of Ds on a standard basis.

b.  The attempt to adduce Davies 3 on the appeal bordered on an abuse of process. Davies 3 itself states it is made in support of the O.14 and the interim payment application.  P’s skeleton argument sought to rely on Davies 3 for the purposes of the O.14 appeal without even addressing why it should be admitted (paras. 3 and 7).  P’s reply skeleton seemed to attempt to re-cast Davies 3 as being in support of the interim payment application, whilst nevertheless stating it should be allowed in support of the O.14 appeal as containing new evidence satisfying the Ladd v Marshall requirements (which I have addressed above).  Costs of and incidental to the application to adduce Davies 3 be to Ds on an indemnity basis.

46.  For the purposes of summary assessment of the costs of the Notice of Appeal and the Amendment Summons, P may submit written comments on Ds’ costs schedule in no more than 3 pages within 3 days. Ds to respond within 3 days thereafter.

Interim Payment Summons

47.  Wong states that Ds have had notice of P’s desire to seek an interim payment and the evidence in support since the Amendment Summons and Davies 3.  P seeks leave to issue the interim payment summons provided in draft and to have it heard with the O.14 appeal.

48.  In my view, P should, if it considers appropriate, issue an interim payment summons making it clear which evidence is relied on in support.  Ds should then have an opportunity to respond by evidence in the normal way.

49.  Although I have been considering the merits of P’s claims for the purposes of the O.14 appeal, this is not a good enough reason to “jump the gun” and consider an application which has not been properly made, and without Ds having filed evidence in response.

Other matters

50.  Any other consequential matters related to the form of the order or costs may be raised in writing within 3 days for further direction.