LEE KWOK TUNG ALBERT v. CHIYU BANKING CORPORATION LTD

DCCJ 2736/2016

IN THE DISTRCT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO.2736 OF 2016

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D E C I S I O N

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1.  On 12 May 2017, this Court made a decision to transfer the action herein to the Court of First Instance (“CFI”) on the plaintiff’s application by summons dated 23 January 2017 with costs (“the said decision”). This is the hearing of the defendant’s summons dated 26 May 2017 for leave to appeal to the Court of Appeal (“CA”).

Brief Background

2.  As a matter of background, the plaintiff instituted an action in the CFI founded on contract[1], tort[2], breach of certain principles and Codes of Practice under the Personal Data (Privacy) Ordinance, Cap 486 (“PDPO”). Later, the plaintiff took out the present action in this court against the defendant founded on breach of s.66(1) PDPO only which, by virtue of s.66(5) of the PDPO, has to be brought here. There is no dispute that the 2 actions arose out of the same set of facts. However, it is the plaintiff’s case that the s.66(1) PDPO claim is deliberately excluded in the said CFI action[3]. Mr Chiu submitted that it is because the plaintiff may not be able to establish himself a data user. The plaintiff then asked for transfer of the present action to the CFI with a view that it is to be consolidated with the said CFI action or to be dealt with together there. 

3.  The reasons for transfer were set out in a written decision handed down by this Court on 12 May 2017, and this Court does not intend to repeat the same here. Suffice it to say that the defendant’s main reason for opposing the transfer is that the CFI lacks the jurisdiction to hear a claim under s.66(1) of PDPO by reason of s.66(5). The defendant relies on the CFI decision in Lee Chick Choi v Best Spirits Company Limited by DHCJ Yee[4] which was upheld in the CA[5]. It was held in Lee Chick Choi at its first instance that by reason of s.66(5) of PDPO, the District Court has exclusive jurisdiction over s.66(1) PDPO claim. This Court disagreed and considered, inter alia, that s.3 of the High Court Ordinance, Cap 4 (“HCO”) stipulates that the CFI, being a part of the High Court, is of unlimited jurisdiction. After considering all the circumstances, this Court exercised its discretion and transferred the action to the CFI.

Grounds of Appeal

4.  There are four grounds of the intended appeal set out in the draft notice of appeal attached to the defendant’s summons. They can be re-grouped as the following 4 broad grounds:

i)   Ground 1: construction of s.66(5) PDPO
This Court erred in construing that on a proper construction of s.66(5) of the PDPO, it does not confer exclusive jurisdiction on the District Court regarding s.66(1) PDPO claim, particularly in the light of the CFI and CA decisions in Lee Chick Choi (supra). Further, this Court erred in construing that s.66(5) prescribes only a procedural requirement;

ii)   Ground 2: construction of s.3 HCO
This Court erred in construing s.3 of the HCO having unlimited jurisdiction, and thus can deal with s.66(1) PDPO claim despite s.66(5) and the decision of the CFI and CA decisions in Lee Chick Choi (supra);

iii)   Ground 3: LTO analogy
This Court is wrong in drawing analogy between this case with the transfer provisions in the Labour Tribunal Ordinance, Cap 25 (“LTO”); and

iv)   Ground 4: discretion ground
This Court erred in exercising its discretion to transfer by failing to appreciate that the plaintiff could have amended its claims, including the s.66(1) PDPO claims so that all his claims can be dealt with in the Action herein, and that the issue of the Action herein and transfer are abuse of process. 

Test of Reasonable Prospect of Success

5.  Section 63 of the District Court Ordinance, Cap 336 (“DCO”) provides that leave to appeal against a District Judge’s decision has to be obtained either from this Court or the CA before an appeal can be lodged to the CA. Further, s.63A(2) of the DCO stipulates that:

“Leave to appeal shall not be granted unless the judge, the master or the Court of Appeal hearing the application for leave is satisfied that—

(a) the appeal has a reasonable prospect of success; or

(b) there is some other reason in the interests of justice why       the appeal should be heard.”

6.  Paragraph 59/2A/4 of the Hong Kong Civil Procedure (2017) Vol. 1 succinctly sets out how the “reasonable prospect of success” test is to be applied:

“In Wynn Resorts (Macau) SA v Mong Henry (unrep., [2009] H.K.E.C., 1293), Chu J. (as she then was observed that:

“… To meet the ‘reasonable prospect of success’ test, an applicant is required to show more than just an arguable case, but an appeal that has merits and ought to be heard, although he does not have to demonstrate that the appeal will probably succeed.

In KNM v HTF (unrep., HCMP 288/2011, [2011] H.K.E.C. 1210, the Court of Appeal (at §9) confirmed that “The relevant test of whether an appeal has a reasonable prospect of success under section 63A [District Court Ordinance], is whether the applicant for leave can show that he has an arguable case with reasonable chances of success on appeal. A reasonable prospect of success therefore means an appeal with prospects that are more than ‘fanciful’ but which do not need to be shown to be ‘probable’.” It was insufficient to show that the appeal was “merely arguable” and “not fanciful” for the court to be satisfied that it had a reasonable prospect of success. In respect of case management decisions, the appellant faces a very high hurdle and has to show that the judge had gone clearly wrong and made orders which clearly involved an injustice or an inability for the trial court to carry out its task or had erred in principle or that his order was irrational …

Where the intended appeal is an appeal against the exercise      of discretion of the judge below, the applicant would have to        show that he has an arguable case with reasonable chances of     success that the relevant decision exceeds the generous ambit    within which reasonable disagreement is possible, and is in      fact plainly wrong, and not merely the appellate court would    prefer a solution which the judge had not chosen (RK v YS, unrep., HCMP 1969/2012, 1 November 2012, CA)”

(Emphasis added)

7.  This Court will be guided by these principles in considering whether leave to appeal should be granted.

Discussion

   Grounds 1 & 2

8.  After hearing the argument and reading the submission of Mr Cheung for the defendant, it is fair to say that he is simply repeating his argument advanced when the transfer summons was argued. His main argument on these 2 grounds, so far as can be discerned, is this. By reason of s.66(5) of the PDPO, the District Court is vested with exclusive jurisdiction to hear the s.66(1) claim. By the same reason, the High Court, notwithstanding s.3 of the HCO, has in fact been stripped off or otherwise does not assume jurisdiction over s.66(1) PDPO claim. Since the argument concerning these 2 grounds are related, it will be appropriate for the 2 grounds to be considered together.

9.  Apart from relying on Lee Chick Choi (supra), Mr Cheung refers this Court to So Wing Keung v Sing Tao Limited and Anor [6] in support of his proposition that notwithstanding s.3 of the HCO stipulating the jurisdiction of the High Court being “unlimited”, its jurisdiction is in fact not unlimited. It only has unlimited jurisdiction to do everything necessary within its limited jurisdiction. Accordingly, the CA in So Wing Keung (supra) declined jurisdiction to hear an appeal.

10.  The part of the judgment in So Wing Keung (supra) by Ma CJHC (as the CJ then was) referred to by Mr Cheung is at paragraph 33(2). This Court considers that paragraphs 33(3) and (4) may also be relevant to Mr Cheung’s argument. They are as follows:

“33(2) … Obviously, the Court will have the full armoury of powers within that jurisdiction to do what is necessary, whether such powers derive from statute of its inherent jurisdiction, but it cannot exercise a jurisdiction it does not have.

33(3) As to Mr McCoy’s point that the Court of Appeal, as a superior court of record, must have inherent jurisdiction to overturn a lower court’s order or decision if that has been reached without jurisdiction, I do not see any distinction between such a situation and that where it is said the court below has erred, whether on fact or law. Quite simply, whether or not the Court of Appeal can hear an appeal from a lower court depends on the wording of the statute that defines its jurisdiction.

33(4) Although in Stuchiner, Litton VP referred to this Court as a “superior court of unlimited jurisdiction”, it is clear, when that statement is read in context, that all the Vice-President was saying was that the Court of Appeal had an inherent jurisdiction to do everything necessary within the jurisdiction it already had, …”

(underline added by the learned Ma CJHC)

11.  So Wing Keung (supra) is a case concerning an appeal against the decision of Hartman J setting aside an ex-parte order made by Stone J granting search warrant in favour of the ICAC. The appeal listed before the CA was initially a civil appeal. The parties seemed not having any issue on the nature of appeal until the last minute. The question before the CA then was whether the appeal was a civil or a criminal appeal. The important consequence is that, if it was a criminal appeal, it should be heard by the Court of Final Appeal (“CFA”) instead of by the CA: see paragraph 32 of So Wing Keung (supra) referring to s.31(b) of the Hong Kong Court of Final Appeal Ordinance, Cap 484 (“HKCFAO”). After going through a detailed analysis, Hon. Ma CJHC came to the view that in substance it was a criminal appeal. The CA considered it did not have jurisdiction to hear that appeal.

12.  In my judgment, So Wing Keung (supra) cannot help the defendant. Firstly, the unlimited jurisdiction of the High Court constituted under s.3 of the HCO is expressly stated to be “subject to the provisions of this Ordinance [i.e. the HCO]. In So Wing Keung (supra), whether the appeal in question can be dealt with by the CA is governed by various provisions including s.13 of the HCO. Accordingly, the so-called unlimited jurisdiction is limited by s.3 HCO. It is entirely within the contemplation of s.3 of the HCO. It is not inconsistent with the proposition that the CFI has unlimited jurisdiction including s.66(1) claim as there are no provisions under the HCO limiting its jurisdiction over such claim.

13.  Secondly, what the CA has said in essence, in my view, is that there is a procedural irregularity. The CFI of the High Court had already exercised jurisdiction and adjudicated on the matter. It would be for the CFA, not the CA to deal with further appeal.

14.  Thirdly, even if the High Court’s jurisdiction were limited, it does not mean that by reason only of s.66(5) PDPO, the CFI does not assume jurisdiction over s.66(1) claim PDPO despite the clear and unequivocal language of s.3 of the HCO. It is entirely a matter of construction of the 2 provisions. This Court has yet to see how, apart from Lee Chick Choi (supra), by adopting fundamental principles in statutory construction, the CFI cannot assume jurisdictions over s.66(1) PDPO claim notwithstanding s.3 of the HCO.

15.  Coming back to Lee Chick Choi (supra), although this Court still maintains that the learned deputy judge did not have the benefit of full argument from both sides, and that the CA had reserved its decision on the jurisdictional point, it is equally true the deputy judge’s view on jurisdiction has not been challenged or questioned by the CA. In the circumstances, apart from not merely fanciful, this Court accepts that the argument now advanced by the defendant, relying on Lee Chick Choi (supra), is more than arguable. It is because the decisions which this Court seeks to distinguish is directly on the point and are from higher courts.

16.  For this reason alone, leave to appeal should be granted. In any event it concerns an important issue of jurisdiction, namely, whether the CFI will lose or otherwise cannot assume jurisdiction simply because s.66(5) of the PDPO stipulates that proceedings under s.66(1) “are to be brought in the District Court” with remedies obtainable the same as those granted in the CFI.

   Ground 3

17.  With due respect, I do not find there is any substance in the Mr Cheung’s LTO analogy ground. The case of Wong Chi Ching v Bocom International Holdings Company Limited[7] is to illustrate that despite the stronger and more obvious wordings of the LTO suggesting exclusive jurisdiction to the Labour Tribunal[8], the CA considers it would be too narrow a construction to say CFI has no jurisdiction over employment matters. Now a less restrictive drafting is adopted in s.66(5) of PDPO[9]. It would appear to this Court that violence is done to the language of s.66(5) PDPO and s.3 of HCO if the construction now contended by the defendant is adopted.

   Ground 4

18.  So far as can be discerned from Mr Cheung’s argument under this head, it comprises basically 3 points. Firstly, the CFI does not have jurisdiction, and therefore the exercise of discretion to transfer was wrong. Secondly, if the CFI has jurisdiction, the plaintiff should have amended the pleadings in the said CFI action to include the s.66(1) PDPO claims. There is therefore no need to have 2 actions dealing with the same matters. It is an abuse of process and therefore the Action herein should not be transferred. Thirdly, a s.66(1) PDPO claim, on a proper construction, should have encompassed all other claims of a claimant such as claims under the common law or otherwise. In other words, the scope of the plaintiff’s claim will not go beyond that prescribed by s.66(1) of PDPO. The said CFI action is a duplicity and an abuse. The exercise of discretion for transferring up is therefore wrong. 

19.  The first point is understood. It hinges on whether the CFI has jurisdiction over s.66(1) PDPO claims. However, for the other 2 points, this Court considers that they are most unreasonable.

20.  As have stated in my decision dated 12 May 2017[10], the plaintiff could have gone about his present claims against the defendant in a better way. However, we have an adversarial litigation system in Hong Kong. If the defendant considers there is an abuse of process by instituting 2 actions in different venues on the same or substantially the same causes of action, it is for the defendant who, perhaps on the able advice of Mr Cheung or its legal team, to take out appropriate interlocutory applications. At the transfer hearing, similar questions have been raised by this Court. This Court was told that they might be considering striking out. However, no action had been taken out up to the time of this hearing. 

21.  It is a hard fact the plaintiff has not taken any step to amend its pleadings in the said CFI action. There is no question that a defendant can apply to amend the plaintiff’s pleadings. If the defendant considers it has a good case in what Mr Cheung has asserted above, the defendant should have taken steps to strike out the plaintiff’s claim founded on contract and tort in the said CFI action if not for a stay. However, nothing has been done. Even the defendant considers these claims are in fact one and the same, it simply sits there and takes neither application to strike out nor transfer down. Neither is there any application in either this Court or in the CFI for staying of proceedings on the ground of abuse or what.

22.  The plaintiff’s claim covering all causes of action, common law or under PDPO, is now in the CFI. It is beyond the jurisdiction of this Court. The venue to argue whether the PDPO claim is all embracing such that whatever claims that may arise will be within the PDPO ambit should be the CFI. It will be most unreasonable for the defendant to allege that this Court has wrongly exercised a discretion for reasons submitted by Mr Cheung but on the other hand, sit back and takes no action. Neither argument now asserted by the defendant had ever been raised before, whether in this Court or in the CFI.

Disposition and Costs

23.  For the reasons set out in [13] and [14] above, leave is granted to the defendant to appeal to the CA in respect of the said decision of this Court. Costs of the leave to appeal will be in the cause of the appeal in the CA with certificate for counsel.