XCHRX SPORT TIME INVESTMENT LTD. v. CHOW WAH YAN SANDY AND ANOTHER

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 6129 OF 1991

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REASONS FOR DECISION

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1. This is an application by the defendants to strike out the statement of claim for want of prosecution. The plaintiff's case as set out in the writ of summons against the defendants is that the defendants were in breach of a sub-sale agreement in respect of a flat in Mei Foo Sun Chuen. The plaintiff claims for specific performance or damages in lieu.

2. The writ of summons was issued on 14 August 1991, and the defence was filed about a month later, on 12 September 1991. On 23 July 1992, the defendant applied to strike out the plaintiff's claim for specific performance on the basis that they were entitled to withdraw from the agreement by paying, or repaying, the plaintiff the deposit together with an amount equal to the deposit as liquidated damages. The defendants contended that they were entitled to do so under the original provisional sale and purchase agreement. That part of that application was adjourned to a date to be fixed in consultation with the counsels' diaries. The application was not restored.

3. The defendants, in support of the present application, submit that there have been inordinate and undue delay. The defendants also suggest that they will be prejudiced because of the delay. The defendants suggest that there may be witnesses who can no longer be located. One of the defendants said, because of the pending proceeding, he was prevented from settling down in Canada peacefully with his children. The defendants also claim that the pending proceeding, because of the registration of the writ in the Land Office, would make it difficult for them to realise the capital investment and they also encounter difficulties in renting out properly the premises in question.

4. The plaintiff, on the other hand, suggests that the defendants were also responsible for the delay as they had not restored the original application which was taken out in 1992 and was adjourned shortly thereafter. There had been a lapse of over seven years since the commencement of the action in 1991. In my view, there can be no doubt that there had been inordinate and inexcusable delay, a point readily conceded by counsel for the plaintiff, Mr LAM. I do not accept the plaintiff's suggestion that the delay was caused or contributed to by the defendants' failure to restore their original application which is, so the plaintiff claimed, a significant consideration.

5. There can be no dispute that once a plaintiff issues a writ, the plaintiff is bound to observe the provisions under the rules of the Supreme Court and to proceed with the case with reasonable diligence. A plaintiff cannot rely on the inordinate delay on the part of the defendant to justify their own delay. The plaintiff must take reasonable steps to ensure that the case progresses without inordinate delay. It is, in my view, not open to the plaintiff in the present case to claim that they have been induced into inaction by the defendants' inaction.

6. Having said that, I still have to consider whether the delay will give rise to a substantial risk that it is not possible to have a fair trial and/or that serious prejudice would be caused to the defendant by the delay in question. I have considered the various matters raised by the defendants in support of their claim that a fair trial cannot be ensured and that serious prejudice would be caused to them. I have, in that regard, also taken into consideration the nature of the dispute and the issues involved in the dispute between the parties.

7. I am not satisfied that the various matters raised by the defendants in the affidavit are serious enough to justify the drastic step of striking out the plaintiff's claim. As I have observed in the course of counsel's argument, if the claim is struck out, the plaintiff will not even be entitled to the amount of $100,000, which had been conceded by the defendants. I tend to agree with the observation by Mr LAM that the issues between the parties turn upon basically a construction of the relevant provisional sale and purchase agreement.

8. The alleged non-availability of the witnesses per se, in my view, would not give rise to a substantial risk that a fair trial cannot be ensured. The alleged prejudice is not, in my view, serious enough to justify the striking out. I have some sympathy for the defendants. I think it is also right for me to observe that the claim for specific performance is unlikely to be successful at the trial in the light of this long delay. Although, technically, Mr LAM is right in his assertion that the claim for specific performance may not be time-barred as such, I do not consider this aspect to be of any significance in the light of the background of this matter and that any order for specific performance in favour of the plaintiff, even if liability is to be established, is unlikely to be granted. But I am not satisfied that a case for striking out for want of prosecution has been established. In the circumstances, the application has to be dismissed.

I shall now hear parties on the question of costs before I give direction as to the further conduct of this case.

[Discussion re costs]

COURT: I order that the cost of this application is to be the plaintiff's cost in the cause.