WONG, AILEEN v. DIASQUA INTERNATIONAL LTD

DCCJ 5387/2020

[2023] HKDC 1661

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 5387 OF 2020

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DECISION

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1.  This matter arose out of a dispute over suspected water seepage from the Defendant’s property known as Workshop on the 4^th floor (including an open flat roof) of Guardforce Centre, No 3 Hok Yuen Street East Kowloon (“D’s Property”) down to the Plaintiff’s property known as Workshop Unit No 1 on the 3^rd floor underneath the D’s Property (“P’s Property”).

2.  There are two applications before this court:

(1)  A summons taken out by the Defendant on 27 March 2023 seeking, among other things, (a) to vary paragraphs 7 and 8 of the Order made by Registrar Lui on 7 September 2022 (“Registrar Lui 2022.09.07 Order”) regarding performance of water tests by the parties at D’s Property and filing of the corresponding expert reports after the tests, and (b) to revoke paragraph 1 of the order made by Madam Registrar Soong dated 10 March 2023 (“Registrar Soong Order”); and

(2)  By way of a Notice of Appeal dated 3 May 2023, the Plaintiff seeks (a) to set aside the order of Master B Mak granting a stay of execution of paragraphs 1 and 2 of Registrar Soong Order, which effectively ordered the Defendant to allow water ponding tests be carried out by the parties’ experts in D’s Property on or before 21 April 2023, failing which the Defendant be debarred from adducing expert evidence at the trial, and (b) an order that the Defendant’s summons (for a stay) dated 19 April 2023 be dismissed.

Procedural History

3.  This action was commenced in 2020; the original Statement of Claim was filed on 6 October 2020. The Defendant filed and served its Defence on 26 November 2020.

4.  Upon the consent of the parties, expert directions were first given by Registrar Lui on 30 August 2021 on both liability and quantum in respect of the water seepage from D’s Property down to P’s Property (“Registrar Lui 2021.08.30 Order”).

5.  By further court orders dated 15 March 2022 and 1 June 2022, the deadline for lodging the joint expert report was successively extended to 12 May 2022 and 12 July 2022 respectively.

6.  Evidently, the parties failed to comply with Registrar Lui 2021.08.30 Order as extended.

7.  On 22 August 2022, Registrar Lui further ordered, amongst other things, that “Unless the parties complete and lodge the joint expert report by 4:00 pm on 27 October 2022, the parties be debarred from adducing expert evidence at the trial and leave granted for doing so be revoked.”

8.  On 23 August 2022, the Plaintiff applied to amend its Statement of Claim, to which the Defendant did not object. By consent, leave to amend was then granted by Registrar Lui in an order dated 7 September 2022 (“Registrar Lui 2022.09.07 Order”).

9.  Pursuant to Registrar Lui 2022.09.07 Order, the Amended Statement of Claim was filed and served on 9 September 2022, and the Defendant filed its Amended Defence on 30 September 2022.

10.  In Registrar Lui 2022.09.07 Order, also by consent of the parties, Registrar Lui made, among other things, the following further orders:

(1)  Under paragraph 6: “Leave be granted to the parties to adduce expert evidence on liability and quantum pertaining to the liability and/or source of water seepage in Workshop Unit No 1 on 3^rd Floor Guardforce Centre No 3 Hok Yuen Street East Kowloon (the “Premises”) and the quantum of damages of the water seepage to the Premises in December 2021, limited to one expert for each party”

(2)  Under paragraph 7: “The water leakage experts of all parties (the “Experts”) do conduct a 1^st joint inspection of the Premises and the Defendant’s Premises within 14 days after inspection of documents under paragraph 4 hereinabove has been completed and a 2^nd inspection within 21 days thereafter. The Plaintiff and the Defendant do make the Premises and the Defendant’s Premises available on these two dates for inspection and carrying out of all water leakage tests and in the manner as the respective Experts deem fit”

(3)  Under paragraph 8: “During these 2 joint inspections, the Experts are required to carry out all water leakage tests and in the manner as the respective Experts deem fit for the preparation of a joint expert report”

11.  Despite the Registrar Lui 2022.09.07 Order, the Defendant did not allow the Plaintiff’s expert to conduct water ponding test in D’s Property between November 2022 and March 2023. Meanwhile, in a revised “Proposed Method Statement” from the Plaintiff’s expert, the Plaintiff informed the Defendant and its expert that the intended water ponding test would be confined to areas where “there is any design requiring water facilities”.

12.  However, the Defendant continued to disallow any water ponding test in D’s Property. Upon hearing arguments from the parties’ legal representatives, Madam Registrar Soong therefore made further orders on 10 March 2023 (ie the Registrar Soong Order), which include the following:

(1)  Under paragraph 1 therein: “Unless the Defendant cooperates in the examination(s)/ inspection(s) of the involved premises by the parties’ experts by allowing the conduct of all necessary tests including water ponding test to the internal area of the Defendant’s premises where there are water using facilities and the flat roof appurtenant thereto, the Defendant shall be debarred from adducing expert evidence at the trial of the action and the leave granted in paragraph 6 of the Order dated 7 September 2022 shall be revoked.”

(2)  Under paragraph 2 therein: “The joint examination(s)/ inspection(s) shall be conducted within 42 days from the date hereof ie by 21 April 2023.” And

(3)  Under paragraph 6 therein: “Unless the joint expert report is compiled by the deadline in paragraph 4, ie by 23 June 2023 (Friday), parties shall be debarred from adducing expert evidence at the trial of this action except that the Plaintiff may apply for leave to adduce the report complied by Hau Tung Ngai dated 3 January 2020 as expert evidence”

It is observed that the unless order under paragraph 6 was made consequential upon making the unless order under paragraph 1. If the Defendant fails to comply with paragraph 1 of Registrar Soong Order, paragraph 6 cannot possibly be complied with.

13.  Instead of complying with Registrar Soong unless order, the Defendant took out the present summons (dated 27 March 2023) seeking to vary paragraphs 7 and 8 of Registrar Lui 2022.09.07 Order as follows:

“7. The water leakage experts of all parties (the ‘Experts”) do conduct two inspections of the Premises and the Defendant’s Premises. The Plaintiff and the Defendant do make the Premises and Defendant’s Premises available for the two inspections and carrying out of all water leakage tests (but excluding a ponding test to be conducted in the internal area of the Defendant’s Premises and the external flat roof thereof) and in the manner as the respective Experts deem fit.

8.  During these two joint inspections the Experts are required to carry out all water leakage tests (but excluding a ponding test to be conducted in the internal area of the Defendant’s Premises and the external flat roof thereof) and in the manner as the respective Experts deem fit for the preparation of a joint expert report.”

In addition, the Defendant seeks to revoke paragraph 1 of Registrar Soong Order. It is, however, noted that there is no application to vary paragraph 6 of Registrar Soong order.

14.  To avoid being found non-compliant with the unless order of Registrar Soong, by a summons dated 19 April 2023, the Defendant seeks leave to stay the execution of paragraphs 1 and 2 of Registrar Soong’s Order. Leave for a stay as sought was granted by Master B Mak on 20 April 2023.

15.  It is for this reason that, by way of appeal, the Plaintiff now seeks to overturn Master B Mak’s order granting a stay of execution.

16.  Since only paragraphs 1 and 2 of Soong’s Order were stayed, only the said two orders form the subject matter of the Plaintiff’s appeal.

Background

17.  Since around 2012, there has been water seeping down to P’s Property at the following internal locations: Women’s Toilet, Men’s Toilet, Store Room, Equipment Store & Load Test Room, Fire Escape Corridor, Chubb Service Area, Pantry, Office Area A, ACS Service Team Room and ACS Workshop Room Property.

18.  The Plaintiff therefore sought assistance from the property management office, the Building Department and the Food and Environmental Hygiene Department (the “Joint Office”). Tests were carried out by the Joint Office at both P’s Property and D’s Property. According to the Defendant, the Joint Office did not carry out water ponding test in D’s Property.

19.  Subsequent to the investigation of the Joint Office, two Nuisance Notices (dated 13 August 2019 and 15 April 2020 respectively) were issued by the Joint Office requesting the Defendant to take steps to rectify the water seepage problem. The Plaintiff asserts that no steps or no adequate steps were taken by the Defendant, with which the Defendant disagrees.

20.  According to the report of the Hong Kong Building Inspection and Structural Diagnostic Limited dated 3 January 2020 based on an inspection carried out on 22 August 2019, the water seepage in the Store Room, Men’s Toilet, Women’s Toilet and Pantry of the P’s Property was caused by water leaking from the toilets of D’s Property, while that in the Office Area and Equipment Store Room were caused by water leakage from the flat roof of D’s Property. It also stated that there was no sign or evidence to suggest that the water leakage in P’s Property was caused by water ingress from the external wall of the building.

21.  Then, on 13 December 2021, as a result of works carried out by the Defendant or its tenant inside D’s Property, which involved pouring a large quantity of water on the floor, water seeped through the floor slab. It caused extensive water dripping inside the Store Room, the Men’s Toilet, the Women’s Toilet, the ACS Service Team Room and the ACS Workshop Room of P’s Property.

22.  According to the Plaintiff, such water leakage is still ongoing.

The Plaintiff’s position

23.  The Plaintiff asserts (or pleads) that since around 2012, water seepage has occurred at different locations inside P’s Property, some were under the internal area of D’s Property, and some were under the flat roof.

24.  On different occasions, complaints were made to the building management office, and assistance was sought from the Joint Office. Nuisance Notices were issued to the Defendant by the Joint Notice after inspections and tests were performed. Apparently, the Defendant has taken no effective steps to stop the water seepage.

25.  Physical damage was caused to P’s Property – spalling off of concrete and rusting of reinforcing bars. The Plaintiff had actually carried out repairs to the damaged areas. However, without the cooperation of the Defendant, water seepage continued.

26.  According to the view or recommendation of the Plaintiff’s expert, a water ponding test is the best way to conclusively determine if there is water leakage down to P’s Property through the slab or flat roof of D’s Property, and if so, the locations where leakage occurs.

27.  The Plaintiff emphasized at the hearing that the intended water ponding tests were only required at the flat roof and the internal areas where there are water using facilities. Notably, Registrar Soong Order only covers the said locations.

28.  The Defendant, however, objects to any water ponding test being carried out at D’s Property.

Defendant’s grounds of objection

29.  The Defendant engaged two experts of M2R Solutions Limited, Mr Y K Chan and Mr Peter Sham, for their views on the parameters of inspection and methodology to be adopted for investigating the cause of the alleged water leakage from D’s Property to P’s Property. For this purpose, Mr Y K Chan carried out an inspection on site on 7 February 2023.

30.  Based on Mr Chan’s visual survey, observations and notes, Mr Shum opines that,

(a)  it may be destructive to D’s Property without the protection of a waterproofing system;

(b)  the accuracy of the ponding test may easily be affected, such as the permeability of concrete;

(c)  if a ponding test is to be conducted, it is necessary to close all the outlets and remove all the things on grade, including fixtures, machines, floor tiles, finishes, as well as the existing waterproofing system of the enclosed area for a 48-hour test to identify the source of water leakage;

(d)  it may be the external/internal wall or drainage pipe instead of the concrete floor slab that caused the water leakage;

(e)  water supply to D’s Property has to be suspended during the ponding test, and

(f)  ponding tests are time and cost consuming.

31.  Further, in reliance on the Guidelines on Prevention of Water Seepage in New Building (published by the Building Authority in March 2005), the Defendant argued that a water ponding test is proposed to be used to tackle water leakage found at roof/flat roof of a new building, it therefore does not apply to Guardforce Centre, which is almost 40 years old.

32.  The Defendant further informed the court that it had entered into a tenancy agreement in June 2021 with a tenant who operates a gold trading business and has installed a number of heavy machines in D’s Property at a significant cost. Its tenant strongly opposes to the carrying out of water ponding test on the flat roof and the internal area because this would require it to remove all the heavy machines installed therein, and its business has to be suspended for 48 hours.

33.  In reliance on Mr Shum’s opinion and because of the concerns regarding the tenant, the Defendant objects to the ponding tests on the following grounds:

(1)  The coverage of the ponding test is far more extensive than the alleged affected surface areas of P’s Property (“Ground 1”);

(2)  It may be the external/internal wall or drainage pipe instead of the concrete floor slab that caused the water leakage (“Ground 2”);

(3)  The Plaintiff failed to explain why the ponding test is necessary (“Ground 3”);

(4)  Ponding test may be destructive to the property and the contents within the property without the protection of a waterproofing system (‘Ground 4”);

(5)  Ponding tests are commonly utilised to test whether there are any cracks or ‘give-ways’ in a newly applied waterproofing membrane of a waterproofing system in a new building. This does not apply to the present situation (“Ground 5”);

(6)  Ponding tests are routinely proposed when addressing water seepage found at the roof/flat roof of a new building. This is not the case in the present circumstance (“Ground 6”);

(7)  Ponding test is inherently time-consuming and costly, and in this case, it is unsuitable, particularly in light of the fact that there are less intrusive yet equally accurate alternative methods (“Ground 7”);

(8)  It is necessary to shut off all the water outlets and remove all fixtures, machines, floor tiles, finishes, as well as the existing waterproofing system of the enclosed area, for a 48-hour ponding test to identify the water leakage source of floor concrete. The water supply of the relevant area must also be suspended (“Ground 8”);

(9)  The intended ponding test will no doubt affect the business operation of the tenant, which will cause them loss and damage and may result in a claim to be made by them against the Defendant (“Ground 9”); and

(10)  The interest of the tenant, being a third party, will be severely prejudiced (“Ground 10”).

Legal Principles

34.  The Defendant’s application to vary Registrar Lui’s expert directions is made under O 38, r 44 of the Rules of District Court (“RDC”), which provides that,

“Any direction given under this Part of the Order may on sufficient cause being shown be revoked or varied by a subsequent direction given at or before the trial of the cause or matter.”

35.  It was held in Wong Man Kin v Secretary for Justice [2017] 4 HKLRD 412 that this rule may be invoked by a party or on the court’s own motion.

“15. … This rule enables a court to review an earlier case management decision relating to expert evidence. Although the rule existed even before Civil Justice Reform (CJR), the exercise of discretion under this rule should be guided by the objectives of the CJR. The rule may be invoked irrespective of whether the previous order was a consent order or an order made by the court. The circumstances pertaining when the previous order was made would be a relevant consideration in deciding how the discretion under the rule ought to be exercised. Given this rule, it is unnecessary to resort to the traditional ways to challenge a previous consent order that has been made relating to expert evidence. The rule may be invoked by a party or on the court’s own motion.

16. The critical factor, which is clearly fact-sensitive and requires further consideration in an appropriate case, is what constitutes “sufficient cause” to revoke or vary a previous order made or direction given in relation to expert evidence.”

36.  Regarding an appeal against master’s decision, it is by way of rehearing. The judge considers the matter afresh. Where the master has given a written decision, this court may but is not obliged to adopt his reasoning in the present consideration.

Analysis

37.  The starting point is that the Defendant consented to the carrying out of all water leakage tests in D’s Property and in the manner as the experts deem fit; Registrar Lui 2022.09.07 Order was therefore made accordingly.

38.  ‘All water leakage tests’ would naturally include ‘water ponding test’ if it is so required by the experts. Besides, back in November 2021 [1], the Plaintiff’s expert had already informed the Defendant and its expert that water ponding test was required. Thus, the water ponding test ought to be in the contemplation of the Defendant at the time when it consented to the making of Registrar Lui 2022.09.07 Order.

39.  In the present application, the Defendant therefore relies on O 38, r 44 of RDC and seeks to vary paragraphs 7 & 8 of Registrar Lui 2022.09.07 Order and revoke paragraph 1 of Registrar Soong Order. The Defendant contends that the views expressed by Mr Shum in his report dated 23 March 2023 regarding the possible impact of the water ponding test on D’s Property and the installations therein constitute ‘sufficient cause’ justifying the variation of the existing orders in question.

40.  The question for the court is therefore whether the Defendant’s grounds of objection (formulated primarily on the basis of Mr Shum’s opinion) are valid and acceptable for the purpose of O 38, r 44.

41.  To respond or address the concerns raised by Mr Shum, the Plaintiff’s expert compiled a report entitled ‘Expert Opinion’ dated 4 September 2023 [2], in which he dealt with every point raised by the Defendant in detail. His responses can be briefly summarized as follows:

(1)  As the flat roof is an open area, ie exposed to the elements, there should be a waterproofing layer in the roof slab, and the water ponding test is meant to examine whether the waterproofing system (if any) is functioning well.

(2)  The water ponding test is one of the most commonly used water seepage investigation methods to determine if a certain area (eg a flat roof) is a source of water leakage. It is a simple, direct and effective method to identify cracks and/or defects in the underlying waterproofing system. Further, the dye color ponding test has been proven to be able to reveal multiple intermittent or even small leaks.

(3)  The Office Area inside P’s Property (affected by water seepage) is located under the flat roof of D’s Property. Hence a water ponding test is required to be carried out on the flat roof.

(4)  Water, once it gets into the concrete material, may travel horizontally and seep through any leak path within the material. Even if there is a waterproofing layer, it may be defective at specific locations, and water in the concrete may seep through the defective areas down to the concrete material underneath. It may then continue to travel horizontally before it finally seeped out from the ceiling of P’s Property at its weak points.

(5)  Hence, the location(s) of the defective waterproofing layer is/are not necessarily located right above the area(s) inside P’s Property where water seepage was observed at the ceiling. A water ponding test of the entire flat roof, as opposed to a localised area, is therefore required to determine if any leakage from the flat roof caused the water damage in P’s Property.

(6)  According to his investigation, the water damage inside P’s Property was unlikely caused by leakage through the external walls. However, if the Defendant’s expert prefers to carry out a water test on the external walls, he is happy to go along.

(7)  As regards the indoor area of D’s Property where there are water facilities, a ponding test is advisable because the existence of water facilities may give rise to the possibility of water seepage.

(8)  Water ponding test is not only carried out in new building; both he himself and the Joint Office have performed many ponding tests in old buildings for the purpose of identifying the source of water leakage.

(9)  The Guidelines on Prevention of Water Seepage in New Buildings referred to by the Defendant are guidelines for Authorized Persons, Registered Structural Engineers and Registered Contractors (under the Building Ordinance) in Hong Kong to ensure that the buildings they design and construct are free from water seepage. It does not mean water ponding tests cannot be carried out in old buildings.

(10)  The water supply to D’s Property does not have to be suspended during the ponding test.

42.  Regarding the issue of heavy machinery in D’s Property, the Plaintiff’s expert observed that, as of 13 December 2021, there were no fixtures, machines, floor tiles or finishes inside D’s Property. Since the flat roof is exposed to rain, any machinery placed on the flat roof should not be easily damaged by water.

43.  I find that the responses and/or explanations given by the Plaintiff’s expert are sensible, coherent and in line with common sense.

44.  As to the contentions of the Defendant, Grounds 1, 3, 5 and 6 have been sufficiently and satisfactorily answered or addressed by the Plaintiff’s expert in his Expert Opinion. I therefore do not intend to state the obvious here.

45.  Regarding the other grounds of objection, with respect, they are misconceived, non-sensical, unsustainable and/or irrelevant for consideration.

(1)  In respect of Ground 2, the possibility of water seepage through the external walls does not mean that there is no water leakage through the flat roof slab or the floor slab of the indoor area of D’s Property. Further, if the Defendant’s expert suspects that water leaks through the external wall, a water test can also be performed on the external wall in parallel, which is allowed under Registrar Lui 2022.09.07 Order.

(2)  As to Ground 4, the suggestion that the existing waterproofing work would be damaged for carrying out the water ponding test does not make sense to this court. The purpose of the water ponding test is to examine the effectiveness of the existing waterproofing system. Thus the existing waterproofing system should be kept intact during and for the performance of the test. In particular, I do not accept that the water ponding test is destructive (in the sense that existing structure and/or property would be damaged).

(3)  To the extent that Ground 4 refers to the damage to the machinery and/or property inside D’s Property that might be caused by the water ponding test, Counsel for the Defendant (upon taking further instructions) confirmed at the hearing that there is in fact no machinery installed on the floor of the indoor area of D’s Property where there are water facilities, thus the concern is unreal. I wonder why the Defendant saw fit to take this point in the first place.

(4)  As further informed by counsel for the Defendant, there are however some machines installed by the tenant at the flat roof. These machines sit on top of a grid of steel I-beams, as shown in one of the photos exhibited. Apart from the fact that these machinery placed on the flat roof are exposed to weather (which would inevitably be subject to heavy rainstorms or typhoons) and would probably have a sufficient degree of resistance to water, there is actually no evidence to suggest that these machinery have to be removed or even protected during the water ponding test, if one is carried out. Thus, there is no cause for concern.

(5)  Under Ground 7, the Defendant contends that water ponding test is both time-consuming and costly. The Plaintiff’s expert says the test lasts 48 hours. I do not consider that a span of 48 hours is unreasonably prolonged. Regarding cost, there is no evidence of the probable cost involved in such a process. I am therefore not satisfied that the ponding test is a costly test. Given that such a test is widely and commonly adopted by the Joint Office in its investigation of the cause of water seepage in old buildings [3], without evidence of the actual cost to be incurred, it is reasonable to assume it would not be unreasonably costly.

(6)  Regarding Ground 8, I don’t see why the water outlets have to be shut off during the water ponding test, which is to be performed on the floor only. Regarding water supply, the Plaintiff’s expert has clarified that there is no need to suspend the water supply to D’s Property during the test. The suggestion that all fixtures, floor tiles, finishes, and the existing waterproofing system have to be removed for the water ponding test, as I have pointed out in subparagraph (2) above, does not make any sense. Such contention, if it is not made with an intention to mislead, is plainly misconceived.

(7)  Regarding the contentions (under Grounds 9 and 10) that the ponding test will affect the business operation of the tenant, loss and damage will therefore be caused (which the tenant may claim against the Defendant) and, as such, the tenant strongly opposes the intended ponding test, these are not relevant factors to be considered by the court for the present purposes. I agree with the comment made by Registrar Soong that if there is any inconvenience to be caused to the tenant by the ponding test, it is a matter between the tenant and the Defendant, and it should not be a bar to the preparation of evidence in these proceedings.

46.  Besides, the inconvenience or disruption that a water ponding test might cause to the occupier of a property has been considered by the Court of First Instance in Chow Wai Tak v Mr Li Chi Ho, A Magistrate & Ors [2020] HKCFI 2494; the observations made by Chow J (as he then was) are noteworthy:-

“54. Whether it is appropriate to use the conventional testing methods, ie the Ponding Test and Water Spray Test, to investigate the source of the water seepage in the Complainant’s Flat is a matter of professional judgment for the Joint Office to determine. …

55. As for the alleged interference with the Applicant’s rights under BOR 14 (protection of privacy, family and home), such interference can readily be justified upon the application of the well-established 4-stage proportionality test:

(1) The proper investigation of water seepage, which is causing nuisance to the Complainant, is a legitimate aim.

(2) The use of the conventional testing methods, ie the Ponding Test and Water Spray Test, to investigate the source of the water seepage is rationally connected to the legitimate aim.

(3) The interference is slight. Ms Lee accepts that the Ponding Test and Water Spray Test are non-destructive tests. The furniture in the affected areas which cannot be moved away would be protected by water bags, and the affected areas would be cleaned up after completion of the tests. There should be no permanent damage to the premises or the furniture. When pressed, Ms Lee was unable to point to any real or substantial harm or damage which may be caused to the Applicant from the carrying out of the Ponding Test and Water Spray Test in the kitchen (including the balcony) and bathroom of the Applicant’s Flat. The interference in this case is no more than reasonably necessary to achieve the legitimate aim.

(4)  For the same reasons, a reasonable balance has been struck between the societal benefits arising from the application of the impugned measures and interference with the Applicant’s rights under BOR 14.”

47.  Apart from the above, one should further note that:

(1)  the expert directions were given in Registrar Lui 2021.08.21 Order by consent;

(2)  on 16 November 2021, again by consent of the parties, the court further ordered the parties to attend a joint inspection to P’s Property and D’s Property within 28 days (with the apparent purpose of identifying the cause(s) of water seepage);

(3)  as early as 26 November 2021, the Plaintiff’s expert already informed the Defendant’s expert of his intention to perform the ponding test at D’s Property;

(4)  during the joint inspection on 13 December 2021, it was noted that D’s Property was under internal renovation. Water seepage through the floor slab of D’s Property down to P’s Property was noted inside the Plaintiff’s Store Room, Men’s Toilet, Women’s Toilet, and ACS Service Team and ACS Workshop Room. At that time, there was no heavy machinery installed inside D’s Property;

(5)  by an email dated 5 January 2022, the Plaintiff’s expert explained the rationale for conducting a ponding test in the Defendant’s expert. Thus the Defendant by then ought to be aware of the reason behind such request (if it was not obvious enough in the circumstances); and

(6)  nevertheless, the Defendant chose to ignore the Plaintiff’s request for a water ponding test at that stage.

In the circumstances, even if there is any machinery that has to be temporarily removed at this stage to allow the water ponding test to proceed, and/or the tenant’s business operation would thereby be affected, the Defendant has only to blame, as it should have allowed the Plaintiff’s expert to proceed with the test in early 2022.

48.  For the reasons set out above, I accept the evidence of the Plaintiff’s expert regarding the details and reasons for the water ponding tests at D’s Property, and reject all the grounds of objection raised by the Defendant. It must then follow that there is no basis to vary paragraphs 7 and 8 of Registrar Lui 2022.09.07 Order or to revoke paragraph 1 of Registrar Soong Order.

49.  Besides, it is well settled that in a case where expert evidence is required, the respective experts may hold different views on the best or the most appropriate test to be performed and/or the corresponding methodology to be adopted in their investigation. The proper approach to be adopted was stated in Atlantic Link Ltd v Yen Ying Building (IO) [2019] 5 HKLRD 703 at paras 22, 23 and 26 as follows:

“22. The court should not be asked, and indeed is not equipped at this stage to rule on which of the methodologies adopted by the different experts is to be preferred. In 皇河實業有限公司 v Wan Chiu Yuen and Chan Mei Wah, 4 HH Judge Leung (as he then was) had said at [14]–[17]:

[14] It is desirable that the experts agree on the appropriate test and methodology. But if they cannot, they cannot. It is not disagreement between the parties, but their experts.

[15] In case of experts’ disagreement, the court’s concern is that the experts explain their competing views. It becomes part of the court’s consideration in determining which expert’s opinion is to be preferred. …

[16] For the purpose of the present application, numerous affirmations have been filed by the parties as well as their respective experts. By asking the court to rule on the experts’ difference as per their affirmations; and to direct a test or methodology to be adopted for the purpose of preparing the expert reports, the parties are effectively carving out part of the experts’ opinion for interlocutory determination prior to trial.

[17] The determination of the difference in the expert opinion at this juncture is particularly undesirable, because in view of the results of the test to be carried out and the expert reports to be compiled, it may turn out that the experts would need to be called at the trial.

23. I respectfully agree and adopt the comments of the learned Judge. However, whilst the court does not adjudicate which of the methodologies propounded by the experts is to be preferred, it does decide on whether the conduct of the parties leading to the application to extend time was reasonable or acceptable.

…

26. In the present circumstances, I am of the view that despite Dr Lau’s advice, it was unreasonable for the appellants not to have adhered to the court’s timetable, for the following reasons:

(1) There is no rule that experts must adopt the same method statement in a joint expert report. I can appreciate it would be desirable for them to do so as it will narrow down the issues in dispute that need to be decided by the court, but I am not aware of any authority (as confirmed by Ms Liao) which stipulates that it is essential for experts to agree on methodology before a joint expert report can be compiled.

(2)  Paragraph 6(i) of the Order of Mr Registrar Ho dated 2 October 2018 already envisaged the possibility of the experts adopting different parameters — this supports the argument that the Registrar did not deem it essential for the experts to agree on the method statement before doing the joint inspection or the joint expert report. This paragraph was also repeatedly quoted by IKC in their opposition to the appellant’s insistence on agreeing the Method Statement before a joint inspection could take place;”

50.  Thus, even if the Defendant genuinely disagrees with the Plaintiff’s expert as to the appropriateness of the water ponding test in the present circumstances, it is not a sufficient ground to preclude the Plaintiff from carrying out what its expert deems fit.

51.  I therefore hold that the Plaintiff ought to be allowed to carry out all water leakage tests (including water ponding tests) at the flat roof and other internal areas of D’s Property where there are water facilities, as the Plaintiff’s and/or the Defendant’s expert deem fit. As pointed out by the Plaintiff’s expert, if indeed the cause of the water seepage is unrelated to the flat roof or the floor of the D’s Property, the ponding test would rule out this possibility and provide support to the Defendant’s defence.

52.  What is then the best way forward, bearing in mind the underlying objectives of CJR enshrined in the RDC? Dismissing the Defendant’s summons dated 27 March 2023 without more may not do real service to the parties. As the time given to the Defendant to comply with paragraphs 1 and 2 of Registrar Soong Order had only a day to run when Master B Mak granted the stay on 20 April 2023, the parties will probably be left in a situation where no ponding test will be conducted; and the Defendant will be barred from adducing any expert evidence at the trial. Further, the real cause of water seepage may remain unknown, and, as such, no effective remedial works can be performed to stop the water seepage. As a result, the underlying dispute between the parties remains unresolved.

53.  Meanwhile, I note from the correspondences between the parties after the hearing that the Defendant is now prepared to allow water ponding tests to be carried out at D’s Property.

54.  I further consider that in seeking an order for a stay of execution before the deadline for complying with paragraphs 1 and 2 of Registrar Soong Order, the Defendant has demonstrably no intention to flout Registrar Soong’s order at the time.

55.  Upon due consideration, I take the view that, while the Defendant’s summons dated 27 March 2023 is to be dismissed, it is appropriate, in the present circumstances, to extend the time for compliance with Registrar Soong’s unless order to 42 days from the date of this decision, and to make the corresponding revision to the deadlines set by Registrar Soong for the compliance of the various further steps to be taken by the parties. I am satisfied that this can be done pursuant to O 1B, r 1(2), O 3, r 5 and/or O 38, r  44 of RDC. It was held by the Court of Final Appeal in Astro Nusantara International BV v PT Ayunda Prima Mitra (2018) 21 HKCFAR 118 that the court’s discretion to extend time under O 3, r 5 is a wide one.

56.  Regarding Registrar Lui 2022.09.07 Order, as the relevant parts regarding expert directions have been superseded by Registrar Soong Order, no revision needs to be made.

Stay of execution

57.  As this court has come to the view that the Plaintiff is entitled to carry out water leakage tests (including water ponding tests) in D’s Property, the stay granted by Master B Mak on 20 April 2023 ought to be lifted.

58.  Regarding the costs of the Defendant’s original application dated 19 April 2023 for a stay of execution, which was reserved by Master B Mak, given this court’s ruling on the Defendant’s application dated 27 March 2023, in hindsight, one would naturally consider that the Defendant ought to have complied with Registrar Soong Order at the time.

59.  However, I do see some force in the Defendant’s argument that as the Defendant had made its application to vary and to revoke, without a stay, its application would be rendered nugatory [4], and it would then be put in breach of an unless order of the court with serious consequences.

60.  On balance, I consider that the appropriate costs order for the Defendant’s application for a stay of execution would be costs in the cause of the Defendant’s summons dated 27 March 2023.

Conclusion and Order

61.  I therefore order that:

(1)  the Defendant’s summons dated 27 March 2023 be dismissed; and

(2)  the stay of execution granted by Master B Mak on 20 April 2023 be lifted.

62.  Concerning the expert evidence on the cause of water seepage and the damage done, I order that specific paragraphs of Registrar Soong Order be varied as follows:

(1)  Paragraph 2: “The parties’ experts shall conduct joint examination(s)/ inspection(s) referred to in paragraph 1 on or before 9 February 2024;”

(2)  Paragraph 3: “Within 28 days thereafter, the parties shall arrange a without prejudice meeting to take place between their respective experts for the purpose of compiling a joint expert report;”

(3)  Paragraph 4: “Within 35 days thereafter, parties shall procure their respective experts to compile a joint expert report. The joint expert report shall address, amongst other things:-

(a)  if different methodologies/ method statements are adopted by the experts, the reason why each expert adopts certain methodology/ method statement;

(b)  the issues on which the experts have reached a common position and in respect of each issue, what the common opinion is;

(c)  where the experts disagree on specific issues, what those issues are and the basis of their respective opinion on such matter; and

(d)  where possible, give reasons for the issues the experts disagree upon.”

(4)  Paragraph 5: “The Plaintiff do file the duly signed joint expert report (in compliance with O 38, r 37A and r 37C) within 7 days thereafter;”

(5)  Paragraph 6: “Unless the joint expert report is compiled by the deadline stated in paragraph 4, parties shall be debarred from adducing expert evidence at the trial of this action except that the Plaintiff may apply for leave to adduce the report compiled by Hau Tung Ngai dated 3 January 2020 as expert evidence.”

63.  Upon the undertaking of the Plaintiff (provided in its solicitors’ letter to the court dated 2 November 2023), I further order that the Plaintiff shall indemnify the Defendant for any damage caused by the dye used in the conduct of the ponding test to (a) the internal area of the D’s Property where there are water using facilities, and (b) the flat roof appurtenant to the internal area of the D’s Property.

64.  Regarding costs, without the benefit of hearing submissions on costs from the parties, I make the following nisi orders:

(1)  The costs of the Defendant’s summons dated 27 March 2023 be to the Plaintiff to be taxed, if not agreed, with certificate for counsel;

(2)  The costs of the Plaintiff’s appeal dated 3 May 2023 be to the Plaintiff to be taxed, if not agreed, with certificate for counsel; and

(3)  The costs of the Defendant’s summons (for a stay) dated 19 April 2023 and the Order dated 20 April 2023 be in the cause of the Defendant’s Summons dated 27 March 2023.

Unless any party applies to vary within 14 days, this order nisi shall become absolute without further order of the court.