CHUN WO BUILDING CONSTRUCTION LTD v. METTA RESOURCES LTD

HCCT 29/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTRUCTION AND ARBITRATION PROCEEDINGS

NO. 29 OF 2013

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DECISION
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1.  This is Chun Wo’s specific discovery application. The decision on the same is as follows.

2.  As a general observation, it should be said that, prima facie, all the requested documents are relevant and in the possession, custody or power of Metta.

Category M : Quotations referred to in Metta Discovery Files A95, A104 and A107

3.  The details are set out in the 3^rd Schedule of Chun Wo’s Summons dated 14 April 2015. Chun Wo has acted with care in identifying the necessary documents.

4.  There are the usual arguments on relevance and necessity of the requested discovery. However, putting aside the question of delay in providing Chun Wo with the information, the real issue here is whether the “related build-ups” (see AE4, p 956), which are expected to be disclosed in conjunction with the final account statements for the remedial works in September 2015, will provide the information requested by Chun Wo. In particular, whether Chun Wo will be able to see from the related build-ups if new works are included in Metta’s claim.

5.  I am satisfied that the example referred to in Leung’s 8^th affirmation, at paras 6 to 11, in respect of Simbel’s remedial works demonstrates both the relevance and necessity of the requested documents. Chun Wo clearly needs to see what costs are attributable to new works and what can fairly be regarded as remedial costs. There is no assurance that the related build-ups will provide the answers.

6.  Further, I should say that I do not see why it would be right for Chun Wo to have to wait for the finalisation of the accounts before continuing its works on Metta’s defect claims. There is an extremely tight timetable and there is much to be done between now and the trial. Substantial delay on any of the important but outstanding trial preparation works may put the trial date at risk.

7.  In the premises, I allow the application in respect of Category M.

Category N : Photos, including photographic records of the cores, taken by Metta’s experts

8.  The key issue is whether these photos are covered by litigation privilege as maintained by Metta. Metta says that upon the exchange of provisional expert reports, the privilege will be waived in respect of those photos relied upon by the experts. However, the remainder of the photos will continue to be protected against discovery.

9.  There is an argument by Chun Wo that the documents alleged to be privileged should nevertheless be listed in Metta’s List of Documents with a claim for privilege. Metta says that the photos are covered under Part 2, para 2 of its Amended List of Documents filed on 17 February 2015. Whilst I am prepared to accept that para 2 is adopted from a standard formulation, it is right to say that it is expressed in very generalised terms and quite uninformative. However, the decision here does not turn upon this complaint.

10.  The most helpful authority which has been referred to the court on the topic of litigation privilege is the commentaries in Disclosure by Matthews and Malek, 4^th edn, rubric 11.33 (I have also looked at 11.30). Litigation privilege normally covers communications, and there should be an element of confidentiality in the communications.

11.  Prima facie, the photos in question are records of the physical state of various parts of the construction works. I can accept that litigation was contemplated at the time when the photos were taken, but it is not at all clear why the photos are confidential in nature and thus should be regarded as privileged.

12.  I can see that photos can be used as a means of communication. In this regard, Chun Wo has made clear that it is not interested in any commentaries which may be attached to any photos. Its application is confined solely to the photos. I can also see that photos can be the products of the exercise of professional skill and judgment. However, I do not see that to be the case here.

13.  In the premises, I am not satisfied, and the burden here is on Metta, that the privilege claim is properly made out.

14.  Further, I am unable to agree that Metta is entitled to selectively disclose the photos according to whether they are relied upon by the experts. This is inherently unfair, and potentially the court may be provided with a misleading picture. If I were wrong about the claim of privilege, I would hold that Metta cannot selectively waive privilege on the photos. Metta has made clear that some of the photos will be deployed in its expert evidence, given the pressing circumstances of this case I see no reason why the photos should not be disclosed now.

15.  Finally, on the photographical records of the cores, the only point here is that Chun Wo is concerned about the condition of the cores shown in some of the photos produced by Metta. It therefore wants to examine all the photos of the cores to see if they had deteriorated over time, possibly due to unsatisfactory safekeeping. I am satisfied that this part of the request is justified.

16.  For these reasons, I also allow the application in respect of Category N.

Category O : Final drawings

17.  This request concerns the information which would allow Chun Wo to know what was done by the remedial work contractors in respect of alleged defective works. Prima facie, such information must be relevant.

18.  I do not agree that the lack of any existing plea by Chun Wo on design changes is decisive here. I do not believe that the absence of such a plea constitute a legal inhibition over this request. It is a matter of common sense that unless the relevant material is available to Chun Wo, it would not be in a position to know if there are design changes, and accordingly amend its case if so advised.

19.  Further, what is sufficient for the proper assessment of the remedial works (see Metta’s skeleton arguments, para 26) is not to be dictated by Metta.

20.  For these reasons, I also allow the application in respect of Category O.

Category P : Payment information since Metta Discovery File A107

21.  Metta’s argument here is that the discovery sought will be rendered out of date when the final accounts are concluded. It is estimated that those accounts will be concluded in mid-September this year.

22.  On the other hand, Chun Wo, quite understandably, is very concerned about the possibility of delay in the finalisation of the accounts and would like to work on what is available without further delay.

23.  Given that there is no guarantee on the date when the final accounts will be available and the very tight timetable, I also allow the application on this Category.