JOSE MIRANDA DA COSTA JUNIOR AND ANOTHER v. LORENZO YIH, also known as YU CHUAN YIH AND OTHERS

HCA 156/2010

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 156 OF 2010

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(by counterclaim)

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REASONS FOR DECISION

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1.  This was an application by the first defendant (“Lorenzo”) for leave to appeal this court’s dismissal of his application for leave to adduce his fifth affidavit sworn on 15 January 2014 (“Lorenzo 5”) at the hearing on 20 January 2014 (“the January hearing”) of the summons for judgment of the first plaintiff (“Miranda”). At the conclusion of the hearing for leave to appeal, I dismissed the application with reasons to be handed down which I now do. Costs followed the event and were ordered to be summarily assessed and dealt with on paper.

Background facts

2.  The facts appear in my judgment dated 19 February 2014 (“the judgment”).  In outline, they may be summarised as follows.

3.  On 11 September 2013, Miranda issued a summons for judgment premised on Lorenzo's breach of an unless order dated 22 April 2013 for discovery.  Miranda’s case was that Lorenzo's third affidavit filed on 16 May 2013 (“Lorenzo 3”) was non-compliant.

4.  Directions for the filing of evidence for the hearing of the judgment summons were given on 9 October 2013 (“the October order”) which, inter alia, provided that no further evidence be filed without the leave of the court.

5.  Pursuant to the October order, Lorenzo filed his fourth affidavit on 19 November 2013 (“Lorenzo 4”) and Miranda filed his ninth affidavit in reply on 24 December 2013 (“Miranda 9”).

6.  The summons for leave to adduce Lorenzo 5 was taken out on the eve of the January hearing and some three weeks after Miranda 9.

7.  The reasons for dismissing that summons appear in §§ 38-39 of my judgment:

“38. It should be mentioned that shortly before the hearing Lorenzo applied by summons dated 15 January 2014 for leave to file his 5^th affidavit (Lorenzo 5) of even date. The thrust of Lorenzo 5 was to the effect that he used Microsoft Outlook to receive emails from different e-mail accounts; that he would delete e-mails sent to his personal accounts (at Hotmail and Yahoo) once they had been read except very rarely when important ones would be left on the hard drives for following up; and that the earliest e-mail found in his Hotmail account is dated May 2013.

39. That evidence could and should have been filed in Lorenzo 3 or 4.  It was not and no explanation has been given as to why it was not.  Moreover, Miranda has not had the opportunity of making a reply.  In those circumstances, Lorenzo 5 should be disregarded.”

The applicable principles

8.  For interlocutory appeals, leave will only be granted if the court is satisfied that the appeal has a reasonable prospect of success or there is some other reason in the interests of justice why the appeal should be heard: see section 14AA of the High Court Ordinance and SMSE v KL [2009] 4 HKLRD 125 at § 17.

9.  The October order made it abundantly clear that no further affidavit was to be filed without the leave of the court. In the post-CJR era, it is inconceivable that leave would be granted in the absence of genuine extenuating circumstances, for example, that the evidence was not available at the date of the earlier affidavit or only came into existence after the date for the filing of that affidavit.  In other words, they would be exceptions that normally would fall within the rule in Ladd v Marshall.  

10.  Further, in exercising the discretion to grant leave, the court is bound to have regard to the objectives of the CJR set out in O 1A, r 1 and to seek to promote the attainment of such objectives.

11.  For those reasons, where a direction prohibiting further evidence to be adduced without leave has been given, it has to be read with RHC O 32, r 11A (4).  That provides that where the determination of the application is adjourned for the hearing of the summons, no further evidence may be adduced unless it appears to the Court that there are exceptional circumstances making it desirable that further evidence should be adduced.

12.  It will be seen that the rationale of O 32, r 11A (4) is to ensure that a case is dealt with as expeditiously as is reasonably practicable and to ensure fairness between the parties (those being the objectives of the CJR stated in O 1A, r 1 (b) and (d)): Fortune Assets Development Ltd v De Monsa Investments Ltd, HCA 167/2009, (unrep) 21 August 2009 at §§10-11 and the annotation in Hong Kong Civil Procedure 2014 at 32/11A/3 which states that the sort of “exceptional circumstances” envisaged are likely to be along the lines of the exceptions laid down in Ladd v Marshall [1954] 1WLR 1489.  

13.  “Special circumstances” are not made out if a proper review of the potential issues that might arise in proceedings ought to have resulted in the information contained in the affidavit being filed within the time limits imposed: Fortune Assets at §12.  I agree with that approach which is in line with the rationale underlying O 32, r 11A (4) and furthers the CJR objectives identified above.

14.  Mr Nip who appeared for Lorenzo accepts that the obligations imposed by O 32, r 11A (4) apply but sought to justify Lorenzo 5 on the basis that evidence filed on behalf of Miranda after the date of Lorenzo 4 had raised new evidence regarding Lorenzo’s use of personal e-mail accounts. But, with respect, that submission is wrong on two fronts: the approach is wrong and, on the facts, it is incorrect.

15.  The thrust of Lorenzo 5 appears in § 38 of the judgment. Information concerning Lorenzo’s personal e-mail accounts given in Lorenzo 5 was plainly pertinent to the question whether Lorenzo had fully discharged his discovery obligations under the unless order.  I agree with Ms Cheung who appeared for Miranda that any proper review of the potential issues would have resulted in the information being included in Lorenzo 3 or 4.  Whether or not Miranda had adduced evidence regarding Lorenzo’s personal e-mail accounts is wholly beside the point.

16.  In any event, other evidence was adduced on Lorenzo’s behalf at the date of Lorenzo 4 that had specifically referred to his personal e-mail accounts including his Hotmail account.  Therefore, Lorenzo could and should have dealt with the matters in Lorenzo 5 concerning his personal e-mail accounts, at the latest, in Lorenzo 4.

17.  Mr Nip further submitted that because Miranda was able to make use of the information in Lorenzo 5 and revised Miranda’s submissions as a result, he was not prejudiced by the last-minute application and, contrary to § 39 of the judgment, in so revising his submissions, effectively, Miranda had replied to Lorenzo 5.

18.  On the facts, Miranda had limited time (being no more than 2 business days) between the receipt of Lorenzo 5 and the January hearing to respond. The fact that Miranda endeavoured to show the falsity of Lorenzo 5 in the limited time available rather than to do nothing does not mean that Lorenzo’s last-minute application had not prejudiced Miranda. Such a last-minute manoeuvre creates a dilemma for the innocent party: to seek an adjournment which would mean having to derail the hearing (when the innocent party was anxious to have its summons heard as soon as possible) or to live with it and doing what was possible within the limited time available.  It has been said that “[t]he unenviable position that such a party finds himself in its in itself a prejudice”: see per As Cheung J (as he then was) in Wise Union Industries Ltd v Hong Kong Science and Technology Parks Corporation, unreported, HCAL 12/2009, 21 September 2009 at § 9.

19.  It is to be noted that it took Lorenzo three weeks after receiving Miranda’s evidence in reply to make the last-minute application, leaving Miranda only 2 business days to respond at a time when Miranda would have been otherwise occupied, preparing for the hearing. That is unfair.

20.  In that connection, Mr Nip stressed that Ms Wong SC who appeared for Miranda at the January hearing did not oppose Lorenzo’s application for leave. In my view, that is not conclusive.  The court seized of the matters involved is well able to form its own view as to whether the innocent party had been prejudiced. In any event, as I have stated, special circumstances have not been made out to justify the granting of leave to admit Lorenzo 5.

21.  Finally, it was also said that as the substantive appeal from the judgment is as of right and is due to be heard by the Court of Appeal later this year, leave to appeal from my refusal to admit the Lorenzo 5 into evidence should be granted so as to give the Court of Appeal the full picture.  If that approach be correct, it would create an exception to the leave requirement for interlocutory appeals which is not to be found in the rules.  It is not an attractive proposition and falls to be rejected.