WONG SHUI KEE ROGER v. VICTOR CHU & CO (a firm)

CACV 265/2004

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 265 OF 2004

(ON APPEAL FROM HCB NO 5129 OF 2004)

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BETWEEN

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J U D G M E N T

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Hon Bharwaney J (giving the judgment of the Court):

1.  This is the judgment of the court.

2.  This is an application by the respondent under Ord. 59, r. 5 of the Rules of the High Court (“RHC”) and under the court’s inherent jurisdiction to strike out the Notice of Appeal dated 1 September 2004 on the grounds that the appellant has failed to prosecute the appeal; the appeal is frivolous, vexatious, an abuse of the process of the court, and is not arguable; and the appellant has failed to comply with Ord. 59, r.5 of the RHC. Although he was aware of it, the appellant was absent at the hearing.  We directed that the application be heard in his absence.

3.  The appellant is a solicitor. He sued the respondent, a firm of solicitors, in defamation and lost. Costs awarded in favour of the respondent were taxed in the sum of $516,211.60. They were not paid. The respondent issued a petition to have the appellant declared bankrupt. The appellant contested the petition. Tang J. as he then was, heard the petition and made a bankruptcy order against the appellant. In his judgment dated 27 August 2004, the learned judge dealt with and dismissed the objections raised by the appellant in opposition to the petition. His order was sealed on 1 September 2004. The appellant, acting in person, issued a Notice of Appeal against that order on 1 September 2004 and served his Notice of Appeal on the respondent on 2 September 2004. The appellant paid the relevant court fees on 6 September 2004 and lodged copies of the Notice of Appeal, endorsed with the amount of the fee paid and a certificate of the date of service of the Notice of Appeal, with the Registrar on 6 September 2004. The process of setting down was then complete.

4.  The appellant was suspended from practice as a solicitor after he was made bankrupt.

5.  The appellant took no further steps in relation to this appeal between September 2004 and 2008.  In particular, the appellant did not give notice that the appeal was set down as required by Ord. 59, r. 5(3).

6.  On 28 October 2004, the respondent received a copy of the appellant’s Statement of Affairs from the Official Receiver’s Office. In his Statement of Affairs, the appellant stated that, as at September/October 2004, he had no assets whatsoever, and debts of approximately HK$1.7 million.     

7.  Over the ensuing period of over 3 years, the appellant’s outstanding actions against the respondent were struck out. The appellant did not appear at the hearing of those strike out applications.  On 14 April 2008, however, the appellant wrote to respondent’s solicitors to consent to the setting aside of the Bankruptcy Order.  On 17 April 2008, the respondent’s solicitors received a copy of the Notice of Appeal, which included a civil appeal number.  The appellant was discharged from bankruptcy on 27 August 2008. He has not resumed practice as a solicitor.

8.  On 4 June 2009 (10 months after he was discharged from bankruptcy), the respondent’s solicitors received a fax from the appellant addressed to Ms Margaret Tung, the former Director of Compliance of the Law Society of Hong Kong (and copied to, amongst others, the Chief Justice of the High Court and the Secretary for Justice).  In that fax, the appellant complained that the respondent’s solicitors had failed to respond to his letter of 14 April 2008.  He provided a correspondence address on this occasion, and the respondent’s solicitors replied to this fax by letter dated 15 June 2009, copied to Ms Tung, reminding the appellant that he had taken no steps to prosecute the appeal for 5 years. The respondent’s solicitors refused, on behalf of the respondent, to consent to the setting aside of the Bankruptcy Order.  The Law Society did not seek any response from the respondent’s solicitors in relation to the appellant’s complaint.

9.  On 4 June 2009, the appellant copied an email exchange between him and Mr Richard Tang of the Official Receiver’s Office to the respondent’s solicitors.  In this email, the appellant stated that the main ground of his appeal was that he was a practising solicitor at the time he was made bankrupt and bankruptcy was “not the last resort or means to recover the debts owed to the Creditor.”

10.  Thereafter, there were no further communications with the appellant for over a year.  However, on or about 13 July 2010, the respondent’s solicitors received a Notice of an Application for Legal Aid dated 12 July 2010.  By this time the appeal was almost 6 years old.  On 21 July 2010, the respondent’s solicitors received a fax from the appellant in which he requested them to send him a copy of the Notice of Appeal.  They responded on 23 July 2010, pointing out that his legal aid application acted as a stay of the proceedings, and indicating that they were not prepared to consent to any further steps being taken in the appeal.  This letter was copied to the Law Society and the Director of Legal Aid.

11.  On or about 23 October 2010, the respondent’s solicitors received a Memorandum of Notification that a party has been refused Legal Aid in respect of the appellant’s legal aid application. 

12.  On 10 December 2010, the appellant wrote to the Registrar of Civil Appeals requesting a hearing date for the appeal and sent a copy of the request by fax to the respondent’s solicitors.  The Registrar replied on 13 December 2010, with copy to the respondent’s solicitors, and provided him with some directions and a sample appeal index.  The respondent’s solicitors caused a search to be carried out of the Court file in relation to the appeal, and ascertained that the only documents which had been filed by the appellant were the Notice of Appeal, Notice of Application for Legal Aid and Memorandum of Notification of Refusal of Legal Aid.

13.  On or about 17 December 2010, the appellant served a bundle of documents with a handwritten index.  In addition to the Notice of Appeal, the Judgment and the Bankruptcy Order, this bundle included what appeared to be communications between the Appellant and various bodies with no apparent interest in the appeal, including the Chief Executive, the US State Department, and the Iranian Government. 

14.  The respondent’s solicitors wrote to the Registrar of Civil Appeals on 17 December 2010 to point out that the appellant had not complied with Ord. 59, r.5, and had not taken any steps in the appeal since filing the Notice of Appeal on 6 September 2004, apart from applying for legal aid.  The Registrar responded on 21 December 2010 by drawing the appellant’s attention to Ord. 59, r.5(3) and advising him to take out a summons if he had not complied with that rule.  The appellant replied to the Registrar by letter of the same date requesting leave from a single Judge of the Court of Appeal to dispense with the requirement of Ord. 59, r.5(3). He also submitted a draft appeal bundle. He was advised by the Registrar on the same day that if he wished to apply for an order to dispense with the requirement of Ord. 59, r. 5(3), he should take out the appropriate application by Inter-parte Summons. 

15.  On 10 January 2011, the appellant sent copies of two letters addressed to the Consul General of Japan and the Premier of China to the respondent’s solicitors. 

16.  The appellant did not make any application to the Court as directed by the Registrar.  On 10 January 2011, the Registrar directed the appellant to send a copy of the index to the bundle to the respondent’s solicitors within 7 days, and directed the respondent’s solicitors to make comments within 7 days of receipt.  The respondent’s solicitors wrote to the Registrar on 13 January 2011 to point out that the appellant should comply with the previous direction to seek leave to dispense with Ord. 59, r.5(3) before attempting to proceed with an index.  On 17 January 2011, the Registrar wrote to the respondent’s solicitors and directed that, if the respondent did not consider it appropriate for the appellant to take further steps, the respondent should take appropriate action or make an application to the court.  In the interim, the appellant wrote to the respondent’s solicitors (with copy to, amongst others, the Chief Justice, but not to the Registrar) and alleged that the respondent’s solicitors were in contempt of court.

17.  On 8 February 2011, the appellant wrote to the Registrar and requested that he fix a hearing date for the appeal.  Instead, the Registrar fixed a preliminary directions hearing on 7 March 2011. At that hearing, the Registrar once again indicated that it was for the respondent to make an application in relation to the appellant’s non-compliance with the Rules, and that, in the meantime, he intended to give directions for the conduct of the appeal.  The respondent’s solicitors informed the Registrar that they would deal with those directions without prejudice to their contention that the appeal should not proceed to a substantive hearing.  After hearing submissions from the parties, the Registrar made directions for the preparation of the appeal index.  On 9 March 2011, the respondent’s solicitors received a letter from the appellant, in which (in addition to making allegations of misconduct) he confirmed that he intended to proceed.  The respondent then issued the present summons to strike out the appeal on 17 March 2011.                                                        

18.  The point taken in relation to the non-compliance with Ord. 59, r. 5(3) can be dealt with quickly.  An appellant is required, within 4 days of setting down, to give notice to that effect to all parties served with the notice of appeal. There is no prescribed form of the notice and the practice is to serve such notice by letter. Such notice may even be given orally (as held by Keith JA in China Weal Ltd. v. Lam Sau Wah [2001] 1 HKLRD 351). The process of setting down was complete in this case when the appellant paid the relevant court fees on 6 September 2004 and lodged, with the Registrar on the same day, copies of the Notice of Appeal endorsed with the amount of the fee paid and a certificate of the date of service of the Notice of Appeal. On that day, the Registrar filed a copy of the Notice of Appeal and caused the appeal to be set down in the list of appeals, assigning the number CACV 265 of 2004 to the appeal.  When the respondent’s solicitors received on 17 April 2008 a copy of the Notice of Appeal, which included a civil appeal number, they must have realised that the appeal had been set down. The process of setting down an appeal is the process whereby the appeal is instituted and this occurs when copies of the notice of appeal endorsed with the amount of fee paid and with a certificate of service of the notice are lodged with the Registrar. When those copies are accepted by the Registrar, a civil appeal number is assigned and the appeal is set down. The late notification of the setting down of appeal is not a ground upon which the present appeal can be struck out.

19.  For the reasons given by Yuen JA in Yu Man v. Pricewaterhouse Coopers (a firm), HCMP 71 of 2006, 5 June 2006, neither can the present appeal be struck out on the ground that the appellant did not apply to fix a date for hearing the appeal until 10 December 2010.

20.  Practice Direction 4.1 deals with civil appeals.  Paragraph 18 thereof provides:

“18. All applications to fix a date for the hearing of any application or appeal should be addressed to the Registrar of Civil Appeals, who will instruct the Clerk of Court to fix the earliest date available for the hearing of the application or appeal in accordance with the state of the list to which it has been assigned. The application to fix a date must include the applicant’s estimate as to the length of the hearing”.

21.  In Yu Man v. Pricewaterhouse Coopers (a firm), HCMP 71 of 2006, 5 June 2006, Yuen JA dealt with an extension of time to fix a hearing date of an appeal which had been dormant for some 3 years. She referred to the then equivalent of paragraph 18 of the Practice Direction on Civil Appeals and to Ord. 59, r.5(2) which provides:

“Upon the said documents being left, the Registrar shall file one copy of the notice of appeal and cause the appeal to be set down in the list of appeals; and the appeal shall come on to be heard according to its order in that list unless the Court of Appeal or a judge of that Courtotherwise orders”. (Emphasis added by Yuen JA).

And she concluded:

“The words I have emphasized indicate that even if no application to fix a hearing date is made, the appeal should still come on to be heard according to its order in the list of appeals. Although there are now three lists, this is clearly an interlocutory appeal and the appeal should come on to be heard according to its order in the interlocutory list. I do not consider that the words “unless the Court of Appeal or a judge of that Courtotherwise orders” can be construed to mean the Practice Directions.

Of course, where an application to fix dates is made, the court would be able to assign the most appropriate date for hearing having regard to the type of appeal and the estimate of length of hearing. But in view of the mandatory language of rule 5(2), I do not see how it can be said that an appeal can never be heard unless an application to fix dates is made.

This is particularly so when paragraph 9 of Practice Direction 4.1/3 does not expressly impose an obligation on the appellant to make an application to fix dates, nor does it specify the period within which the application must be made. The making of an application to fix dates makes the process of appeal more convenient for all parties as well as the court, but paragraph 9 does not expressly impose an obligation on any party to make an application to fix dates, and in any event a practice direction cannot alter rule 5(2) which provides that an appeal shall come on to be heard after it is set down.”

22.  It should also be noted that paragraphs 42 and 43 of the Practice Direction 4.1 provide that appeals involving a litigant in person will first be fixed for a preliminary directions hearing before the Registrar of Civil Appeals and will not be listed for hearing until any directions given are complied with.

23.  However, that does not mean that a respondent to a dormant appeal is without recourse.  A respondent to a dormant appeal which has been set down should either apply to fix dates for the appeal to be heard, or, in an appeal involving a litigant in person, apply for a preliminary directions hearing, or apply to strike out the appeal for want of prosecution under the inherent jurisdiction of the court, as the respondent has done in the present application. A similar application to strike out a dormant appeal, albeit in an appeal from a dismissal of an application for judicial review, succeeded in Interasia Bag Manufacturers Ltd. v. Commissioner of Inland Revenue [2009] 5 HKLRD 818 where the appeal had been dormant for nearly 5 years since the appeal had been set down.

24.  We are likewise satisfied that the present appeal ought to be dismissed for want of prosecution. The delay from 6 September 2004 to 10 December 2010 when the appellant applied to fix a date for the hearing the appeal amounted to a period of over 6 years. No excuse has been offered for this clearly very inordinate period of delay. The fact that a bankruptcy order was made against him did not disqualify him from appealing against that order, which he did, and from prosecuting that appeal diligently, which he did not.  The right of access to the courts does not equate to an absolute right to be heard on appeal.  The appellant has had his day in court. He failed and he has sought to exercise a right of appeal.  That right is available to him only if he prosecutes his appeal diligently.  That he has patently failed to do.

25.  The jurisdiction to strike out for want of prosecution is discretionary.  Although not a highly significant factor, merits remains a relevant consideration in the exercise of this discretionary power. An appeal does not have to be frivolous or vexatious or wholly unsustainable in order to be struck out for want of prosecution but, obviously, the weaker the appeal the more likely would the court invoke its power to strike it out for delay.

26.  We are far from impressed by the Grounds of Appeal presented by the appellant. He will have an uphill battle trying to persuade the appellate court that the suggestion of Tang J, that he should file an affidavit of means, if he had the assets or the means to pay the debt, indicated a real possibility of bias on the part of the judge.  The appellant will also have difficulty persuading the appellate court that Tang J erred in refusing to accept the undertaking of the appellant’s former solicitors to pay the costs in HCA 5590/2000 as adequate security. That undertaking was only valid if the appellant’s claim against his former solicitors was established, which was not the case. The appellant also appealed on the ground that Tang J wrongly failed to find misconduct on the part of the respondent and his solicitors. However, that matter was fully canvassed before Master Au-Yeung, as she then was, who rejected the allegation of misconduct.  The review to a judge in chambers from her decision was later dismissed by consent. Finally, the appellant complained that Tang J ought to have adjourned the petition pending the outcome of other proceedings between the appellant and the respondent. But 2 of those proceedings had already been struck out when the petition was heard by Tang J and it is difficult to fault the analysis of Tang J that the other 2 proceedings did not disclose a bona fide dispute on substantial grounds. Indeed, these 2 proceedings were also struck out subsequently.

27.  The fact that the bankruptcy order in the present case is spent is also relevant in that the appeal has lost most, if not all, of its significance.  If the record of the past bankruptcy is suggested to be relevant, the appellant has only himself to blame for not prosecuting his appeal earlier.

28.  Not only has the respondent not been paid the amount of the taxed costs owed by the appellant, the respondent has suffered the prejudice of having this appeal hanging over it for this very considerable number of years. 

29.  Moreover, it must not be forgotten that, in the present era, prejudice includes prejudice to the courts and the other litigants when the court’s limited resources are misused. As Lord Woolf MR noted in Arbuthnot Latham Bank Ltd. v. Trafalgar Holdings Ltd. [1998] 1 WLR 1426 at 1436D/E –F/G:

“... any delay which occurs from now on will be assessed not only from the point of view of the prejudice caused to the particular litigants whose case it is, but also in relation to the effect it can have on other litigants who are wishing to have their cases heard and the prejudice which is caused to the due administration of civil justice.”

30.  In the present appeal, the absence of merits, the lengthy period of inordinate delay that has occurred, and the consequent prejudice that has been suffered by the respondent in the present appeal, and the wider prejudice to the courts and other litigants, is more than sufficient for us to exercise our discretion to strike out the Notice of Appeal and to dismiss the appeal for want of prosecution.

31.  As the respondent has succeeded in dismissing the appeal for want of prosecution, we do not intend to consider or deal with the further ground advanced by the respondent to dismiss the appeal, namely, that it is frivolous, vexatious, and an abuse of the process of the court.

32.  For these reasons, we order that the Notice of Appeal be struck out and the appeal be dismissed with costs to the respondent.