PLAINVIM INTERNATIONAL LTD v. TDK HONGKONG CO LTD

HCA 358/2013
HCA 715/2013
HCA 1568/2013
(Consolidated)

[2026] HKCFI 3185

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 358 OF 2013

ACTION NO. 715 OF 2013

ACTION NO. 1568 OF 2013

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(Consolidated by the Order of Master J. Wong dated 20 June 2014)

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D E C I S I O N

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1.  Introduction

1.1  By a summons dated 15 September 2025 (“Summons”), the Defendant (“D”) seeks leave to adduce expert evidence on PRC customs law and practice. The proposed expert issues are (“Proposed Expert Issues”):

(1)  As a matter of the PRC customs law and practice at the material time (“Proposed Expert Issue No 1”):

(a)  During the term of the Manufacturing Agreements (as defined in §1(i) of the Statement of Claim filed on 5 September 2014 (“SOC”)), was the Plaintiff (“P”) who owned and operated the Processing Unit[1] the Party responsible for obtaining the relevant customs clearance procedures with respect to the Equipment[2] and Materials[3] (as defined in §107 of the Defence and Counterclaim filed (“D&C”) on 28 November 2014)?

(b)  In the light of the documents generated in the customs clearance procedures for the importation of Equipment and Materials into Mainland China, would P have had the necessary documents to apply for the uplifting of customs supervision to facilitate the relocation, export, disposal of such Equipment and Materials in the material time from 2012 to 2013? In particular, was it necessary for P to obtain from D any further “Particulars” (as defined in SOC §1(s)[4] in order to proceed with any such application?

(2)  Were there any changes in the PRC customs laws and regulations to the above from late 2012 to 2024, which would have affected P’s obligations and ability to apply for the uplifting of customs supervision in relation to the Equipment and Materials (and if so, how) (“Proposed Expert Issue No 2”).

1.2  It is common ground between the parties that expert evidence should be adduced in respect of the Proposed Expert Issues. The disagreement between the parties is whether expert evidence should be adduced as regards the following additional issues proposed by P (“Additional Issues”)[5]:

(1)  The procedures, requirements and documents needed for the import of equipment and materials (“Additional Issue No 1”);

(2)  The supervision/restraints imposed by the Customs (“Additional Issue No 2”);

(3)  The procedures, requirements, information and documents required for the discharge of such supervision/restraint when the equipment and materials are moved out of the processing unit (“Additional Issue No 3”);

(4)  The procedures, requirements, information and documents required for the discharge of the supervision/restraint when the equipment cannot be identified (“Additional Issue No 4”).

1.3  At the hearing, D was represented by Mr Anson Wong SC (leading Mr Martin Kok) and P by Mr Siu Choi Fat of Messrs Chui and Lau (“C&L”).

2.  Material facts

2.1  P was at all material times engaged in the business of processing and manufacturing electronic components at the Processing Unit. At all material times, D was a subsidiary of TDK Corporation. D and TDK Corporation were together engaged in the business of manufacturing electronic components and materials.

2.2  In or about 1992, TDK Corporation, through D, invited P to become an outsourced manufacturer of certain products in the Mainland, including toner sensors, ferrite cores, dry magnets, magnetic rollers and the component parts for the magnetic rollers (“Products”). Between 1993 and 2008, P and D entered into three manufacturing agreements (“Manufacturing Agreements”), by which it was agreed that P would manufacture the Products with the Equipment and Materials supplied by D at the Processing Unit for D.

2.3  On 7 December 2011, D notified P in writing that it would not extend or continue the last of the Manufacturing Agreements after its expiry on 31 March 2013.

2.4  In the present proceedings, the parties have raised various claims and counterclaims against each other, including claims relating to the Equipment and Materials retained by P in the Mainland.

2.5  Relevantly for present purposes, subsequent to the expiry of the third of the Manufacturing Agreements, some of the Equipment and Materials remained at the Processing Unit. Some (if not most) of the Equipment and Materials were imported on a tax-exempted basis into the Processing Unit and were accordingly subject to the supervision of the Mainland customs authorities. Export or such supervised Equipment and Materials would require prior applications to be made to the relevant Mainland authorities to uplift such supervision. As I understand P’s evidence[6], the Equipment and Materials (using D’s term)[7] or the Items (using P’s term)[8] left “stranded” at the Processing Unit were only removed in October 2020 (in respect of the Materials) and June 2024 (in respect of the Equipment).

2.6  Arising from the Equipment and Materials “stranded” in the Processing Unit, it is pertinent to note that it is P’s case that D was in breach of its obligations to provide the Particulars for the purpose of it applying on D’s behalf the lifting of customs supervision: SOC §78(a). P makes a number of monetary claims arising from its alleged failure to deliver vacant possession of the Processing Unit to a third-party tenant (in the sum of over HK$45 million), loss of rental from July 2013 to April 2018 (in the sum of over HK$217 million) and mesne profits for P’s unlawful trespass of the Processing Unit from April 2013 until the removal of the Items, and staff costs to maintain and care for the Items: SOC §80.

2.7  Conversely, it is D’s case that P was in breach of its contractual obligations to return the Equipment and Materials. In particular, it is D’s case (disputed by P) that:

(1)  P was the party responsible for obtaining customs clearance for the importation of the same from Hong Kong into the PRC for use at the Processing Unit: D&C §50(2) and disputed at Reply and Defence to Counterclaim (“R&DC”) §45(2);

(2)  In the light of the documents generated in the customs clearance procedures for importing the Equipment and Materials into the PRC, P had the necessary documents to apply for the lifting of the relevant customs supervision and it was unnecessary for P to obtain the Particulars in order to proceed with such application: D&C §§50(3)‑(4) and 116 and disputed at R&DC §68.

3.  The applicable principles

3.1  The applicable legal principles are well established and not in dispute. As recently summarized in Best Tri Printing v Tam Chi Leung Nolan [2025] HKCFI 2098 at §15(1), the Court applies a two-stage test in determining whether proposed expert evidence should be admitted:

(1)  First, the evidence has to be admissible as expert evidence for the purpose of section 58 of the Evidence Ordinance Cap 8. It will be so admissible in any case where the court accepts that there exists a recognized expertise governed by the standards and rules of conduct capable of influencing the court’s decision on any of the issues which it has to decide, and the witness to be called satisfies the court that he has a sufficient familiarity with, and knowledge of, the expertise in question, to render his opinion potentially of value in resolving any of those issues;

(2)  Secondly, evidence meeting this test can still be excluded by the court if the court takes the view that calling it will not be helpful to the court in resolving any issue in the case justly. Such evidence will not be helpful where the issue to be decided is one of law or is otherwise one on which the court is able to come to a fully informed decision without hearing such evidence.

3.2  The giving of expert directions is very much a matter of case management: Shenzhen Futaihong v BYD [2019] 2 HKC 175 at §§9 and 13. The Court will not grant leave simply because it cannot rule out the possibility that the proposed evidence might be relevant and helpful. If the applicant fails to persuade the court of the relevance and necessity of the proposed evidence, the application should be dismissed (§12).

3.3  In determining relevance and necessity, the proper starting point is the pleadings, which define the live issues of dispute between the parties: Leung Siu v Bank of China (Hong Kong) Ltd, HCA 1911/2012, 7 March 2014 at §7(f). It is not a permissible use of expert evidence to fish for evidence in order to formulate a case: Sunrich Traders Ltd v Kumar Vaswani [2024] HKCFI 3033 at §62.

3.4  Even where expert evidence is in principle relevant and necessary, the court retains responsibility for controlling its scope. The court would be abdicating its case management responsibility were it to give general endorsement to expert issues that are too broad or abstract to be of genuine assistance to the resolution of the real disputes: Shenzhen Futaihong at §§28–30. Expert issues that are too wide, or that would muddle the issues and escalate costs and time, will likewise be refused: Leung Siu at §25.

4.  The Proposed Expert Issues

4.1  As stated earlier, the parties agree that expert evidence should be adduced in relation to the Proposed Expert Issues.

4.2  I am satisfied that the requirements are met for the court’s proper exercise of its discretion to grant leave to adduce expert evidence in relation to the Proposed Expert Issues:

(1)  It is clear that PRC customs law and practice is a recognized field of expertise capable of influencing the court’s decision on the issues in dispute;

(2)  There is no dispute that D’s proposed expert possesses sufficient familiarity with and knowledge of the relevant expertise;

(3)  As is plain, the Proposed Expert Issue No 1 (§2.7(1) above) and No 2 (§2.7(2) above) are framed directly by reference to the contentious pleaded issues.

4.3  I am further satisfied that party-appointed experts are more appropriate than a single joint expert in the present case, given the size of the claim and the degree of controversy the Proposed Expert Issues are likely to generate.

5.  The Additional Issues

5.1  I now turn to the Additional Issues proposed by P. The overarching submission advanced by P is that the Proposed Expert Issues are too narrow and fail to cover the disputed issues requiring assistance from experts.

(i)  Additional Issues Nos 1-3

5.2  P submits that expert evidence is required to confirm the exact requirements for the import, export and discharge of supervision of the Equipment and Materials so that the court can determine whether the parties could comply with their respective obligations and, if not, the reasons why. P says that Additional Issue Nos 1-3, unlike Proposed Expert Issue No 1, are not directed at who was responsible, but at what the customs rules and procedures required thereby providing to the court the framework of customs supervision.

5.3  D submits that Additional Issues Nos 1-3 are embarrassingly wide, overly general, and merely seek to have the expert outline the customs framework in the abstract. D says P’s real complaint – D’s alleged failure to supply the Particulars – is already covered by Proposed Expert Issue No 1, and that P has not explained how these general formulations are relevant or necessary to any disputed issue in the pleadings.

5.4  I agree with D and decline to grant leave for expert evidence to be adduced in respect of Additional Issues Nos 1-3 for the following reasons:

(1)  The pleaded issues are who was responsible for handling the customs procedures addressed by Proposed Expert Issue No 1(a) and whether P had sufficient documents to uplift supervision without the Particulars from D addressed by Proposed Expert Issue No 1(b). In answering those issues, the matters covered by Additional Issues Nos 1-3, insofar as they are relevant, will necessarily be canvassed. There is no need for separate freestanding questions;

(2)  Allowing Additional Issue Nos 1-3 in the form proposed would risk permitting P to fish for expert input that might suggest new lines of argument not properly raised in the pleadings – which is impermissible – and would serve only to muddle the issues and escalate costs: Sunrich at §62 and Leung Siu at §25.

(ii)   Additional Issue No 4

5.5  A paramount issue which is said to be left unaddressed by the Proposed Expert Issues is that, as alleged in the affidavits of Mr Siu, "over the past 20 years, some equipment were assembled or dismantled" and "if the said equipment has become an integral part of another equipment or it has been dismantled, full explanation and details have to be provided to the Customs" ("New Allegation").

5.6  It may be stated immediately that the New Allegation is not addressed in the witness statements filed by P. Neither is it expressly pleaded. The only pleading referred to by P is R&DC §46(6) which avers that D "did not and was not able to identify all of the Items… and was at all material times unable to provide all the relevant documentation to enable [P] to assist it to apply for uplifting of Customs supervision of such items."

5.7  P submits that Proposed Expert Issue 1(b) overlooks the New Allegation because it presupposes that the relevant documents are only those existing at the time of import and does not address the potential need for additional documentation where equipment has been physically altered.

5.8  I agree with D that the factual premise of Additional Issue No 4 does not arise from P’s pleadings, and given that the New Allegation is not even addressed in P’s factual witness statements, it appears that Additional Issue No 4 is plainly an attempt to fish for evidence in order to formulate its case. I refuse to grant leave to adduce expert evidence on Additional Issue No 4.

6.  Conclusion

6.1  I make an order in terms of Summons §§1-8.

6.2  I had directed the parties to provide (hopefully agreed) pleading references to be inserted into the Proposed Expert Issues. The parties were unable to agree and neither proposal is, in my view, comprehensive or helpful. For example, the proposal from D only makes reference to its own pleaded case and the proposal from P contains pleading references which are strictly not relevant. I propose to revisit the issue (if required) having had sight of the expert reports (if necessary).

6.3  As to costs, I make a costs order nisi that the costs of the Summons be costs in the cause, save that P should pay to D the costs of and occasioned by the arguments in relation to the Additional Issues including the costs of the hearing on 20 March 2026 to be taxed if not agreed. I decline to grant a certificate for two counsel.