XU YING v. XU WEIHONG

HCA 2650/2017

[2020] HKCFI 2826

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2650 OF 2017

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DECISION

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1.  On 7 August 2020, I handed down a decision (“the Main Decision”), in which I allowed D’s application for an order setting aside the leave for service out of jurisdiction obtained by P on 30 October 2018 and for a declaration that this court does not have the jurisdiction over the dispute in these proceedings. On 21 August 2020, P took out a summons (“the summons”) for leave to appeal against the Main Decision. This decision should be read together with the Main Decision. For ease of reference, the abbreviations used in the Main Decision are adopted herein.

2.  I have directed that the summons would be determined on paper without an oral hearing.  The parties have provided me detailed written submissions pursuant to the directions given by this court.  I have considered those written submissions.

The principles

3.  Leave to appeal would only be granted if the appeal has a reasonable prospect of success (which means that the prospect of success is reasonable and more than fanciful, without having to be probable), or there is some other reason in the interests of justice why the appeal should be heard^[1].

4.  In order to overturn a decision made by the court as a result of exercise of a discretion, it has to be shown that the relevant decision exceeded the generous ambit within which reasonable disagreement is possible, and not merely that the appellate court would prefer a solution which the court below had not chosen.  The Court of Appeal’s function is not to exercise the discretion afresh, but will only interfere if it is shown that the discretion was wrongly exercised on principle or the court below had taken into account irrelevant consideration or had ignored relevant consideration[2].

5.  Leave to appeal may be granted under the “some other reason in the interests of justice” limb if the applicant does not have a reasonable prospect of success in his or her intended appeal, but the appeal would present the Court of Appeal with an opportunity to provide much needed clarification on an area of the law or to entertain an argument that the law ought to be changed[3].

6.  P is relying upon the “reasonable prospect of success” limb, and the “some other reason in the interest of justice” limb to seek leave to appeal.

ANY REASONABLE PROSPECT OF SUCCESS?

Prolix Notice of Appeal

7.  A draft notice of appeal (“the draft NOA”) of 22 pages is annexed to the summons.  With respect to counsel for P, I agree with the observation made by counsel for D that the draft notice of appeal is prolix with no concise grounds of appeal.  Such an approach is contrary to the guidance repeatedly emphasized by the Court of Appeal.  As said by Lam VP in Gotland Enterprises Limited v Kwok Chi Yau[4]:

“70. … A notice of appeal should only set out grounds which in counsel’s view are reasonably arguable. The practice of lodging an appeal with ill-considered and unsatisfactory grounds of appeal, particularly those that provide no more than a lengthy critique of the judgment rather identify a justifiable basis for the Court of Appeal interfering in the decision of the judge below, is not acceptable. In future, the court will exercise tighter case management of the appeal process and the Registrar may bring such illegitimate notices of appeal to the attention of a judge for striking out consideration. In modern litigation ethos, appeals brought without proper grounds are regarded as abuse of process.”

See also Lam VP’s dictum in Yap Sui Kong v Yip Fong Tim[5].

8.  I take this opportunity to remind practitioners that a notice of appeal must be prepared in accordance with the guidance given by the Court of Appeal. As said by the Court of Appeal, any notice of appeal which is not prepared in that way may be liable to be struck out.  An application for leave to appeal based upon such an improper draft notice of appeal may also be dismissed for no reasonable prospect of success in the intended appeal is shown.

9.  Reading the draft notice of appeal, P appears to suggest that I have erred in my rulings on the following issues:

(1) Order 11 rule 1(1)(f) (“Gateway (f)”)

(2) Order 11 rule 1(1)(b) (“Gateway (b)”)

(3) Malicious Falsehood

(4) Forum

(5) Material Non-Disclosure

10.  I would examine P’s submissions under each issue in turn in the paragraphs below.

Gateway (f)

11.  In the Main Decision, I held that:

(1) In order to obtain leave to service proceedings on a defendant outside the jurisdiction of Hong Kong under Gateway (f), the plaintiff must show that a real and substantial tort has been committed in Hong Kong. The Court of Appeal’s decision in Oriental Press Group Ltd v Google LLC[6] is an authority on the point.[7]

(2) There is no convincing evidence showing a good and arguable case that a real and substantial tort has been committed by D in Hong Kong[8]:

(a) There is no convincing evidence showing substantial publication of the Declaration and/or the Trust Agreement in Hong Kong[9].

(b) Further, based upon the evidence before the court, even if liability is established, the alleged damage suffered by P would be minimal[10].

12.  P submits that:

(1) Insofar as P’s case is based on malicious falsehood and defamation in tort, I erred and applied the wrong test for service out.  The plain words of the statutory gateway do not impose a general test of a “real and substantial tort committed in Hong Kong”.

(2) I also erred in equating the test of real and substantial tort to the requirement of “substantial publication”.  Even assuming that the test of real and substantial tort were the applicable test in the present case, it would not mean that P had to prove “substantial publication” before he could obtain leave for service out under Gateway (f).

13.  As to whether Gateway (f) contains the requirement that the plaintiff must show a real and substantial tort has been committed in Hong Kong, P and D have made their respective submissions on the point, and I have ruled that D’s submission is correct in the Main Decision[11]. I would not repeat what I have said in the Main Decision.  Suffice for me to say that, in my view, P does not have a reasonable prospect of success on this point in the appeal.

14.  P argues that the “real and substantial tort” requirement in Jameel v Dow Jones & Co Inc[12] is confined to cases involving libel published in multiple jurisdictions.  With respect, I am unable to agree.  As submitted by D, the principle in Jameel is concerned with balancing between the right to reputation on the one hand and the right to freedom of expression on the other hand, and to prevent an abuse of process of the court by committing resources to an action where little is at stake, and the costs of the proceedings would be out of all proportion to what could be achieved.  This principle is applicable not only to set aside leave for service out of jurisdiction, but also as a ground to strike out an action for abuse of process despite the defendant’s submission to jurisdiction.[13]

15.  In the Main Decision, I did not only hold that there was no convincing evidence showing substantial publication of the Declaration and/or the Trust Agreement in Hong Kong, I also held that the alleged damage suffered by P would in any event be minimal.  I am not persuaded that I am plainly wrong in my analysis.

16.  In my view, P does not have a reasonable prospect of success on matters relating to Gateway (f).

Gateway (b)

17.  As to Gateway (b), I said the following in the Main Decision:

“21. Further, since I have decided that P has not shown a good arguable case that D may have committed a real and substantial tort in Hong Kong, I am of the view that the court’s discretion should be exercised against granting leave to serve the proceedings out of Hong Kong under Order 11 rule 1(1)(b).”

18.  P submits that it is plainly wrong for exercising the discretion against P and not to grant P leave for service out under Gateway (b) where it is clear that D is desirous of making continuous use of the false Declaration and the alleged Trust Agreement against P unless otherwise restrained by the court. With respect, I am unable to agree.

(1) P has not explained why it would be plainly wrong to exercise the discretion against P while P has not shown a good arguable case that D may have committed a real and substantial tort in Hong Kong.

(2) Further, there is no evidence showing that D is desirous of making continuous use of the Declaration and the Trust Agreement against P.  In D’s 2^nd affirmation dated 9 June 2020, D simply said that the authorities in Chongqing required D to preserve the original of the Trust Agreement in the event that further inspection of the same by the authorities were necessary. 

19.  I am of the view that P does not have a reasonable prospect of success by relying upon Gateway (b).

Malicious Falsehood

20.  P submits that I have erred in holding that there was no serious issue to be tried on P’s claim based upon malicious falsehood against D.  P argues that I have failed to properly consider P’s pleading, and I have also misconstrued s.24 of the DO.  P says, in terms of pleading, all that was required in order to make the nature of the case clear was identification of the nature of the loss and the mechanism by which it was likely to be sustained.

21.  I would not repeat what I said on this issue in the Main Decision[14]. Suffice for me to say that I am not persuaded that P has shown a reasonable prospect of success on this issue in the appeal.

Forum

22.  On the question of forum, I said in the Main Decision:

“29. Since P has failed to show that Hong Kong is clearly and distinctly the forum conveniens, P should not be allowed to pursue his claim in the Hong Kong court.”

23.  Having considered the draft NOA and P’s written submissions, I do not see how this court can be said as being plainly wrong in reaching that conclusion.

24.  If P cannot overcome this point, his appeal to the Court of Appeal would be bound to fail.  On this point alone, leave to appeal would be refused.

Material Non-Disclosure

25.  In the Main Decision, I held that in respect of the 1^st complaint and the 2^nd complaint as set out in [30], there had been deliberate material non-disclosure by P in the ex parte application for the Leave.  I note that the counsel team representing P in the inter partes application leading to the Main Decision and in this leave application was not involved in the ex parte application.  My comments concerning material non-disclosure should not be understood as anything against counsel.

26.  Based upon what I have said in [36(2)] of the Main Decision, P submits that I have made a plain error.  In that paragraph, I said:

“(2) As to the alleged direct publication of the Declaration by D to Feng in Hong Kong, in the ex parte application, P did not tell the court that in fact P did not have solid evidence on this point. P also did not reveal to the court that at the material times, D was ordinarily resident in the Mainland. The residence of Feng would certainly undermine the allegation of direct publication of the Declaration by D to Feng in Hong Kong. The subsequent amendment to [18] of the Statement of Claim shows the weakness of this allegation.” (Emphasis added)

27.  Reading in context, it is clear that the reference to “D” being ordinarily resident in the Mainland instead of Feng at [36(2)] of the Main Decision is a typographical error. The entire paragraph is clearly referring to the fact that P had failed to refer the ex parte court to the fact that Feng was ordinarily resident in the Mainland.  For the avoidance of doubt, I direct that a corrigendum be handed down together with this decision.

28.  As a matter of fact, the subject matters in the 1^st complaint and in the 2^nd complaint have not been disclosed in the ex parte application.  P submits that his claim against D is meritorious.  With respect, this is beside the point.  Even if P has a meritorious claim against D, and even if the ex parte order would still be granted if disclosure was made, that would not mean that the disclosure need not have been made[15].  I took the view that the matters which have not been disclosed are matters which the court should have in the weighing scale, and I ruled that the non-disclosure of these matters constituted material non-disclosure.  I do not see how this court could be said as being plainly wrong in these rulings.

29.  I have also ruled that the material non-disclosure was deliberate.  In my view, P also does not have a reasonable prospect of success in obtaining an order to set aside that ruling in the appeal.

30.  P argues that after setting aside the Leave, the decision of refusing to re-grant the same leave to P is disproportionate. I am unable to agree.

(1) As said in [39] of the Main Decision, where the material non-disclosure is deliberate, the court should normally not entertain a fresh application.

(2) As shown in the Main Decision, apart from material non-disclosure, P has many other problems in his case against D.  In view of all these problems, it would not serve any meaningful purpose if leave is re-granted to P.

(3) The decision of refusing to re-grant the leave to P is a discretionary decision made by this court.  Taking into account all the aforesaid matters, it could not be said that I have erred in principle in exercising the discretion.  

No reasonable prospect of success

31.  For the reasons above, I am of the view that there is no reasonable prospect of success in P’s intended appeal against the Main Decision.  I would refuse leave under the “reasonable prospect of success” limb.

SOME OTHER REASON IN THE INTERESTS OF JUSTICE

32.  P appears to say that the following questions ought to be submitted to the Court of Appeal for determination under the “some other reason in the interests of justice” limb:

(1) whether “real and substantial tort committed in Hong Kong” is a necessary requirement in Gateway (f); and

(2) the true meaning of s.24 of DO. 

33.  I am unable to agree.

(1) In respect of the first matter, I am of the view that the issue has been determined by the Court of Appeal in Oriental Press Group Ltd.

(2) In respect of s.24 of the DO, the difference between the parties is not the true meaning of that section, but is whether P has pleaded a case which would enable him to rely upon s.24(1) of the DO.  The true meaning of the section is not an issue in these proceedings.

34.  Further, as said in the above, I do not see how P could overcome the forum issue.  Even if my ruling on Gateway (f) and my ruling on the pleading issue relating to s.24 of the DO are reversed in the appeal, P’s appeal would still fail by reason of his failure on the forum issue.  For this reason, it would not serve any useful purpose to grant leave to appeal to P on the issues as set out in [32] above.

35.  I would also refuse leave under this limb.

DISPOSITION

36.  I dismiss the summons.

37.  There be a costs order nisi that costs of the summons be paid by P to D forthwith with a certificate for 2 counsel. Those costs be summarily assessed.  There be leave to D to file and serve a bill of costs for summary assessment within 7 days after the costs order nisi becoming absolute, and leave to P to file and serve a written reply to the said bill within 7 days thereafter.

38.  I thank counsel for the assistance rendered to the court.