ROBERT JAMES BROOK v. THE LAW SOCIETY OF HONG KONG

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

1997, No. 236
(Civil)

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J U D G M E N T

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Liu, J.A.:

1. The appellant was unsuccessful in an administrative law action against the Law Society before Keith J. He was dissatisfied with the decision of the court and decided to take steps with a view to prosecuting his appeal.

2. The appellant was late in serving a Notice of Appeal. He applied to Mortimer V-P, for an extension of time. His application was refused by the Vice-President. From that refusal, he now appeals.

3. A number of concessions were made in the application before the Vice-President, one of which was that the memorandum of notification of the appellant's application for legal aid (the Memorandum) filed in the court below did not have the effect of stopping the running of time within which a Notice of Appeal should be lodged. Under O 59, r 4(1)(c) Rules of Supreme Court, the time for the service of a Notice of Appeal in this case is 42 days.

4. The judgment of Keith J. was sealed on 30 July 1997. But for the now contended stay, before Mortimer VP the applicant's (the appellant's) time to serve his Notice of Appeal expired on 10 September 1997. It was not until 29 October 1997 that he first applied to Mortimer V-P ex parte for an extension. From 10 September to 29 October 1997, it was seven weeks. Because of the concessions made, it was not pressed before Mortimer V-P that there had been any effective stay or that the appellant was not late for as much as seven weeks. Before us, counsel for the appellant assumes a somewhat different stance, and we entertain her submissions on construction only for fear of possible injustice.

5. The appellant applied to the Director of Legal Aid for assistance and the Memorandum was filed in the court below on 11 August 1997. On counsel's contention that the filing of the Memorandum had stopped time from running, the appellant's 42 days for serving a Notice of Appeal would arguably expire on 23 October 1997, not earlier on 10 September 1997. If delay was to commence from 23 October 1997, he would be only six days late instead of 7 weeks late up to the date of his application for extension made on 29 October 1997.

6. The Vice-President concluded that the applicant failed to satisfactorily explain his delay until 15 October 1997 when leading counsel gave certain advice to the appellant, but Mortimer V-P was satisfied that further delay as from 15 October 1997 was excusable. In other words, as from 15 October 1997, the appellant and those he instructed were regarded as having proceeded with reasonable diligence in the prosecution of his intended appeal.

7. Therefore, if the filing of the Memorandum had the effect of staying, in part, the statutory 42 days within which a Notice of Appeal had to be served, the expiration of the statutory period would fall on 23 October 1997, not 10 September 1997. Since the appellant had satisfied the Vice-President that he was not dilatory as from 15 October 1997, with a legal aid stay up to 22 October 1997 there was no culpable delay from 23 October 1997 to 29 October 1997 when a summons for extension was issued. The Vice-President also held that the applicant had an arguable case. The other factors featured in the appellant's application for an extension of time were favourably received by the Vice-President. In other words, if the filing of the Memorandum did serve to halt the running of the statutory appeal period of 42 days, the appellant should succeed in obtaining his extension.

8. Therefore, much hinges upon the true construction of section 15 of the Legal Aid Ordinance. In essence, counsel for the appellant submits that section 15 operated as a stay for 42 days. Section 15 sub-sections (2), (3) and (4) read :

"(2) Where an action has been commenced or where an appeal has been lodged in respect of any proceedings and any party, or any person who wishes to be joined as a party, makes an application for legal aid, the Director shall, as soon as practicable after the application is made, notify the other party or each of the other parties, and file in the court in which the action is commenced or in the court in which the appeal is lodged, as the case may be, a memorandum of such notification. (Emphasis supplied)

(3) Where any party to an action, or any person who wishes to be joined as a party, makes an application for legal aid to prosecute an appeal or proceedings in the nature of an appeal, the Director shall, as soon as practicable after the application is made, notify the other party or each of the other parties, and file in the court or tribunal against whose judgment or order it is intended to appeal, a memorandum of such notification. (Emphasis supplied)

(4) Where any memorandum is so filed, then, unless otherwise ordered by the court in which the memorandum is filed, all proceedings in the action or in the appeal or in both the action and the appeal shall, by virtue of this section, be stayed for such period, being not less than 14 days, as may be prescribed, and during such period (unless otherwise ordered by any such court) time fixed by or under any law or otherwise for the doing of any act or the taking of any step in the proceedings shall not run. (Emphasis supplied)"

9. Sub-section (4) deals with the effect of the filing of a s. 15 memorandum on "all proceedings in the action". Counsel for the appellant concedes at one point that this was not a sub-section (2) scenario, but later counsel seeks to argue that on account of a possible application under O 59 r 15 Rules of Supreme Court the administrative law action had not come to an end, hence sub-section (2) would also be engaged. Counsel leans primarily on sub-section (3). For an intended substantive appeal such as that in this case, sub-section (3) would embrace the period from the conclusion of the action until the institution of the appeal, in which there could no longer be any subsisting proceedings. For an intended interlocutory appeal, the action itself in sub-section (3) would be pending, but the instant appeal concerns an intended substantive appeal. In this judgment, I would focus on aspects of the appellant's intended substantive appeal from an adverse decision given in his administrative law action which was concluded. It is submitted on behalf of the appellant that sub-section (4) would as well apply to sub-section (3) as it would to sub-section (2) despite the absence of subsisting proceedings in an intended substantive appeal scenario, otherwise the Legal Aid Scheme devised to offer a moratorium to all procedural periods would be frustrated. It matters not, so counsel argues, whether or not an action is still subsisting or an appeal has been lodged, sub-section (4) would still extend to such a period in between.

10. Counsel for the appellant further submits that the Legal Aid Ordinance stands on its own and that no assistance can be derived from the decisions of the courts in other common law jurisdictions. This court is therefore left with a wide margin within which to pursue a purposive construction, aided by s. 19 of the General Clauses and Interpretation Ordinance.

11. In the final analysis, I part company with the basic approach adopted by counsel for the appellant. On instructions, counsel for the Law Society refrains from offering any assistance on interpretation. However, personally, he associates himself with the conclusion drawn from sub-sections (2),(3) and (4) by counsel for the appellant. The matter at issue could not be said to have been fully argued. There is a real need for confining my deliberation to within a narrow ambit, and this judgment should be read with the same constraint.

12. It is almost unarguable that an action comes to an end when a judgment is delivered and the order the court makes is perfected. That is what happened here, and this court is saddled with what flowed from an intended substantive appeal. It is also reasonably clear that whilst s.15(2) deals with a subsisting action or a subsisting appeal, sub-section (3) caters for, in the case of an intended substantive appeal, the period between the conclusion of an action and the institution of an appeal. Save for intended interlocutory appeals, sub-section (3) decidedly relates to no subsisting action or subsisting appeal. Sub-section (3) is concerned with "any party to an action" which must mean, for an intended substantive appeal, the action which has been concluded, not an action pending resolution. This analysis is supported by the subsequent reference in sub-section (3) to the making by any party to an action of "an application for legal aid to prosecute an appeal". A substantive appeal may not be prosecuted unless finality has been achieved, and it stands to reason that for an intended substantive appeal the "action" in sub-section (3) would have to equiparate with the concluded action, the party to which is making an application for legal aid to prosecute an appeal. Both in sub-section (2) and in sub-section (3), a memorandum is required to be filed in court. For the purposes of sub-section (2), the court means the court in which an action has been commenced or an appeal has been lodged. In the case of an intended substantive appeal, the court in sub-section (3) must mean a court in which litigation was completed and the action came to an end. Under sub-section (3), a memorandum is required to be filed in that court, the court in which an action was brought to an end and from which an intended substantive appeal is being pursued. A party to a concluded action, seeking to appeal on legal aid would have to make "an application for legal aid to prosecute an appeal". It would then be just a small step to construing "action" in the words "all proceedings in the action" in sub-section (4) by reference to a concluded action in sub-section (3) in the case of an intended substantive appeal.

13. Apart from the meaning of the word "action" in the context of both sub-sections (3) and (4), in the Legal Aid Scheme s. 15(4) could not have been intended to engage merely sub-section (2) to the exclusion of sub-section (3), given the embracing application of the legal aid moratorium to all periods for the benefit of an aided or potentially aided person.

14. Sub-section (4) refers to "all proceedings". Were there proceedings in this case, on which a stay may operate? O 59 r 15 Rules of Supreme Court empowers the court below in which the concluded action was litigated to entertain an application for an extension of the statutory 42 days for lodging an appeal. For an intended substantive appeal, the application would have to be made within that statutory 42 days. O. 59 r 15 is in these terms :

".........the period for serving notice of appeal ............may be extended or abridged by the court below on application made before the expiration of that period."

Rule 15 clearly envisages a further proceeding in the action that has been concluded.

15. The Memorandum was filed in the court below after the appellant's administrative law action had finally been disposed of. For the intended substantive appeal in this case, the appellant's concluded action would have to be regarded as resurrected for an O 59 r 15 proceeding to be entertained and the Memorandum to be accepted for filing. I have sufficiently identified an action to which sub-section (4) may apply and a proceeding which a memorandum may stay.

16. The Memorandum was filed in the concluded action. Section 15(4) of the Legal Aid Ordinance therefore stayed the action so that an O 59 r 15 proceeding may be pursued at a later time. The period of stay is prescribed by law to be 42 days and "during such period time fixed by ......... law ......... for the doing of any act or .......the taking of any step in the proceedings" would not run. See s. 15(4) of the Legal Aid Ordinance.

17. The words "proceeding in an action" couched in the old rule for withdrawal by a plaintiff before taking any further step in the action were considered in Spincer v Watts, (1889) 23Q.B.D.350, where it was held that those words meant taking the subsisting action forward "with a view of continuing the litigation with the person against whom the proceeding is taken". See also Mundy v Butterlay Company Limited [1933] 2Ch.227. But these decisions do not bear upon the words "all proceedings in the action" in s. 15(4) of our Legal Aid Ordinance. First of all, these words in s. 15(4) are distinguishable from "the taking of any step" appearing in the latter part of that sub-section. Not only would the word "proceedings" in "all proceedings in the action" in sub-section (4) seem to apply to all conceivable proceedings, whether or not it is a step in the litigation, but the meaning of the word "proceedings" as given by s. 2 of the Legal Aid Ordinance includes legal proceedings. It even includes negotiation prior to the institution of legal proceedings and mediation. That is clearly not a step in the action. The words "all proceedings in the action" in our s. 15(4) would seem to be susceptible of a much wider meaning. There is nothing in the background in this case to suggest that they should not be liberally interpreted. "Proceedings" should therefore include the legal proceeding undertaken pursuant to O 59 r 15 for making an application within the statutory 42 days to the court below for extending the time to appeal from a concluded action. It is to be regarded as a legal proceeding in the appellant's concluded action for taking the intended substantive appeal forward. In that limited sense, a parallel may well be drawn between this case and the English decisions, but the two legislations are decidedly different with their own purposes to serve. Clearly, it would not be profitable to continue with the present discussion.

18. Sub-section (3) enjoins the Director of Legal Aid to file a memorandum in the court below "where any party to an action ......... makes an application for legal aid to prosecute an appeal". Apparently, the Director accepted the appellant as a party "to an action". In making an application for legal aid to prosecute his intended substantive appeal, the appellant was thus regarded within the Legal Aid Scheme as "a party to an action" although his administrative law action had been concluded.

19. Lastly, in an intended interlocutory appeal, there exists a pending action in which an O 59 r 15 application, as a step therein, may be made. Put another way : as the action has yet to come to an end in any interlocutory appeal, s. 15(4) would be plainly applicable. It is inconceivable that s. 15(4) could have been intended to apply only to s. 15(3) in part, that is to say, to an intended interlocutory appeal but not an intended substantive appeal. Therefore, the appellant's action, albeit a concluded one, coupled with the legal proceeding envisaged by O 59 r 15 links s. 15(4) to s. 15(3).

20. In my view, for the purposes of s. 15(3) and (4) of the Legal Aid Ordinance, there was an "action" in place for the appellant, as a party thereto, to invoke O 59 r 15. In conclusion, the filing of the Memorandum activated a stay.

21. The judgment of Keith, J. was sealed on 30 July 1997. Within 42 days, the appellant was entitled to apply to the court below for an extension of time to serve his Notice of Appeal under O 95 r 15. That period for making an application was stayed for 42 days by the filing of the Memorandum in the court below. In other words, with the stay the appellant would have up to 23 October 1997 to make an application to the court below for an extension of time. Therefore, the appellant was not out of time until 23 October 1997.

22. On the material placed before him, Mortimer V-P was satisfied that there was no inexcusable delay after 15 October 1997. Consequently, on the true construction of section 15 of the Legal Aid Ordinance and the views held by the Vice-President, there was no unexplained delay caused by or on the part of the appellant after 15 October 1997. The other considerations were regarded as being all in the appellant's favour. It has not been suggested that any of the overall circumstances caused prejudice. In my view, with no culpable delay and an arguable case the appellant should have been allowed an extension for serving his Notice of Appeal. For the reasons I have endeavoured to give, I would allow the appeal and substitute an order, extending time to the appellant for lodging his Notice of Appeal against the decision of Keith, J. I would also make an order nisi for costs against the respondent but would not disturb the costs order made below.

Leong, J.A.:

23. I have had the benefit of reading my Lord Liu JA's judgment. I agree that this is a case that extension of time to serve a notice of appeal should be granted.

24. The crux of the matter, as I see it, is whether s.15(4) of the Legal Aid Ordinance Cap. 91 which provides for automatic stay of proceedings on an application for legal aid applies to stop the time for service of a notice of appeal. That depends on what interpretation can be given to the words "all proceedings in the action" in the subsection. If s.15(4) applies, the appellant would have until 23.10.97 to make his application in which case, when he made it on 29.10.97, he was only 6 days late. The Vice President might have in such circumstances exercised his discretion differently.

25. The purpose of automatic stay of all proceedings under s.15(4) is to give time for the Director of Legal Aid to consider an application for legal aid, whether the application is made after an action has commenced or an appeal has been lodged as envisaged in s.15(2) or the application is made to prosecute an appeal as envisaged in s.15(3). The stay is also to ensure that the appellant in the meantime would not be prejudiced by his lack of legal representation in his litigation. Section 2 of the Ordinance defines "proceedings" as to include "legal proceedings". The legal proceedings in connection with an action do not conclude when avenues for appeal are still open. An application to serve notice of appeal out of time may be regarded as legal proceedings by way of appeal. A wider interpretation of s.15(4) so as to include legal proceedings taken by an intending appellant to pursue his appeal is therefore necessary. Otherwise, s.15(3) does not serve the purpose intended by the legislature.

26. If that interpretation of s.15(4) is adopted, the appellant had, including the 42 days stay until 23.10.97 to service his notice in time. The Vice President found that the appellant was not dilatory since 15.10.97 and he has an arguable case. That being the case, the delay was only 6 days and the appellant had not been idle during this period. It is a case that the exercise of the discretion to grant extension should be in favour of the appellant. I would allow the appeal.

27. I agree with the extension of time granted by my Lord Nazareth V-P and also his order in respect of costs in these proceedings.

Nazareth, V.-P.:

28. I also agree that the appeal should be allowed and an extension of time granted.

29. The only question of any substances before us, which seems to have been bypassed before Mortimer V-P because of the concessions and submissions made there, is whether the words "all proceedings in the action" in s. 15(4) of the Legal Aid Ordinance embrace the sort of situation here, i.e. where the action has in the ordinary sense concluded. What proceedings are there, then, that can be stayed, it may be asked.

30. The object of the 42-day stay in s. 15(4) can only be to enable the application for legal aid to be processed. It would be absurd to suggest that legal aid is not to be provided or applied for after conclusion of an action in the ordinary sense. It must follow, therefore, giving the provision the purposive construction that is both appropriate, and required by s. 19 of the Interpretation and General Clauses Ordinance (Cap. 1), that the proceedings although concluded in the ordinary sense, are to be regarded as still on foot for the purposes of s. 15. To construe s. 15(4) otherwise, would plainly deny it the primary effect that must be its purpose, i.e. to effectively provide legal aid not only with respect to interlocutory decisions but also with respect to final decisions that conclude proceedings in the ordinary sense, where its need is incomparably greater.

31. As to costs, it seems to me that the costs orders made prior to the appeal to us should not be disturbed, but that the appellant should have his costs before us.

32. The appeal is accordingly allowed, and the appellant is granted an extension of time until 7 January 1998 within which to lodge his notice of appeal. There will be an order nisi that the appellant is to have his costs of the appeal against the order of Mortimer V-P.