YEUNG MAN FUNG t/a YIP HING DESIGN DECORATION & ENGINEERING v. HUNG FAN KEUNG HENRY

IN THE COURT OF APPEAL

1994, No. 199
(Civil)

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J U D G M E N T

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Godfrey, J.A. :

1. This appeal arises out of a commonplace and simple dispute between the plaintiff builder and the defendant employer.

2. The work related to property of the defendant in Tuen Mun in the New Territories. The defendant was dissatisfied with the work. The plaintiff was compelled to sue for what was, as he claimed, due to him. He obtained legal aid to bring the necessary proceedings.

3. The action was commenced in the District Court on 19 September 1991. In due course a date was fixed for the trial. The date fixed for the trial was 10 September 1992; but the trial was aborted. The parties fell out over a hearsay notice, the object of which was to enable a surveyor's report, commissioned by the defendant, to be received in evidence, without any opportunity being given to the plaintiff to cross-examine upon it.

4. The case was stood out of the list to a date to be fixed; but no new date was sought and the action went to sleep.

5. On 29 October 1993, the solicitors for the defendant wrote to the solicitors for the plaintiff reminding them that the court had ordered the trial of the action to be adjourned to a date to be fixed. They invited the plaintiff's solicitors to take positive action to restore the action for trial within fourteen days, otherwise, they said, the defendant would apply to the court to strike out the plaintiff's claim for want of prosecution without further notice.

6. Although nothing remained to do except to restore the case for trial, the plaintiff's legal advisers took it into their heads to apply for further particulars of the defence, and on 12 April 1994, they applied for such particulars.

7. On 12 August 1994, they obtained an order for some of these particulars. (There was at that stage no application made by the defendant for leave to amend the defence.)

8. The defendant failed to give the particulars ordered, and on 9 September 1994, the plaintiff applied for an "unless" order.

9. On 3 October 1994, the defendant applied for and obtained a fourteen days' extension to comply with the order for particulars. (Still no application for leave to amend the defence was made.)

10. Subsequently, the defendant decided that he needed to apply for leave to amend his defence, on the startling ground that his (new) legal advisers did not understand the defence that had been prepared by the defendant's original legal advisers. On 17 October 1994 he applied to the court accordingly.

11. What the defendant now wanted to do was to change the nature of his case (although, be it remembered, the trial had been fixed for hearing two years earlier). If he succeeded, he would no longer have the embarrassment of having to give particulars of his own defence, which his new legal advisers said they could not understand. (That might have been a possible course had the application for leave to amend the defence been made when the application for particulars was first made. It was, in my judgment, by now much too late to expect the court to take this course.) So, rather than give the particulars ordered, the defendant chose to rest his hopes for the future on a successful application for leave to amend his defence. He made his application on 17 October 1994, the day on which his time for giving the particulars ordered expired.

12. On 20 October 1994, the plaintiff applied for judgment in the action on the basis of the defendant's failure to comply with the order for particulars.

13. On 25 October 1994, the judge (Her Honour Judge Kwan) refused the defendant's application for leave to amend the defence and granted the plaintiff's application for judgment to be entered in his favour. The judge later prepared reasons for her decision which were placed, without objection, before us.

14. The judge put the matter in this way:

"The Defendant had two choices, to appeal or to comply. He did neither.

Deputy Judge Chain ordered the Defendant to file further and better particulars after he had heard arguments from both sides. If the Defendant felt the Order was wrongly made or that he wanted that Order altered, then in the ordinary way he should have appealed against it.

Deputy Judge To gave the Defendant a further period of 14 days to comply after hearing submissions. Instead of complying, the Defendant took out another summons to amend.

I was mindful of the fact that a default judgment is not a judgment on the merits, however, the very nature of the judicial process requires an effective and appropriate sanction to compel due compliance by the parties to the proceedings with Orders of the Court. The sanction for default by the Defendant is for his defence to be struck out and a default judgment entered against him.

The order to strike out the defence was not taken lightly. I considered all the arguments put forward, and all in the circumstances of the case. Had the Defendant put forward a good reason for his non-compliance, I might not have made such an order. Unfortunately there was no good reason put forward from the Defendant for his non-compliance. A submission that he did not understand his own pleadings well enough to comply with the Order of the Court was not sufficient reason in the circumstances."

15. The defendant had the unenviable task in this court, discharged on his behalf with great valour and dignity by Mr. Albert Yau, of trying to persuade us that the judge's decision fell outside the band of reasonable decisions which she could in her discretion have made.

16. I am, for my part, wholly unsatisfied that this is so. I appreciate the force of Mr. Yau's argument that this was an excessive punishment for a defendant who, in response to a request for particulars made two years after the date of the trial originally fixed, came to the conclusion that his own pleaded defence was so seriously defective that he could not give the required particulars of it and now wanted to present his defence in a different way. But the defendant's decision to rely on the success of his application for leave to amend the defence, and to change tack on the matter of particulars after passing by two or three opportunities to do so, was, in my judgment, 'contumelious' in the sense in which that word is used in the cases cited to us in this context. Even if that is wrong, I am quite satisfied that, in the circumstances of this case, the judge cannot be said to have exercised her discretion wrongly. It was no doubt open to her to come to the alternative conclusion; but this court is not here to allow litigants in interlocutory applications in the District Court to have a second bite of the cherry, and this court should do all it can to discourage this sort of appeal. It is said that the order the judge made was "draconian". The edicts of Draco were intended to bring about sorely needed reforms in the Athens of his day. I would hope that judges in the District Court, and in the High Court, will in future be far more freely prepared to make "draconian" orders, if the result is to ensure that legal advisers to the parties get on with the litigation with which they have been entrusted and bring that litigation to a speedy (and much less expensive) conclusion. Cases like the present are a disgrace to the jurisprudence of Hong Kong.

17. In the present case, it is worth observing that most of the difficulties would have been avoided if, at an early stage, it had been appreciated that what was required was the preparation of a schedule of defects on which each party could have commented, and on which schedule each party could have come to trial, armed with the evidence of their respective surveyors going to the matters raised in issue by the schedule. That is the way in which building disputes of this nature ought to be prepared for trial. Pleadings which are incomprehensible to those who read them, and even to those who prepared them, are never any use to anybody and are particularly useless in building disputes.

18. For the reasons I have endeavoured to state, I would dismiss this appeal, with costs.

Bokhary, J.A. :

19. The defendant did not ask Her Honour Judge Kwan for still more time to supply the particulars. Instead, he sought to circumvent the order for particulars by seeking leave to amend. His advisers should have realised that if such leave were refused, then he would be left without any answer to the application for judgment against him.

20. It was not as if he merely wished to delete the averments ordered to be particularised. The amendments sought would radically alter the nature of the defence. The judge was entitled in her discretion to refuse leave to amend. Indeed, in all the circumstances, I think that granting such leave would have been plainly wrong.

21. Once such leave was refused, the entering of judgment for the plaintiff was, in all the circumstances, the only logical course. I, too, would dismiss this appeal.

22. Before concluding this judgment, I think it only fair to Mr Yau, who appears before us for the defendant, to note that he did not appear in the court below or advise in the proceedings below.

Nazareth, V.-P.:

23. I agree with what has fallen from my brothers, Godfrey and Bokhary JJ.A. For those reasons the appeal must be dismissed.

24. The way in which the defendant's case has been taken forward, if I can use that expression, reveals a sorry state of affairs. I have considerable sympathy for the defendant. But that does not afford me a proper basis for interfering with the judge's order appealed against. I cannot see that the judge misdirected herself in principle or that she failed to take into account matters which she should have or took into account matters she ought not to have, or indeed that she was plainly wrong. In the result, there is no basis for interference and the appeal must be dismissed.