LAW KWOK FAI PAUL AND OTHERS v. WELLMEI (HK) PLASTICS & ELECTRONICS INDUSTRIAL LTD AND ANOTHER

CACV 45/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 45 OF 2014

(ON APPEAL FROM HCA NO. 184 OF 2012)

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REASONS FOR DECISION

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1.  This is an application by the Plaintiffs/Appellants for leave to adduce fresh evidence on appeal from a decision given by Deputy Judge B Chu on 30 September 2013. The summons was issued on 20 October 2014. The appeal is due to be heard on 5 November 2014. I shall refer to this timeline later.

Material facts

2.  The facts material to this application are as follows.

3.  The Plaintiffs claimed that the Defendants had harassed them in activities aimed at collecting an alleged debt of about $10m for goods sold and delivered to a company with which the Plaintiffs were thought to be connected.  The Plaintiffs also claimed that the Defendants published materials which were defamatory of them.

Legal proceedings

4.  On 6 February 2012 the Plaintiffs obtained an ex parte injunction restraining the Defendants from harassing them.  This order was continued after an inter partes hearing on 10 February 2012.

5.  A statement of claim was served on 21 March 2012.  It sought the following relief:

- a declaration that the Plaintiffs are not liable for the alleged debt,

- an injunction to restrain the Defendants from activities of harassment and publication of defamatory materials and

- damages for nuisance, assault and harassment, libel and negligence, none of which were particularized.

6.  As a result of correspondence between the parties’ solicitors, on 23 January 2013 there was a consent order for final judgment for the declaratory and injunctive relief (“the Consent Order”).

7.  Three months later, in April 2013, the Plaintiffs indicated that they would proceed with other claims in the Statement of Claim.  The Defendants’ position was that the proceedings had been concluded with the Consent Order.

8.  On 27 May 2013 the Plaintiffs issued an application for leave to amend the Statement of Claim to include claims for hiring security guards from January to September 2012 at a total cost of more than $1.9m and engaging a Close Protection Unit from January 2012 to March 2013 at a total cost of more than $8.6m (collectively referred to here as “the security personnel expenditure”).  No evidence was filed in support.

9.  An affirmation was filed by the Defendants’ solicitor dealing with the issue whether the parties had reached a concluded settlement leading to the Consent Order.  An affirmation in opposition was filed by Mr Yam, the Plaintiffs’ solicitor.  Mr Yam’s affirmation contained no explanation why there had been no claim for the security personnel expenditure (which are special damages) in the year since the claim was filed in March 2012.

10.  The application for amendment was heard before Deputy Judge B Chu in September 2013.  The learned judge handed down judgment on 30 September 2013 refusing the application to include the security personnel expenditure in the proposed amendment, as there had been no explanation why the Plaintiffs did not plead the expenditure in the first place and only did so some four months after the Consent Order.

11.  The Plaintiffs applied for leave to appeal which was granted by the judge on 19 February 2014.  On 27 February 2014 the Plaintiffs filed the Notice of Appeal.  One of the grounds was that the judge erred in law and in fact in holding that the Plaintiffs ought to have provided an explanation as to the delay in pleading the special damages.

Application to adduce fresh evidence

12.  However, eight months later on 20 October 2014, the Plaintiffs applied to adduce fresh evidence, being the second affirmation of Mr Yam, the Plaintiffs’ solicitor. Mr Yam sought to explain why the security personnel expenditure was not pleaded in the original statement of claim and to disclose when the Plaintiffs had decided to proceed with the remainder of the claims.  He also sought to explain why these matters were not put in evidence earlier.  This was because, he says, the Defendants had not raised the issue of delay in their affirmation opposing the application to amend.

Principles

13.  Although the hearing to amend was interlocutory, Miss Catrina Lam, counsel for the Plaintiffs, accepts that the principle in Ladd v Marshall [1954] 3 All ER 745 applies. That being the case, all three conditions set out in that authority must be satisfied before the court would consider, in the exercise of its discretion, whether or not to permit fresh evidence to be adduced on appeal.

14.  The three conditions are:

(1) the applicant (ie the appellant in our case) must show that the evidence could not have been obtained with reasonable diligence for use at the trial;

(2) the evidence must be such that, if given, it would probably have an important influence on the result of the case;

(3) the evidence must be such as is presumably to be believed, or in other words, it must be apparently credible, although it need not be incontrovertible.

Discussion

15.  It is clear that the present application is unmeritorious as it does not even get off the ground on the first condition.  First, the matters set out in Mr Yam’s affirmation were known to him well before the hearing before Deputy Judge Chu.  Secondly, the point that the delay needs to be explained by evidence from the applicants is either valid or it is not -- that remains to be decided at the appeal proper next week. But if it is a valid point, the absence of an explanation is not something that needs to be asserted as a fact in an affirmation from the respondents.  It is therefore no excuse for the Plaintiffs to say that they had failed to anticipate that it might be raised against them.  If the point is a valid one, they should have anticipated it.

16.  Since the Plaintiffs have failed to cross the first hurdle in their application, it is not necessary for me to discuss the other two conditions.

17.  Further, it is important to note that the summons to adduce fresh evidence (for the appeal to be heard on 5 November 2014) was filed only on 20 October 2014.  The judgment under appeal was given on 30 September 2013, more than a year before the summons, and the materials in the affirmation were known to the deponent even earlier, in April 2013.  Miss Lam has with commendable honesty acknowledged that there is no explanation for the delay in making the application.

18.  Even if the application had satisfied the conditions in Ladd v Marshall, I would have dismissed it in the exercise of the court’s discretion.

18.1  Order 1A r.3 of the Rules of the High Court requires parties and their legal representatives to assist the court to further the underlying objectives of the Rules.  One of the underlying objectives is to ensure that cases are dealt with as expeditiously as is reasonably practicable and to ensure that the resources of the court are distributed fairly.  It is common sense that the less time there is between the filing of an application to adduce fresh evidence on appeal and the hearing of the appeal proper, the greater the risks of not finding a slot for a judge to hear the application in good time before the appeal.

18.2  If a slot can be found at short notice, this gives the judge less reading and preparation time.  And an appeal from the single judge’s decision would lead to further complications as it would be difficult to find time for it before the appeal proper is heard.

18.3  If no slot can be found, the application would have to be heard at the same time as the appeal proper.  If the application is granted, the appeal may well have to go off, and a hearing day which may have benefited other litigants would be lost.  It is perhaps time for legal representatives to be made aware that late applications for leave to adduce fresh evidence may be refused on this ground only, and with attendant costs orders to reflect the court’s discouragement of this practice.

Order

19.  The application here was accordingly dismissed with costs to be paid by the Plaintiffs / Appellants / Applicants to the Defendants / Respondents/Respondents, to be taxed if not agreed.