YEUNG SEK SUNG v. CHEUNG FOR MING AND ANOTHER

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HEADNOTE

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PRINCIPLES TO BE ADOPTED FOR AN ORDER FOR AN INTERIM PAYMENT UNDER ORDER 29, RULE 10 OF THE RULES OF THE SUPREME COURT.

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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JUDGMENT

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1. This is an appeal by the defendants against a decision of Master Perrior made on the 2nd May 1990 when he ordered the defendants to make an interim payment to the plaintiff of $100,000. As the appeal is concerned with the principles to. be adopted where an application is made for an interim payment, I have decided to hand this judgment down in open court.

2. The facts which emerge from the pleadings and three affidavits of Mr Robinson, the plaintiff's solicitor reveal that on the 29th April 1988 at about 9:30 p.m. the van that was being driven by the plaintiff along Wai Yip Street near Kwun Tong Road broke down on the flyover. After manoeuvring the vehicle to the side of the road, the plaintiff alighted and walked to the rear with the intention of placing a red cloth on the van to warn oncoming vehicles. However. whilst standing at the rear of the van, he and the van were struck by a taxi driven by the 1st defendant.

3. The plaintiff who is aged 32, suffered a compound fracture of the right tibia and fibula. The plaintiff was in hospital from the date of the accident until the 12th July 1988 when open reduction and plating was carried out for the fracture. Subsequently he received treatment as an outpatient. At the end of August 1989, the plaintiff was readmitted to hospital for a period of four days for the removal of the screws and plates in his leg. The plaintiff, still suffers numbness and pain in his right leg and has a 10x loss of plantar flexion of the right ankle and his permanent disability has been assessed at 5%. Before the accident, the plaintiff participated in several sports, but his activities in that respect are likely to be considerably reduced.

4. The plaintiff was a construction site worker before the accident and following the accident he was unable to work for a period of 16 months. The plaintiff was able to resume light work in September 1989, but since February 1990, according to evidence filed on behalf of the defendants, it appears that he has been working full time.

5. A writ was issued on the 12th January 1990 that claims damages on the grounds of the negligent driving of the 1st defendant whilst the 2nd defendant is sued as the owner of the taxi which it is alleged was being driven by the 1st defendant as the servant or agent of the 2nd defendant. Apart from the usual allegations of negligence in a running down action, the statement of claim pleads the conviction of the 1st defendant for careless driving when he was fined $1,000 at the San Po Kong Magistracy on the 7th December 1988.

6. Special damages including loss of earnings are claimed in the statement of claim up to the 30th September 1989 in the sum of $190,174. A continuing loss of earnings. is also claimed at the rate of $11,550 per month.

7. By the defence, the accident is admitted but the allegations of negligence are denied. It is admitted that the 1st defendant was driving the vehicle and that it was owned by the 2nd defendant, but the capacity in which the 1st defendant was driving has not been admitted. Contributory negligence has been alleged by the defendants.

8. When the present summons came before the master, it only referred to the defendant in the singular which, by implication, must have been the 1st defendant,. However, the summons was amended to include both defendants at the hearing. I have been told that the master considered that an award of damages, presumably on the basis of full liability, would be in the region of $400,000. A specific claim was made by the plaintiff that he had suffered from financial difficulties that resulted in a loan of $50,000 being made to him by his brother-in-law.

9. At the conclusion of Mr McCoy's submission on behalf of the defendants, Mr Waley for the plaintiff sought to make a further amendment to the summons by seeking an order for interim payment either from the 1st and/or the 2nd defendant. Despite Mr McCoy's objection to this amendment, I allowed the application for I am of the opinion that the plaintiff should have made the application in this manner at the outset.

10. An application for an interim payment is made under Order 29, rule 10 of the Rules of the Supreme Court which where relevant reads :-

Order 29, rule 11 which must.be read in conjunction with rule 10 sets out the conditions to be satisfied before an order is made. 0.29, r.11 reads as follows :-

the Court may, if it thinks fit and subject to paragraph (2), order the respondent to make an interim payment of such amount as it thinks just, not exceeding a reasonable proportion of the damages which in the opinion of the Court are likely to be recovered by the plaintiff after taking into account any relevant contributory negligence and any set-off, cross-claim or counterclaim on which the respondent may be entitled to rely.

          (2)    No order shall be made under paragraph (1) in an action for personal injuries if it appears to the Court that the defendant is not a person falling within one of the following categories, namely -

 

(a)      a person who is insured in respect of the plaintiff's claim;:

 

(b)     a public authority; or

 

11. Mr McCoy drew my attention to Brian Breeze and Others v. R McKennon & Son Ltd. and others [1985]32 BLR 41 where it was held that in order for an applicaton for an interim payment to succeed, the court must be sure that the plaintiff will, at the trial, recover damages from the defendant. In' his judgment at pp.49 and 50, Croom-Johnson L.J., had this to say :-

"What the court must be satisfied of under rule 11(1)(c) is that the plaintiff will recover substantial damages from the respondent against whom the order is made, and the damages 'likely to be recovered' means recovered from that respondent and not from somebody else. The onus of proof to 'satisfy' the court on liability under 11(1)(c) is high. It is equivalent to being sure that the plaintiffs will recover. A mere prima facie case is not enough....

 

The court cannot be 'satisfied' under rule 11(1)(c) without evidence. This should be provided by the affidavit under rule 10(3)(a) setting out the grounds of the application. The grounds of the application cover both the need for the plaintiff to have the money and also the reason why the respondent to the application is the proper person to provide it."

The application against each of the two defendants must therefore be treated separately, whilst I respectfully adopt the approach in England that the standard of proof is a high one on the balance of probabilities.

12. Another authority that was cited Shanning International Ltd v. George Wimpey International Ltd [1988] 3 All E.R. 475 held that when an application is made for an interim payment, the court is required to approach the matter in two stages, first, by deciding that if the action went to trial, the plaintiff would obtain judgment for a substantial sum and, second, to determine whether in the exercise of its discretion, an order should be made, and if so, for what amount. At both stages the court is required to take into account the likelihood of a set-off or other defence succeeding at the trial.

13. Mr McCoy criticised the manner in which the evidence has been presented on behalf of the plaintiff through the plaintiff's solicitor. It is clear that an affidavit can be made by a solicitor to support a claim for an interim payment but unless there are good reasons put forward such as the physical incapacity of the plaintiff or his absence abroad, then it is undesirable that a solicitor should give this evidence. In the circumstances of the present case, there appears to be no reason why the plaintiff himself should not have sworn an affidavit or affirmation as he is present in Hong Kong and is gainfully employed.

14. For the purposes of this application, Mr McCoy concedes that liability against the 1st defendant will be established at the trial but that in deciding whether an interim payment should be made, I should take into account the issue of contributory negligence. Indeed, it is abundantly clear from the evidence, particularly the conviction of the 1st defendant for careless driving, that liability is likely to be established on the balance of probabilities and that having regard to the injuries suffered by the plaintiff, substantial damages will be awarded. However. Mr McCoy argued that there is no evidence to support the claim against the 2nd defendant for it has not been established that the 1st. defendant was driving the taxi as his servant or agent. Mr Waley responded to this argument by citing Rambarran v. Gurrucharran [1970] 1 WLR 556 where it was held that where the facts show that at the time of an accident, the car was owned but not driven by the owner. it can be said that that person's ownership affords some evidence that it was being driven by his servant or agent, but that it must be decided on the totality of the evidence after the full facts have been heard. Whilst there is prima facie evidence that the 1st defendant was driving as the servant or agent of the 2nd defendant, nevertheless, the high standard of proof on the balance of probabilites has not been established. Accordingly I agree with Mr McCoy's submission that the application against the 2nd defendant must be refused.

15. The object of an application for an interim payment is to alleviate hardship or prejudice to the plaintiff during the period from the institution of proceedings up to the date oftrial, see Ricci Burns Ltd v. Toole and another [1989]3 All E.R. 478 at 485 f. However in my judgment, an interim award should normally be considered when the trial is unlikely to take place for a long period of time. In this case the pleadings were closed on the 7th February 1990. Although the summons for the interim payment was issued on the 22nd January. 1990, the hearing was not fixed until the 13th February when it was adjourned for argument until the 2nd May. The issues in the action are not complex and I consider that a hearing of between two or three days should suffice so that the action is fit for trial in the running list. A likely hearing date would therefore be within about two months. It is quite clear that had the plaintiff proceeded to set the action down for trial after the close of pleadings, in all probability, judgment would now have been given. The plaintiff would therefore have been better advised to proceed with the action to bring it to finality instead of embarking upon an application for an interim payment. 'This application has merely delayed the hearing with an unnecessary increase in costs.

16. The amount of $100,000 that was awarded by the master took into account the sum of $50,000 by way of the loan that the plaintiff had received from his brother-in-law. However, Mr Waley conceded that there was no evidence to support this part of the award although he contended that the total amount awarded was not unreasonable. There was in fact no documentary evidence to support the claim for the loan nor was any evidence provided by the plaintiff's brother-in-law. In any event, the master should not have taken this sum into account in the absence of satisfactory evidence when exercising his discretion. The evidence from the plaintiff's employer with regard to the claim for loss of earnings was also unsatisfactory and did not comply with the rules.

17. No evidence of hardship was in fact provided by the plaintiff nor was any need put forward as to why an interim payment should be made. Accordingly, although the plaintiff, on the balance of probabilities, is likely to succeed in obtaining judgment against the 1st defendant on the grounds of his negligent driving and that he will be awarded substantial damages, I do not consider. for the reasons that I have set out, that an award should have been made in this case. If I had considered otherwise, the issue of contributory negligence would have to be taken into account, but having regard to the evidence any contributory negligence that is found is not likely to be high.

18. As a result the appeal is allowed and the order for interim payment is set aside. Costs will be to the defendants.