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HCA2150/2008
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
ACTION NO. 2150 OF 2008
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BETWEEN
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YEUNG PUI YING ANNA |
Plaintiff |
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and |
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DAY & CHAN |
1stDefendant |
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YEUNG KWOK LEUNG, LESLIE |
Intended 2ndDefendant |
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ALAN HUBERT DAY |
Intended 3rdDefendant |
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Before : Deputy High Court Judge Burrell in Chambers
Date of Hearing : 17 February 2010
Date of Decision: 17 February 2010
Date of Reasons for Decision: 26 February 2010
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REASONS FOR DECISION
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1. This is the plaintiff’s summons pursuant to Order 5 rule 6 to amend the writ of summons by adding the name of Yeung Kwok Leung, Leslie as the 2nd defendant. The intended 2nd defendant is a solicitor in Hong Kong and acted in person on this application. At the conclusion of the hearing I granted the application and now give these brief written reasons.
2. The background to the application can be stated shortly. In 1994 a company, Shun Kai Bullion Co. Ltd executed a legal charge to secure a $1.5 million loan. The plaintiff and her husband, Mr Wong Shun guaranteed the loan in favour of Chow Tai Fook Jewellery Co. Ltd. At the time the loan was guaranteed in 1994 D1 was the plaintiff’s firm of solicitors and D2 and D3 were partners. D3 has hitherto consented to an application to have his name added as the 3rd defendant.
3. The staff member of D1 who dealt with the plaintiff and her husband when executing the guarantee was a conveyancing clerk named Pak Kui Sing (“Mr Pak”).
4. In 1998 Chow Tai Fook commenced proceedings against the plaintiff and her husband for $1.2 million (approximately) under the guarantee arising out of default in payment on the loan.
5. Eventually, in March 2007, after a trial, the plaintiff was ordered to pay $1.53 million under the guarantee. Her husband has been declared bankrupt in 2006.
6. The plaintiff commenced these proceedings in 2008, for breach of contract and negligence. It is claimed that Mr Pak failed to exercise due care and skill when advising the plaintiff in 1994 and gave misleading advice and information. He was not legally qualified to perform the legal services which he carried out. In particular, it is claimed at paragraphs 8(vii) and (viii), that Mr Pak failed to advise the plaintiff properly or at all of the consequences of the company or of her husband becoming insolvent or bankrupt.
7. Mr Yeung opposes the application to include his name as a defendant primarily because, he submits, the action against him is time-barred by the Limitation Ordinance. He concedes, for present purposes, that he is a “necessary party” under Order 15 but submits the action should be struck out because of the limitation period.
8. There are five key dates. 1994, the date of the signing of the guarantee. 1998, the year in which Chow Tai Fook commenced proceedings against the plaintiff and Mr Wong. 2006, the date of Mr Wong’s bankruptcy. 2007, the date of the judgment against the plaintiff and 2008, the date of the commencement of these proceedings.
9. Mr Yeung submits that the plaintiff’s damage accrued from the date when she was first sued, namely in 1998. The plaintiff’s response is that the damage did not become real until the judgment was handed down in 2007 and this action is therefore within time.
10. The plaintiff would argue as follows. Between 1994 and 1998 she was wholly unaware that any tortious wrong had been committed against her. Moreover no damage had been suffered. Between 1998 and 2007 she defended the claim against her in the guarantee proceedings presumably on the basis, inter alia, that she believed in the truth and legal correctness of what Mr Pak had told her in 1994 and continued to so believe. Only in 2007 did her liability under the guarantee become real to her. Only in 2007 did her liability to pay damages to Chow Tai Fook become real and only in 2007 was she bound to accept that the advice she claims she received from Mr Pak was flawed which now forms the basis of the present claim. Put simply, the argument is that the crucial “event” is not being sued but being sued successfully.
11. The success or failure of the above argument has however, for the purposes of this application, been superceded by the 4th key event namely Mr Wong’s bankruptcy.
12. Part of the plaintiff’s claim is that Mr Pak gave no advice as to the consequences to the plaintiff of either Mr Wong or the company becoming insolvent. There can be no doubt that the damage suffered by the plaintiff by virtue of the loss of her right of contribution from her husband, they being joint and several guarantors, stems from 2006.
13. In all the circumstances the only further questions, in my judgment, which need to be addressed in this application are those contained in Order 15 rule 4. (1) Is there a common question of law and fact between the existing defendant(s) and the proposed defendant and (2) does the right to relief arise out of the same transaction? Mr Yeung concedes both these issues.
14. The application is granted with costs to the plaintiff in any event.
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(M.P. Burrell) |
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Deputy High Court Judge |
Mr John J.E. Swaine and Mr Brian M.W. Wong, instructed by Messrs Tsang, Chan & Woo, for the Plaintiff
The Intended 2nd Defendant in person, present
Appeal by the 2nd Defendant to Court of Appeal allowed. Please refer to CACV67/2010 dated 20 July 2010
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