TONG CHOI YAU v. KONG, SIN MAN (also known as SIN MAN KONG, KEN S KONG, KENNETH S KONG AND SINMAN S KONG)

HCA 1056/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1056 OF 2014

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R U L I N G

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1.  This is my ruling on the plaintiff’s application by way of an inter partes summons for (1) to have leave to serve the statement of Chan Lai-man as to fact as per the copy annexed to the summons within 3 days from the date of the order; and (2) for the plaintiff to have leave to file his second supplemental list of documents as per copy annexed; time for service of summons be abridged costs of the application be in the cause.

2.  The application is made very late in the day.  It is not made at the eleventh hour; it is made well past the twelfth hour.  The trial has already commenced.  The plaintiff is in the box being cross-examined.

3.  Since there are two aspects to the summons, I shall deal firstly with the application for leave to serve a witness statement late.  Although the wording of the application is for leave to serve a witness statement, the real objective is to have leave to call the witness who has not hitherto been the subject of any witness statement filed pursuant to directions of the court as a witness of fact in the trial.

4.  The intended witness, Miss Chan Lai-man, is a witness who apparently witnessed the signing of the alleged agreement, which is the central issue in this case.  The plaintiff says that the alleged agreement was executed by the plaintiff and the defendant.  The defendant says that he never signed such a document.  So the signature of or the execution of the document is central in this case.

5.  Miss Chan is the person who appears, on the face of the alleged agreement, and that is at the execution page of the agreement, to have witnessed the execution of the agreement and she is identified by her full name.  So the relevance of the intended witness’ evidence cannot be in doubt. 

6.  The central issue is also not in doubt, since the defence has from a very early stage put into issue the authenticity of the alleged agreement. 

7.  Paragraph 5 of the amended defence (not amended in this aspect) says that:

“Upon perusal of the agreement, the defendant found the agreement was allegedly signed by the defendant both in his own personal capacity and in his capacity as director of the company for and on behalf of the company as the so-called debtor. The defendant avers that he was never a director or shareholder and defendant further avers that he had never signed the agreement in any of the said capacities and his signature in the agreement had been forged.”

8.  So the relevance of the intended witness’ evidence cannot be doubted.

9.  Mr Poon admits the lateness of the application, but says that the plaintiff is willing to pay all reasonable costs caused by this late application.  Mr Poon says no prejudice is caused to the defendant. 

10.  Mr Poon, however, is unable to provide any explanation for the lateness of this application, why a witness who would be a central figure in the trial or should have been one of the major witnesses in such a trial is sought to be called as a witness only on the afternoon of the first day of the trial.

11.  This, despite the order as early as 12 October 2015, over two years ago, that the parties do file and exchange signed witness statements within 42 days of the date of the order and also an order on 17 March 2016  whereby the parties were directed to obtain counsel’s advice on the whole matter, including reliance on expert evidence, all interlocutory applications, including applications for amendment of pleadings, and/or leave to adduce supplemental witness statements shall be taken out within seven days of that order.  This was on 17 March 2016, a year and a half ago.

12.  Mr Poon says no prejudice is caused and no prejudice that cannot be remedied by costs and so the application should be acceded to.

13.  Mr Lo for the defendant objects, saying that his client is prejudiced by the matter being further delayed and he might wish to call evidence in response to this late witness, who is ill because of prostate cancer and may not be able to give evidence in the end.  In any event, the further delay of this matter is an element that cannot be remedied by costs.

14.  I consider that the starting position is that set out in Order 38, rule 2A, paragraph (1):

“The powers of the court shall be exercised for the purpose of disposing fairly and expeditiously of the cause or matter before it, and saving costs, having regard to all circumstances of the case, including the extent to which the facts are in dispute or have been admitted; the extent to which the issues of fact are defined by pleadings; and the extent to which information has been or is likely to be provided by further and better particulars, answers to interrogatories or otherwise.”

15.  And it says, paragraph (2):

“At the determination of a case management summons, in an action commenced by writ, the court shall direct every party to serve on the other parties, within such period as the court may specify and on such terms as the court may specify, written statements of the oral evidence which the party intends to adduce”.

16.  Commentary under this rule says that:

“The rule is designed to achieve: (1) the fair and expeditious disposal of proceedings and the savings of costs; (2) the elimination of any element of ‘surprise’ before or at the trial as to the witnesses each party intends to call at the trial or as to the substance of the evidence. The parties will no longer be able to spring or to be exposed to surprises as to the trial witnesses or their evidence, but will be required to ‘place their cards on the table’.”

17.  Although not specifically referred to by Mr Lo, paragraph 3 is also important:

“...the promotion of a fair settlement between the parties. With all or substantially all the factual evidence before them, subject to cross-examination, the parties will be able to make a more realistic appraisal of the strengths of weakness of their own and each other’s cases, which should contribute towards the fair and expeditious disposal of the proceedings by settlement or otherwise.”

18.  So, in this case, Mr Lo relies on this commentary, saying that this late witness statement would be taking them by surprise and would be against the spirit of Order 38, rule 2A.

19.  Another part of the rules which perhaps is also important is the case management timetable, which is Order 25 and specifically at Order 25, rule 1B, which at paragraph (3) says that:

“The court shall not grant an application under paragraph (2)...

Which is to vary a milestone date.

“...unless there are exceptional circumstances justifying the variation”.

And milestone dates includes the trial, and if I were to grant this application, it is inevitable that the trial would be delayed further than it already has been.

20.  Finally, what is important is the objectives under the CJR, which seems to have been overlooked by everyone. Order 1A, rule 1:

“...underlying objectives are

(a) to increase the cost-effectiveness of any practice or procedure to be followed in relation to procedings before the Court;

(b) to ensure that a case is dealt with as expeditiously as is reasonably practicable;

(c) to promote a sense of reasonable proportion and procedural economy in the conduct of proceedings;

(d) to ensure fairness between the parties;

(e) to facilitate the settlement of disputes; and

(f) ensure that the resources of the court are distributed fairly.”

21.  And, in order to further the underlying objectives, there are case management powers under Order 1B, rule 1, and in the exercise of the case management powers I can, under 2(j), “exclude an issue from consideration” or “take any step to make any other order for the purpose of managing the case and furthering the underlying objectives set out in Order 1A”.

22.  This is effectively an application for extension of time and the commentary on extension of time under Order 1B is particularly apposite and the commentary in the White Book citing Fortune Asset Development v De Monsa Investments Limited is applicable in this case, where:

“Registrar Au-Yeung...”

(As she then was).

“...held that in exercising its power under Order 1B, rule 1(2)(a), the court will take into account all the circumstances including but not limited to the following matters:

1. What was the original time allowed; when has it expired?  The more the original time allowed, the more difficult it is to justify an extension.”

In the present case, as I have identified, the original direction was for witness statements to be filed and exchanged two years ago.  There was a further order a year and a half ago, requiring the parties to to make any other applications for supplemental witness statements. That was a year and a half ago.

“2. Was the original time laid down by consent or at the suggestion of the applicant?”

The timetable is the usual timetable under a case management summons.  Nothing unusual about the timetable.

“3. Why was the original time not adhered to?”

In this case, we have no explanation for that.

“4. When was the application for extension of time taken out? The greater the delay, the more difficult it is to obtain an extension.”

In this particular case, as I have mentioned, the application was taken out on the afternoon of the first day of trial.  The delay, if anything, is particularly egregious in this case.

“5. What realistically is the further time needed? An applicant should not just casually pick a multiple of seven days without regard to its adequacy.”

There is no further time required, but the time that has already lapsed is particularly great.

“6. Was there any de facto extension of time already enjoyed by the applicant, whether by way of consent, or in waiting for his time summons to be heard?”

This is not applicable.

“7. Will the extension of time sought have impact on any hearing date or milestone date?”

As I have mentioned, if I grant the application, this would inevitably have an impact on trial and that is a milestone date.

23.  In the circumstances of the case, in view in particular of the lack of any explanation or the lack of any exceptional circumstances which can be relied on by the plaintiff to justify this very late application, I dismiss paragraph 1 of the plaintiff’s summons.

24.  That leaves paragraph 2.  The explanation for the supplemental list is that the plaintiff did not know that these documents could be obtained because the plaintiff had not previously contacted Miss Chan.

25.  Now, of course, there is again no explanation why no earlier attempt had been made to contact Miss Chan, given her importance in these proceedings.  Nevertheless, under Order 24, which governs discovery and the commentary at paragraph 24/2/16 of the White Book, there is a “continuing obligation to give discovery”, so:

“The obligation is general, requires the disclosure of all relevant documents whenever they may come into a party’s possession.

Of course:

“This requirement is supported by the linked principle that a party must not seek to take his opponent by surprise and he must not, by withholding relevant documents, mislead the court...”

26.  So, prima facie, the plaintiff should file his second supplemental list of documents. 

27.  However, a distinction should be drawn between disclosure and use of the documents.  The mere fact of disclosure does not entitle the plaintiff to use or refer to those documents which have come about at a very late stage and which could have been identified and could have been brought to the attention of all the parties very much earlier. 

28.  The effect of that, of course, is that there must be disclosure, but I will not permit the documents to be relied on by the plaintiff.  If the defendant chooses to utilise those documents, I would be more disposed to allow the defence to utilise those documents, since the defence did not know of the existence of those documents until this afternoon.

29.  So, in the circumstances, the order that I make is that paragraph 1 of the summons is dismissed; paragraph 2, order in terms; time for service of the summons be abridged.

30.  Costs be to the defendant.