WINPO DEVELOPMENT LTD v. WONG KAR FU AND OHTERS

HCA3541/1993

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 3541 OF 1993

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JUDGMENT

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Introduction

1.  On 24 November 2010, Master S. Kwang acceded to an application by the 4^th and 5^th defendants to dismiss the plaintiff’s action against them for want of prosecution and on the ground of abuse of process of the court. 

2.  This is the plaintiff’s appeal from that order. 

Chronology of this action and factual background

3.  This action was commenced by the plaintiff on 29 April 1993 against the 1^st to 16^th defendants.  The plaintiff claims as registered owner of land known as Lots Nos. 1829A3 and 1829ARP in Demarcation District No. 121, Yuen Long, New Territories.  It claims that the 1^st to 16^th defendants wrongfully and without the consent of its predecessor in title trespassed on portions of the lots.  The plaintiff claims an order for vacant possession, an injunction to restrain the defendants from remaining on the lots and also damages for trespass. 

4.  The 4^th and 5^th defendants occupy No. 72 Tong Yan San Tsuen, Southern District, Yuen Long, New Territories, Lot No. 1829ARP in Demarcation District No. 121.  The 4^th defendant is the mother of the 5^th defendant. 

5.  On 28 May 1993, the 4^th defendant filed her Defence and Counterclaim in which she asserts, and seeks a declaration, that the plaintiff’s alleged title was extinguished in or about 1969 pursuant to s. 17 of the Limitation Ordinance, Cap. 347, by reason of her adverse possession of the land since about 1948.  On 27 May 1993, the 5^th defendant filed his Defence also asserting adverse possession (but not raising this by way of counterclaim). 

6.  On 15 June 1993, the plaintiff filed its Reply and Defence to the 4^th defendant’s Defence and Counterclaim and its Reply to the 5^th Defendant’s Defence. 

7.  Consequently, the pleadings in the action were deemed to be closed in late June 1993. 

8.  On 12 May 1994, default judgment was entered against all the defendants except the 3^rd, 4^th and 5^th defendants.  On the same date, 12 May 1994, the plaintiff took out a summons for directions which was heard by Master Beeson (as she then was) on 2 June 1994.  

9.  Subsequently, the 5^th defendant filed his List of Documents dated 18 June 1994, the plaintiff filed its List of Documents dated 23 June 1994 and the 4^th defendant filed her List of Documents dated 3 August 1994. On 20 September 1995, the plaintiff filed a Supplemental List of Documents.  On 2 October 1996, Master Jennings extended the time for the plaintiff to file witness statements of fact and gave leave to each party to adduce surveyor’s reports. 

10.  Thereafter the action went quiet.  Although the plaintiff filed Notices of Intention to Proceed on 23 January 1998 and 25 August 2005 respectively, no step was in fact taken to prosecute the action after either notice. 

11.  On 27 September 2006 and 21 November 2007, the 4^th and 5^th defendants filed Notices of Intention to Proceed.  Surprisingly, instead of applying to dismiss the action for want of prosecution at that stage, the 5^th defendant proposed to amend his Defence and, in June 2008, correspondence ensued between his solicitors and the plaintiff’s solicitors concerning a consent summons in this regard.  This eventually led to a request by the 5^th defendant for the plaintiff’s endorsement on his Amended Defence and Counterclaim on 12 January 2009. 

12.  On 12 January 2009, the 5^th defendant filed an Amended Defence and Counterclaim asserting a title by adverse possession over a larger area of land than that claimed by the plaintiff in its Statement of Claim.  In response to this, the plaintiff filed an Amended Reply and Defence and Counterclaim to the 5^th Defendant’s Counterclaim on 12 February 2009 asserting its title to that larger area of land.  Despite the filing of these pleadings, the plaintiff took no further step to prosecute the action from 12 February 2009.  

13.  On 3 February 2009, the 4^th and 5^th defendants’ solicitors, Messrs Haldanes, wrote to the plaintiff’s solicitors concerning this action and HCA2160 of 2007 (as to which action, see further below).  In that letter, Messrs Haldanes asked when the plaintiff anticipated filing a response to the 5^th defendant’s Amended Defence and Counterclaim.  They went on to state that it was their intention to apply to consolidate the two actions but wanted to have all pleadings finalised before doing so. 

14.  By summons dated 13 July 2010, the 4^th and 5^th defendants applied to dismiss the action for want of prosecution. 

15.  On 23 July 2010, the plaintiff served a Mediation Notice on the 4^th and 5^th defendants.  On 6 August 2010, the 4^th and 5^th defendants served their Mediation Response indicating their agreement to pursue mediation to attempt to resolve the dispute. 

16.  On 23 August 2010 and 6 September 2010, the plaintiff’s solicitors proposed a joint mediation of this action and HCA2160 of 2007 on the basis that common questions of law and fact arise in both actions.  On 7 September 2010, the 4^th and 5^th defendants’ solicitors wrote to say that their clients’ position was that, if the application to dismiss the action for want of prosecution were successful, it would be unnecessary to consider any mediation of the action. 

17.  According to the 5^th defendant’s evidence in support of the summons, the 4^th defendant used to live on the disputed land from around 1951 to 2005 and knew the factual details of her and the 5^th defendant’s family’s occupation of the property in question as adverse possessors.  However, she is 102 years old and is residing permanently in an old people’s home.  Her health deteriorated severely from around 2002 and she now receives constant medication to treat various ailments from which she is suffering. Her memory is very poor and she is unable to speak coherently. 

18.  For his part, the 5^th defendant is 73 years old and his evidence is that his memory of past events is much worse than before.  Also, he says he does not have personal knowledge of events prior to his becoming an adult. 

19.  It is the intention of the 5^th defendant, if the matter proceeds to trial, to call a number of witnesses.  Their names and ages are: Ng Tung (86), Tsang King Wan (77), Shan Chung Sang (63), Cheung Lin Hing (55) and Teng Hung Ping (59).

20.  On 24 November 2010, on the hearing of the 4^th and 5^th defendants’ summons, the Master  ordered that the plaintiff’s claim against the 4^th and 5^th defendants be dismissed for want of prosecution and as an abuse of the court’s process. 

HCA 2160 of 2007

21.  On 12 October 2007, a writ was issued by Mr Ng Kam Hung as plaintiff against the plaintiff in this action as defendant in HCA 2160 of 2007 (“the 2007 Action”).  Mr Ng Kam Hung is the son of the 4^th defendant in this action and the younger brother of the 5^th defendant in this action.  He is represented by the same firm of solicitors who are representing the 4^th and 5^th defendants in this action, namely Messrs Haldanes.  For the avoidance of doubt I will continue to refer to the plaintiff in this action as such, notwithstanding that it is defendant in the 2007 Action.

22.  In the 2007 Action, Mr Ng Kam Hung claims a declaration that the plaintiff is barred from bringing any action at law to recover an area of about 7,200 square metres in the Remaining Portion of Section A of Lot No. 1829 in Demarcation District No. 121 and a declaration that any title of the plaintiff to that area has been extinguished by virtue of s. 17 of the Limitation Ordinance.  That area is the same area as that in respect of which the 5^th defendant counterclaims in this action.  The plaintiff in this action, as defendant in the 2007 Action, has counterclaimed to assert its title to that area of 7,200 square metres. 

23.  On 9 May 2008, witness statements of the 5^th defendant’s intended witnesses in this action (see §19 above) were filed in the 2007 Action for Mr Ng Kam Hung. 

The relevant principles

24.  The court has inherent jurisdiction to dismiss an action for want of prosecution if there has been default in complying with the rules or excessive delay in the prosecution of the action: see Hong Kong Civil Procedure 2011, Vol. 1, at Note 25/L/1 (p. 583).  The 4^th and 5^th defendants seek to invoke this inherent jurisdiction in the present case. 

25.  Prior to the introduction of the Civil Justice Reform (“CJR”) with effect from 2 April 2009, the approach adopted in Hong Kong to applications to dismiss for want of prosecution was that laid down by the House of Lords in Birkett v James [1978] AC 297.  In that case, Lord Diplock held that the power to dismiss an action for want of prosecution should only be exercised where the court is satisfied either (1) that the default has been intentional and contumelious, e.g. disobedience to a peremptory order of the court or conduct amounting to an abuse of the process of the court, or (2) that there has been inordinate and inexcusable delay on the part of the plaintiff or his lawyers and such delay will give rise to a substantial risk that it is not possible to have a fair trial of the issues in the action or is such as is likely to cause or to have caused serious prejudice to the defendants either as between themselves and the plaintiff or between each other or between them and a third party. 

26.  A further principle laid down in Birkett v James was that a plaintiff whose action was dismissed for want of prosecution before the limitation period had expired was, save in an exceptional case, entitled to issue a fresh writ for the same cause of action and, accordingly, the power to dismiss an action for want of prosecution, other than in a case of contumelious conduct on the plaintiff’s part, should not normally be exercised within the currency of the limitation period, when it would only aggravate the prejudice to the defendant from delay and add to costs. 

27.  The relevant principles, applicable before the introduction of the CJR, were comprehensively summarised by Neill LJ in Trill v Sacher [1993] 1 WLR 1379 at pp. 1398A-1400. These were adopted and applied by the Court of Appeal in Hongkong & Shanghai Banking Corp. Ltd v Luan Tao Sheng [1998] 1 HKC 438 per Mortimer VP at pp. 443E-445I. 

28.  In Grovit v Doctor [1997] 1 WLR 640, the House of Lords held that for a plaintiff to commence and continue litigation which he had no intention to bring to a conclusion could amount to an abuse of process and that, accordingly, once the court was satisfied that the reason for delay was one which involved an abuse of process in maintaining proceedings when there was no intention of carrying the case to trial, it was entitled to dismiss the action.  In such a case, it was not strictly necessary to establish want of prosecution under either of the limbs identified by Lord Diplock in Birkett v James: see per Lord Woolf at pp. 647H-648A. 

29.  Since the introduction of the CJR in this jurisdiction, with effect from 2 April 2009, the court has a duty to further the underlying objectives of the Rules of the High Court by actively managing cases (O.1A r.4(1)) and the parties to litigation and their legal representatives have a duty to assist the court to further the underlying objectives of the rules (O.1A r.3).  The underlying objectives are set out in O.1A r.1(1) and have been described as “probably one of the most, if not the most, important aspects of CJR”: Hong Kong Civil Procedure 2011, Vol. 1, at Note 1A/0/3 (p. 38). 

30.  Relevantly, for present purposes, the underlying objectives include: (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, and (f) to ensure that the resources of the court are distributed fairly. 

31.  There can be little doubt that the introduction of the CJR has wrought changes to the court’s approach to applications to dismiss for want of prosecution.  In a Civil Justice Reform Special Release to the 2010 Edition of Hong Kong Civil Procedure, Professor Adrian Zuckerman states, at §35 (p.14):

“The crucial difference between Birkett v James and the new approach lies in the fact that procedural defaults are now assessed not just by reference to the prejudice they have caused to the possibility of holding a fair trial or to the opponent. They must also be assessed by reference to the underlying objectives, which require the court to ensure that the case is resolved expeditiously and with procedural economy.”

32.  This change of approach reflects the changes which were brought about by the Woolf Reforms in England.  As these were being introduced, Lord Woolf MR held, in Arbuthnot Latham Bank Ltd v Trafalgar Holdings [1998] 1 WLR 1426 at 1436:

“In Birkett v James [1978] A.C. 297 the consequence to other litigants and to the courts of inordinate delay was not a consideration which was in issue. From now on it is going to be a consideration of increasing significance. Litigants and their legal advisers, must therefore recognise that any delay which occurs from now on will be assessed not only from the point of view of the prejudice caused to the particular litigants whose case it is, but also in relation to the effect it can have on other litigants who are wishing to have their cases heard and the prejudice which is caused to the due administration of civil justice.”

33.  In a case such as the present, where the delay of which complaint is made occurred before as well as after the introduction of the CJR, the court must look at the matter of delay in the context in which it occurred: see Re Wing Fai Construction Co Ltd [2010] 3 HKC 593 per Rogers VP at §12.  A party is not to be blamed for not observing a rule that did not exist at the relevant time.  But where the period of delay or part of that delay has occurred since the introduction of the CJR, the court will have to take into consideration any non-observance of the new rules: see ibid. at §13. 

Discussion

(1)     Was there inordinate and inexcusable delay?

34.  The 4^th and 5^th defendants contend that the plaintiff took no step in the action since the date of its application for an order extending time for the filing of witness statements from Master Jennings on 2 October 1996 until the filing of its Amended Reply and Defence and Counterclaim to the 5^th Defendant’s Counterclaim on 12 February 2009. 

35.  There was therefore a period of delay of over 12 years from 2 October 1996 to 12 February 2009.  A short period of about seven months of the latter part of this period should, in my view, be discounted as being a period for which the 5^th defendant was at least partly to blame.  On 14 June 2008, the parties signed a consent summons for leave for the 5^th defendant to amend his Defence.  It was only on 12 January 2009 that the 5^th defendant did eventually file his Amended Defence and Counterclaim, to which the plaintiff then responded.  In any event, the period of delay involved is plainly inordinate delay, being materially longer than the time regarded by the profession and the courts as an acceptable period: see Hong Kong Civil Procedure 2011 at Note 25/L/5 (p. 586). 

36.  The plaintiff has not put forward any proper or valid reason for this period of delay.  Instead, the plaintiff has sought to suggest, in effect, that the 4^th and 5^th defendants were guilty of this period of delay thereby invoking principle (6) of Trill v Sacher (supra), namely a defendant cannot rely on a period of delay for which he has himself been responsible.  The plaintiff’s contention is that, although it was trying to find witnesses when it obtained the extension of time from Master Jennings, it transpired that it did not have any witnesses of fact.  On the other hand, the plaintiff submits that the 4^th and 5^th defendants bear the burden of proving adverse possession and therefore they must have witnesses of fact whose statements they did not serve pursuant to the order of Master Beeson. 

37.  The plaintiff suggests that the 4^th and 5^th defendants deliberately chose not to file witness statements because they were awaiting the clarification of the law of adverse possession.  In the period from 1994 to January 2006 there were, it is submitted, uncertainties in the law in this regard which were not clarified until the Court of Final Appeal’s decision in Chan Tin Shi & Ors v Li Tin Sung & Ors (2006) 9 HKCFAR 29 and then that of the Court of First Instance in Harvest Good Development Ltd v Secretary for Justice [2007] 4 HKC 1. 

38.  The plaintiff contends that the 4^th and 5^th defendants’ Notices of Intention to Proceed on 27 September 2006 and 21 November 2007, as well as the commencement of the 2007 Action on 12 October 2007, demonstrate that the various members of the Ng family, including the 4^th and 5^th defendants, chose not to proceed with this action (and to commence the 2007 Action) pending the clarification of the law but only did so after the decisions referred to in the preceding paragraph.

39.  I do not accept this deflection of the blame for the delay by the plaintiff to the 4^th and 5^th defendants.  It appears from the transcript of the Master’s decision on appeal that Mr Chan Chi Hung SC, leading counsel for the plaintiff[1], had submitted that the plaintiff itself had adopted a wait and see attitude in respect of the issues of law that were not clear.  In any event, there would have been no reason for the 4^th and 5^th defendants to stir the plaintiff into activity against them by prosecuting the 4^th defendant’s Counterclaim.  If the plaintiff did not proceed to judgment on its claim for vacant possession, the 4^th defendant would have little or no incentive to prosecute the Counterclaim and there would be no incentive at all for the 5^th defendant to take any step in the proceedings.  Any choice of the 4^th defendant not to proceed with her Counterclaim could not be said to have caused the plaintiff’s own delay in prosecuting the action. 

40.  It is clear from the Court of Appeal decision in Team Glory Development v So Luen Fai & Ors [2009] 2 HKC 297 at §10, that waiting for the outcome of the litigation in Chan Tin Shi & Ors v Li Tin Sung & Ors (2006) 9 HKCFAR 29 is not to be regarded as a good excuse for inaction.  Furthermore, this is not a case in which the plaintiff wrote to suggest to the 4^th and 5^th defendants that the parties put the proceedings in this action on hold pending the clarification of the law. 

41.  On the other hand, the combination of (1) the 5^th defendant’s application to amend his Defence and to plead his Counterclaim first intimated in June 2008, and (2) the letter dated 3 February 2009 from Messrs Haldanes for the 4^th and 5^th defendants expressing an intention to consolidate this action and the 2007 Action do, in my opinion, entitle the plaintiff to say that the 4^th and 5^th defendants waived or acquiesced in the past delay for which the plaintiff was responsible.  Principle (7) of Trill v Sacher is that a defendant cannot rely on a period of delay if at the end of the period he so conducts himself as to induce the plaintiff to incur further costs in the reasonable belief that the defendant intends to exercise his right to proceed to trial notwithstanding the plaintiff’s delay.  Based on these acts of the 4^th and 5^th defendants, the plaintiff proceeded to expend costs in preparing and filing its Amended Reply and Counterclaim to the 5^th Defendant’s Counterclaim.  

42.  In short, the period of delay prior to June 2008 was, in my opinion, inordinate and inexcusable on the part of the plaintiff but, for the reasons I have explained, was waived or acquiesced in by the 4^th and 5^th defendants. 

43.  There is a further period of delay relied upon by the 4^th and 5^th defendants, namely the period from 12 February 2009 when the plaintiff filed its Amended Reply and Defence and Counterclaim to the 5^th Defendant’s Counterclaim until 13 July 2010 when the 4^th and 5^th defendants issued their summons to dismiss for want of prosecution. 

44.  The period of delay in question, being one of 17 months, is clearly inordinate.  In addition, I do not consider there is any good excuse for the delay.  The next step for the plaintiff should have been to take out a summons for directions and to proceed to set the case down for trial. 

45.  The plaintiff’s response to this further period of delay is that the delay is excused by their waiting for the 5^th defendant to indicate whether he would file a Defence to its Counterclaim to Counterclaim.  The basis of this contention is a letter dated 12 February 2009 in respect of this action, in which Messrs Haldanes expressly reserved the right of the 5^th defendant to file a Defence to the Counterclaim to Counterclaim if necessary after taking instructions.  In addition, the plaintiff says it was justified in waiting to take a further step in the action because in the letter from Messrs Haldanes dated 3 February 2009, in which they expressed the intention to consolidate the actions, they added, “but we would like to have finalised all pleadings before we do so”. 

46.  As a fallback, the plaintiff argued that the period of delay is only seven months or so by reference to acts of Mr Ng Kam Hung in the 2007 Action, including filing his Amended Reply and Defence to Counterclaim on 20 November 2009.  The plaintiff is contending, in effect, that it was reasonable for it to assume that acts done in the 2007 Action to finalise the pleadings in that action would suspend the running of time in this action. 

47.  I do not think that either argument of the plaintiff is correct.  As to the former argument, I do not consider the plaintiff’s reliance on the letters from Messrs Haldanes of 3 and 12 February 2009 excuses the further delay from 12 February 2009 until 10 July 2010.  In my opinion, it was incumbent on the plaintiff to press on with this action immediately after it filed its Amended Reply and Counterclaim to the 5^th Defendant’s Counterclaim and not to wait for (1) confirmation from Messrs Haldanes as to whether the 5^th defendant would file a Defence to Counterclaim to Counterclaim, or (2) a possible consolidation application.  This is all the more so since, save for the first two months of this period of inactivity, the new regime under the CJR was in force. 

48.  As to the latter argument, I do not consider that the plaintiff was entitled to await any step in the 2007 Action before progressing with this action. That action is a separate action and, absent agreement with the 4^th and 5^th defendants to suspend the running of time in this action, the plaintiff was duty bound to prosecute this action independently of the 2007 Action.  Absent such agreement, the fact that an application might be made at a later date to consolidate the two actions does not, in my opinion, justify refraining from proceeding with this action.

49.  I therefore conclude that there was inordinate and inexcusable delay in the prosecution of this action in the latter period of delay relied upon by the 4^th and 5^th defendants, namely from 12 February 2009 to 13 July 2010. 

50.  The consequence of my conclusion in respect of the latter period of delay is that the former period of delay, although in my view waived or acquiesced in by the 4^th and 5^th defendants, becomes relevant again because of principle (9) of Trill v Sacher.  That principle is that once the limitation period has expired the court is entitled to take account of all the earlier periods of inexcusable delay since the issue of the writ, including “periods of delay on which at an earlier stage the defendant could not rely because he was estopped from doing so by inducing the plaintiff to incur further costs in the reasonable belief that the action was going to proceed to trial, but which have been revived by subsequent inordinate and inexcusable delay”. 

51.  Finally in respect of inordinate and inexcusable delay, it is relevant to point out that this is not a case in which the rule in Birkett v James that, save in exceptional cases, an action will not be struck out for want of prosecution before the expiry of the relevant limitation period, is engaged.  That is because the action itself raises an issue of limitation which is to be determined by reference to the original date of the action.  If the action were to be dismissed for want of prosecution, any fresh action would not give rise to the same issue of limitation. 

(2)     Fair trial not possible or serious prejudice to the 4^th and 5^th defendants?

52.  In this regard, principle (13) of Trill v Sacher is relevant, namely:

“When considering the question of prejudice and, if it is raised, the question whether there is a substantial risk that it will not be possible to have a fair trial of the issues in the action, the court will look at all the circumstances. It will look at the periods of inordinate and inexcusable delay for which the plaintiff or his advisers are responsible and will then seek to answer the questions: has this delay caused, or is it likely to cause, serious prejudice, or is there a substantial risk that because of this delay it is not possible to have a fair trial of the issues in the action? As Slade LJ stressed in Rath v C.S. Lawrence & Partners [1991] 1 WLR 399, 410: ‘a causal link must be proved between the delay and the inability to have a fair trial or other prejudice, as the case may be.’”

53.  In support of the application to dismiss, Mr Erik Shum, counsel for the 4^th and 5^th defendants, advances the submission that the respective ages of his clients mean that it is obvious there is a risk that a fair trial is no longer possible and that they have suffered serious prejudice by reason of the delay.  As already noted, the 4^th defendant was aged 102 at the time of the affirmations in support of this application and, for his part, the 5^th defendant was aged 73.  The 4^th defendant is now infirm and, so far as the evidence discloses, unlikely to be able to give meaningful evidence in support of her and her son’s case of adverse possession.  For the 5^th defendant’s part, although relatively much younger, he is also of advanced age and the clarity of his recollection of events from the twenty years prior to 1993 is likely to have faded. 

54.  Although the 4^th defendant’s health deteriorated from 2002 onwards, which was during the earlier period of delay which I have held to be excused, I do not think it right to assume that no further prejudice has been suffered by the 4^th and 5^th defendants during the later period of delay for which I have held the plaintiff to be responsible.  It seems to me that the 4^th and 5^th defendants will have suffered prejudice in the form of diminished memories, either of themselves or of the witnesses they would intend to call to support their claim of adverse possession, by reason of the passage of time. 

55.  Nor is it necessary for the defendant to adduce specific evidence as to prejudice flowing from the loss of memory of witnesses in the later, rather than earlier, period of delay.  In Roebuck v Mungovin [1994] 2 AC 224, Lord Browne-Wilkinson, with whom the other Law Lords agreed, held (at p.234D-G):

“The refinement that the defendant has to show further, post-estoppel, prejudice caused by further post-estoppel delay by the plaintiff introduces into another sector of the law of striking out one of the least satisfactory elements of the decision in Birkett v James [1978] AC 297. In the ordinary case the prejudice suffered by a defendant caused by the plaintiff’s delay is the dimming of witnesses’ memories. Where there are two periods of delay, how can it be shown that a witness has forgotten during the later, rather than the earlier, period? We were referred to an unreported decision of the Court of Appeal, Hornagold v Fairclough Building Ltd (unreported), 27 May 1993; Court of Appeal (Civil Division) Transcript No.634 of 1993, where there was a difference of opinion as to whether in such a case it was necessary to adduce specific evidence that the prejudice flowed from the loss of memory in the later period. I have no doubt that such evidence is not necessary and that a judge can infer that any substantial delay at whatever period leads to a further loss of recollection. But even so the attempt to allocate prejudice to one rather than another period of delay is artificial and unsatisfactory.”

56.  As against the prejudice of diminished memories on the part of the 4^th and 5^th defendants and their witnesses, it is necessary to consider the nature of the claims and counterclaims in this action.  The only issue in this action is the question of whether the family of the 4^th and 5^th defendants is able to establish adverse possession of 20 years of the land in question.  In its claim, the plaintiff asserts ownership over the area coloured pink in the plan attached to its Statement of Claim.  Based on the alleged adverse possession relied upon by the family of the 4^th and 5^th defendants, the 5^th defendant added his Counterclaim in January 2009 asserting a title to a larger area of land of approximately 7,200 square metres (coloured green in the plan attached to his Counterclaim).  To that counterclaim, the plaintiff has in turn counterclaimed to assert its ownership over that larger area of land.  That same claim to adverse possession to the 7,200 square metre area is also advanced by Mr Ng Kam Hung in the 2007 Action. 

57.  Therefore, come what may, even if this action were to be dismissed for want of prosecution, the very same underlying issues will still fall to be determined in the 5^th defendant’s Counterclaim, by reason of the plaintiff’s Counterclaim to Counterclaim, and in the 2007 Action, by reason of the plaintiff’s Counterclaim in that action.  The underlying issue of adverse possession for twenty years prior to 1993 will remain in issue in the 5^th defendant’s Counterclaim and in the Counterclaim to Counterclaim by reason of the operation of s. 35(1) of the Limitation Ordinance, Cap. 347, which deems a new claim made in an action to have been commenced on the same date as the original action. 

58.  Furthermore, in this regard, the possession that is relied upon by the various parties seeking to assert the adverse possession against the plaintiff, namely the 4^th and 5^th defendants in this action and Mr Ng Kam Hung in the 2007 Action, must be exclusive and singular: see Adverse Possession by Stephen Jourdan at §§7-30 & 7-31 citing Powell v McFarlane (1977) 38 P & CR 452 and JA Pye (Oxford) Ltd v Graham [2003] 1 AC 419. The consequence of this is that, although the 4^th defendant has not counterclaimed in respect of the larger area of 7,200 square metres, the basis of her adverse possession claim is the same exclusive and singular possession as that which forms the basis of the 5^th defendant’s Counterclaim. 

59.  I accept the submission of Mr Chan that the reality of the situation is that the two actions involve the same battle between two camps, namely the plaintiff in this action and various members of the Ng family.  The only issue in both actions is whether the Ng family have established adverse possession as against the plaintiff.  The 4^th and 5^th defendants in this action and Mr Ng Kam Hung are all represented by Messrs Haldanes.  Messrs Haldanes have themselves proposed consolidating the 2007 Action with this action.  The Statement of Claim in the 2007 Action and the 5^th Defendant’s Amended Defence and Counterclaim are substantially the same.  The 4^th defendant is the mother of both the 5^th defendant in this action and Mr Ng Kam Hung.  It would seem likely that the 4^th and 5^th defendants in this action will call the same witnesses as will be called by Mr Ng Kam Hung in the 2007 Action, whose witness statements have been filed. 

60.  As against the prejudice that may be inferred to have been caused by the period of inordinate and inexcusable delay on the part of the plaintiff, it is right to take into account a number of countervailing matters.  The 4^th and 5^th defendants were already aged 85 and 56 respectively at the date of the issue of the writ in this action. They cannot complain of any delay in the issue of the writ since the plaintiff as registered owner was entitled to issue its writ claiming vacant possession at any time.  Indeed, the later the plaintiff issued its writ the better, so far as those who might assert a claim to adverse possession are concerned.  The events to which the witnesses will speak are matters of broad fact rather than detailed events, such as in a personal injury action.  Their memories can be assisted by aerial photographs, survey sheets and other documents.  In addition, it appears that the 5^th defendant in this action has already made a witness statement in another case to support a claim for adverse possession by a Madam Tsang to a piece of land nearby the land which is the subject of this action: see Yu Siu Cheuk v Realray Investments Limited, unrep., HCA277 of 2007, 31.3.09, at §59. 

61.  Mr Shum relied on the case of Team Glory Development Ltd v So Luen Fai & Ors [2009] 2 HKC 297, in which the Court of Appeal dismissed an action for vacant possession by a registered owner who was guilty of inordinate and inexcusable delay in the prosecution of his claim.  However, the serious prejudice in that case involved the death of a witness and a neighbour, as well as the ageing of other neighbours.  More importantly, in that case there was no late amendment to the counterclaim to assert a claim by adverse possession to a larger piece of land than that forming the subject matter of the original action, as is the case here.  For this latter reason, in particular, I consider the present case to be distinguishable on its facts to the case of Team Glory Development Ltd v So Luen Fai & Ors. 

62.  Taking all the above matters into account, I have reached the conclusion that the inordinate and inexcusable delay for which the plaintiff is responsible does not give rise to a substantial risk that it is not possible to have a fair trial of the issues in the action.  Furthermore, given the exceptional circumstance of the existence of the 5^th Defendant’s Counterclaim and the plaintiff’s Counterclaim to Counterclaim, which means that the same underlying issue that is raised in this claim stands to be tried in any event, I consider that the prejudice caused to the 4^th and 5^th defendant’s by reason of the plaintiff’s inordinate and inexcusable delay is outweighed.  I wish to stress that this conclusion is not intended to condone the delay on the part of the plaintiff.  That delay, as I have held, was both inordinate and inexcusable.  But the court is enjoined, under the CJR, in giving effect to the underlying objectives of the rules always to recognise that the primary aim in exercising its powers is to secure the just resolution of disputes in accordance with the substantive rights of the parties: see RHC O.1A r.2(2).  In the exceptional circumstances of this case, I consider I should exercise my discretion to allow the plaintiff’s claim to survive this dismissal application. 

(3)     Abuse of process

63.  An additional head on which the Master dismissed the action, and which Mr Shum advanced in argument before me, was that the plaintiff’s conduct demonstrated that it had no intention to prosecute the action diligently, such that it was guilty of an abuse of the court’s process.  It is noteworthy, in this regard, that the 4^th and 5^th defendants’ summons to dismiss for want of prosecution did not seek the dismissal of the action as an abuse. 

64.  The relevant period of delay is that between 12 February 2009 and 13 July 2010.  Although that delay was inordinate and inexcusable, I do not consider that the conduct of the plaintiff in that relevant period of delay demonstrates a sufficient lack of intention to prosecute the action to trial so as to bring this case within the Grovit v Doctor principle.  Here, I accept that the plaintiff was waiting for the 4^th and 5^th defendants to decide whether to apply to consolidate this action with the 2007 Action.  Although I do not think that conduct excuses the delay in question, I am prepared to accept that it defeats the suggestion that the plaintiff was merely warehousing this action and had no intention to prosecute it to trial or was guilty of a wholesale disregard of the rules. 

65.  I do not therefore consider that the plaintiff’s claim falls to be dismissed as an abuse of process. 

(4)     Conclusion on application to dismiss for want of prosecution/abuse of process

66.  In my opinion, the plaintiff’s claim should therefore, exceptionally, be permitted to survive this application to dismiss for want of prosecution.  I say exceptionally since it is only because of the unusual feature of the same underlying issues being subsumed within the lately added 5^th defendant’s Counterclaim and the Counterclaim to Counterclaim that I have decided that I should exercise my discretion not to dismiss the plaintiff’s claim.  The failure of the plaintiff otherwise to bring this action, commenced in 1993, to trial by now is a matter in respect of which the court should express strong disapproval.  Putting the matter bluntly, the plaintiff’s claim has survived only by the skin of its teeth.  The court’s disapproval of the dilatory manner in which the plaintiff has prosecuted the action to date can and should, in my view, be reflected in the costs order to be made on this appeal, which I shall address below.  Active case management should follow and the parties should be in no doubt that no further delay will be tolerated. 

Disposition and costs

67.  For the reasons set out above, I allow the plaintiff’s appeal and set aside paragraphs 1 and 2 of the Master’s order dated 24 November 2010.  Instead I dismiss the 4^th and 5^th defendant’s application dated 13 July 2010 to dismiss the action for want of prosecution. 

68.  I consider that the dilatory conduct of the plaintiff should be reflected in the costs order on this appeal.  I therefore make an order nisi that the costs of this appeal and of the 4^th and 5^th defendant’s application dated 13 July 2010, including the costs reserved by the orders of Master Levy dated 19 July 2010 and Master Lo dated 4 August 2010 and the costs of the hearing before the Master on 24 November 2010, be the plaintiff’s costs in the cause.  This will ensure that the plaintiff will only recover the costs of surviving this attack if it ultimately prevails in the action.  Also, those costs will only fall to be paid if the action is now prosecuted to completion.  For the costs of the hearing before me and of that before the Master on 24 November 2010, I grant a certificate for two counsel but not, as requested by Mr Chan, for three counsel. 

69.  I direct that the 4^th and 5^th defendants’ own costs be taxed in accordance with the Legal Aid Regulations. 

70.  Finally, I do not set aside paragraph 4 of the Master’s order dated 24 November 2010 but vary it to direct the parties to attend before the listing clerk within 14 days of today’s date to fix a Case Management Summons in this action and in the 2007 Action, to be heard at the same time.  This is to ensure the parties in this action and the 2007 Action now proceed to comply with their duty to ensure these cases are dealt with as expeditiously as is reasonably practicable and to ensure the court will be able to give appropriate case management directions to achieve this end.