WING MING GARMENT FACTORY LTD v. THE INCORPORATED OWNERS OF WING MING INDUSTRIAL CENTRE

HCCT 60/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTRUCTION AND ARBITRATION PROCEEDINGS

NO. 60 OF 2006

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D E C I S I O N

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1.  There are two summonses. The first one was issued by the defendant on 16 November 2010. It seeks an order to debar the plaintiff from filing its amended reply and defence to counterclaim, or alternatively, an unless order for its filing, an order to debar the plaintiff from filing expert evidence in reply to the defendant’s expert report by Mr Howes dated 24 December 2009, and for directions of further conduct of the action.

2.  The second summons was issued by the plaintiff on 27 January 2011.  It seeks leave to file the amended reply and defence to counterclaim as annexed thereto, leave to file the expert report of Mr Cook dated 11 June 2010 within three days in reply to the Howes report of the defendant, and for directions for further conduct of the action.

Background

3.  The plaintiff was the developer and currently the owner of some parts of Wing Ming Industrial Building in Kowloon.  The defendant is the Incorporated Owners of the building.

4.  This action was commenced by the plaintiff on 18 August 2006.  It alleges breaches of the Deed of Mutual Covenant and the Building Management Ordinance; Cap. 344 by the defendant since 1994/1995.  The problems allegedly resulted from the defendant’s breaches are water seepage problems and modification of the male and female toilets on the ground floor.

5.  The defendant filed a defence and counterclaim on 29 September 2006.  The counterclaim alleges wrongful conversion of some common areas and facilities in the building.

6.  The plaintiff filed a reply and defence to counterclaim on 27 October 2006.  The defendant amended the defence and counterclaim on 15 January 2008.

7.  At a directions hearing on 26 June 2008, the plaintiff asked for leave to adduce expert evidence on building/engineering and valuation issues.  Reyes J only granted leave in respect of valuation evidence.  All valuation reports were filed in early October 2008. 

8.  Leave was given on 30 October for the action to be set down for trial.  Trial dates were then fixed on 27 July 2009 with five days reserved and a PTR was fixed on 23 June.

9.  On 8 May 2009, the plaintiff issued two summonses.  One was for leave to adduce an expert report by Messrs Gilbert Wu and Simon Cheung on building/engineering matters and the other was for leave to substantially amend the statement of claim to incorporate the matters contained in this report. 

10.  These summonses were heard before Burrell J at a 9.30 am hearing on 10 June 2009.  The learned judge said in his directions that the hearing was listed for 15 minutes.  Before the hearing, some 30 pages of submissions together with 17 authorities, two recent affirmations, a 42 page draft amended statement of claim and the expert report by Wu and Cheung were provided to the court.  In the end, the hearing took one hour and that only allowed the parties to make a somewhat superficial airing of the issues.

11.  The learned judge in the time available was persuaded that the proposed amendments and additional expert evidence would assist the trial judge to dispose of the proceedings fairly and may save some costs and time.  The learned judge was of the view that the issues were more likely to be shortened and crystallised than if the amendments were refused. The learned judge also regarded that it was reasonable to expect both parties to be ready for the allotted trial dates.  The summonses were therefore allowed.

12.  However, the parties failed to get themselves ready for the allotted trial dates.  The trial dates and the PTR were vacated by consent on 22 June.  The time for the defendant to file the re-amended defence and counterclaim and its expert report on building/engineering matters were extended to 31 July 2009.  The joint inspection by Mr Cheung for the plaintiff and Mr Howes for the defendant took place on 15 July 2009. 

13.  On 25 January 2010, Saunders J granted leave by consent for the defendant to file the re-amended defence and counterclaim and Mr Howes’ report within seven days, and for the plaintiff to file its amended reply and defence to counterclaim within 60 days.

14.  The defendant filed the re-amended defence and counterclaim and the Howes report within the time limit.

15.  The parties then took part in mediation in late April but the matter was not resolved.

16.  The plaintiff’s solicitors wrote on 28 May that the plaintiff’s building/engineering report in reply would be ready by 11 June and the amended reply and defence to counterclaim could be filed on or before 2 July.  The defendant’s solicitors replied on 7 June and pointed out that there was no leave from the court for any building/engineering report in reply.  On 11 June, the plaintiff’s solicitors served on the defendant’s solicitors a reply report, not by Wu and Cheung but by Mr Cook, on the ground that Wu and Cheung were not available to give evidence in these proceedings because of their other engagements.  The plaintiff’s solicitors also proposed to file the amended reply and defence to counterclaim on 16 July.

17.  The defendant’s solicitors replied on 28 June that the plaintiff had not given good reason for change of expert. Furthermore, if the Cook report should be allowed, the plaintiff will be able to make use of the reports by more than one building/engineering expert.  The defendant’s solicitors also criticised the plaintiff for shopping for expert.

18.  Despite the plaintiff’s solicitors’ proposal to file the amended reply and defence to counterclaim on 16 July, it was not filed long after that date. 

The defendant’s summons

19.  The defendant’s summons was then issued on 16 November with a view to debar the filing or to have an Unless Order for the filing of the amendments to this pleading.

20.  The plaintiff’s solicitors then delivered the amended reply and defence to counterclaim on 14 December.  They also indicated that they would only call Mr Cook to give evidence whilst the Wu and Cheung report could be referred to by either party, as the law may permit. 

The plaintiff’s summons

21.  The plaintiff’s summons was then issued on 27 January 2011 with a supporting affirmation seeking to adduce the Cook report.

22.  A letter dated 26 January 2011 by Cheung on behalf of Wu and Cheung was also exhibited in the affirmation in support of the change of expert.  The letter says that since Wu and Cheung had prepared their report, they had been busily engaged for various other engineering assignments.  They therefore could not afford any further involvement in this action as the plaintiff’s experts.  Save this general assertion of unavailability, there is no further explanation on why Wu and Cheung cannot continue with their duty as expert witnesses to assist the court.

The experts’ declarations

23.  At this juncture I would refer to the declarations of Wu and Cheung as appended to the end of their report.  They declared, among other things:

“8.1 We understand that our primary duty in this report is to provide evidence to the court based on our independent professional opinion.

…

8.6 We also understand that:

(a) our report, subject to any corrections before swearing as to its correctness, will form the evidence to be given under oath or affirmation; and

(b)     we may be cross-examined on our report.”

The plaintiff’s submissions

24.  Mr Liu, counsel for the plaintiff, submitted that the change of expert will produce no prejudice to the defendant save as to costs.  He also indicated that the plaintiff will not call Messrs Wu and Cheung or make use of their report despite the amendments in the statement of claim were based on that report.

25.  He further submitted that it is a case management decision on whether to allow the change of expert.  The primary aim of case management is to secure a just resolution of the dispute in accordance with the substantive rights of the parties (Order 1A rule 2(2) of the RHC.

26.  He also pointed out that the Howes report referred to an alleged excavation room and alleged unauthorised excavation work by the plaintiff in the basement of the building as the cause of water seepage in the basement.  These new matters had not been addressed to in the Wu and Cheung report but have been dealt with extensively by the Cook report.  He therefore submitted that it is necessary for the plaintiff to call Mr Cook. But I note that there is no suggestion that Wu and Cheung do not have the expertise to deal with these new matters.

27.  Mr Liu further referred to Chinachem Charitable Foundation Limited v Chan Chun Chuen and Another, HCAP8/2007 (15 May 2009 at para 26), where Lam J said:

“… If the court is satisfied, after reading all these materials, that there are relevant matters canvassed by the substitute expert which may be important to the just resolution of the dispute that had apparently been omitted from the reports of the other experts, that would present a prima facie case for the admission of the substitute expert report in the interest of just resolution of dispute. Even so, the court must also have regard to other relevant circumstances like the potential disruption to the trial, the prejudice to the other parties, the explanation offered by the applicant for change of expert etc.”

28.  Mr Liu also denied expert shopping by the plaintiff.  He also submitted that the trial dates have not been fixed and the change of expert will produce no effect on any milestone date.  However, he said if I should refuse the change of expert, more time and expense will be incurred for Wu and Cheung to prepare a reply report.  There will then be delay and extra costs which are contrary to the objectives of the CJR.

29.  On these submissions, it seems to me that the only right thing for me to do is to permit the change of expert, but there is up to now not a word of explanation on why there was no application for change of expert before Mr Cook was asked to prepare his report. 

30.  Mr Cook and his staff made the first inspection of the building on 22 March 2010, which was before the mediation in late April.  There was thus ample time for the plaintiff to apply for change of expert before the Cook report was made.  But the plaintiff did not apply then. It chose to wait when the Cook report was ready and then presented it to the court as a fait accompli. 

31.  The court is also told that it is in line with the objectives of the CJR to allow the change of expert after the expert had been engaged and a report has been made.

The defendant’s submissions

32.  The defendant opposes the change of expert.  Mr Yue, counsel for the defendant, referred me to Law Chung Fai v Lam Ming Kuen HCPI 96/2008 (13 Sep. 2010), where Bharwaney J summarised the principles for determining an application to change expert witness.  The learned judge emphasised that the discretion to allow a change must be exercised in the light of the underlying objectives of the CJR.  I do echo these principles.

Decision

33.  However, when a party presents a report by a new expert to the court as a fait accompli on the very flimsy ground that the original expert is too busy to continue with the case and the party offers no explanation on why an application for change could not have been made before the new expert is asked to prepare the new report, then the court would be very slow to grant the application, otherwise the court’s discretion to allow a change of expert would be usurped by the party seeking the change.  That should not be allowed.

34.  I also echo the view of Deputy Judge Carlson in Winford (Hong Kong) Ltd v Ricacorp Properties Ltd, HCA2481/2008 at paras.5-9 that, “no prejudice to the other side which cannot be compensated by costs” is not a sufficient argument for the party seeking leave.

35.  I also do not accept that Wu and Cheung are so busy that they are unavailable for this case anymore.  This is particularly so when trial dates have not yet been fixed. 

36.  In the premises, I dismiss the plaintiff’s application for change of expert.  I do not allow the Cook report to be adduced in evidence at the trial or for Mr Cook to be called.

37.  Since Mr Liu has indicated that regardless of my decision on change of expert, the plaintiff has the need to put in an expert report in reply on the building/engineering matters, I will therefore give time for Wu and Cheung to prepare such a report. 

38.  On the two summonses, I order that:

(1)    Leave be to the plaintiff to file and serve the amended reply and defence to counterclaim in terms of the draft as annexed to the plaintiff’s summons within three days from today. 

(2)    Leave be to the plaintiff to file and serve an expert report by Wu and Cheung in reply to the Howes report of the defendant within three months from today. 

(3)    Leave be to the parties to exchange supplemental witness statements within 28 days from today. 

(4)    No further witness statement be filed and served save with the leave of the court. 

(5)    Within 28 days from the filing and service of the Wu and Cheung reply report as ordered above, the parties’ building/engineering experts do meet on a without prejudice basis to identify the issues which they are in agreement and the issues which they dispute. 

(6)    Within 28 days after the said without prejudice meeting the building/engineering experts do provide a joint report outlining the issues which they agree and provide their respective final reports on the issues that they dispute. 

(7)    A case management conference be fixed but not before 1 July 2011. 

(8)    I make the following costs orders nisi: 

(i)    Insofar as paragraph 1 above is concerned, save for the costs of and occasioned by the amendments to the amended reply and defence to counterclaim that are consequential upon the re-amended defence and counterclaim which have been dealt with by the order of Saunders J on 25 January 2010, the costs of and occasioned by the amendments to the amended reply and defence to counterclaim be to the defendant in any event.

(ii)   Costs of the application for change of expert and the costs of today be to the defendant in any event. 

(iii)  Costs of the other directions save ordered above be in the cause.