WONG LOI YEUNG v. PANG YUET HO AND ANOTHER

CACV 86/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 86 OF 2014

(ON APPEAL FROM HCA 1157/2011)

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REASONS FOR JUDGMENT

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Hon Cheung CJHC (giving the reasons for judgment of the court) :

1.  At the conclusion of the hearing, we dismissed the appeal with costs to the defendants.  We now give our reasons.

2.  The action below concerned a Chinese temple, and the parties are people or company involved in the running of the temple. By a decision dated 26 March 2014, Deputy High Court Judge ST Poon struck out the amended statement of claim and dismissed the plaintiff’s action.  From that decision of the deputy judge, the plaintiff appealed.

3.  Hearing of the appeal was fixed for 16 December 2014.  The deadline for the plaintiff to lodge the appeal bundles and his written submissions expired on 2 December 2014.  It was not done.  After some chasing, the court was belatedly informed by the plaintiff’s solicitors by a letter dated 11 December 2014 that the parties had reached a global settlement in respect of their disputes concerning the temple, and the plaintiff would file a summons for the withdrawal of the appeal in due course.  The assertion of the reaching of a global settlement was, however, promptly denied by those acting for the defendants.  By a letter of the same date, the defendants’ solicitors informed the court that no settlement had been reached, and they had instructions from the defendants to proceed with the appeal on 16 December 2014 as scheduled.

4.  On the following day, the plaintiff filed a summons, returnable on 16 December 2014, asking for leave to withdraw the notice of appeal with no order as to costs pursuant to the alleged global settlement.  The supporting affirmation said that there were meetings between the parties or their representatives on 3 December 2014 and 8 December 2014 resulting in the signing of two written agreements in Chinese to settle the disputes between them, including the appeal.

5.  In two affirmations filed on their behalf on 15 December 2014, the defendants denied the reaching of any global settlement and claimed that the documents signed were no more than draft agreements with no binding effect.

6.  At the hearing of the summons for leave to withdraw the notice of appeal on 16 December 2014, Ms Eunice Yung, for the plaintiff, submitted as her primary position that the appeal should be stayed pending the plaintiff commencing a fresh action against the defendants to enforce the global settlement.  She asked for an amendment of her summons accordingly.  She contended, in essence, that this course would best preserve her client’s position.  That is, if the global settlement were found to have been made, she could get a mandatory injunction in the new action to compel the defendants to consent to the withdrawal of the appeal with no order as to costs as per the global settlement.  If no global settlement were found to have been made and neither party was bound by anything regarding this appeal, her client could proceed with the appeal.  Counsel told the court that her side was not in a position to proceed with the appeal.

7.  Mr Ronald Tang (Ms Leona Chan with him) opposed the application for a stay.  He contended that the appeal should be dismissed with costs as the plaintiff was totally unready to proceed with the appeal in any event.  He accepted that if, in the new action to be commenced the court were to find that the alleged global settlement had been reached, the plaintiff could recover from the defendants the costs of this appeal as part of his loss and damage arising from the defendants’ breach of the global settlement.

8.  We note from the evidence that the parties had started negotiating in early November 2014.  But, in our view, that was no reason for the plaintiff not to get prepared for the appeal, including the lodging of the appeal bundles and written submissions as required by the Practice Direction.  As a matter of fact, even on the plaintiff’s own case, no global settlement had been reached prior to the deadline for the lodging of the bundles and written submissions.  Even as at the date of the hearing, the plaintiff was not ready to proceed with the appeal.

9.  If the plaintiff were right and a global settlement had been reached, he would be vindicated in the new action to be commenced, and the dismissal of the appeal would not have caused him any prejudice, as the alleged global settlement provided for the withdrawal of the appeal.  As for the costs, as accepted by Mr Tang, the plaintiff could recover the same by way of damages for breach of the global settlement in the new action.  On the other hand, if the plaintiff were wrong and no global settlement had been reached, the plaintiff would only have himself to blame for the dismissal of the appeal and the award of costs against him.

10.  We take the view that it would be quite unfair to the defendants to have the appeal hanging over their heads indefinitely pending the commencement and final determination of the new action.  Judging from what has happened in the past regarding the present action, the resolution of the new action to be commenced might well take some time.

11.  The present situation is quite different from that facing Lam VP in Schindler Lifts (Hong Kong) Ltd v Nikko Services Ltd, CACV 250/2010, 29 November 2013.  There, the only dispute between the parties was whether a clause in the settlement agreement reached by them allowed one party to resume the prosecution of the appeal.  An action in the District Court had already been commenced to resolve that matter.  It was in that context that an application for a stay of the appeal pending the resolution of the District Court action was made to, and acceded to by, the Court of Appeal.  The court’s decision was an exercise of discretion based on the circumstances of that case.

12.  On the facts of the present case, the best course to take was to dismiss the appeal with costs.  That was what we did at the conclusion of the hearing.