HO PING KWONG v. CORDELJA CHAN

1987, No. A1460

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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JUDGMENT

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The Action.

1. In this action, the Plaintiff seeks damages from the Defendant is respect of certain alleged defamatory statements published by her in February and March 1987. The Defendant denies that the statements were defamatory, and says that, in any event, they were published on occasions of qualified privilege. The Plaintiff replies that the Defendant was actuated by mailce.

The Background.

2. The background to the matter is that in May 1986 the Building Authority required the owners of a resideatial development of flats knows as Summit Court to carry out certain maintenance works, which I will call "the concrete works". The Authority also advised that certain other work on the pipes and drains be performed, which I will refer to as "the pipe works". The phrase "the works" used in this judgment, unless the coutext otherwise requires, refers to both lots of work.

3. At a meeting on 28 May 1986, the management committee appointed the Plaintiff "to look for a certified architect with whom he is acquainted to handle" the works. At that same meeting, the management committee agreed that "whenever there be maintenance works in the future, there be question from a number of companies with detailed itemization to be approved by the committee."

4. Although this is nowhere recorded, the Plaintiff says he was given supreme authority to handle the matters of the works, and that the requirement of approval by the committee applied only to routine maintenance work, not the works that he was given supreme authority to handle. This supreme authority, the Plaintiff says, included the powers to accept tenders and to contract, but, he says, he did not exercise this powers alone. Indeed, he says that to exercise the power would have made people unhappy and justify an accusation that he was arrogant; he would be like a tyrant, he says. Later in his evidence, when his attention was drawn to minutes of a meeting of the management committee of 17 October 1986 saying that the matters of the award of contracts should be decided by the general meeting of owners, the Plaintiff changed his tack somewhat, to say that his supreme authority was limited to engineering, not financial, matters. He did not say this earlier, he says, because he was not asked. This evidence is not satisfactory. It is contradictory for the Plaintiff to say that he had the power to award contracts, but his supreme authority did not extend to financial matter.

5. The owner agreed that both lots of work should be done, and, on 23 June 1986, authorised its management committee to make the appropriate arrangements. The Plaintiff was appointed to engage a chartered architect to handle the matter.

6. On 23 July 1986, the Plaintiff became the chairman of the management committee. On the same date, the management committee decided that the concrete works and the pipe works were to be done in conjunction.

7. The architect appointed by the Plaintiff to handle the matter was Mr Peter Tse, a friend of his of very long standing. Mr Tse did not give evidence before me. Apparently, Mr Tse was very busy, and he delegated most of the work on the ground to a Mr Eddie Cheng, who, although trained to some extent, was not a professional architect or engineer.

8. On 23 September 1986, Mr Tse invited responses to a form of tender, which provided detailed specifications for the concrete works and made provision for a nominated sub-contractor to do the pipe works for a provisional sum of $450,000. This sum of $450,000 was estimated by a Plaintiff. At that stage at any rate, in accordance with the decision of the management committee, it was envisaged that both lots of works would be done together.

9. Mr Tse invited six contractors to tender for the works. Only four of the contractors responded to the invitation, and only two of these wen positive: Spray Engineering offered to do the works for $557,600, without a required contingency allowance of $15,000, and the tender by Hoi Tong Construction Company was $581,716, including the contingency of $15,000; the difference being some $9,000. Both these prices include the provisional sum of $450,000 in respect of pipe works to be done by a nominated sub-contractor. It will be seen from these figures that, in financial term anyway, the pipe works were by far the bigger job. I have not heard any explanation for the apparently add course adopted of having the major works ride on the back of the minor works as a sub-contract. I appreciate, of course, that the concrete works were required by the Building Authority to be done, but the decision having been made that both lots of work would be done together, I do not understand why the pipe works were treated as a sub-contract and why detailed specifications for this work were not drawn up at the same time as those for the concrete works.

10. For reasons that have not been explained to me, or for no reason, the inclusion of the pipe works sub-contract in the concrete works contract was, thenceforth, ignored, and the leaders by Spray and Hoi Tong seam to have been treated as if they related only to the concrete works.

11. On 23 October 1986, there was an extraordinary general meeting of the owners to discuss the remedial work. The Defendant was present at this meeting, representing her mother, who was an owner. The Plaintiff was the chairman. The Plaintiff gave some estimates of the cost of the works. The Defendant suggested that experienced firms be invited to tenders and the tenders be gathered and disclosed to all owners in a meeting. The Defendant drew the attention of the meeting to problems which arose some years before when some other work had not been done properly. Apparently, she impressed the owners; so much so that she was appointed by them to perform some supervisory task in relation to the work.

12. There is some dispute as to the precise nature of her appointment, but, in my view, this matters little. What is clear is that, at that time, she enjoyed the confidence of the owners and they appointed her to a position is which she was entitled to know what was going on in relation to the works so that she could make some major contribution. The Plaintiff said in evidence that "more or less everyone was saying why not appoint her to become a member of the committee to look after the work". The Plaintiff agreed in evidence that, whatever quibbles there were about the exact nature of her appointment, she was entitled to be kept fully informed of all aspects of the main-tenance work. He agreed that one could say that she would have been blamed if things went wrong.

13. A few days after this meeting, the Plaintiff gave his file relating to the works to the Defendant, which she kept for about a month. This file, he says, contained all the information to date. He says, however, that he cannot recall whether he passed to the Defendant papers he received after he handed the file over to her.

14. On 7 November 1986, there was another extraordinary general meeting of the owners, which, according to the minutes, was "in relation to the submitted tender about maintenance and repair." The minutes refer entirely to "tenders" and not quotations. The names of the contractors are given and the amounts of their "tenders". The list in the minutes is as follows -

Yip Sing Plumbing: $331,650

Harwood Plumbing Work: $369,392

May Shing Repairs Work: $109,780

Law Wah Kee Plumbing: $374,900

Universe Plumbing: 415,000

Hitchens Construction Repair Work: $761,910

Hoi Tong Construction and Plumbing: $440,000

Spray Engineering (...) Repair Work: $557,600

Hoi Tong Construction Repair Work: $131,716.

15. This is all very confused and confusing. The impression created is that these "tenders" are in response to the invitation to tender, but we know that only Spray and Hoi Tong so responded. Some "tenders" seem to relate to only the pipe works ("plumbing"), some to only the concrete works ("repair or repairs work"), that of Hitchens, judging by the price, to both, lots of work, and Hoi Tong seems to have tendered for both lots of work separately, although, if the term "construction" relates to the concrete works, Hoi Tong tendered for both lots of work in one tender and separately for the concrete works in another tender. To increase the confusion, the Plaintiff, in his notes at page D71 of the documents, dated between 7 and 23 October 1986, refer to a tender by Hoi Tong of $116,716, which, presumably, omits the contingency sum of $15,000, for the concrete works, a tender by Spray of $107,600 for the concrete works, a quotation by Hitchens of $452,050, without specifying to what work this refers and another quotation by Harwood of $793,000 for the pipe works.

16. According to the evidence, the tenders opened at the meeting were sealed, and there was a degree of formality in their opening. This is surprising because the Plaintiff had knowledge of at least some of these tenders well before 7 November 1986.

17. No decision regarding these tenders is recorded in the minutes of this meeting. The evidence is that they were referred to Mr Tse, the architect.

18. Putting aside the confusion mentioned above, the position seems to be that only Spray and Hoi Tong had submitted proper tenders in response to the invitation to tender, and the Plaintiff considered these tenders only in so far as they referred to the concrete works.

19. The Plaintiff did not favour Spray Engineering for several reasons: The tender was, he thought, sloppily prepared, it omitted the contingency fee of $15,000, the firm's registration certificate had expired and, when he tried to telephone the firm a few times, no one answered. These are the explanations he gave in evidence. In his notes, at page D71 of the documents, he says only that this tender was dropped because he could not contact anyone in charge over the telephone. Accordingly, he says, he decided to accept the tender by Hoi Tong, with some changes, accepted by Hoi Tong, to the conditions of the contract. He instructed Mr Tse to offer the contract for the concrete works to Hoi Tong on 25 November 1986. This he did in spite of a recommendation by Mr Tse that Spray Engineering's tender be accepted.

20. In this decision, he says he consulted the first vice-chairman and a member of the management committee. Later in his evidence, when it was pointed out to him that in his notes at page D72 he had recorded that, on 19 December 1986, he reported to the committee that it had been decided to appoint Hoi Tong and that he had discussed "the same with every committee member respectively", he said he had probably mentioned the award of the contract to the other members of the committee when he bumped into them on the premises. This probability did not occur again to him later in his evidence when he agreed with the proposition that, although there were eighteen members of the management committee, he consulted only two of them.

21. When asked if he discussed the award of this contract with the Defendant, the Plaintiff said "probably, but I am not sure enough to say yes". Later in his evidence, he conceded that he did not consult the Defendant.

22. The "tenders" mentioned at the meeting of 7 November 1986, apart from those of Hoi Tong and Spray for the concrete works, were, in fact, obtained, not in response to any invitation to tender prepared by the architect, but by the Plaintiff himself "shopping around" or "window-shopping". After hearing the Plaintiff's evidence, I find it difficult to understand what he had in mind in undertaking this exercise. He is a professional engineer. He admitted that he knows that the proper procedure is for tender documents to be prepared by the architect, including an invitation to tender, for sealed tenders to be submitted and for these to be opened with formality. He agreed that this helps to avoid "cheating". Yet, in respect of the works which were far greater in monetary terms, he adopts this slip-shod method of seeking informal quotations.

23. Although Mr Tse was appointed in respect of both the concrete works and the pipe works in June 1986, and there was no reason why both lots of works should not have been done together, he did not prepare contract documents for the pipe works until eight months later - in February 1987. Subsequently, there were changes to the tender documents as a result of defects pointed out by the Defendant, but she was not told of these changes. The Plaintiff agreed in evidence that it was desirable that both sets of works be dealt with at the same time.

The Publication of the "Defamatory" statements.

24. On 18 February, the Defendant spoke to the Plaintiff and asked him about proper tender documents for the pipe works. The Plaintiff said they would be ready in three days.

25. On 20 February 1987, the Defendant issued what has been referred to as the first circular and which is alleged to be the first publication of defamatory matter. This circular called a meeting of the management committee on 25 February, accused the Plaintiff of making mistakes, suggested that conditions of tender be drafted by an architect rather the Plaintiff who claimed to an expert and said that the Plaintiff was single-handedly controlling the works.

26. On 24 February 1987, the Defendant prepared what has been called the second circular. This was, the Defendant says, intended for committee members, and this certainly appears to be so from its contents. On the morning of 25 February 1987, she gave about ten copies of this circular to a Mr Cheung of the Summit Court management office and asked him to hand copies to the committee members as soon as possible with a request to attend the meeting that evening.

27. The second circular pointed out what the Defendant regarded as the short-comings in the procedure adopted by the Plaintiff, suggested that the employment of the architect was only some kind of subterfuge and, generally, that the Plaintiff was a dishonest person involved in some plot to cheat the owners of Summit Court.

28. Only the Defendant and three other persons attended the meeting of 25 February 1987. The Plaintiff did not attend. He says that he did not do so because it had been called by the Defendant and he did not consider the meeting an official one. Miss Yuen has argued that, if the Defendant had wanted meetings to find out what was going on or to make a point, she could have called them herself.

29. The Defendant herself prepared minutes of this meeting. These minutes record the Defendant as accusing the Plaintiff of failing to discharge his duties and making deliberate mistakes and suggest that the Plaintiff is fraudulent, dishonest and that he acted unlawfully.

30. In the second circular, the Defendant said that if the matter could not be resolved at the meeting on 25 February 1987, she would disclose the position to the owners. On about 5 March 1987, she did so by disseminating a third circular to the owners, annexing the first and second circulars and the minutes of the meeting of 25 February 1987. This was in anticipation of a general meeting of the owners to be held on 6 March 1987. Taken together, the documents disseminated by the Defendant on this occasion alleged that the Plaintiff was incompetent, neglectful in his duties to the owners, dishonest and involved in some kind of fraudulent scheme.

31. The Defendant prepared about sixty to eighty copies of the third circular, with the annexures, wrapped them with white Kraft paper sealed with adhesive paper in two bundles. On the bundles, she wrote "Please distribute to the owners", and handed them to Mr Cheung of the management office with the request that he distribute them to the owners, but not to members of the management committee, to the chairman or vice-chairmen, or to their friends, or to tenants. She also asked Mr Cheung to ask owners to come to the meeting on 6 March 1987.

32. The Defendant says that she did not wish the committee to know of the contents of the third circular because she feared that, if they were aware in advance of what she was going to do, they would find a way of stopping her. The Plaintiff says that this attempt was unsuccessful because he received a copy of the third circular before the meeting, but his evidence as to the events at that meeting seems to indicate that he was taken by surprise: He says he was at a loss as to what to do.

33. The minutes of the meeting of 6 March 1987 tell only of the checking of "the tender submitted by 4 contractors through architect" for the pipe works, and a decision to hold another meeting on 12 March 1987 to chose a contractor. In fact, the evidence indicates that the Defendant put the Plaintiff firmly in the "hot-seat" and embarrassed him a great deal. He says she attacked his competence and integrity, although he cannot recall precisely, or indeed generally, what she said. The statement of claim alleges that she repeated the allegation that the Plaintiff was involved in a plot to get money and I find that it is probable that she did say something to this effect.

34. On about 11 March 1987, the Defendant disseminated what has been called the fourth circular to the owners. Again, she handed this to Mr Cheung, with a request similar to that accompanying the third circular. This manifested an attempt to have the Plaintiff removed from his office on the grounds of his incompetence and alleged that he was attempting to conceal evidence against himself.

35. This attempt by the Defendant was not considered on 12 March 1987, and on that day the Plaintiff issued the writ in this matter. The Defendant's proposal was discussed at another meeting of the owners on 27 March 1987. Her attempt failed. In fact, the owners removed the Defendant from her position.

The Defamatory Nature of the Statements.

36. Although the defence denies the defamatory nature of the statements made by the Defendant, Mr Whitehead did not address any argument to me suggesting that they were not so. Indeed, it would have been very difficult to argue that they were not defamatory. Without seeking to analyze the various allegations made by the Defendant - it is not necessary to do so this stage - there can be no doubt that the thrust of the message conveyed by the statements was seriously defamatory of the Plaintiff.

Qualified Privilege.

37. The Defendant pleads that the statements were published on occasions of qualified privilege. It is argued that the committee members and owners of Summit Court had a duty and interest to receive the statements made by the Defendant and she had a corresponding duty and interest to make them, and this is not seriously challenged by Miss Yuen. I accept that an occasion of qualified privilege has been established and attaches to the publications to the owners and committee members.

38. The Defendant says she was also motivated by a desire to protect her own interests, as a person responsible for the works, and I accept that this motive also falls legitimately under the cover of qualified privilege.

39. A publication to a Mrs Grace Mak, who was not a committee member or an owner, does not fall within this qualified privilege and I will deal with this separately. Such a publication does not destroy the privilege in respect of the publications to the owners and committee members. Qualified privilege arises from an occasion of privilege and attaches to a publication.

40. Publication to persons without a duty or interest may be evidence of malice, and I will consider this aspect of the relevance of the publication to Mrs Mak in that connection.

Malice: The Law.

41. The Plaintiff seeks to defeat the plea of qualified privilege on the basis that the Defendant was actuated by malice.

42. The onus of proving malice rests on the Plaintiff. He must satisfy me on a balance of probabilities that the Defendant used the occasions when she published the defamatory statements, not honestly for the purpose of the duties and interests for which the qualified privilege is extended by law, but for a sole or dominant indirect motive or improper purpose not connected with the privilege.

43. If I am satisfied that the Defendant did not believe what she said was true, or knew or believed that the defamatory statements she made about the Plaintiff were false, malice will be established, in the circumstances of this case, by inference.

44. It is not easy for the Plaintiff to establish malice;

"Judges and juries should, however, be very slow to draw the inference that the defendant was so far actuated by improper motives as to deprive him of the protection of the privilege unless they are satisfied that he did not believe that what he said or wrote was true or that he was indifferent to its truth or falsity." (Lord Diplock in Horrocks v. Lowe [1975] A.C. 135, 150.)

"... the plaintiff must show affirmatively that the defendant did not believe it to be true or was indifferent to its truth or falsity. Juries should be instructed and judges should remind themselves that this burden of affirmative proof is not one that is lightly satisfied." (Ibid. 151.)

45. What the Defendant said about the Plaintiff cannot be considered a fair and objective report to the committee and the owners of the information that she had a duty and an interest to convey. The statements may fairly be classified as coloured by "gross and unreasoning prejudice" (Lord Esher M.R. in Royal Aquarium and Summer and Winter Garden Society Ltd. v. Parkinson [1892]1 Q.B. 431, 444), but this is not sufficient to establish malice.

46. If the Defendant believed positively that what she said was true, this will negative any question of malice:

"In ordinary life it is rare indeed for people to form their beliefs by a process of logical deduction from facts ascertained by a rigorous search for all available evidence and a judicious assessment of its probative value. In greater or in less degree according to their temperaments, their training, their intelligence, they are swayed by prejudice, rely on intuition instead of reasoning, leap to conclusions on inadequate evidence and fail to recognise the cogency of material which might cast doubt on the validity of the conclusions they reach. But despite the imperfection of the mental process by which the belief is arrived at it may still be "honest," that is, a positive belief that the conclusions they have reached are true. The law demands no more." (Lord Diplock; Horrocks 150)

47. Between these two extremes - an absence of a belief in the truth, or knowledge of the falsity, of the statements and a positive belief that they were true - there is an intermediate position:

"If he publishes untrue defamatory matter recklessly, without considering or caring whether it be true or not, he is in this, as in other branches of the law, treated as if he knew it to be false. But indifference to the truth of what he published is not to be equated with carelessness, impulsiveness or irrationality in arriving at a positive belief that it is true." (Lord Diplock; ibid)

Evidence of Malice.

48. There is no direct evidence on which I could find that the Defendant was motivated by any spite or ill-will. Indeed, the Plaintiff concedes fairly that he has no reason to dispute that the Defendant primary motive for publishing the statements was to protect the owners of Summit Court. Malice in the sense of spite or ill-will is not, of course, necessary for the purpose of establishing liability.

49. Miss Yuen argues that the Defendant's conduct demonstrates a desire to injure the Plaintiff. The Defendant says this is not so; she was against the Plaintiff's conduct, not him personally. It is interesting to read what Lord Diplock says about this situation, which, I think, reflects perfectly the Defendant's position in this case:

"[Human beings] find it difficult to hate the sin but love the sinner. Qualified privilege would be illusory, and the public interest that it is meant to serve defeated, if the protection which it affords were lost merely because a person, although acting in compliance with a duty or in protection of a legitimate interest, disliked the person whom he defamed or was indignant at what he believed to be that person's conduct and welcomed the opportunity of exposing him. It is only where his desire to comply with the relevant duty or to protect the relevant interest plays no significant part in his motives for publishing what he believes to be true that "express malice" can properly be found." (Horrocks, 151.)

50. Miss Yuen argues that the publication of the first circular within the three-day period within which the Plaintiff promised proper tender documents for the pipe works shows that she was not interested in putting things right, but wanted to injure the Plaintiff. The Defendant says that, while she was initially satisfied with the Plaintiff's promise to produce proper tender documents for the pipe works within three days, when she thought about it, she realised that the Plaintiff might have had in mind preparation of these documents himself. She agrees that she did not contact the Plaintiff to clear up this point.

51. The terms of the first circular - "... I suggest the contract and conditions of tender be drafted by an architect instead of someone who claims to be an expert ... " - seem to support what the Defendant says was her attitude of mind. It may be that the Defendant's conduct was not reasonable in pre-empting the three-day period and in failing to clear up her doubt, but I am concerned with honest belief not reasonableness.

52. It is also argued on behalf of the Plaintiff that the strength of the language used by the Defendant is evidence of malice. It is clear that the Defendant could have discharged her duty by informing those with an interest of what they should know by reciting the facts in a calm, dispassionate manner, without drawing conclusions not justified by the facts. She did not do this. If she had done so, the matter published would have been true, no plea of privilege would have been necessary and any question of malice would have been irrelevant.

53. I accept that the language used here is some evidence of malice and I should weigh this in the scales in determining whether I am satisfied that the Defendant had no honest belief in the truth of what she said, or was reckless, caring not whether it was true or false.

54. The next aspect for consideration as evidence of malice is the Defendant's conduct in seeking to prevent the Plaintiff and the other committee's members knowing what she was going to tell the owners. The Defendant admits that she wished to spring things on the Plaintiff. This, she says, was so that the Plaintiff and the committee members would not be able to prepare a plan to stop her talking. Miss Yuen argues that the motive was to prevent a rational, informed debate on the matter.

55. Again, I accept that I must weigh this evidence in the process of my consideration of the Defendant's testimony with a view to determining if it is established that the Defendant had no honest belief or was reckless.

56. At the meeting of 6 March 1987, the Defendant's husband turned up and participated in the discussion. Miss Yuen argues that this is evidence of an intention to incite the owners against the Plaintiff. I do not accept this. There is no doubt that the Defendant had strong, even if unreasonable, feelings about this matter, and I see nothing unnatural or sinister in the fact that her husband should adopt her cause and seek to assist her in establishing that her concerns were justified.

57. In this connection, it is also argued by Miss Yuen that the fact that Mrs Mak received the 'bunch" of circulars is evidence that the Defendant wished people other than those with a duty and interest to receive the information to know of the Plaintiff's conduct. This, she says, is evidence of malice. To be evidence of malice - apart from evidence of a publication for which the Defendant is responsible and liable - it is necessary to find that this publication was deliberate and not merely accidental arising from carelessness. There is no evidence that any other "non-privileged" people received any of the circulars and it is clear that Mrs Mak herself received only the publication on or about 5 March 1987. If the Defendant sent this publication to Mrs Mak maliciously, there does not seem to be any good reason why the Defendant should not send to her the other publications. I do not accept that this publication to Mrs Mak was deliberate, and I find no evidence of malice here.

58. Miss Yuen argues that there is evidence that the Defendant was motivated by an improper purpose in making the statements. This improper purpose, she says, was the desire to ensure that Law Wah Kee obtained the contract for the pipe works. The Defendant admits that she favoured Law Wah Kee because she knew the firm well and was satisfied that it was a good contractor. This attitude is, of course, perfectly in order because to have a good contractor do the work was in the interests of the owners. I do not consider that there is any firm basis for suggesting that the Defendant was intent on seeing that Law Wah Kee secured the contract contrary to the interests of the owners and to achieve some personal advantage to the Defendant. There is no evidence of malice here.

59. Having considered these matters, my next task is to consider my impression of the evidence of the Defendant and to decide whether from this, and the other factors I have mentioned, it can be said that the Plaintiff has established that she had no honest belief in the truth of the statements she made, or was reckless as to whether or not they were true.

The Defendant's evidence.

60. Justification is not pleaded in this action, but I am at liberty to consider how far it can be said that the Defendant behaved reasonably in believing what she said about the Plaintiff, not because it is necessary that her belief should be reasonably held, but because the reasonableness or otherwise of what she says was her belief is relevant in a consideration of whether or not, in fact, she entertained the belief she says she had. The more unreasonable the belief, the more likely it is that the Defendant did not, in fact, hold that belief, honestly or otherwise.

61. The Defendant said in evidence that, between the time the Plaintiff handed his file of papers to her and mid February 1987, the Plaintiff did not discuss the concrete works with her. She tried several times to get in touch with Mr Tse to discuss this work with him, but, in spite of leaving messages for him to contact her, she was unsuccessful.

62. It is not clear on the evidence whether Mr Tse was ever told of the Defendant's appointment to a position of major responsibility for the works; the Plaintiff is vague about this.

63. She had a number of telephone conversations with Eddie Cheng, who was not a qualified architect and not an authorised person. The Defendant says that Mr Cheng did the best he could, but said that he would have to refer matters to Mr Tse. She asked him to ask Mr Tse to call her, but he never did. Mr Cheng's evidence is that he answered her queries and left her satisfied. In his mind, this might have been the case, but he was not the appointed architect and the extent of his knowledge of the over-all requirements of the owners is not clear.

64. The Defendant says she was not aware that the contract for the concrete work was awarded to Hoi Tong. She became aware of this only on 25 February, when she happening to see the work being carried out. She says she felt very angry about this. She had learned from the Plaintiff's file that Spray had submitted the lower tender and that Mi Tse had recommended this contractor.

65. As for the pipe works, she was aware that tenders were being submitted, but she was not aware that this was as a result of the Plaintiff "shopping around", rather than in response to proper tender documents. She became aware that no tender documents had been prepared for the pipe works during February, and she felt this was improper.

66. The Defendant was challenged on her knowledge of whether or not there were any proper tender documents for the pipe works before February 1987. It was suggested to her that she knew there were no such documents from perusing the file given to her the Plaintiff. Her evidence in this regard is not satisfactory. I set out my note of it:

Q. You knew that there were no formal tender documents for the pipe works?

A. I was not very sure at the time.

Q. You had the file for a month - ample opportunity to see what was in it?

A. What had happened before didn't matter to me. The file contained things that had happened before. On 7.11.86, we formally asked for a tender for the works because we agreed on 23.8.86 that we would ask for fresh tenders by the architect.

Q. Do you agree that in November 1986, when you had the file, you knew there were no formal tender documents for the pipe works?

A. Yes.

Q. On 7.11.86, quotations were disclosed, not tenders, to the owners?

A. Right. That evening the Plaintiff opened all documents of tender and read out the figures which were written down. That is all I know. And then it was said all documents would be delivered to the architect for his perusal.

Q. At the meeting on 7.11.86, you knew there were no formal tender documents for the pipe works?

A. I had no idea. I thought that all that was required was there already.

Q. On 7.11.86, you thought there were formal tender documents for the pipe works?

A. Yes; this was to be dealt with by the architect.

Q. I put it to you that when you had the file you could see there were only formal tender documents for the concrete works, not the pipe works?

A. Yes, indeed; at the time there were no tender documents for the pipe works, but as this was something to be done by the architect, he had to do something about it - it was his job. That is what a normal architect would do.

Q. At meeting 7.11.86, you said you did not know whether there were formal tender documents. Are you retracting that?

A. It didn't occur to me that there weren't such documents. I assumed everything was properly done, so I did not bother to find out exactly what the situation was.

Q. You accepted you knew in November 1986 there were no formal documents. Then you said you assumed there were. You have given three different answers.

A. I don't think they are inconsistent.

67. I do not know what the Defendant was trying to say here. At one moment, she seems to be saying that she knew there were no formal tender documents for the pipe works, and then, with the next breath, she says she assumed there were such documents. She could not have known, of course, from a perusal of the file, that there were no formal tender documents for the pipe works. All she would know, if she applied her mind to it, was that there were no such documents in that file. I believe that is what she was trying to convey; that she knew that the file did not contain any formal tender documents for the pipe works, but, if things were being done properly, such documents would have been in existence. What happened at the meeting of 7 November 1986, according to the minutes, seems to be consistent with there having been a formal invitation to tender for the pipe works. Perhaps not surprisingly, the Defendant was confused in her own mind as to what she knew and did not know about a tender for the pipe works. I do not think she was lying.

68. At a meeting on 18 February 1987, she asked the Plaintiff why no such tender documents had been prepared, and the Plaintiff responded that this would be done within three days.

69. The Defendant says that, until very late in the day, she did not know that the Plaintiff was an engineer.

Evidence of Dr Ng.

70. Dr Ng Tin Chu, a member of the committee, was called by the Plaintiff with the intent, presumably and inter alia, of showing that what the Defendant recorded in the minutes of the meeting of 25 February 1987 as reflection of what Dr Ng said at that meeting was false. Those minutes record that - "Chan reported to all persons the reasons for accusing a certain person for failing to discharge his duties and how it was discovered." It is then recorded that Dr Ng Tin Chu "pointed out that it would be very difficult to prevent another person (especially Chan) from following suit after taking over. He thought it would be best if power was not vested in a single person?.

71. Dr Ng gave evidence and said that what he meant was that if Chan was appointed as chairman she may create all the misunderstanding and difficulty the Plaintiff was creating.

72. The result of this evidence is to establish that what the Defendant recorded as Dr Ng's contribution was substantially accurate.

The Plaintiff's Evidence.

73. Having heard the Plaintiff give evidence, I am uneasy about him. While not finding positively that he has lied to me, I am not satisfied that he believed everything he said to me. On the other hand, although he may not have been completely conscientious in relating the facts to me, I am satisfied that he is basically an honest man, if not as well-organised and efficient is conducting the affairs of Summit Court as he might have been. I do not believe that he ever had in mind any scheme to defraud the owners of Summit Court, or that his conduct gave any reasonable grounds to suspect that this might have been the case.

74. I have already mentioned some of the imperfections in the Plaintiff's evidence.

75. The Plaintiff says that, if he had been in the position of the Defendant, his behaviour would have caused him concern to a certain extent.

76. In relation to the pipe works, he admitted in evidence that he succeeded in creating the impression that he was treating a tender by Hoi Tong more favourably than a tender by the firm recommended by the Defendant - Law Wha Kee. The Plaintiff agreed in evidence that it would have appeared that one contractor was being treated more harshly than another.

77. The Defendant said in evidence that this impression was not created in her mind because, in fact, she did not know what was going on, but this evidence by the Plaintiff is indicative of the fact that he was behaving in a way that may have a roused justifiable suspicions as to his motives in the minds of an observer, and that, at least in retrospect, he recognised this.

78. The Plaintiff agreed in evidence that it would have reasonably appeared to the Defendant that he had made mistakes in carrying out his duties.

79. Given the delay in getting the pipe works going and his dose relationship with Mr Tse, the Plaintiff agreed that it may appeared that there was deliberate delay to a layman. When asked what he meant by the reference to a layman, he said meant to someone who would not know that it was not necessary to accept the lowest tender; which, in the context, does not make much sense. He agreed that it would have appeared reasonably to the Defendant that proper procedures regarding the concrete works had not been followed. He also agreed that would have appeared to the Defendant that the tender documents relating to the pipe works were not properly drawn. He did not agree that his conduct gave cause for suspicion.

80. The Plaintiff agreed that it would have appeared to the Defendant that he had not carried his duties properly in relation to the contract for the concrete works because she did not have the knowledge of how decisions were reached in matters like that. He also agreed that, the Defendant not knowing of an amendment to the specifications in the tender relating to the pipe works, it appeared to him that the Defendant was right to say that wrong instructions were given to the architect and that there would have been undesirable consequences from this.

81. The Plaintiff was asked in cross-examination if he agreed that from the period from October to January he basically ignored the Defendant; that he did not consult her. His reply was that he did not consult her regarding the concrete works - "Whether from my carelessness or otherwise, I would say yes."

The Defendant's Reaction to Plaintiff's Conduct.

82. I have no doubt that, looking at the Plaintiff's behaviour from the point of view of someone who could not see into his mind and to whom the Plaintiff's thoughts were not communicated, his conduct of his duties would appear slip-shod and would give some cause for concern and suspicion.

83. The Defendant says that she had this concern and suspicion, and more than that: She jumped to the conclusion that the Plaintiff was up to something dishonest and she said so. The Defendant says that, if the Plaintiff had been a laymen, her suspicion might have stopped there, but, she says, "any normal competent professional man would not have committed such serious mistakes", implying that she, therefore, drew the inference that they were not, in fact, mistakes", but deliberate, dishonest acts. She also reported her suspicions and conclusions to the Independent Commission Against Corruption.

84. In the result, I find that there was some basis for the Defendant's suspicions, although far short of a sufficient basis for the Defendant's statements attributing dishonesty to the Plaintiff. I do not believe I can find that the suspicions she says she had were so unreasonable that I should, on this ground alone, find that she could not have held them.

The Defendant's Statements as to the Plaintiff's Future Intentions.

85. Some of the defamatory statements made by the Defendant were statements of what the Plaintiff, in her opinion, intended to do in the future. In regard to these statements, Miss Yuen criticised the Defendant's evidence as indicating that she did not genuinely hold the belief that the Plaintiff would do the things she said he would do. Miss Yuen pointed to parts of the Defendant's evidence in which she said that, in her estimation, there were clear indications of malice, or, at least, recklessness. I set out below some of her evidence in this regard:

    "What he had done resulted in my thinking he intended to do something involving the money the works."

    "I was concerned with what he had done and whether that would involve monetary matters."

    "I consider I was correct in forming that thinking at that time. It is a pity that up to now I cannot prove it because the work was dropped."

    "Of course I was aware of that. [The evil plot.] He planned it in such a way that there was a possibility to do things the way he wanted."

    "It's possible. [An intention to subsequently lower the conditions of the works and reduce the amount of work.] That was highly possible that such things occur, so I brought that up."

    "Q. Asking if knew at time, not what possible? A. I thought such things might happen so was my duty to stop it before it actually happened. It would be too late to do anything if it came into being. There was no need for me to find proof of that if there was suspicion. I had to do something. It had not actually happened, so how could I find proof? I thought that these things might happen so I did something to prevent this happening."

    "Q. So no proof, only saw possibility? A. I had proof to prove that what I was thinking was correct, but I have nothing to prove that he actually did that because events had not yet happened."

    "You mean direct proof but what he had been doing led me to think that way."

86. 'There is such a possibility. [Of lowering conditions and reducing work.] That's why I must stop him from doing this. Whether he did or not, is another matter; I must stop him. Prevention is better than cure."

    "Whether in future he would do it, was another matter. But we had to stop all the loop-holes at that stage."

87. "It was a great possibility."

    "When I wrote that I thought his plot was along direction of assigning work to Hoi Tong. If you ask if I guessed wrongly, there was still a possibility in future."

88. The Defendant was subjected to a long, searching and intelligent cross-examination. Miss Yuen was, in this respect, seeking evidence from the Defendant that she did not genuinely believe that the Plaintiff was dishonestly plotting. The questions were difficult to handle because they involved several elements: What had the Plaintiff done? What did the Defendant believe the Plaintiff had done? What was the Plaintiff going to do in the future? What did the Defendant believe the Plaintiff was going to do in the future? What proof did the Defendant have of what the Plaintiff was going to do in the future?

89. I do not believe that anything the Defendant said indicates that she did not believe what she said or was reckless as to the truth of her statements. To me, she was saying that she could not prove what the Plaintiff was going to do in the future because he had not then done it, but she honestly believed that he was going to do something dishonest because of what he had done in the past; conduct that she could not regard as honest mistakes because he was a qualified engineer, and a competent qualified engineer could not have been honestly so careless and slip-shod.

Assessment of the Defendant's Evidence.

90. As a witness, the Defendant fell very far short of perfection.

91. She is a formidable lady, and, whatever the rights and wrongs of the matter, I cannot help but feel considerable sympathy for the Plaintiff in his experience in having her firmly on his tail. She is obviously a woman of considerable determination and strength of character. She is persistent, even stubborn, and, I am sure, of high moral character, even if her personality is somewhat flawed by a lack of discretion and rationality. Many other adjectives descriptive of her character came to mind as I listened to her give evidence, and Mr Whitehead has used some of them in addressing me; she is irritating, even infuriating, intolerant, self-confident, over-suspicious, precipitant and impatient.

92. Several times during her evidence, I asked, even pleaded with, her to restrict her answers to the questions, not to seek to argue her case and not to seek to divine what was in Counsel's mind. " But I do not believe she was being evasive; I think she was anxious to ensure that I fully understood her case, and, perhaps, she thought she could achieve this better than Mr Whitehead.

93. I did not find the Defendant to be a pleasant personality, and, in spite of a human tendency to conclude from this aversion that she is not to be believed, I have found the conclusion that she is sincere to be irresistible.

94. I have described some of the strengths or weaknesses, as I see them, of the Defendant's personality. But another characteristic was dominant: I have no doubt that she is utterly honest. I find that she believed sincerely that there was something seriously wrong with the procedures adopted by the Plaintiff and that his conduct was open to serious suspicion. She believed, I am sure, that what she said in the various defamatory publications was true. Indeed, she made it fairly clear in her evidence that she still believes what she said was true. She is not a woman who is readily prepared to compromise on what she regards as accurate facts backed by what she accepts as cogent evidence. Even when, at times, I doubted whether the Defendant was capable of giving a simple answer to a simple question, I found I could not doubt that she was telling me was the truth as she saw it.

95. Even if I am wrong in believing in the Defendant's sincerity, there is a considerable margin of safety in the fact that, to find against the Defendant on this point, the Plaintiff would have to show affirmatively that she did not believe her statements to be true or was indifferent to their truth or falsity. He has most certainly not done that.

96. Weighing up the evidence I have heard, I conclude that the Defendant was unreasonable in concluding that the Plaintiff was involved in some plot or conspiracy and was a dishonest man. I do believe, however, that she positively and sincerely believed what she said, both it regard to these allegations, and, with more reason, the less serious allegations she made. At some stage, on the basis of inadequate evidence she concluded that the Plaintiff was promoting some fraudulent scheme, and nothing, to this day, has swayed her from this view. She was driven by "gross and unreasoning prejudice", she relied on faulty intuition instead of reasoning, she leaped to shaky conclusions on inadequate evidence and failed to recognise the validity of contrary evidence; just what Lord Diplock in Horrocks described as the process by which people form beliefs in ordinary life.

Recklessness.

97. Having found that the Defendant had a positive belief in the truth of what she said, there is no need to examine the issue of whether or not she was reckless as to the truth:

"Can a man who believes what he says on a privileged occasion to be true and which if true would not be an abuse of the occasion be held to have made his statements "recklessly whether they be true or false"? Gross and unreasoning prejudice may have led him to have uttered them recklessly whether they were true or false, but if he believes the truth of what he said, can he at the same time be said to be reckless of the truth or falsity of his statements? May be that others with more judgment and more wisdom would not have formed the same belief, but if, in fact, he believes what he says, he cannot at the same time, in my opinion, be reckless whether it is true or false. Such recklessness falls short of deliberate falsehood. But such recklessness, not minding or caring whether it be true or false, whether it arise from anger or unreasoning prejudice, or from some other cause, is not consistent with belief in the troth of the statement." (Viscount Dilhorne in Horrocks, at 145H.)

The "Non-privileged" Publication.

98. Mrs Grace Mak, who is a tenant at Summit Court, not an owner, gave evidence. Her attention was directed to the first circular. She was asked if she had seen this. She said she could not remember exactly. She remembered receiving only a "bunch" of circulars at the same time. She found them in her mail-box. They were sealed by being stapled at the corner, but one could read them without breaking them open. She read the circulars only briefly, but recalls that they referred to the Plaintiff. She took very little notice of them.

99. Of course, I accept Mrs Mak's evidence as truthful. I have already found that this publication by the Defendant was not deliberate. The question that remains is whether the Defendant is liable in respect of a publication made through want of care, and whether there was such want of care, or whatever other ground of liability may be necessary, in this case.

100. Gatley on Libel and Slander (Eighth Edition) at paragraph 235 says that a defendant will not be liable where the publication by him is neither intentional nor due to any want of care, implying that where there is want of care liability is established. I do not read the authorities quoted in that paragraph as stating that want of care is sufficient to establish liability. In my view, the liability of a defendant is founded on his publication of a defamatory statement. Clearly, he publishes a defamatory statement when he brings it to the attention of a third party. Equally clearly, that third party need not be a person to whom the publisher wishes to convey the information. Thus, if the publisher asks a messenger to deliver an oral and defamatory message to another person, the publisher publishes the message to the messenger, although be intends that other person to be the ultimate recipient.

101. In my judgment, the question is not whether or not the defamatory statement comes to the knowledge of a person by want of care of the publisher, but whether or not, by his acts, the publisher should have known, in the ordinary course of events, that the statement would, as a likelihood, come to that person's attention, although that person was not the intended eventual recipient. On the facts of this case, the question is: Did the Defendant know, by disseminating the third circular and its annexures by the method chosen by her, that it would, in the natural course of events and as a matter of probability, fall into the hands of someone who was not covered by the privilege extended by law?

102. I have already recited what the Defendant says about how she chose to distribute the third circular.

103. Mr Cheung, the messenger, did not give evidence. He has ceased his employment with the owner's incorporation.

104. The Defendant called Mr Shek Wei Chung to give evidence. He had worked for the Defendant in 1986-1987. He said he saw Mr Cheung of Summit Court in the Defendant's office in the period February-March 1987 and saw the Defendant give him bundles of documents wrapped in white paper and tied with string. He remembered the Defendant asking Mr Cheung to give the bundles of documents to the owners. On the first occasion, he said, there was a big bundle of documents, and the Defendant told Mr Cheung three or four times that he should hand the documents to the owners, not to the committee members or the tenants. Mr Cheug accepted these instructions. There was a second occasion, he said, about a month later, when the Defendant gave Mr Cheung a similar package with similar instructions. Mr Cheung again accepted the instructions and told the Defendant she could put her heart at ease. Before these two occasions, there were other times when Mr Cheung gave some letters to the Defendant and the Defendant gave some letters to Mr Cheung. On these occasions, when the Defendant gave some letters to Mr Cheung, she instructed him to give them to the committee members. Mr Cheung agreed to do this.

105. Under cross-examination, Mr Shek said he remembered the occasion when the Defendant repeated her instructions to Mr Cheung several times because she was, he said, "candid and something like a man". Repeating the instructions was contrary to her straightforward nature, so he remembered the incident. He conceded that there was no special reason why he should remember the other occasions.

106. Miss Yuen suggested that I should suspect this evidence. I do accept that Mr Shek cannot be accurate as to detail after such a lapse of time. Indeed, his evidence differs from the known facts - as to the interval between the deliveries of the restricted papers - and from that of the Defendant - she says she secured the bundles with adhesive tape, not string, but I find that there is no reason why I should not believe the substance of his evidence.

107. I have already said that it is clear that the Defendant had very strong feelings about this matter. It is probable that these strong feelings would have been communicated to Mr Shek; they occupied a very small office. In my view, it is probable that this would have made an impression on Mr Shek and helped to impress the substance of the events in his memory.

108. Mr Shek is not longer employed by the Defendant, and there is no evidence that he is obligated to her so that it is possible he would lie on her behalf.

109. I accept that the Defendant had no reason to expect that the documents she handed to Mr Cheung for delivery would fall into the wrong hands. Mr Cheung was employed by Summit Court and it was reasonable course to adopt to entrust delivery of the documents to him.

110. In the event that the correct test here is want of care, I am satisfied that my findings of fact would not establish this.

111. Accordingly, I find that the Defendant is not liable for the publication to Mrs Mak.

Result.

112. In the result, the Plaintiff's claim is dismissed.

The Justice of the Matter.

113. I can understand the Plaintiff feeling aggrieved by the outcome of this litigation. It may well be surprising to the layman that there is no liability on the person who defamed him seriously and unreasonably as in this case. Generally, the law requires reasonable behaviour and founds liability in negligence. Liability for defamatory statements on a privileged occasion is an exception. This can be attributed to the law's attempt to maintain a balance between the desirability of frank speech on privileged occasions and the need to protect people against being damaged in their reputations. Lord Diplock in Horrocks at page 149 says: "The public interest that the law should provide an effective means whereby a man can vindicate his reputation against calumny has nevertheless to be accommodated to the competing public interest in permitting men to communicate frankly and freely with one another about matters in respect of which the law recognises that they have a duty to perform or an interest to protect in doing so." One view may be that the law could do this, while requiring those communicating defamatory statements to act reasonably. But I must apply the law as I find it, although this may result, in the circumstances of this case, in an appearance, at least to the non-lawyer, of injustice.

114. It will be small comfort to the Plaintiff, but I comment nevertheless that he can be satisfied that Miss Yuen did all that could be done, competently and professionally, to establish his case.

Costs.

115. I will hear counsel on costs. For the guidance of counsel, I indicate that I believe serious consideration must be given to depriving the Defendant of her right to recover her costs in this matter. Although I have found that she is not liable for the defamatory statements made by her, I am inclined to think that her conduct was grossly unreasonable and verging on the disgraceful. The decision of the Plaintiff to launch this action to clear his name, which he has done successfully as far as the serious allegations of dishonesty are concerned, might be thought to be entirely understandable. It may be that it would be unjust to order him to pay the Defendant's costs in the circumstances of this case.