XCHRX Booman Automobile & Metal Ltd. and Others v. Jaw Siu-wah

DCCJ348/2001

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 348 OF 2001

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R U L I N G

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1. This is an application under Order 27 of the Rules of the District Court for judgment to be entered in favour of the plaintiffs based on an alleged admission on the pleadings. Of course this is a very salutary jurisdiction whereby the court can enter judgment where clearly a liability is admitted on the defendant's own pleadings and then of course that would entitle the plaintiff to enforce his judgment obtained in that way.

2. If there is a balance left over then that balance can be tried in the conventional way, but at least a plaintiff does not have to wait until the outcome of the trial itself before he can get his money on the admitted amount.

3. In this case the defendant, who it seems to me has been very well advised by his solicitors, has approached the matter by making a series of payments as the matter has proceeded. Initially, that is to say on 22 February last year, there was a cheque which was tendered in the sum of $47,500. That payment was unconditional but the plaintiff at that stage decided to return it, fearing that the plaintiff might then be met with a plea that this was in full and final settlement of the entire claim. But Mr Che, who appears on behalf of the defendant, has made plain that this was an unconditional offer.

4. The matter then proceeded and on 27 September last, there was an amount of $79,000 that was tendered, that being in respect of a monthly licence fee that was due from the defendant. That payment was accepted. Subsequently, the claim was amended to include the company to which all the other parties are shareholders, and the matter is now proceeding on the basis of the company, as 1st plaintiff, and then 17 other plaintiffs being the shareholders.

5. Just to complete the picture so far as payments are concerned, there has been a further payment of $14,000 in respect of the licence fee. That payment was made on 20 December and accepted.

6. Faced with those payments, which have been made under cover of letters from the defendant's solicitors, Ms Yeung, who appears on behalf the plaintiffs says that here is the clearest admission of liability and therefore she should get judgment for the entire amount. Mr Che, who appears for the defendant says that cannot be right. It is a misconceived and indeed an unnecessary way of approaching this matter.

7. Order 27 clearly has in mind a different factual situation. Here there is an acknowledgement of partial, if not very substantial, acknowledgement of liability. Payment has been made in the sum of $79,000 and a further sum of $14,000, and it is anticipated that so far as the licence fee is concerned, the defendant will continue to make payments as the licence fee becomes due. And so there is nothing for the plaintiff to execute judgment against. There remains a dispute on liability as to the balance of the claim and that dispute will need to be dealt with in the conventional way at the trial. Or alternatively, if the parties agree, the dispute can be referred to the Small Claims Tribunal, and litigated there more cheaply.

8. I take the view that Mr Che is right in his approach to this matter. It is pointless entering judgment on the basis of these admissions. There have been admissions, that is clearly so, and in respect of those admissions payment has been made so there is nothing to execute judgment on.

9. And so for these reasons I decline to make the order asked for by Ms Yeung and so that part of her summons will stand dismissed.

(Discussion re further matters)

10. This now leaves over the question as to whether I should award the plaintiffs interest on the payments that have already been made by the defendant, and also whether I should exercise my discretion to award them costs, although of course there is no judgment in existence and the action continues.

11. I can see the force of Ms Young's submission in the sense that what she is saying is that the Plaintiffs have had to issue these proceedings. It is only after they issued the proceedings that the defendant has been brought to heel, as it were, and that these proceedings have in fact forced him into making admissions and indeed to make payments which have been accepted.

12. As against that Mr Che says that it simply would not be right to do that at this stage where there is still the balance of the claim which is very much contested and is very much alive and must, in due course, be tried in this court as part of this action, unless of course the parties come to some sort of agreement about it or decide to litigate the rest of it more cheaply in the Small Claims Tribunal.

13. I take the view that as a matter of discretion, I ought not to start awarding interest where in fact there simply is no judgment and really the question of costs ought more conveniently to await the final outcome of this action.

14. I know this will make it more difficult for the parties to deal with the matter perhaps more modestly by deciding to litigate the balance of their differences in the Small Claims Tribunal but that does not mean that they should not at least try now to deal with the matter sensibly. There is not very much left over, and I am sure Mr Che hears what I say, that where in the ordinary course of events a payment has been made which has been the subject of litigation and it is a payment that is made after the due date. In the ordinary course of events interest will be applied by the court and it may be that as a matter of coming to some sort of global settlement of this action, he will be prepared to advise his client that there should be interest. But I am not going to award it at this stage.

(Discussion re costs)

15. The appropriate order on this summons is defendant's costs in the cause.

(Discussion re other matters)

16. Paragraphs 1 and 2 of this summons dismissed.

17. Leave to plaintiff to file reply within 21 days of date of this order.

(Discussion re making of orders)

18. As to the directions, I am going to say costs in the cause.

19. As to the dismissal of paragraphs 1 and 2 of the summons, I should say defendant's costs in the cause because this has all been part of the argument.

20. I will make an order in terms of paragraph 3 in all its parts and then paragraph 4 I will remove completely and the new paragraph 4 will merely recite costs in the cause.