THE INCORPORATED OWNERS OF MAY MOON HOUSE v. LAI MUN HAN ROSSETT

DCCJ1269/2005

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 1269 OF 2005

D E C I S I O N

1.  The plaintiff applies for leave to appeal my decision on 25 August 2005 setting aside the default judgment entered by the plaintiff on 21 April 2005.  I shall not repeat the background and the reasons set out in my decision on 25 August last year.  I will simply address the submissions made by the parties today.

2.  Mr Suen, counsel for the plaintiff, submitted that it is not the duty of the plaintiff to ascertain the correct address to effect service on the defendant.  He referred me to a number of authorities on the definition of “address”, “usual address” and “last known address”. 

3.  I have also been referred to the wordings of Order 10 rule 3 where service was effected by posting to the usual or last known address of the party to be served, or insertion into the letterbox for that address of the Writ of Summons; and that knowledge of the Writ is deemed on the seventh day of the posting or insertion into the letterbox address unless the contrary is shown. 

4.  The defendant’s grounds of setting aside was based on the wrong address being used as the service address for the Writ.  The defendant has, throughout her application to set aside, been consistent in showing the ‘contrary’ to the service under Order 10 Rule 2.  That is, the address used by the plaintiff for service was not her last known or usual address. 

5.  The defence case was that she had, through her frequent attendances to the owners’ meetings convened by the plaintiff, indicated repeatedly her preferred and actual residential address was the preferred address for service in previous litigation between her husband and the plaintiff.  

6.  She is well known to the members of the plaintiff both before the transfer of the property at May Moon House and after the transfer of the property from her husband to her name.  Her name should also not be foreign to the plaintiff or the plaintiff’s members because her husband had written to the plaintiff and had referred to her full name in writing, therefore, her identity had been brought to the notice of plaintiff.   Also, at general meetings of the owners of the plaintiff convened by the plaintiff, the intention of using the residential address for service had repeatedly been expressed. 

7.  It is also the defendant’s case that neither her husband or herself had ever resided at the address for service used by the plaintiff. 

8.  In my decision of 25 August 2005, I have expressed that I am satisfied the defendant has successfully shown to the contrary that the address used by the plaintiff for service was not the defendant’s usual or last known address. 

9.  Mr Suen submitted that so long as the defendant’s notice of the Writ of Summons was brought about by the plaintiff, the Order 10 requirement will be satisfied. 

10.  I cannot agree that this is a case where the test for effective service by simple service on any address that may bring the notice of the  defendant to these proceedings should suffice as good service.  I have also, in paragraph 10 of my 25 August decision, expressly stated my reason for distinguishing the circumstances in the Hong Kong Mortgage Corporation Limited v Cheng Kit Yu case with the present one. 

11.  The most important distinguishing feature in that case was that the address the Hong Kong Mortgage Corporation used for service was the address on the mortgage deed which was expressly stated in the mortgage deed to be the address for service under the mortgage.  This is not a case where the mortgage corporation or the bank suing the guarantor or the debtor for the return of the loan under the mortgage deed.  There is no such agreement between the plaintiff or similar agreement between the plaintiff and the defendant in the present case. 

12.  Neither can be it said that the plaintiff had no means of locating the defendant as in the case of Law Kwok Hung v Tse Ping Man [1999] 4 HKC 397, where the same company address was used by the two companies and the two defendant guarantors in the legal charge and their guarantees executed by the companies and the two defendants.  The plaintiff used the defendant’s address in the register kept by the defendant’s professional body after failure to effect service on the defendant’s last known address stated in the guarantee, which happened to be the company’s address. 

13.  The facts are very different here.  The defendant is well known to the incorporated owners.  The chairperson resided next door to the service address.  It is an address that the defendant had never resided in.  It is therefore inappropriate when the circumstances is that the defendant’s address for service should be easily ascertainable by the plaintiff. 

14.  The facts show clearly that the plaintiff turned a blind eye to the facts known to the incorporated owners and its members and simply effected service to an address that it knew was neither the usual address, nor the residential address, or the last known address of the defendant.  Whether it was done deliberately or recklessly is not important. 

15.  This is a matter that concerned the court’s discretion in accepting the circumstances and the background relied on by the defendant to show that she had no knowledge of the service of the Writ on her.  I have been referred to the Practice Notes of the Hong Kong Civil Procedure  2006 under Order 59(1) of Practice Note 49 at page 860:

“There are many authorities for the proposition that an appeal will not be entertained from an order which it was within the discretion of a judge to make unless it be shown that he exercised his discretion under a mistake of law or in disregard of principle or under misapprehension as to the facts or that he took into account irrelevant matters or failed to exercise his discretion or the conclusion which the judge reached in the exercise of his discretion was outside the generous ambit within which a reasonable disagreement is possible.  Many of the cases in this area are decisions refusing to interfere with a judge’s discretion in making some interlocutory order. “

16.  Clearly, the decision made on 25 August last year was one of  a decision in an interlocutory application.  In an appeal against the discretion exercised in an interlocutory application to set aside the default judgment, it is clearly a higher threshold that has to be satisfied than merely whether there is a reasonable prospect or realistic prospect of success as expressed in 0.59/1/49. 

17.  In any event, given the aforesaid authority on appeals against exercise of discretion in interlocutory matters, I do not think the plaintiff’s appeal would have any realistic prospect of success, and the plaintiff’s opposition to the defendant’s application to set aside a default judgment, I find, is without merits. 

18.  Therefore, leave is refused.  

(Discussion re costs)

19.  Costs to the defendant to be taxed if not agreed, with a certificate for counsel.