CHEUNG SIU TAK ANTHONY v. SHUN TAK-CHINA TRAVEL SHIP MANAGEMENT LTD

HCMP 2101/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 2101 OF 2009

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BETWEEN

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J U D G M E N T

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1.  This is an application by the Plaintiff under section 41 of the High Court Ordinance and Order 24 rule 7A of the Rules of High Court for pre-action discovery against the intended Defendant for the following classes of documents :-

a. The statements of the Operator, Master and Chief Officers of jetfoil Funchal;

b. The statements of the Operator, Master and Chief Officers of Santa Maria;

c. Documents revealing the particulars of the Operators, Owners and Insurers of jetfoils Funchal and Santa Maria;

d. A sample ticket containing all the Terms and Conditions and/or Notes to Passengers at the time of the accident of the jetfoils Funchal and Santa Maria;

e. The statements or records concerning the occurrence of the accident, in particular, statements made by crew members, other passengers and any eye-witnesses;

f. The operation manual or training manual issued by the Operators to crew members;

g. Photographs of the damaged jetfoils, Santa Maria and Funchal and the accident scene;

h. Any survey reports of the damaged jetfoil.

2.  Further, by summons dated 4 November 2009, the Plaintiff also applied for discovery of the employment contracts of the Master and/or Chief Officer of Santa Maria and Funchal, and I call this class i documents.

3.  The applications were opposed by the Defendant.

The Accident and pre-action Protocol

4.  On 11 January 2008, the Plaintiff was then traveling onboard a jet foil, Santa Maria. Santa Maria collided with another jet foil, Funchal. As a result of the collision, the Plaintiff suffered injuries. It is not disputed that the Defendant was the operator of both Santa Maria and Funchal. The Defendant is a potential defendant in the personal injury case to be brought by the Plaintiff.

5.  It is the case of the Plaintiff that the collision and the consequent injuries suffered by him were caused by the recklessness, negligence and breach of statutory duties and breach of the contract of carriage by Defendant, and its servant employees or agents.

6.  By letter of demand to the Defendant dated 27 October 2008, the Plaintiff’s solicitor requested the Defendant to disclose a number of documents similar to those requested herein.

7.  By then, the Defendant was represented by Messrs. Ince and Co. By letter dated 7 November 2008, Messrs. Ince and Co. did not commit to provide any of the documents. They further argued that the amount of the Plaintiff’s claim would be subject to limitation according to the Athens Convention 1974. As the Defendant had been paying for the medical expenses of the Plaintiff after the accident, Messrs. Ince and Co. put on records that their client should have paid more than they would be liable under the said Convention. It is therefore the Defendant’s case that the Plaintiff could not recover any further damages on top of the medical expenses already paid on his behalf by the Defendant.

8.  By letter dated 6 December 2008, the Plaintiff responded by claiming that the medical expenses were paid voluntarily by the Defendant and he denied having agreed for such expenses be deducted from the damages.

9.  Plaintiff sent further letters in January and June 2009 to Messrs. Ince and Co. requesting for the said documents. By a letter from Messrs. Ince and Co. dated 28 October 2009 (“the October letter”), they agreed to provide the investigation report by the Marine Department containing the consolidated statement of the Masters, Chief Officers, crewmembers and other relevant people in respect of Santa Maria and Funchal. There was no agreement to provide the statement of all these witnesses. Messrs. Ince and Co. agreed to re-confirm the names of the owners, operators and insurers. For the terms and conditions of passengers, it was confirmed that they were publicly available on the Defendant’s company website. They agreed to provide copy of the terms and conditions to the Plaintiff. They also agreed to provide photographs of the damaged jet foil and the accident scene as required.

10.  Regarding the operation manual and training manual, Messrs. Ince and Co. argued that they were irrelevant to any claim that might be brought by the passenger. And they also claimed litigation privilege on the surveyor reports of the jet foils.

11.  Notwithstanding the October letter, the documents had not been provided and as a result, the Plaintiff issued the present proceedings. After the action commenced, Messrs. Holman Fenwick Willan replaced Messrs. Ince and Co. as the solicitors for the Defendant. By letter dated 17 November 2009 (“the November letter”), Messrs. Holman Fenwick Willan objected to the application by the Plaintiff. They also referred to the investigation report by the Marine Department which the Plaintiff has obtained, together with the Register records of the two jet foils. They claimed that the Plaintiff had all the relevant information to commence the proceedings. They confirmed again that at the material time the two vessels were chartered to Far East Hydrofoil Company Limited and the Defendant was the employer of the two vessels’ officers and crewmembers.

12.  It is further stated in the November letter that the Defendant does not deny that the incident occurred in the course of carriage. According to Article 3 Rule 3 of the Athens Convention, liability was presumed on the part of the carrier, namely, the Defendant. What they are arguing was quantum, in that Article 7 limit the liability of the Defendant for personal injury claim.

The Law

13.  Before I proceed to consider the argument by the parties, I should first consider the legal basis of the Plaintiff claim. Plaintiff is basing his claim under section 41 of the High Court Ordinance which reads –

(1) On the application, in accordance with rules of court, of a person who appears to the Court of First Instance to be likely to be a party to subsequent proceedings in that Court in which a claim is likely to be made, the Court of First Instance shall, in such circumstances as may be specified in the rules, have power to order a person who appears to the Court of First Instance to be likely to be a party to the proceedings and to be likely to have or to have had in his possession, custody or power any documents which are directly relevant to an issue arising or likely to arise out of that claim-

(a) to disclose whether those documents are in his possession, custody or power; and

(b) to produce such of those documents as are in his possession, custody or power to the applicant or, on such conditions as may be specified in the order-

(i) to the applicant's legal advisers;

(ii) to the applicant's legal advisers and any medical or other professional adviser of the applicant; or

(iii) if the applicant has no legal adviser, to any medical or other professional adviser of the applicant.

(2) For the purposes of subsection (1), a document is only to be regarded as directly relevant to an issue arising or likely to arise out of a claim in the anticipated proceedings if—

(a) the document would be likely to be relied on in evidence by any party in the proceedings; or

(b) the document supports or adversely affects any party's case.

14.  I also refer to a passage by the learned Editors of the Hong Kong Civil Procedure 2010 at paragraph 24/7A/3: -

“Application for an order for the disclosure of documents before the commencement of proceedings under paragraph (1) can only be made when the following 4 conditions can be fulfilled, namely: -

(1)  that the person making the application appears to be likely to be a party to subsequent proceedings in the High Court;

(2)  that a claim in respect of person injuries to a person or in respect of a person’s death is likely to be made;

(3)  that the person against whom the order is sought appears to be likely to be a party to such proceedings; and

(4)  that such person appears to be likely to have or to have had in his possession, custody or power any relevant documents.”

15.  The learned Editors also say at paragraph 24/7A/5 that:-

“The supporting affidavit must fulfill the following requirements: -

(1)  It must specify or describe the document in respect of which the order is sought;

(2)  It must show if practicable by reference to any pleading served or intended to be served in the proceedings, that such document are relevant to issue arising or likely to arise our claim personal injuries made or likely to be made in the proceedings as the case may be;

(3)  It must show that the person against whom the order is sought is likely to have or have had such documents in his possession custody or power;

(4)  In addition in the case of an application under paragraph (1) the affidavit must also state the grounds in which it is alleged that the applicant and the person against whom the order is sought are likely to be parties to subsequent proceedings in the High Court in which the claim for personal injuries is likely to be made.

16.  Ms. Ho, Counsel for the Defendant, relied heavily on the phrase “directly relevant” in section 41(1) of the High Court Ordinance. It is her main argument that the document must be directly relevant to an issue arising or likely to arise out of the claim that this Court could order a discovery and section 41(2) provide that “a document is only to be regarded as directly relevant to issue arising or likely to arise out of claim in anticipated proceeding if (a) document will be likely to be relied on in evidence by any party in the proceedings or (b) the document support or adversely affect any party’s case. She also refers me to Order 24 rule 8 which provides that the Court would dismiss the application for discovery if it is of the view that the discovery is not necessary either for disposing fairly of the cause or matter or for saving costs.

17.  There is no disagreement on the above legal principle. And for considering the intended defence, the Defendant relied on the Athens Convention. The Plaintiff’s solicitor Mr. Lau made no submission that the Convention does not apply, and for this application, I presume it does.

The Parties’ Evidence Argument and my Ruling

18.  In support of this application, the Plaintiff filed 2 affirmations. He has not exhibited the draft Statement of Claim. In his First Affirmation, he only set out the collision. For some reasons he exhibited all his medical reports which I do not see how they are relevant to the present proceedings and they have not been referred to by Mr. Lau, or Ms. Ho. He repeated the contents of various letters sent by his solicitors to Messrs. Ince and Co. Paragraph 12 of his affirmation only states that he believes that the documents sought are relevant, existing and within the custody and control of the Defendant.

19.  The only part directly relevant to the issue in dispute is paragraph 4, which reads –

“the collision and the consequent injuries suffered by [the Plaintiff] were caused by the recklessness, negligence and breach of statutory duties and breach of the contract of carriage by Defendant, its servants employees or agents, the master and crew of Santa Maria and Funchal.”

20.  This is the only issue that I could identify from his affirmations. There could be another issue on whether he has agreed for the hospital fees be set off from his damages. But the documents sought are not related to this issue.

21.  In his 2^nd Affirmation filed on 1^st December 2009, the Plaintiff responded to the Affirmation of Patrick Yeung Pui Choi, solicitors of the Defendant whose affirmation set out the ground of opposition. These are the key evidence for and against the application and it is helpful to compare the case of the parties as set out in these 2 affirmations.

22.  On Classes a and b documents, Mr. Yeung affirmed that the Marine Department has conducted an investigation of the collision and published a report. If the Plaintiff needs to know how the collision occurred in order to frame or describe his claim of damages, the report is sufficient. Classes a and b documents are not necessary.

23.  The Plaintiff stated in his 2^nd Affirmation that the report is hearsay evidence and his counsel need the statement from the various crewmembers to prepare the Statement of Claim. He also claims that the Operators, Masters and Chief Officers may be liable to him because of their negligence. He needs to identify the possible defendants. And more important, he mentioned that he intends to uplift the limitation imposed by Article 7 of the Athens Conventions by relying on Articles 13 of the Athens Conventions. It has to show that the damages to him were caused by act or omission of the carrier done with the intent to cause such damage, or recklessly with knowledge that such damages would probably result. He needs the statement to determine whether the act or omission of the Operators Masters and Chief Officers fall with the scope of Article 13.

24.  To determining the application, the starting point must be the cause of action to be pleaded by the Plaintiff. As I read from the affirmation, the first cause of action is the negligence of the Defendant and/or its servants and agents, either from breach of common law duty or breach of contract as set out in his First Affirmation.

25.  Ms. Ho seeks to argue that this is no in dispute as liability is admitted. But the highest of this argument is liability is not disputed by the Defendant. No admission has been made for its crewmembers. They could be equally liable on negligence. I accept the argument that liability is still an open issue.

26.  The Plaintiff also seeks to uplift the limitation of the Athens Conventions. But Article 13 clearly set out that the Plaintiff may uplift the limitation by proving that the cause of action is cause by recklessness on the part of the Defendant AND with knowledge that it would cause damage to the Plaintiff. It is well establish principle of law that particular of knowledge has to be pleaded. And I have referred the parties to the case of Cheung Kai Wing v. Mok Sheung Shum trading as Mok Sum Kee and others CACV 20 of 1993. It cannot be disputed that recklessness has to be pleaded with reference to material facts relied upon.

27.  Mr. Lau submitted and which appears from the affirmation that the weather on the day of accident is very misty and there have been delay in taking off without stating that the Defendant and/or its servant are reckless in taking off at such weather.

28.  From my analyses above, what the Plaintiff is saying is that they needed the statement to see if there is any recklessness on the part of the Defendant and/or its servant and agents. He did not say how the Defendant has been reckless and more important, that the Defendant and/or its servants or agents know their act would result in damage to the Plaintiff. I have to agree with Ms. Ho that this is fishing for evidence as far as the matter relates to uplifts of the limitation.

29.  I should also say that the description of document could be very wide to cover any statement given by the crewmembers. If the Plaintiff is referring to statement other than those given to the Marine Department, the Plaintiff has not set out the basis for believing that such statements exist. I am not prepared to allow discovery on unidentified document.

30.  On the statements given to the Marine Department, I believe it is relevant to the issue of negligence claim as now suggested. Ms. Ho raised a legal argument and refers me to section 60(2) of the Shipping and Port Control Ordinance that in any proceedings such statement would not admissible against him. Section 60(2) reads –

(2) No answer given by a person in pursuance of a requirement imposed under subsection (1)(e) shall be admissible in evidence against that person or the husband or wife of that person in any proceedings.

31.  I have no sight of the statement in issue. But the Report from Marine Department is a Preliminary Inquiry carried out under section 51(1) of the Merchant Shipping Ordinance, and not under the Shipping and Port Control Ordinance. The investigator has power to collect evidence under the Merchant Shipping Ordinance. Without concrete evidence that the statements given by the crewmembers are under the Shipping and Port Control Ordinance, I am not convinced that section 60(2) applies.

32.  And in the report, the investigator refer to evidence from Masters, Chief Engineers, Chief Officers and Night Vision Officers of Santa Maria and Funchal, the Defendant, and 7 passengers on board Santa Maria and Funchal. In the circumstance, I do order the Defendant to disclose the statement given to the investigator of the said Report by the Defendant, the Master and First Officer. I shall come to the Chief Engineers and Night Vision Officers later.

33.  On Class c of the Schedule, the Plaintiff now only seeks the identity of the Insurer. Mr. Yeung stated in his affirmation that the Plaintiff could not in law have any cause of action against the Insurer.

34.  In reply, the Plaintiff did not set out any reason for asking for discovery of the names of the Insurer. He only refers to the October letter when the Defendant agrees to confirm the name of the Insurer.

35.  There is no legal basis for joining the Insurer as a party in a marine accident. I agree with Ms. Ho that the identity of the Insurer has no relevance to the issue in dispute and I dismiss this application.

36.  On Class d of the Schedule, Mr. Yeung confirm that they agree to provide copy of the Terms and Conditions of Carriage. In reply, the Plaintiff states that he has lost his ticket. It may consist of small prints apart from Terms and Conditions of Carriage. It may contain exclusion clause or passenger reminder and the original departing time.

37.  Pausing here, the Plaintiff has not stated the relevance of these other terms to his case, or that of the Defendant. The best I could understand from his affirmation is that the departing time would prove that the trip has been delayed for more than 2 hours because of thick fog. But there is no evidence as to why a sample ticket would have the departure time of his trip.

38.  I do ask the Defendant to give a set of the print out of the Terms and Conditions of Carriage. The application for a sample ticket is refused.

39.  On Class e of the Schedule, Mr.Yeung affirmed that the Defendant does not have such statement except for Master, Chief Officer, Chief Engineer, and Night Vision Officer. It is submitted that they are not necessary or relevant. And that they may be disclosed after close of pleading when the issue in dispute can be properly identified.

40.  The Plaintiff required the Defendant to affirm to the above statement by an officer of the Defendant. And for the statement of the Chief Engineer and Night Vision Officer, he repeat the argument on Class a & b and said he need these statement.

41.  I can understand that in a collision case, the evidence of the Operator Master and Chief Officer would be directly relevant. I have ordered their statement to the Marine Department be disclosed.

42.  But what is the relevance of the evidence from the Chief Engineer and Night Vision Officer. I suspect the main argument of the Plaintiff is to uplift the limitation. Given that the issue is inadequately pleaded, I would exercise my discretion under O.24 rule 8 to dismiss this application on the ground that it would not be necessary.

43.  The burden rest on the Plaintiff to prove that the Defendant has the statement from the other passenger. The Plaintiff has nothing to suggest that the Defendant has these statement. The denial of Mr. Choi is sufficient to show that the Defendant does not have such document and this part of the application should be dismissed.

44.  On Class f documents, Mr. Yeung submitted that they could not be relevant. In reply, the Plaintiff submitted that in the report of the Marine Department, it is mentioned that “pre-flight check and pre-departure check had been carried out according to laid down night service procedure set by the [Defendant]. According, these operation manual and training manual is relevant as the crewmembers may have failed to follow the procedure.

45.  Pausing here, the Plaintiff is not suggesting that the crewmembers have failed to follow the procedure. And the report has not suggested the accident being caused by crewmembers failing to follow the pre-flight and pre-departure procedure, or there is any problem with such procedure. Again, given that no pleaded case on the negligence of the crewmember in this aspect, I fail to see the relevance of this class of document and I dismiss the application.

46.  On class g of the Schedule, Mr. Yeung submitted that there are 2 photographs illustrating the damages to the jetfoil in the report. The Plaintiff submitted that the photographs could show the positions and extent of the damage of the jetfoils and shed light on how the collision occurred. But I agree with Ms. Ho that photograph of the 2 damaged jet foil appear in the report. They should be sufficient at this stage for the Plaintiff to frame his case. Application for class g document is dismissed.

47.  On class h, Mr. Yeung submitted that the surveyor reports are subject to privilege. This is disputed by the Plaintiff. But he does not set out his reason why these surveyor reports are relevant.

48.  Ms. Ho submitted that the surveyors report detailing the state and extent of the damage caused to the jetfoils as a result of the collision is irrelevant to the Plaintiff’s intended claim.

49.  To begin with, the Plaintiff does not explain why the surveyors report is relevant. I have to agree with Ms. Ho that the state and extent of the damage to the jetfoils is not relevant to a claim based simply on negligence. Again there may be a claim to uplift the limitation. I need only to repeat myself that this is not an issue sufficiently identified from the Affirmation. This application must fail.

50.  Ms. Ho advanced an alternative argument that this is covered by litigation privilege. Mr. Lau submitted that “the document was privileged for production if, but only if at least the dominant, even if not the sole purpose for which it was prepared was that of submitting it to a legal advisor for advice in connection with reasonably anticipated litigation arising out of the accident (Waugh v. British Railway Board [1979] 2 AER 1169). And the burden rest on the Defendant to prove it. I believe there is no dispute to this legal principle.

51.  Ms. Ho submitted that the surveyors report which were prepared subsequent to the collision of the jetfoils are prima facie subject to litigation privilege due to the clear prospect of legal proceedings following the marine accident.

52.  I do not intend to go into that as I consider I have dealt with the matter on relevancy. If I were wrong, then I have to agree Mr. Lau that it is questionable whether the survey reports are covered by litigation privilege. Mr. Yeung did not explain how the surveyors report come into picture in his affirmation.

53.  And on class i, Ms. Ho submitted that they have confirmed the employer of the crewmembers is the Defendant. Mr. Lau has reservation and submitted that the employment contract is the evidence to show if the Defendant is the employer or if there is other employer of the crewmembers.

54.  I agree with Ms. Ho that the issue has been sufficient answered. I do not share the suspicion of Mr. Lau. I found that this is not necessary for a fair disposal of the case to order discovery and I exercise my discretion to disallow the application.

55.  That concludes my ruling. On those document I order discovery, the Defendant shall file an affirmation within 21 days from the date hereof to confirm if it has possession of the document and to give inspection thereof within 14 days thereafter.

56.  On the issue of cost, the general rule is the Plaintiff shall pay the costs of the Defendant. I would give an order nisi that the Plaintiff do pay the costs of the Defendant to be taxed if not agreed, such order nisi to be made absolute within 14 days from date hereof.