SAMBA ENGINEERING LTD v. JET-WIN ELECTRICAL CO. LTD.

DCCJ 3281/2002

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 3281 OF 2002

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JUDGMENT

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1. This is the Plaintiff's application for an interlocutory injunction to restrain the Defendant from posting or publishing words to the effect that the sub-contractor Samba withholds payment of salaries ("二判三馬無糧出慘") ("the 1st Statement"), that the sub-contractor Samba does not release payment ("二判三馬唔放水") ("the 2nd Statement"), and that the sub-contractor Samba has no conscience ("二判三馬無良") ("the 3rd Statement").

The plaintiff's case

2. According to an affirmation of Fung Kei Yau filed on behalf of the Plaintiff on 31 May, 2002, the plaintiff is a sub-contractor engaged by Cheung Hing Construction Company Limited ("Cheung Hing") in respect of 2 building projects with the Architectural Services Department ("ASD"), namely, Contract No.TCK-051 and Contract No.TCK021. In about June, 2001, the works to be carried out by the plaintiff under the 2 projects were sub-contracted to a company called Wah Hip (E & M) Engineering Company Limited ("Wah Hip"). The defendant is a sub-contractor engaged by Wah Hip in respect of the sub-contract works. It is common ground that there is no contractual relationship between the plaintiff and the defendant.

3. On 17 May, 2002, at about 11:00 a.m.¹, some banners containing the 1st and 2nd Statements which, says the plaintiff, were defamatory of it, were posted up in the vicinity of an office of the ASD situated at Sung Ping Street, Hung Hom. These banners were removed about an hour later. It is unclear who removed the banners. Nor is it known who posted up the banners. On 23 May, 2002, at about 10:00 a.m., some 6 vehicles appeared in the vicinity of the ASD office situated at Sung Ping Street. Some of the vehicles, says the plaintiff, carried banners containing the 3rd Statement and words to the effect that the main contractor and the sub-contractor had no conscience. The plaintiff contends that the words were defamatory of it.

4. At least for the purpose of this application, the plaintiff has not been able to identify the ownership of the 6 vehicles involved in the incident except that one of them bore the name, address and telephone number of the defendant. However, the banners carried by this Vehicle did not contain any of the defamatory statements or words complained of in this action. They appeared to be targeted at the government. It is also the plaintiff's case that Mr. Sin Cheung Shing, a director of the defendant, was standing close to the vehicles.

5. Mr. Wong, solicitor for the plaintiff, quite rightly concedes that, at this stage, he has no evidence to link the defendant to the incident that took place on 17 May, 2002. He accepts that the present application should be confined to the incident on 23 May, 2002. The parties have attempted in their affirmations to argue over the question whether the plaintiff was indebted to Wah Yip or the other way round. I do not think that this issue is relevant to this application at all. Nor am I in a position to resolve this dispute on affidavits.

The defendant's case

6. The defendant says that for the period between July and October, 2001, it had supplied materials to Wah Hip at the price of $2,371,733.80 for the 2 projects. However, Wah Yip has failed to pay for the materials supplied. The explanation given by Wah Yip was that ASD, the main contract and the plaintiff had failed to pay Wah Yip. At the suggestion of Mr. Chan Hon Pan of Wah Yip, Mr. Sin turned up with a vehicle in Sung Ping Street on 23 May, 2002 with a view to gaining sympathy from ASD for its situation. The defendant denies that it had anything to do with the other participants of the event on 23 May, 2002; and the banners it posted up, says the defendant, had nothing to do with the plaintiff.

The applicable principle

7. The applicable principle in granting interlocutory injunctions to restrain publication of defamatory statements attracts little controversy. The position is well summarised in Gatley on Lible and Slander (9th ed. para.25.2) as follows:

(a) The jurisdiction to grant such an injunction is of a delicate nature, which ought only to be exercised in the clearest case;

(b) The reluctance to grant peremptory injunctions is rooted in the importance attached to the right of free speech;

(c) The practice established in applications for interlocutory injunctions by American Cyanamid v. Ethicon [1975] AC 396 of not considering the merits of the case once it had been shown there was a serious issue to be tried, but determining where the balance of convenience lay between the parties as regards the imposition of a restraining order, has been rejected as inappropriate in defamation cases;

(d) The Court will only grant an interlocutory injunction where,

(i) the statement is unarguably defamatory;

(ii) there are no grounds for concluding the statement may be true;

(iii) there is no other defence which might succeed;

(iv) there is evidence of an intention to repeat or publish the defamatory statement.

(e) Where the defendant contends that the words complained of are true, and swears on affidavit that he will plead and seek at trial to prove the defence of justification, the Court will not grant an interlocutory injunction, unless, exceptionally, the Court is satisfied that such a defence is one that cannot succeed: see Bonnard v. Perryman [1891] 2 Ch. 269.

The statement unarguably defamatory

7. As Mr. Wong has rightly conceded, it is only the 3rd Statement that I need to consider for the purpose of this application. In Cheng v. Tse Wai Chun (2000) 3 HKCFAR 339, Lord Nicholls NPJ drew the distinction between fact and comment as follows (at p.347D-F):

"Second, the comment must be recognisable as comment, as distinct from an imputation of fact. If the imputation is one of fact, a ground of defence must be sought elsewhere, for example, justification or privilege. Much learning has grown up around the distinction between fact and comment. For present purposes, it is sufficient to note that a statement may be one or the other, depending on the context. Ferguson J gave a simple example in the New South Wales case of Myerson v. Smith's Weekly (1924) 24 SR (NSW) 20 at p.26:

'To say that a man's conduct was dishonourable is not comment, it is a statement of fact. To say that he did certain specific things and that his conduct was dishonourable is a statement of fact coupled with a comment.'

8. It follows that the 3rd Statement is a statement of fact rather than a comment. In my view, the 3rd Statement bears the meaning that the plaintiff has no conscience. For present purposes, I accept that such an allegation was unarguably defamatory of the plaintiff.

Defence of Justification

9. In its defence, the defendant raises and relies on the defence of justification and fair comment. Since I have come to the view that the 3rd Statement is a statement of fact rather than a comment, the defence of fair comment is not relevant here. Notwithstanding a plea of justification in the defence, the defendant fails to swear in any of the affirmations filed on its behalf that it will seek at trial to prove the defence of justification. A defendant is not entitled to rely on a plea of justification to resist an application for interlocutory injunction if he is not prepared to swear on oath that he will seek to plead and prove it at the trial: see Bonnard v. Perryman [1891] 2 Ch. 269. The burden of requiring a sworn statement to that effect is, in my view, not an onerous one. In the absence of such an averment on oath, I fail to see how the defendant can rely on a plea of justification to resist this application. In the premises, I reject this as a valid ground of opposition here.

Other Defence

10. As I have mentioned earlier, the ownership of the 6 vehicles involved in the incident on 23 May, 2002 is unknown except that one of them bore the name, address and telephone number of the defendant. That vehicle, however, did not carry any of the banners complained of. I doubt very much that the mere presence of a director and a vehicle of the defendant at the scene would be sufficient to prove the publication of the defamatory statement by the defendant. There is no allegation or evidence of conspiracy whereby the defendant conspired with others to publish the defamatory remark. Nor is there any allegation or evidence of agency whereby the defamatory statement was published through an agent of the defendant. In the circumstances, I accept that there is an arguable defence which may succeed that the defendant was not the publisher of the 3rd Statement.

11. On this ground alone, no interlocutory injunction should be granted and it should be sufficient to dispose of this application. Even if I am wrong on this, this application should also be refused as I am unable to find any evidence of intention to repeat or publish the defamatory statement on the part of the defendant. Mr. Wong is unable to suggest otherwise. Although the defendant refuses at my invitation to give any undertaking, I do not think the court can and should infer an intention to repeat or publish the defamatory statement from such refusal, otherwise a defendant would be forced to provide some form of undertaking which may curtail his right of free speech even when no such intention to repeat or publish the defamatory words can be shown.

Conclusion

12. Since I have come to the conclusion that no interlocutory injunction should be granted, I therefore dismiss this application. As far as the costs are concerned, I consider that the appropriate order should be the defendant's costs in the cause with a certificate for counsel. The costs order is, of course, an order nisi.

¹ I think it must be a mistake when it was stated to be 11:00 p.m. in paragraph 4a of the affirmation of Fung Kei Yau made on 30 May, 2002.