YEUNG WAI FAN v. HONITON INTERNATIONAL LTD

CACV 6/2016

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 6 OF 2016

(ON APPEAL FROM HCA NO. 1051 OF 2010)

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JUDGMENT

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Hon Yuen JA:

1.  This is the plaintiff’s application by summons filed on 5 June 2017 seeking leave to pay security for costs of his appeal in the sum of $300,000 within 7 days. This court had by an order made on 26 August 2016 ordered that the sum be paid within 28 days; that period had expired on 23 September 2016 without payment.

Background

2.1  Briefly, the background of the matter is as follows.

2.2  In HCA1051/2010, the plaintiff sought an order that he (and/or his father) had been in adverse possession of various lots of land, of which the defendant was the registered owner.  The plaintiff was given legal aid and was legally represented in the action.  After trial, the deputy judge dismissed the action with costs.  The judgment was 31 pages long.  In brief, the deputy judge was not satisfied, having considered evidence including aerial photographs, that the plaintiff and/or his father had been in continuous possession of the lots. 

Notice of Appeal

3.  On 13 January 2016 the plaintiff, acting in person, filed a Notice of Appeal. There were no substantive grounds of appeal.  It was only asserted that the judgment was incorrect and that grounds of appeal would be provided within 7 days.  They were not provided, whether within the 7 days or at all, as discussed below.

Defendant’s application for security for costs

4.1  On 11 February 2016, the defendant’s solicitors wrote to the plaintiff demanding security for costs of the appeal.  This was followed by a summons for security filed on 24 March 2016.

4.2  On 19 August 2016, the application for security was fixed for hearing before this court.  Shortly before the hearing commenced, solicitors came on the record for the plaintiff and counsel was instructed to appear, but only for the purpose of asking for an adjournment.  The court refused to grant an adjournment.  Thereupon, the plaintiff resumed acting in person.  He admitted that he was only able to pay $10,000 as security, but claimed that as he should succeed on appeal, he should not be ordered to make any payment.  Judgment was reserved. 

Order for security for costs

5.1  On 26 August 2016, this court handed down judgment on the summons for security. For reasons set out in the judgment, we made an order in terms of the summons save that the sum of security was reduced to $300,000.

5.2  The plaintiff had 28 days to pay, which period expired on 23 September 2016. It was stated in the order that (amongst other things) if the plaintiff failed to pay the security by that date, the appeal would stand dismissed without further order.

Plaintiff’s Notice of Motion filed on 23 September 2016

6.1  Shortly before close of business on 23 September 2016 the plaintiff, still acting in person, filed a Notice of Motion.  It was written in Chinese and may be summarized as follows.  Para. 1 sought leave to appeal to the Court of Final Appeal against our order for security; para. 2 sought a stay of the order; para. 3 sought “alternatively” an order that the plaintiff have until 31 December 2016, or some other date which the court deemed reasonable, to pay the security; and para. 4 sought an order that the costs of the application be costs in the application for leave to appeal.

6.2  The plaintiff did not file any affirmation in support of the Notice of Motion. Directions were given by the court for written submissions. 

6.3  The plaintiff filed written submissions on 14 November 2016 and 7 December 2016.  The only reference made to the alternative application for an extension of time to pay security was in para. 5 of the November submissions and the last sentence of para. 9 of the December submissions, as follows:

“5. 如法庭仍拒絕我此上訴，我請求可再延長時間給我支付該300,000元之保證金，就如我的動議通知書所要求的時間使我可有最後機會支付繼續我的上訴。”

“9. 由於我之前乃法律援助處理審訊，而我也就上訴此保證金頒令申請法律援助，乃在9月24日前申請，故根據法律援助條理我應享有42天臨時擱置訴訟程式的權利，而且法律援助署仍未作出回復仍需詳細考慮我上訴的理據和上訴保證金判令的理據，我應該得到延長時間支付保證金。”

6.4  Although the plaintiff had admitted in court on 26 August 2016 that he was only able to pay $10,000 as security, he did not provide any explanation (whether by way of affirmation or submissions) as to how he expected to be able to provide $300,000 by 31 December 2016 in order to support his alternative application for an extension.

Judgment dismissing Notice of Motion

7.1  On 27 January 2017 this court handed down judgment on the Notice of Motion.  For reasons set out in the judgment, the application for leave to appeal to the Court of Final Appeal and the application for stay were dismissed.  The alternative application for extension was discussed as follows:

“6. 原告人又說，本庭沒有向他詢問他需要幾多時間安排保證金，也沒有向他解釋不遵從保證金命令的後果。本庭必須指出，在8月19日聆訊開始時，原告人有律師與大律師代表。雖然他們要求押後聆訊被駁回後，原告人轉為親自行事，但法庭有權相信，在應訊前，原告人的律師會已清楚向他解釋當天聆訊的性質，與及在申請中勝敗會導致的後果。無論如何，當日原告人只說他只能負擔一萬元的訟費保證金。明顯地這是遠低於合理的數額，而他亦沒有表示自己有機會在合理時間內，存繳更大數額的保證金。”

The last sentence referred to the fact that the plaintiff had not indicated what chance he had of providing the larger sum of security within a reasonable time.

7.2  In the sealed order, the alternative application for extension of time was not explicitly dismissed but no extension was given.  Since the application for stay was explicitly dismissed, in accordance with the order of 26 August 2016 the appeal stood dismissed on 23 September 2016 when no security was provided by that date. 

Summons of 5 June 2017

8.1  Nearly 5 months later, on 5 June 2017, solicitors went on the record to represent the plaintiff.  On the same day a summons (“the Summons”) was filed on his behalf for an extension of time to pay the security for which the deadline of 23 September 2016 had been imposed by this court’s order of 26 August 2016.

8.2  The Summons was supported by an affirmation of the plaintiff.  Although he acknowledges in para. 12 that “it appears that paragraph 6 of the Judgment¹ [of 27 January 2017] is to deal with para. 3 of my Summons² [of 23 September 2016]”, nevertheless he alleged in para. 13 that “upon perusal of the wordings in paragraph 6 of the Judgment, this Honourable Court has not yet dealt with such relief prayed in my said Summons, i.e. to be given more time to pay the security for costs of appeal”. 

8.3  Be that as it may, he said that he thought nothing further could be done for the appeal until he was advised in May 2017 by newly instructed counsel that in his view, the application for extension of time had not been dealt with yet, and he referred also to a change of circumstances in that he had borrowed a sum of $300,000 from a friend. 

8.4  The affirmation also contained allegations of his belief in the merits of his appeal, and an allegation of a possible conflict of interests on the part of his counsel at trial.

8.5  Pursuant to directions from the court, written submissions were filed by counsel for the plaintiff and the defendant respectively.

Discussion

9.  In my view, the plaintiff could not have been under any illusion that his alternative application for extension of time contained in his Notice of Motion filed on 23 September 2016 was still extant after the Judgment handed down on 27 January 2017.  There had been no grant of interim stay pending determination of the Notice of Motion, and the application for stay was explicitly dismissed on 27 January 2017.  The consequence was that as the plaintiff had failed to make payment on 23 September 2016, the appeal stood dismissed without further order.  The alternative application for extension was discussed in para. 6 of the Judgment and there was no reason for the court to have dealt with part of the Notice of Motion only.  Indeed the plaintiff said in para. 16 of his affirmation that the Legal Aid Department had informed him that his appeal was already dismissed.  

10.1  However, even if it is assumed in the plaintiff’s favour that the Summons did not contain a fresh application for extension, but was to be treated as a renewal of the application made in the Notice of Motion of 23 September 2016, it is clear that the discretion of this court should not be exercised in favour of granting an extension of time.

10.2  The rules of court do not allow an appeal to be left in abeyance until such time as an appellant can acquire funds to provide security.  The parties have had their day in court.  The objectives of the Civil Justice Reform require that cases be dealt with expeditiously. 

10.3  In the present case, the defendant’s summons for security had been filed as long ago as March 2016.  In August 2016, the plaintiff said he was only able to pay $10,000 as security.  No evidence has been proffered by the plaintiff as to when he was able to borrow the sum of $300,000 from his friend.  There was no reference to any loan in the papers before the court in January 2017.  It was only referred to in his affirmation in June 2017, 9 months after the deadline for payment of the security.  In other words, the plaintiff has failed to disclose to the court when he first took steps to borrow the funds and when the funds became available.  His lack of candour does not work in his favour when he is seeking an exercise of discretion from the court.     

11.1  More importantly, there are still no substantive grounds of appeal.  The written submissions filed on behalf of the plaintiff on 20 June 2017 assert “now, the Appellant has filed and served his grounds of appeal on 22 September 2016. [See para. 5³ of the Affirmation of Yeung Wai Fan]”.  But as noted in our Judgment of 27 January 2017, the court file does not contain any such grounds. 

11.2  The written submission filed on behalf of the defendant on 27 June 2017 confirmed⁴ that its solicitors had also not received grounds of appeal, nor could they be found in the Document Index of the case kept in the High Court Registry. 

11.3  Significantly, in the written submissions in reply of 3 July 2017, the plaintiff’s counsel said only the following.

“In reply to para. 1, Chinese grounds of appeal were allegedly filed by the Appellant himself on 22 September 2016. [See para. 6 of the Appellant’s Affirmation in Support filed on 5 June 2017]. Notwithstanding what have been submitted in para. 1, the Appellant is readily able to file and serve his grounds of appeal as long as this Honourable Court grants leave to do so”. (Emphasis added).

There is no explanation why, even by this stage with counsel having been instructed, draft substantive grounds have still not been provided for the court’s consideration.  Counsel only referred to general allegations made by the plaintiff in his affirmation asserting errors in the deputy judge’s findings of fact.  That is simply not good enough to persuade the court that there is even an arguable appeal.      

12.  The allegation about trial counsel is also unsatisfactory to say the least.   The written submissions filed in reply on behalf of the plaintiff referred to trial counsel for both sides being “relatives” when that was not the “relationship” referred to in the Plaintiff’s affirmation.  Further it is clear that the disclosure of the “relationship” was made to the plaintiff before the conclusion of the trial.  More importantly the plaintiff has not indicated how the existence of such a “relationship” had affected counsel’s conduct of the case on his behalf. 

Order

13.  For the reasons set out above, I would dismiss the Summons with costs.  Having considered the statement of costs lodged on behalf of the defendant on 27 June 2017, I would assess the costs on a gross sum basis at $30,000.

Hon Kwan JA:

14.  I agree with the judgment of Yuen JA.