K M CHEUNG & CO, SOLICITORS (A FIRM) v. KUNG CHING

HCA 831/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 831 OF 2011

_________________________

BETWEEN

_________________________

__________________

J U D G M E N T

__________________

Introduction

1.  The plaintiff is a firm of solicitors claiming $40,000 professional fees due and owing as services rendered.  This case was originally commenced in the Small Claims Tribunal.  On 30 March 2011, by way of a consent application, both the plaintiff and the defendant agreed to transfer this case to the Court of First Instance for taxation. The Adjudicator so ordered. This action proceeded in the same manner as in any other actions, pleadings were filed accordingly.

The Application

2.  In the defendant’s summons dated 9 February 2012, he asked for an order that the plaintiff’s claim be struck out with costs.  His application was premised on an unless order made on 30 November 2011, the defendant said the plaintiff had failed to comply with that order.

3.  The unless order reads,

“Unless the Plaintiff do on or before 4 pm on the 14 December 2011 file and serve on the Defendant his answer to the Defendant’s Request for Further and Better Particulars of the Statement of Claim as per the copy thereof annexed to the said summons and served on the Plaintiff on 9 September 2011, the Plaintiff’s Statement of Claim be struck out and the Plaintiff’s claim against the Defendant be dismissed with costs.” (“the Unless Order”)

4.  It is not disputable that the plaintiff has duly filed and served an Answer before 4 pm on 14 December 2011. The defendant took out this summons because he was not satisfied with one of the many answers.

The Further and Better Particulars

5.  Request No. 2 of the Request of Further and Better Particulars of the Statement of Claim filed on 9 September 2011 reads,

“Under paragraph 2

The Plaintiff’s claim is for the sum of $40,000 against the Defendant in respect of the professional services rendered for the Defendant relating to the intended claim and/or legal action against Citibank (Hong Kong) Limited for subscription for the Lehman Brothers 1 year HKD Daily Accural [sic] Coupon Auto ISIN XS0334923322 Callable Multi Coupon”

Request

“Please state what services were allegedly rendered for which the Plaintiff now claims against the Defendant.”  (“The Request”)

6.  The Answer given by the plaintiff:

“It has been stated clearly in the Paragraph 2 of the Statement of Claim that the professional services rendered for the Defendant relating to the intended claim and/or legal action against Citibank (Hong Kong) Limited for subscription for the Lehman Brothers 1 year HKD Daily Accural [sic] Coupon Auto ISIN YS0334923322 [sic] Callable Multi Coupon”

7.  The defendant is not happy with the Answer because the plaintiff did not provide particulars of the services rendered but merely repeating what has been pleaded in paragraph 2 of the Statement of Claim.  The defendant submitted, sanction given in the unless order should follow.

The Issues

8.  The court should decide,

(i)  Whether the plaintiff has satisfactorily answered the Request, is the Answer itself sufficient and complete?

(ii)  If not, in light of the non compliance of the unless order; whether the plaintiff’s act was intentional or contumelious.

The Legal Principles

9.  In Ping Kai Engineering Company Limited (Unreported) HCCT 2 of 2001, 6 February 2002 per Ma J (as then he was) at paragraphs 17 – 18, the court decided the relevant test which is applicable in our case:

“17. The function of particulars is to inform an opponent of the case he has to meet at trial: see Hong Kong Civil Procedures 2002 at paragraph 18/12/1. Thus, the provision of full and proper particulars not only enables the parties and the court to properly prepare for trial, it also serves the important function of encouraging settlement. Settlements rarely occur without each side knowing the full and precise extent of the case made against him.

18. Further and better particulars are therefore important features of the system of litigation governed by the Rules of the High Court. It comes then as no surprise that unless orders are not infrequently made for the provision of such particulars.

19. The consequences of a failure to comply with an unless order for the provision of further and better particulars are the same as in any other situation in which unless orders are made: see Hong Kong Civil Procedures 2002 at paragraph 18/12/58.

……

 22. Accordingly, where there has been a failure to comply with an Unless Order, the Court proceeds on the footing that the sanction stated in the Order will be imposed (i.e. striking out in the present case).  It will not do so where the party in default (and it is important to stress that the burden is on him) to demonstrate with cogent and compelling evidence that the failure was not intentional or contumelious and was caused by circumstances beyond his control.  Invariably, I would have thought that an affidavit would be essential if any explanation is sought to be given for, as is obvious, a court would attach more weight to sworn evidence than evidence either unsworn or simply given from counsel’s table.”

Is a repetition of paragraph 2 of the Statement of Claim a complete and sufficient answer to the Request?

10.  If we revisited the Request, the defendant was asking “what services were allegedly rendered for which the Plaintiff now claims against the Defendant.”  Mr Lee, counsel for the defendant argued, by repeating what has already been pleaded in the Statement of Claim was obviously insufficient.  The plaintiff should have given particulars of the legal services, that is to say, a narration of work done that justified $40,000 legal fees.  

11.  Mr Lee also submitted, a repetition of the pleadings defeated the purpose of the functions of providing further and better particulars, that is to make the opponent to know the full extent of case made against him.

12.  Mr Cheung, counsel for the plaintiff submitted, the defendant was asking for the nature of services rendered and the plaintiff is claiming the defendant for outstanding legal fees, the answer must be “professional legal services”. The plaintiff could have added nothing more to this answer,  that was why the plaintiff repeated paragraph 2 of the Statement of Claim.  Mr Cheung said, in fact, the particulars of the legal services rendered have been clearly pleaded in paragraphs 3 to paragraph 9 of the Statement of Claim, there was no point to plead them again.

13.  When an unless order was made to give particulars, as it was already stated in the request, it is therefore not open to the parties to challenge why the question was posed.   Even it was inadequately drafted, the court should only scrutinize whether the answer given is sufficient and complete.  In this case, the core question is “what services”, a reader would expect details of the work done be provided instead of the nature of the service.  As a result, the answer of “professional legal services” was far from sufficient and complete.  On the other hand, if the request be framed as “what kind of services” instead of “what services” has been rendered, the answer given by the plaintiff should qualify as a satisfactory one. 

Is it intentional or contumelious?

14.  Mr Cheung submitted, it was the plaintiff’s interpretation of “what services” be the kind of services instead of the particulars of the services.  The plaintiff did not withhold particulars from the defendant.  Even if the Court ruled the answer was insufficient and incomplete, the plaintiff’s act was not intentional or contumelious.

15.  The plaintiff filed an affirmation to explain. The particulars requested have already been pleaded in paragraph 3 to paragraph 9 of the Statement of Claim, among other things, providing quotation of legal service fees to the defendant, receipt of instructions, reviewing papers and sending letters to Citibank.  In light of these pleaded facts, the defendant would not be deprived of the opportunity to know the opponent’s case.

16.  I agree. A sufficient answer might be one making reference to the specific paragraphs of the Statement of Claim.

Conclusion and further order

17.  To conclude, although the answer was insufficient and incomplete, the plaintiff’s act did not fall within the “intentional and contumelious” category, this is far from a case of non compliance of the unless order.

18.  I order the defendant’s summons be dismissed.  Costs shall follow the event, I make a costs order nisi that costs of the defendant’s summons be to the plaintiff, with certificate of counsel, taxed if not agreed.  The costs order nisi shall be made absolute after 14 days.

19.  For the sake of completeness, it is necessary for the plaintiff to provide the answers to the Request properly.  I therefore direct the plaintiff to provide further and better particulars to Request No. 2 of the Further and Better Particulars of the Statement of Claim filed on 9 September 2011 within 14 days from the date of judgment.