XCHRX GUIDO KARL WENK v. ALAN LEE GOLDSTEIN

1997, M.P. No. 3908

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS

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REASONS FOR JUDGMENT

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Introduction

1. The Plaintiff obtained a Judgment against the Defendant in Singapore in February, 1996. After the costs of the Singaporean action were taxed, the Plaintiff obtained a Registrar's Certificate against the Defendant in August, 1996. The debts under the Judgment and the Registrar's Certificate have not been paid by the Defendant and the Plaintiff applied to register those orders in Hong Kong pursuant to the Foreign Judgments (Reciprocal Enforcement) Ordinance, Cap. 319 ("Cap. 319") in November, 1997. An Order granting registration was made by Master Cannon on 4 December, 1997.

2. The Defendant contended that the registration ought to be set aside. A number of applications were made to extend the time for applying to set aside the same. At the end, while the Defendant has made an application to set aside the Judgment within the time permitted, he failed to do so in relation to the Registrar's Certificate (the time for applying to do so expired on 30 May, 1998). On 11 June, 1998, the Defendant took out an application asking for extension of time to set aside the Registrar's Certificate notwithstanding that the time had expired as aforesaid.

3. The said summons was heard and dismissed by Master Muttrie on 16 June, 1998. I understood from Mr. Giles for the Plaintiff that the learned Master did so adopting the Plaintiff's interpretation of R.H.C. Order 71 rule 5(4) ("Ord. 71 r. 5(4)" or "the Rule"). The Defendant appealed against that decision contending that the learned Master was wrong.

4. Mr. Kerr for the Defendant contended that the learned Master should have decided in the Defendant's favour because:-

(a) upon a true and proper construction of Ord. 71 r. 5(4) (and contrary to the Plaintiff's argument which was adopted by the learned Master), the Court has jurisdiction pursuant to the Rule to extend the time for applying to set aside the registration notwithstanding the time for doing so has expired;

(b) (assuming his point (a) is accepted) as a matter of discretion, the Court should grant the time extension sought by the Defendant in the circumstances of this case.

5. On 16 July, 1998, the appeal was heard before me. After hearing the parties' submissions, I dismissed the appeal on the same day and gave brief reasons for my decision. I informed the parties that I would give my full reasons later and these are set out below.

The Meaning of Ord. 71 r. 5(4)

6. Ord. 71 r. 5(4) reads as follows:-

"The Court may, on an application made at any time while it remains competent for any party to apply to have the registration set aside, extend the period (either as originally fixed or as subsequently extended) within which an application to have the registration set aside may be made." (italics and bold type supplied).

7. Mr. Kerr submitted that upon a true and proper construction of Ord. 71 r. 5(4), the Court has jurisdiction to extend the time for applying to set aside the registration notwithstanding that time for doing so has expired because:-

(a) the words "remain competent" in the Rule refer to the competence of the Court rather than that of the party making the application. Since the Court is competent to extend any prescribed time under either Ord. 3 r. 5 or its inherent jurisdiction (notwithstanding time for doing so has expired), it is always within the Court's power to grant such extension for the purpose of proceedings relating to Order 71;

(b) alternatively, the said words in the Rule are capable of referring either to the Court or the party making the application. Where the statute in question is capable of two possible constructions, the Court should adopt the one which preserves consistency among related provisions (that is, Ord. 3 r. 5) and the existing powers of the Court (under its inherent jurisdiction);

(c) there is a presumption that a statute is not intended to oust the existing powers of the Courts or to abrogate the Courts' common law powers, and a construction which preserves the status quo should be adopted;

(d) to construe Ord. 71 r. 5(4) in a way that limits the Court's discretionary power to extend time would render the Rule to be ultra vires s. 5(1)(d) of Cap. 319;

(e) to construe Ord. 71 r. 5(4) in the way set out in (d) above could create a harsh result and the Court should adopt a construction which will prevent such a result.

(1) Its Plain and Ordinary Meaning

8. The first rule of construction, the "so-called 'Literal Rule'", cannot be better put than in Craies on Statute Law (1971) 7th ed.,

"The cardinal rule for the construction of Acts of Parliament is that they should be construed according to the intention expressed in the Acts themselves. If the words of the Acts are themselves precise and unambiguous, then no more can be necessary to expound those words in their ordinary and natural sense. The words themselves alone do in such a case best declare the intention of the lawgiver." (pp. 64-5 thereof).

9. The policy consideration in adhering to this "rule" was stated in Bennion: Statutory Interpretation (1992) 2nd ed., p. 406:-

"As Sir Rupert Cross put it [in his Statutory Interpretation (2nd ed., 1987), p. 1]:-

'The essential rule is that words should generally be given the meaning which the normal speaker of the English language would understand them to bear in their context at the time when they were used. It would be difficult to over-estimate the importance of this rule because the vast majority of statutes never come before the courts for interpretation. If it were not a known fact that, in the ordinary case in which the normal user of the English language would have no doubt about the meaning of the statutory words, the courts will give those words their ordinary meaning, it would be impossible for lawyers and other people to act and advise on the statute in question with confidence.'".

10. The undesirable consequence of an approach of "trying to ascertain the legislative intention" without regard to the actual words used in the legislation (especially when the meaning of the words is plain) was set out in Craies:-

"‘Intention of the legislature' is a common but very slippery phrase, which .... may signify anything from intention embodied in positive enactment to speculative opinion as to what the legislature probably would have meant, .... In a court of law or equity, what the legislature intended to be done or not to be done can only be legitimately ascertained from what it has chosen to enact, either in express words or by reasonable and necessary implication." (at p. 66 thereof).

11. Thus, it was stated in Bennion:-

"Section 284. Presumption that text is primary indication of legal meaning

....

COMMENT

British courts, towards the end of the twentieth century, regard the text of Acts of the United Kingdom Parliament with great respect. When called upon to construe an Act, the court regards its primary duty as being to look at the text and say what, in itself, it means. ...."

"Section 285. Presumption that literal meaning to be followed.

Prima facie, the meaning of an enactment which was intended by the legislator (in other words its legal meaning) is taken to be that which corresponds to the literal meaning." (at p. 598).

12. Bearing these remarks in mind, is the meaning of the words in Ord. 71 r. 5(4) plain for the purpose of the dispute of the parties in this action? In my view it is. The phrase relied upon by the Plaintiff is "while it remains competent for any party to apply". The "competence" is expressly stated to be one "for the [applying] party". I therefore consider that this reference to "competence" must be the competence of the applying party and not that of the courts. Further, (although this is not an issue raised by the Defendant) I consider that the word "competence" is to be judged by reference to the time within which the application must be made.

13. I therefore do not agree with Mr. Kerr's submissions set out in sub-paragraph (a) under the earlier heading "The Meaning of Ord. 71 r. 5(4)".

(2) The "Golden" Rule

14. Although this was not exactly the way put by Mr. Kerr, I consider that his submissions set out in sub-paragraph (b) to (e) above relate to what Bennion described as "the so-called 'Golden Rule'". The circumstances under which this "rule" is applicable is set out in Bennion:-

"The 'prima facie rule' referred to in the above dictum of Donaldson MR was called by Viscount Simon the 'golden rule'. He said: 'The golden rule is that the words of a statute must prima facie be given their ordinary meaning ... Lord Blackburn went on to express .... 'that we are to take the whole statute together, and construe it all together giving the words their ordinary signification, unless when so applied they produce an inconsistency, or an absurdity or inconvenience so great as to convince the Court that the intention could not have been to use them in their ordinary signification'" (at p. 603 thereof).

15. However, it must be noted that the "Golden Rule" is only applied when the meaning ascertained under the "Literal Rule" produced "an inconsistency, absurdity or inconvenience so great as to convince the Court that the intention could not have been" that meaning. Thus, Lord Reid said in Pinner v. Everett [1969] 1 WLR 1266:-

"In determining the meaning of any word or phrase in a statute the first question to ask always is what is the natural or ordinary meaning of that word or phrase in its context in the statute. It is only when that meaning leads to some result which cannot reasonably be supposed to have been the intention of the legislature that it is proper to look for some other possible meaning of the word or phrase." (at p. 1273).

16. Since the Rule when construed under the "Literal Rule" would limit the time by which the applying party can make the application, there is bound to be some inconvenience to that party. However, I do not consider that this "inconvenience" is so great as should convince me that the legislature could not have intended to use the words in their ordinary signification. I also do not consider there is any "inconsistency" or "absurdity" which should convince me to depart from the "Literal Rule".

(3) Presumptions against (a) Changing the Pre-existing Laws and (b) Ousting the Court's Jurisdiction

17. I agree with Mr. Kerr that in law there is a presumption that the pre-existing laws are not changed by a statute unless there is a clear legislative intention to do so. The same proposition was stated in Craies:-

"A distinct and positive legislative enactment is necessary to alter any clearly established principle of law" (at p. 121).

18. There is also a presumption in the construction of a statute that the court's jurisdiction is not ousted. Hence, the Court will as much as possible adopt a construction which will prevent the conclusion that its jurisdiction has been ousted. This has been summarized in Craies as follows:-

"A distinct and unequivocal enactment is also required for the purpose of either adding to or taking from the jurisdiction of a superior court of law" (at p. 122).

Thus, it was said in Albon v. Pyke (1842) 4 M & G 421, 424: "The general rule undoubtedly is that the jurisdiction of superior court is not taken away except by express words or necessary implication." (italics and bold type supplied) (per Tindal, CJ).

19. Mr. Kerr, relying on Wo Fung Paper Making Factory Ltd. v. Sappi Kraft (Pty) Ltd. [1988] HKLR 346 at 350, and p. 8 of the transcript inMita Kogyo Kabushiki Kaisha v. Mitac Inc., HCMP No. 2766 of 1992, submitted that such an implication can only be made in the clearest case:-

"The judge referred to the restriction imposed by Order 12, rule 8(2) and said that the inherent jurisdiction of the court was only to be curtailed by statutory enactment. He then said that he knew of no legislation 'in clear terms or otherwise which seeks to divest or deflect the court's inherent jurisdiction in matters canvassed in the instant appeal'." (Wo Fung Paper case at p. 350);

"It is of course only in the clearances [sic] [clearest] of cases that a statutory provision can be repealed by implication: where, for instance, the provisions of a later enactment are so inconsistent with or repugnant to the provisions of the earlier one that the two cannot stand together: see Kutner v. Phillips [1891] 2 QBD 267 at 272." (at p. 8 of the transcript of the Mita Kogyo case).

20. With respect to Mr. Kerr, I do not consider that there is any real difference in the test to be adopted whether it be described as "necessary implication", or as implication "only in the clearest of cases", or indeed as "obvious" cases (see Bennion, at p. 366, Section 174). They are only different ways of saying the same thing, that is, Courts do not lightly consider a statute to bear a certain implication.

21. Ord. 71 r. 5(4) has been set out in full earlier. Ord. 3 r. 5 reads:-

"(1) The Court may, on such terms as it thinks just, by order extend .... the period within which a person is required or authorized by these rules, or by any judgment, order or direction, to do any act in any proceedings.

(2) The Court may extend any such period as is referred to in paragraph (1) although the application for extension is not made until after the expiration of that period.".

22. There are at least two fundamental differences in the Courts' power to extend time under Ord. 71 r. 5(4) on the one hand and that under Ord. 3 r. 5 and inherent jurisdiction on the other. Under Ord. 3 r. 5 and the Courts' inherent jurisdiction, the power to do so is not in any way fettered, for example, there is no need for an application to be made by a party and the Court may make the order on its volition. Further, both the time for making an order and the matters to be taken into account by the Courts are not in any way restricted. On the other hand, the Courts' power to extend time under Ord. 71 r. 5(4) is limited in at least 2 ways:-

(a) there must be an application made by a party for extension of time;

(b) the applying party must remain competent when the application is made.

23. In view of these limitations, I consider that the Courts' power to extend time under its inherent jurisdiction and Ord. 3 r. 5 is inconsistent with or repugnant to that under Ord. 71 r. 5(4). Thus, although there is no express provision in the Rule to this effect, I consider that the presumptions referred to above have been rebutted by implication.

24. I therefore do not agree with Mr. Kerr's submissions set out in sub-paragraphs (b) and (c) under the earlier heading "The Meaning of Ord. 71 r. 5(4)".

(4) Presumption against Creating Harsh Results

25. As regards Mr. Kerr's argument that the construction under the "Literal Rule" may create hardship, I would respond by saying, first, this action does not involve any hardship created by causes beyond the control of the Defendant's solicitors (acting as the Defendant's agent). Secondly, it is not the first time when a statutory provision may potentially create hardship by reason of a prescribed time limit having been imposed by it: see, for example, the Court of Appeal's decision on the effect of Ord. 12 r. 8 before its amendment in the Wo Fung Paper case. If the rules are certain, it is not for the courts to water them down by ignoring the intention of the legislature as evidenced by the express words. As Craies put it:-

"It is not, however, competent for a judge to modify the language of an Act of Parliament in order to bring it into accordance with his own views as to what is right or reasonable" (at p. 91 thereof).

Hence, it is sometime said that:-

"A consequence of the said rule is that the [Court] declines to interfere for the assistance of persons who seek their aid to relieve them against express statutory provisions": Craies, p. 73.

26. I therefore do not accept Mr. Kerr's submissions set out in sub-paragraph (e) under the earlier heading "The Meaning of Ord. 71 r. 5(4)".

(5) Is Ord. 71 r. 5(4) Ultra Vires S. 5(1)(d), Cap. 319?

27. Mr. Kerr submitted that Ord. 71 r. 5(4) is ultra vires s. 5(1)(d) of Cap. 319. This section empowers the enactment of a rule to provide for a prescribed time period for applying to set aside the registration of a judgment and for extending such time. It states:-

"(1) The power to make rules of court under the High Court Ordinance (Cap. 4) shall, subject to the provisions of this section, include power to make rules for the following purposes -

....

(d) for making provisions with respect to the fixing of the period within which an application may be made to have the registration of a judgment set aside and with respect to the extension of the period so fixed; .... ".

28. The doctrine of ultra vires of a subsidiary legislation in relation to its parent legislation was set out in Bennion:-

"Section 58. Doctrine of ultra vires

(1) Any provision of an item of delegated legislation is ineffective if it goes outside the powers which (expressly or by implication) are conferred on the delegate by the enabling Act. This is then said to be ultra vires. .... " (at p. 160).

I do not see how it can be argued that the Rule falls outside or is inconsistent with the provisions of s. 5(1)(d) and therefore do not accept Mr. Kerr's submissions set out in sub-paragraph (d) under the earlier heading "The Meaning of Ord. 71 r. 5(4)".

Is the Power under Ord. 71 r.5(4) Exclusive?

29. In view of the conclusions reached above, I find Ord. 71 r. 5(4) to be a single code in relation to the question of time extension in proceedings regarding Ord. 71. I have explained the reasons for reaching this conclusion under the earlier heading "(3) Presumptions against (a) Changing the Pre-existing Laws and (b) Ousting the Court's Jurisdiction". An alternative way to analyze this issue is to examine if the Courts' jurisdiction under Ord. 3 r. 5 or the inherent jurisdiction has either been repealed or at least curtailed by Ord. 71 r. 5(4).

30. The following proposition was stated in Craies:-

"If a subsequent statute merely creates an exemption or exception from the operation of a previous statute or 'modifies its operation by the annexation of a condition,' the previous statute is not necessarily repealed. And prior enactments may be rendered inoperative without being actually repealed." (at p. 374).

31. The Supreme Court Ordinance, Cap. 4 was enacted in 1873 (being Ord. No. 12 of 1873). The subsidiary legislation enacted thereunder was the Code of Civil Procedure Rules (to be followed by the Rules of the Supreme Court in June, 1967). Cap. 319 was subsequently enacted in 1960 (modeled on a similar Act in the U.K. in 1933) and Order 71 was introduced as a result. Further, while Ord. 3 r. 5 of Cap. 4 confers a general power to extend time, Ord. 71 r. 5(4) was a rule created pursuant to s. 5(1)(d) of Cap. 319 to deal specifically with extension of time for proceedings relating to the setting aside of the registration of foreign judgments. I consider that the Courts' pre-existing power to extend time has been curtailed in relation such proceedings.

The Court's Discretion under Ord. 71 r. 5(4)

32. Since I already decided against the Defendant on the first issue, that is, the issue relating to jurisdiction, there is no need for me to deal with the second issue, that is, the issue relating to whether I should exercise my discretion in the Defendant's favour.

Conclusion

33. For the above reasons, the Defendant's appeal is dismissed and the Order of the learned Master is affirmed.

34. Mr. Giles invited me to authorize the publication of this "Reasons for Judgment". Mr. Kerr objected to this request but accepted that it is for the Court to decide whether publication should be authorized. Since this "Reasons for Judgment" may be of interest to other litigants, I consider that its publication should be authorized.

(Andrew Chung)

Deputy Judge of the Court of First Instance