GANATRA, ANNEMARIE CLAIRE v. FREDA, GIOVANNI

HCPI 405/2019

[2021] HKCFI 3611

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO 405 OF 2019

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J U D G M E N T

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I. INTRODUCTION

1.  On 31 October 2019, the plaintiff (“P”) by her former solicitors (“FSols”) issued a writ of summons (“WoS”) to commence the present action against the defendant (P’s ex-boyfriend, “D”) for personal injury, loss and damages arising from D’s (a) breach of duty of care towards her, (b) trespass to her person and/or (c) fraud on her, which alleged wrongs were perpetrated on 31 October 2016 at D’s residence at the Mid-Levels, Hong Kong (“HK Address”).

2.  On the same day, P by the FSols filed the Notice of Checklist Review (“CLR”). The CLR was scheduled to be heard on 6 April 2020 before Master Roy Yu.

3.  On 6 April 2020, Master Roy Yu granted inter alia the following directions (“6/4/20 Directions”):

(a)	the CLR scheduled to be heard on 6 April 2020 had been adjourned due to the general adjournment of court proceedings announced by the Judiciary for public health considerations;
(b)	on/before 14 April 2020 the FSols were to report to the PI Master via email whether the WoS had been served, and if not, the FSols were to confirm when the WoS would be served;
(c)	upon receiving the report in (b) above, the PI Master might give directions for paper disposal or for adjournment to a date to be fixed (and the parties would be informed of the new hearing date in due course).

4.  It was unclear from the court file whether the FSols reported to the PI Master by email on/before 14 April 2020 or at all pursuant to the 6/4/20 Directions.

5.  Although the WoS gave the HK Address as D’s usual or last known address for service, P on 26 May 2020 (ie almost 7 months after the issue of the WoS) filed an ex parte summons for inter alia leave to (a) issue and serve a concurrent WoS against D in the present action pursuant to Order 6 rule 6 of the Rules of the High Court (“RHC”), (b) serve such concurrent WoS together with a copy of the order to be granted for service out of jurisdiction upon D at Shangri-La at the Fort, 30^th Street, corner 5^th Avenue, Taguig, 1634 Metro Manila, Philippines (“Residential Address”) pursuant to Order 11 rule 1(1) of the RHC, and (c) serve subsequent pleadings, orders and documents upon D out of jurisdiction at the Residential Address (“ ExP Summons”).

6.  On the same day, P filed her 1^st affirmation (“P 1^st Aff”) in support of the ExP Summons which stated inter alia as follows:

(a)	P claimed damages against D for his wilful/negligent spread of sexually transmutable diseases (“Transmuted Diseases”) to her on/ about 31 October 2016 at D’s former residence (ie the HK Address).
(b)	The FSols had intended to serve the WoS on D at the HK Address, but P discovered D had left Hong Kong for a new role as the general manager of “JTI Philippines” (ie Japan Tobacco International in the Philippines) as shown in an electronic news article dated 4 May 2020 that was titled “JTI Philippines appoints Freda as new GM”. P claimed D was usually known by his Anglicised name “John” rather than “Giovanni”, and such news article referred to D as “John Freda”.
(c)	JTI Philippines was a regional subsidiary of a Japanese tobacco company known as the JT Group, and the webpage of the JT Group showed that as at 4 May 2020 the office of “JTI Philippines” was situated at Penthouse, W Office Building, 28th Street, corner 11th Avenue, Bonifacio Global City, Taguig City 1634, Manila, Philippines (“Office Address”).
(d)	On/about 25 March 2020, P tried to find out D’s residence in the Philippines by making several telephone calls to hotels near the Office Address as P believed D would have stayed at a reputable 5-star hotel. P was eventually informed by the hotel reception of Shangri-La at the Fort that D was staying at such hotel at the Residential Address.
(e)	P claimed the FSols had already made arrangements for process servers in the Philippines to serve the concurrent WoS on D at the Residential Address once the court granted leave for such WoS to be served out of jurisdiction, which service would be made in accordance with local laws and verified by notarised affidavit of service.
(f)	P relied on the service gateway in Order 11 rule 1(1)(f) of the RHC because her claim was founded on tort where damage was sustained in and resulted from an act committed at the HK Address within the jurisdiction.
(g)	P believed she had a good cause of action against D, and her claim had a good arguable case with reasonable prospects of success.
(h)	P also claimed that because D performed acts towards her at the HK Address in Hong Kong that led to the wilful/negligent spread of the Transmuted Diseases to her, Hong Kong was clearly the most appropriate forum for the trial of the present action.

7.  On 4 June 2020, Master Roy Yu raised the following requisitions in relation to the ExP Summons (“4/6/20 Requisitions”):

(a)	P should provide further information or supporting evidence to correlate the defendant “Freda, Giovanni” in the present action with “John Freda” in the electronic news article dated 4 May 2020 in paragraph 6(b) above;
(b)	if D was no longer living at the HK Address shown in the WoS as his address for service, P should clarify whether she should amend the WoS by setting out D’s newly found address.

8.  The court file had no record of any reply to the 4/6/20 Requisitions by the FSols. But it appeared from paragraph 9(f) below that as at 30 October 2020 (ie a day before the expiry of the primary 12-month validity period of the WoS), P had yet to answer the 4/6/20 Requisitions.

9.  On that very day (ie 30 October 2020), P filed the 1^st affirmation of her solicitor Douglas Anson James (handling solicitor at the FSols,[1] “Mr Douglas”) (“Douglas Aff”) as P’s ex parte application to extend the validity of the WoS issued on 31 October 2019 (“1^st Application”). By such time, the prima facie limitation period of 3 years for P’s claim that ran from the indexed incident on 31 October 2016 (as pleaded in the WoS – see paragraph 1 above) had expired. In the Douglas Aff, it was said:

(a)	P noted that Order 6 rule 8(2) of the RHC gives the court power to extend the validity of a writ of summons for the purpose of service, and that the court in the exercise of its discretion will adopt a 2-stage test: (i) the court is to consider whether there is “good reason” to grant such extension, and (ii) if so, a discretion will arise and the court may go on to consider factors such as the balance of hardship.
(b)	The P 1st Aff had informed the court that D resided at the Residential Address in the Philippines.
(c)	Subsequently, P arranged for a process server of Process Service Network, LLC (“PSN”) to investigate whether D was still at the Residential Address. On 6 October 2020, an agent of PSN visited the Shangri-la at the Fort, and was informed no one by the name Freda was at the hotel, which information was confirmed by a follow-up telephone enquiry.[2]
(d)	D’s then residential address was unknown to P, who subsequently engaged PSN to carry out “skip-trace” service in relation to D in the Philippines. On 29 October 2020, PSN told P they had exhausted their sources and were unable to find D’s place of residence. P asked PSN for details of the “skip-trace” service, and further asked whether anything further could be done to locate D’s residential address. P had yet to receive a reply from PSN. Thus, P would ask the court for more time to locate D, “to ascertain [D’s] residential address and serve the [WoS], or to apply for the [WoS] to be served at [D’s] workplace, which is known, as described in paragraph 6 of the [P 1st Aff]”.
(e)	Alternatively, PSN suggested to effect service of the WoS by publication in newspapers in Manila, Philippines, or by publication online via PSN’s affiliate company Global Legal Notices (“GLN”).[3] P asked for more time to consider possible application for substituted service by way of publication.
(f)	P claimed she was “in the process of satisfying the Court’s requisitions” (ie the 6/4/20 Requisitions), and anticipated being able to do so shortly after she heard from PSN regarding the details of PSN’s searches in order to decide on the best means of proceeding with service, eg whether to ask for leave to amend D’s service address to his workplace, or to ask for service by publication.
(g)	P claimed there was no known hardship or prejudice to D for extending the validity of the WoS. “However, if the validity of the [WoS] is not extended, [P’s] right to pursue its claim against [D] may be lost due to the limitation period of filing personal injury claims. In that case, the prejudice or hardship to [P] will be considerable.”

10.  On 6 November 2020, Master Roy Yu ordered (a) the validity of the WoS be extended for 6 months from the date of its expiry, and (b) costs of the application be in the cause (“1^st Order”).

11.  On 18 June 2021, P’s present solicitors (“Sols”) filed Notice of Change of Solicitors, giving notice that the Sols had been appointed to act for P in the present action in place of the FSols.

12.  On 16 August 2021, P filed her 2^nd affirmation (“P 2^nd Aff”) as her ex parte application to further extend the validity of the WoS that was issued on 31 October 2019 with validity period extended for 6 months to 30 April 2020 (“2^nd Application”). By the time P filed the P 2^nd Aff, the extended validity of the WoS had expired for about 3½ months. The P 2^nd Aff stated inter alia as follows:

(a)	Shortly after the 1st Application by the Douglas Aff, the handling solicitor[4] left the FSols. P considered for some time whether to continue with the FSols, but in the end decided to change solicitors.
(b)	In/about mid-February 2021, P engaged the Sols.[5]
(c)	On 3 March 2021, the Sols wrote to the FSols to arrange transfer of P’s file to the Sols for their handling. But the FSols were unwilling to transfer P’s file to the Sols until their fees were fully settled (ie the FSols exercised lien on P’s file). After some negotiations, P settled the FSols’ invoices on 11 June 2021, and the FSols thereupon agreed to transfer P’s file to the Sols. On 18 June 2021, the Sols filed Notice of Change of Solicitors, and P’s file was delivered to the Sols for their handling.
(d)	The Sols inspected P’s file from the FSols and discovered the WoS had been allowed to lapse in/about April 2021. When P was informed of this, she claimed the FSols had not advised her of such lapse of the WoS or the need to extend the validity of the WoS. P admitted she had not settled the FSols’ fees at the relevant time, but she had already asked them to transfer her file to the Sols, so she expected to be informed of such important matter when the FSols remained as her solicitors on the record with the court.
(e)	P also claimed she was told by the Sols that upon inspection her file as transferred by the FSols was incomplete with key correspondence and pleadings missing, that the Sols had chased the FSols for the same, and that the Sols received an updated batch of documents from FSols on 4 August 2021.
(f)	P asked for the court’s understanding that due to her illness caused by D, she had fairly low energy levels and needed to rest a lot after work. She also had long working hours as she was a full-time banker. P had to work hard to keep her job to preserve her career which she had worked hard to achieve, and to afford the very expensive medical treatments she had to pay over the past few years and still had to pay for, which she had yet to receive compensation or contribution from D.
(g)	P claimed it was costly, time-consuming and mentally draining for her to seek/receive treatment, and the 10 courses she had received had not been able to clear her refractory infection.
(h)	P was the sole carer of her mother (“Mother”) who had Alzheimer’s disease. P had applied for permanent resident status in Hong Kong so that she could apply for the Mother to come to Hong Kong, and that she could look after the Mother while keeping her job in Hong Kong. Otherwise P would have to visit the United Kingdom as much as possible to take care of the Mother, which was almost impossible during the pandemic. In December 2020, P flew to the United Kingdom to take care of the Mother who suffered from Alzheimer’s disease and who also contracted COVID-19. In February 2021, P travelled to the United States for her prescribed medical treatment that was unavailable in Hong Kong, and she only cleared quarantine in Hong Kong in mid-April 2021.
(i)	P claimed that for the above reasons it had been very difficult for her to find time to handle her affairs, including the present action, and urged the court to indulge her with further time.
(j)	As for the 1st stage of the 2-stage test referred to in paragraph 9(a) above, P referred to the P 1st and the Douglas Affs whereby the court was told D used to reside at the Residential Address, but private investigations revealed D had since moved away. P then engaged PSN to seek information regarding D’s residential address, but she had since been informed PSN had exhausted their sources had been unable to find D’s residential address. So P intended to ask for the WoS to be served at D’s workplace as known (ie the Office Address), and for such purpose P exhibited several recent articles showing D still worked at JTI Philippines, and she confirmed internet search on 16 August 2021 showed no update/change. But PSN advised P that if service on D at the Office Address was not possible, it was still possible to serve D by newspaper publication in Manila, Philippines or by online publication via GLN. P believed if service could be effected by the aforesaid alternative means, ie at the Office Address or by publication, there would be a very high chance D could be successfully served.
(k)	As for the 2nd stage of the 2-stage test referred to in paragraph 9(a) above, P claimed there was no known hardship or prejudice caused to D for extending the validity of the WoS. But if the validity of the WoS was not extended, P’s right to pursue her claim against D might be lost due to the limitation period for filing personal injury claims. She would then “have no recourse to recover compensation for [her] pain and suffering, past and future medical expenses, loss of earning capacity, loss of amenities and more. In that case, the prejudice or hardship caused to [P] will be considerable and permanent”.
(l)	P claimed there was good reason for the court to extend the validity of the WoS, and the balance of hardship also favoured granting the extension of the WoS in order to allow further time to arrange service of the WoS on D.

13.  The draft order that accompanied the 2^nd Application by way of the P 2^nd Aff showed inter alia that P asked for (a) extension of the validity of the WoS for a period of 12 months from the date of expiration of the WoS on 30 April 2021, and (b) costs of the application be costs in the cause (“Draft Order”).

14.  On 24 August 2021, Master Roy Yu refused the 2^nd Application due to “late application” and “no good reason shown” (“2^nd Order”).

15.  On 7 September 2021, P filed Notice of Appeal to appeal against the 2^nd Order for the proposed reliefs in the Draft Order (“Appeal”). The Appeal was heard by this court on 6 October 2021 (“Appeal Hearing”).

II.  LEGAL PRINCIPLES – EXTENSION OF VALIDITY OF WRIT

16.  Order 6 rule 8 of the RHC  Order 6 rule 8 of the RHC provides inter alia as follows:

“(1) For the purpose of service, a writ (other than a concurrent writ) is valid in the first instance for twelve months beginning with the date of its issue ……

(2)        Where a writ had not been served on a defendant, the Court may by order extend the validity of the writ from time to time for such period, not exceeding twelve months at any one time, beginning with the day next following that on which it would otherwise expire, as may be specified in the order, if an application for extension is made to the Court before that day or such later day (if any) as the Court may allow.”

17.  2-stage inquiry Order 6 rule 8(2) of the RHC provides a comprehensive code for the renewal of a writ.[6] The law regarding the exercise of the power to extend the validity of a writ has been clearly set out by the House of Lords in Kleinwort Benson Ltd v Barbrak Ltd[7] and has been adopted by the local Court of Appeal in Chow Ching Man & ors v Sun Wah Ornament Manufactory Ltd & ors,[8]Grand Pacific Equity Ltd v RSH Sports (HK) Ltd,[9] Tan Kah Eng v Tan Eng Khiam,[10] Chan Hon, the Administrator of the estate of Poon Lai Ming, deceased v Bayer Healthcare Limited formerly known as Bayer Diagnostics Limited formerly known as Bayer Diagnostics Limited formerly known as Chiron Limited and formerly known as Ciba Corning Diagnostics (HK) Limited & ors,[11] and Allied Welli Development Limited (In Liquidation) & anor v Chuang Yue Chien, Eugene & ors.[12]

18.  The exercise of discretion to extend the validity of a writ under Order 6 rule 8(2) of the RHC involves a 2-stage inquiry. At stage 1, the court must be satisfied that there is good reason to extend time (and also in a category (3) case referred to in paragraph 21 below that the plaintiff has given satisfactory explanation for his failure to apply before expiration of the validity of the writ); if this stage is passed, then at stage 2, the court exercises its discretion by considering all relevant circumstances, including prejudice and hardship.[13]

19.  In Chow Ching Man & ors, Bokhary JA (as he then was) recognised there can be a degree of overlap between the 2 stages, but such overlap does not undermine the 2-stage approach (page 341):[14]

“Subject to that, just because a factor would be relevant to which way the discretion ought properly to be exercised if it arose does not mean that such factor is necessarily irrelevant to whether or not the discretion arises in the first place. At no stage is justice irrelevant. After all, whether or not a reason is a good one is a question which falls to be determined by a court of law administering justice: justice according to law rather than palm tree justice of course but justice nevertheless.

As Waite, LJ pointed in Lewis v. Harewood, The Times, March 11 1996, there can be a degree of overlap between the two stages. And, as I see it, such overlap does not undermine the two-stage approach. It merely shows that the two stages are not watertight compartments for all purposes.”

Liu JA and Nazareth VP both quoted from inter alia the following passage in the judgment in Lewis v Harewood (page 345):

“…… Matters relevant at stage two are not, however, irrelevant at stage one. There is a degree of overlap, and a judge addressing the inquiry at stage one is entitled and bound to take into account any matters which appear to him to be relevant to the issues of good reason and satisfactory explanation,[15] notwithstanding that the same matters will also be relevant (assuming it arises at all) to the exercise of his discretion at stage two.”

20.  Application made after validity expired Where the interests of justice so require, the court will entertain an application under Order 2 rule 1 or Order 3 rule 5 of the RHC to extend the validity of the writ even after expiration of the validity period.[16] Order 2 rule 1 of the RHC provides that failure to comply with the requirements of the rules shall be treated as an irregularity not nullifying the proceedings, and that the court has a discretion to inter alia make such order dealing with the proceedings as it thinks just. Order 3 rule 5 of the RHC provides inter alia as follows:

“(1) The Court may, on such terms as it thinks just, by order extend …… the period within which a person is required or authorised 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.

……”

21.  Category (3) case Lord Brandon in Kleinwort Benson Ltd identified 3 main categories of cases in which, on an application for extension of the validity of a writ, questions of limitation of action may arise, all being cases in which the writ has been issued before the relevant period of limitation, ie the period applicable to the cause of action on which the claim made by the writ is founded, has expired:[17]

(a)	category (1) cases are where the application for extension is made at a time when the writ is still valid and before the relevant period of limitation has expired;
(b)	category (2) cases are where the application for extension is made at a time when the writ is still valid but the relevant period of limitation has expired;
(c)	category (3) cases are where the application for extension is made at a time when the writ has ceased to be valid and the relevant period of limitation has expired.

Lord Brandon at page 616 explained that in category (3) cases, “it is not possible for the plaintiff to serve the writ effectively unless its validity is first retrospectively extended, …… therefore, it can properly be said that, at the time when the application for extension is made, a defendant on whom the writ has not been served has an accrued right of limitation”.

22.  Here, the WoS was issued on the eve of the expiry of the prima facie limitation period of 3 years for personal injury claims, so by the time of the 1^st and/or the 2^nd Applications the prima facie limitation period had expired. Further, the primary 12-month validity of the WoS had been extended by the 1^st Order to 30 April 2021, but by the time P filed the 2^nd Application on 16 August 2021, the extended validity period of the WoS had expired for about 3½ months. Thus, as Mr Douglas fairly accepted, the present case was a category (3) case.

23.  It has been said that where the application for renewal is made after expiry of the validity period of the writ and after expiry of a relevant period of limitation (ie a category (3) case), the applicant must not only show good reason for the renewal, but must give a satisfactory explanation for his failure to apply for renewal before the validity of the writ has expired.[18]

24.  Good reason  It is the duty of the plaintiff to serve the writ promptly,[19] so the plaintiff has to first establish a good reason for extension or matters at least capable of so amounting so as to justify the exercise of a discretion to extend the validity of the writ under Order 6 rule 8(2) of the RHC.[20] “Good reason” is not as high as “exceptional circumstances”, the latter of which suggest a large degree of stringency which is not required.[21] The later the application is made, the better the reasons are required. This is especially so in category (2)-(3) cases where the period allowed for service extends beyond the end of any relevant period of limitation, and still more so in category (3) cases where the application for renewal is made until after such period, and with it the validity of the writ, has expired.[22]

25.  Whether there is good reason depends on all the circumstances of the particular case, and must be left to the judgment of the master/judge dealing with the matter.[23] It has been said the best reason is that the defendant has been avoiding service or that his address is unknown.[24] The “impossibility or great difficulty in finding or serving the defendant, more particularly if he is evading service” has been held to be an example of a good reason.[25] Indeed, the showing of a good reason for failure to serve the writ during the original period of validity is normally a necessary step to establishing a good reason for the grant of an extension.[26]

26.  When deciding whether good reason has been shown, it is relevant to consider whether the non-service was the result of the plaintiff’s deliberate choice.[27] Where the failure to serve a writ within its validity period was the result of a choice, the discretion to extend arises only if that choice has been made for a good reason, ie one which supports deliberate non-compliance with the time limit involved.[28]

27.  Chow Ching Man & ors was such a case as the writ could have been served within its normal validity period, but the plaintiffs’ solicitors chose to wait until the statement of claim and statement of special damages were ready so they could be endorsed on the writ (page 340). A few days before expiry of the validity of the writ, the plaintiffs issued a summons asking for extension of the validity of the writ for 12 months. A few days later, the master granted a renewal for 12 months. The defendants were served in a matter of days although copies served on 3 of the defendants were returned through the postal service. The plaintiffs adduced further evidence on appeal, but in the end the Court of Appeal upheld Findlay J’s decision to discharge the master’s order and to set aside the service of the writ. Bokhary JA (as he then was) (with whom Liu JA and Nazareth VP agreed) said at page 344 as follows:

“A perfect reason is not necessary. But nothing short of a good reason is enough, however well-intentioned it may have been and wherever one’s sympathies lie. We are, after all, in this context dealing with a deliberate decision not to comply with a highly important and already generous time limit. Our system cannot work efficiently in the interests of the general public if litigants and their advisers can simply presume upon the court’s indulgence. There is already quite enough delay in litigation through mere inattention to time limits; and things would only get worse if the courts were to countenance deliberate failures to serve writs within time in the absence of good reason for the choice.

As I understand the relevant law, there is nothing in the present case capable of amounting to a good reason for the extension in question. The judge did his best to find one. So have I. He could not find one. Neither can I.

As a result, I have, with considerable regret, come to the conclusion that these appeals must be dismissed, even if that means leaving the plaintiff to pursue such remedy as fresh legal advisers may advise them to pursue against their present legal advisers.

Accordingly, I would dismiss these appeals. ……”

28.  Although the conclusion that the non-service of a writ was the result of deliberate choice can be inferred from the circumstances,[29] whether such an inference can be drawn is fact-sensitive.[30] As DHCJ Keith Yeung SC (as he then was) said in Amadeaus Investment Ltd v Lin Kao Kun,[31] the interplay between inability to effect service and non-service out of choice is usefully illustrated by Grand Pacific Equity Ltd v RSH Sports (HK) Ltd[32] where Yuen JA observed as follows:

“29      .…… It matters not whether the inability to serve the third defendant was due to deliberate attempts on his part to evade service or not. The fact remains that the plaintiff was unable to serve the third defendant despite reasonable efforts having been made, which is clearly a good reason for leave to renew a writ. It was not as a matter of “choice” that the plaintiff did not serve the third defendant within the original validity period of the writ ……”

29.  Difficulty of service is not the only type of cases that amount to a good reason. It has been held that “the saving of unnecessary proceedings and costs achieved without prejudice to the respondents” constitutes good reason.[33] But ordinarily it is not a good reason that the plaintiff desires to hold up the proceedings while some other case is tried or to await some future development.[34]

30.  Balance of hardship  Once the requirement for a good reason has been satisfied (and a satisfactory explanation has been given for the failure to apply for renewal before the validity of the writ expired), the court is entitled to have regard to the balance of hardship between the parties and the possible prejudice to the defendant in all the circumstances if an extension is allowed.[35]

31.  Limitation defence  A limitation defence is not an absolute bar to the exercise of discretion to renew the writ. Bharwaney J in Tan Kah Eng v Tan Eng Khiam by his guardian, ad litem, Tan Eng Yam [36]explained as follows:

“43. …… The defendant now enjoys a limitations defence, but that is not an absolute bar to the exercise of the court’s discretion to renew the writ, as the following cases demonstrate.

44. In Jones v Jones [1972] QB 576 at pp. 586-587, Sachs LJ said:

“Where it is desired to deprive a defendant of his ability to plead the statute to limitation, naturally the good cause to be put forward must be strong. It is quite impossible to define the circumstances which can constitute ‘good cause’. It is sufficient in the present case to say that here we find the most unusual set of circumstances. Probably, they are and will remain unique … In this class of case, where the effects of statute of limitation have to be taken into account, it may very well be that the climate of opinion, both in the legislature and in the courts is … moving more towards an ascertainment of how lies the balance of justice between the parties.”

As recognised in the decision of the House of Lords in Kleinwort Benson Ltd v Barbrak Ltd, The Myrto (No. 3) [1987] AC 597, it is possible to renew a writ so as to deprive the defendant of the accrued benefit of a limitation period provided, however, that good cause or a good reason is established. Indeed, where application for renewal is made after the writ has expired and after the expiry of a relevant period of limitation, the applicant must not only show good reason for the renewal, but must give a satisfactory explanation for his failure to apply for renewal before the validity of the writ expired. Once the court is satisfied that a good reason or a good cause has been shown, it moves on to the next stage of the process, namely, to consider all the circumstances of the case, including the balance of prejudice or hardship, and, in this connection, it must weigh the balance of hardship to the plaintiff if the extension is refused and the hardship to the defendant if it is allowed.”

This was upheld by the Court of Appeal on appeal in Tan Kah Eng at p 341. Further, Hong Kong Civil Procedure 2022 states that “[the] test was the same whether the limitation period expired or not though the court might apply the test with less rigour where the limitation period had not expired ……”[37]

32.  Nevertheless, it has been said that a writ will not normally be renewed if the effect of which will be to deprive the defendant of the accrued benefit of a limitation period[38] unless there is good reason, eg the “impossibility or great difficulty in finding or serving the defendant, more particularly if he is evading service” may be a possible exception.[39] As Godfrey Lam J explained in Sealegend Holdings Ltd v China Taiping Insurance (HK) Co Ltd,[40]

“29. …… The law concerning the validity of a writ and its extension is no mere formal procedural rule. Underlying it is the policy of the law that promotes finality to litigation, the prevention of stale claims, and the protection of a defendant from having a claim hanging over his head indefinitely. Inasmuch as a plaintiff with a reasonable cause of action has a right to bring and serve proceedings within prescribed periods, a (potential) defendant has a right not to be vexed by actions that are time-barred or writs that have expired, unless they are extended by the court in accordance with the law. It was open for 6 years, after the vessel was damaged, in this case for the plaintiff to issue a writ and then open for another year for the plaintiff to serve it. These are generous time limits. The present application concerns whether the plaintiff should be granted an indulgence where it has not served the proceedings on the 3^rd defendant within these limits. I am not persuaded that, post-Civil Justice Reform, the court should more readily grant applications for extension of the validity of writs. In Hashtroodi v Hancock [2004] 1 WLR 3206, which was decided after the Civil Procedure Reform in England took effect in 1999, the English Court of Appeal said at [20]:

… One of the important aims of the Woolf reforms was to introduce more discipline into the conduct of civil litigation. One of the ways of achieving this is to insist that time limits be adhered to unless there is good reason for a departure.

30.  In fact, in Pacific Electric Wire & Cable Co Ltd v Hu Hung Chiu [2011] 1 HKLRD 1000, a case cited by Mr Alder which was decided after the Civil Justice Reform in Hong Kong, Reyes J applied the established principles drawn from well known cases such as Kleinwort Benson Ltd v Barbrak Ltd [1987] AC 597.”

33.  This is echoed in the observations by the Court of Appeal in China Medical Technologies Inc (In Liq) v Bank of China (Hong Kong) Ltd, in which Kwan JA (as she then was) said as follows:[41]

“83. …… Limitation issues are of crucial importance to the exercise of discretion whether to extend the writ and for how long. The rationale for informing the court which category the claims fall under is to differentiate the claims in which a defendant who has not been served has an accrued right of limitation (categories (3) and (4)[42]) from those that he has not (categories (1) and (2)). Further, as stated by Reyes J in Pacific Electric Wire & Cable Co Ltd v Hu Hung Chiu [2011] 1 HKLRD 1000 at [18], it would be unlikely for there to be good reason for extension in category (2) cases and even less likely in category (3) cases.

84. It is therefore incumbent on the liquidators to present the relevant limitation points clearly, unequivocally and comprehensibly. That was not done in Borrelli 1^st. Whether the Master would have exercised his discretion less favourably or in the same way if he had been correctly informed is beside the point. Nor is it an answer to say that the extension of the Writ would have no effect on the category (4) claims as the defendant would still be able to run a limitation defence which had accrued before the Writ was issued. The fact remains that the defendant would have to deal with the category (4) claims, which it would not have to deal with without an extension.

……” (my emphasis)

34.  The plaintiffs in that case applied for leave to appeal to the Court of Final Appeal. They failed in such application before the Court of Appeal and eventually before the Court of Final Appeal. Fok PJ[43] said since the application to extend the writ was made ex parte, it was incumbent on the plaintiff to make full and frank disclosure of all material facts relevant to the exercise of the master’s discretion. It was said the plaintiff’s affidavit clearly implied all the claims were not time-barred when the writ was issued, but in fact 6 claims were prima facie already time-barred at the date of the issue of the writ, so Mr Borrelli’s evidence was likely to have led the Master to think that there was potentially serious prejudice to the plaintiff if the writ were not extended but relatively little prejudice to the defendant since the claims were not time-barred at the date of the writ. There were also other misstatements in Mr Borrelli’s evidence about the underlying claims. Fok PJ agreed the master’s exercise of discretion was vitiated, and the judge on appeal having exercised the discretion afresh, there was no basis to say her exercise of discretion miscarried.

III.  LEGAL PRINCIPLES – MASTER’s APPEAL

35.  I have set out the relevant principles in paragraph 51 of my judgment in Ng Ting Kwok v Ng On Kwok & anor,[44] which I adopt but do not repeat here.

IV.  DISCUSSION

36.  Satisfactory reason  Mr Douglas submitted P had satisfactory reason for her failure to apply for extension before the validity of the WoS expired. It was said this came about due to P’s decision to change solicitors. As seen in paragraph 12(a)-(b) above, Mr Douglas (the handling solicitor of P’s file at the FSols) left the FSols and joined the Sols shortly after the 1^st Application was filed on 30 October 2020, and P decided to engage the Sols in place of the FSols to act for her in/about mid-February 2021. Mr Douglas submitted that P’s decision to change solicitors was not unreasonable and could not be criticised, and in fact such decision was a sign of P taking positive action towards prosecuting her case by engaging new solicitors (ie the Sols) to assist her.

37.  Mr Douglas contended that when the validity of the WoS expired on 30 April 2021, P was in “the unfortunate situation of limbo where she had engaged new solicitors [ie the Sols] to act on her behalf who were requesting her former solicitors [ie the FSols] for her files so as to provide her with advice, and she had already requested her former solicitors [ie the FSols] to pass her file to her new solicitors [ie the Sols] so that they may advise her instead”. It was said that although P was in arrears over the FSols’ fees at the relevant time, the FSols remained as solicitors on the record for P in the present action and therefore were duty bound to advise P of the then imminent expiry of the WoS, but the FSols (a) did not properly advise her that the validity of the WoS was about to expire, and (b) allowed the validity of the WoS to expire without taking protective steps to extend its validity, so no application to renew the validity of the WoS was made prior to its extended expiration on 30 April 2021. Mr Douglas argued that had the FSols wished to terminate their duty to advise P, they should have applied to cease to act for P under Order 67 rule 6 of the RHC (and to serve on P a summons and supporting affidavit for such purpose – see Order 67 rule 6(2) of the RHC), failing which the FSols would still “be considered the solicitor of the party till the final conclusion of the cause or matter whether in the Court of First Instance or Court of Appeal” (see Order 67 rule 6(1) of the RHC).

38.  Mr Douglas complained that here the FSols did not apply under Order 67 rule 6 of the RHC to cease to be solicitors on the record in the present action for P, but the FSols did not give P proper advice to renew the validity of the WoS, so P’s failure to renew the WoS in time (which would not have happened but for the lack of proper advice by the FSols during the period of limbo when she was changing solicitors) and her failure to serve the WoS was not the result of any deliberate choice or any deliberate non-compliance. It was said that had P been warned by the FSols of the impending expiry of the validity of the WoS, she would have been able to prevent such expiry either (a) by instructing the FSols to apply for an extension in time or (b) by requiring the FSols to transfer sufficient documents to the Sols (so that the Sols could apply for extension of the WoS in time) while still retaining their lien on the remaining papers. But since P had not been advised on the same, she was not aware of the urgent need to extend the validity of the WoS whilst negotiating with the FSols on costs. Mr Douglas submitted P should not lose her claim for the above reasons.

39.  Mr Douglas cited 2 authorities in support of his contentions. First, he referred to Holman v George Elliot and Company, Limited.[45] In that case, the plaintiff commenced proceedings for damages for a fatal accident by writ, but did not serve the same within 12 months from the date of its date as provided by Order 8 rule 1 of the Rules of the Supreme Court (“RSC”) (equivalent to Order 6 rule 8 of the RHC). The writ ceased to be in force, and on subsequent application by the plaintiff, Stable J extended the validity of the writ under Order 64 rule 7 of the RSC (equivalent to Order 3 rule 5 of the RHC). The English Court of Appeal held there was discretion under such rule which the learned judge could exercise in that case, and in all the circumstances his exercise of discretion was right and proper because “[all] that has happened is that, owing to the lamentable neglect on the part of the managing clerk of the solicitors then acting for the plaintiff, a day over the twelve months was allowed to lapse before he served the writ”.

40.  Secondly, Mr Douglas referred to Tso Yuet Kuk v Sure Famous Limited & anor.[46] In that case, the writ was issued on 21 August 2019 for a claim for personal injury, loss and damages as a result of an accident to the plaintiff at a construction site on 8 September 2016. On 15 October 2020, the plaintiff applied to extend the validity of the writ for 6 months from the date of its expiry. The plaintiff explained he did not serve the writ before 21 August 2020 because the 1^st defendant was dissolved on 27 December 2019 and was not restored to the Companies Register until September 2020. The plaintiff’s solicitors learned of the dissolution of the 1^st defendant from the solicitors for the 1^st and 2^nd defendants on 21 January 2020, whereupon they conducted a company search and confirmed the 1^st defendant applied for deregistration on 27 July 2019 with notice of deregistration gazetted on 27 December 2019. The plaintiff’s solicitors commenced proceedings to restore the 1^st defendant to the Companies Register, and the court so ordered on 29 July 2020. After completion of the relevant procedures, the 1^st defendant was restored in late September 2020, by which time the validity of the writ had expired.

41.  As to whether there was good reason for extending the validity of the writ, the learned master focused on 3 periods, ie from January to 29 July 2020, from July to October 2020, and the 3-month period immediately after issuance of the writ, and concluded there were good reasons to justify the exercise of discretion to extend the validity of the writ (paragraph 34).

42.  For the 1^st period, the defendant complained that the plaintiff waited until 12 May 2020 to apply to the Director of Legal Aid (“DLA”) to extend the legal aid certificate to cover the proceedings to restore the 1^st defendant. But there was communications between the plaintiff’s solicitors and the DLA on the subject prior to 12 May 2020, so there was “no evidence to suggest that the Plaintiff’s solicitors chose to sit back and let the time go by” (paragraph 23). Further, an application for restoration of a deregistered company did not fall within specified categories of urgent applications to be heard during the Judiciary’s general adjourned period as a result of public health considerations (paragraph 24). The plaintiff’s legal aid certificate was extended on 29 May 2020; he issued an originating summons for restoration of the 1^st defendant on 3 June 2020; a consent summons was made on 24 July 2020; and an order was granted on 29 July 2020 to restore the 1^st defendant. The learned master was satisfied “the Plaintiff’s solicitors had been prosecuting the action at a reasonable pace after they had actual knowledge about the deregistration of the 1^st defendant in January 2020” (paragraph 25).

43.  For the 2^nd period, although the court order for restoring the 1^st defendant to the Companies Register was sealed on 31 July 2020, the plaintiff had to pay the Registrar of Companies’ costs through the DLA, and notwithstanding letters by the plaintiff’s solicitors to the DLA asking for payment of such costs on 6 August and 8 September 2020, time was required for the DLA (who had been making arrangements since 12 August 2020) and the Treasury to arrange payment due to public health special work arrangements. Eventually payment was made on 22 September 2020, and the restoration of the 1^st defendant was verified by company search on 30 September 2020, so the application to extend the validity of the writ was filed on 25 October 2020. The learned master was satisfied that the plaintiff’s solicitors had taken reasonable steps with “nothing to suggest that the failure to serve the writ was the result of choice or any deliberate non-compliance on the part of the Plaintiff” (paragraph 27).

44.  For the 3^rd period, the defendants suggested the plaintiff could have served the writ during this period. The letters issued by the defendants’ solicitors on 10 January 2020 and by the plaintiff’s solicitors on 24 January 2020 showed (a) the defendants replied to discovery requests by providing the plaintiff’s and comparable workers’ wage records and by confirming lack of other documents as sought, and (b) the plaintiff provided the defendants with documents concerning an industrial summons, and dealt with matters concerning medical records, joint medical examination and evidence on earnings. The learned master found the plaintiff and his solicitors took active steps after issuance of the writ, and did not choose to withhold or delay service (paragraph 32).

45.  Mr Douglas submitted P’s situation was similar to that of the plaintiff in Tso Yuet Kuk as she did not allow the WoS to lapse as a matter of choice: (a) it was reasonable for her to assume she was not required to renew the WoS when she was not so advised, (b) she was then taking active steps to prosecute her case by changing solicitors, and (c) there was no deliberate non-compliance on her part. Mr Douglas reminded that the learned master in Tso Yuet Kuk said as follows:

“34.  There must be “good reason” to justify the exercise of a discretion to extend the validity of a writ beyond the appropriate period allowed for its service but “exceptional circumstances” or “perfect reasons” are not required. It is not possible to define or circumscribe what is a good reason. Whether a good reason is bad or good depends on the circumstances of the case. ……”

Mr Douglas submitted that even though P did not have a “perfect reason” (as in Tso Yuet Kuk) in the sense that there was nothing physically stopping P from applying for extension of the validity of the WoS “had P been aware of the shorter duration of the second extension and expiry date of the [WoS]”, but P had acted reasonably in the circumstances in the absence of proper advice from the FSols, so there was “satisfactory explanation” for P’s failure to apply to extend the WoS in time as required for the category (3) situation. It was said even if P were somewhat at fault due to the FSols’ neglect, the court would still have discretion to extend the validity of WoS as in the case in Holman where the plaintiff’s solicitors neglectfully served the writ on the defendant after it had expired. Mr Douglas urged me to take into consideration “the considerable hardship that P has been facing by being severely ill, requiring frequent medical attention and treatment, changing solicitors, keeping a demanding job, caring for her elderly mother with Alzheimer’s, and requiring much more rest than a normal person” in deliberating whether or not P had satisfactory explanation for her failure to extend the WoS in time.

46.  I start with the fact that Mr Douglas was the handling solicitor at the FSols for P’s claim against D in the present action. He left the FSols in November 2020 shortly after he made the Douglas Aff on behalf of P for the 1^st Application (see paragraph 12(a) above). Mr Douglas (as he fairly accepted at the Appeal Hearing) was aware that on the very eve of the expiry of the primary 12-month validity period of the WoS (ie on 30 October 2020) P applied to extend the validity of the WoS (see paragraph 9 above). Master Roy Yu granted the 1^st Order a week later (ie on 6 November 2020). P claimed neither Mr Douglas nor herself was unaware of the outcome of the 1^st Application, ie whether or not the validity period of the WoS was extended, and if so, for how long (see paragraph 12(d) above). But Mr Douglas at the Appeal Hearing did not shy from the fact that he knew the primary 12-month validity period of the WoS had expired on 31 October 2020, and that the continued validity of the WoS (if any) was dependent on the outcome of the 1^st Application.

47.  P claimed that after Mr Douglas left the FSols in November 2020, she considered for some time whether to continue with the FSols or to change solicitors to act for her in the present action, and in the end she decided to change solicitors (see paragraph 12(a) above). I agree with Mr Douglas that P should not be criticised for wishing to change solicitors, especially when the particular solicitor at the FSols handling her case (ie Mr Douglas) had left the FSols. It was also not unreasonable for P wishing to continue to retain Mr Douglas (and hence the Sols where he now practised) to act for her in the present action.

48.  According to the P 2^nd Aff, P engaged the Sols (and hence Mr Douglas) to act for her in/about mid-February 2021 (see paragraph 12(b) above). As explained in paragraph 46 above, Mr Douglas having made the Douglas Aff and having filed the 1^st Application on behalf of P when he was still at the FSols would have realised in/about mid-February 2021 that (a) the outcome of the 1^st Application not known to him or P, ie it was then unclear (i) whether the WoS was still valid for service, and (ii) if so, what was the extended validity period, and (b) the answers to (a)(i)-(ii) above would have impact on whether and if so how soon P would have to (1) answer the 6/4/20 Requisitions to apply for a concurrent WoS and to seek leave to serve the concurrent WoS out of jurisdiction, (2) arrange for service of such concurrent WoS on D overseas, and/or (3) re-apply for further extension of the validity of the WoS.

49.  Faced with the above uncertainty, the Sols wrote to the FSols to arrange transfer of P’s file to the Sols for their handling (see paragraph 12(c) above). The Sols (presumably expecting transfer of P’s file by the FSols) did not specifically raise with the FSols the matters in paragraph 48(a)-(b) above. The Sols did not raise these matters with the FSols even when the latter exercised lien on P’s file, and were unwilling to transfer P’s papers to the Sols pending settlement of their outstanding fees/costs. It was said that no urgency was perceived since the FSols, who remained as solicitors on the record for P in the present action, did not advise that the validity of the WoS was about to expire, and/or that protective steps would be required to extend its validity. I will return to discuss this in paragraphs 55-57 below. In any event, I accept that even if the Sols had made such enquiry with the FSols, the outcome would depend on the goodwill of the FSols, and it was at best uncertain whether the FSols would have responded substantively given (a) P’s discharge of their retainer, (b) P’s ongoing differences with them over outstanding fees/costs (which was not resolved until 18 June 2021), and (c) their lien over P’s file (which by reason of (b) above was only lifted on 18 June 2021). I am not persuaded P/Sols could be blamed for not making specific enquiry with the FSols about the validity of the WoS at that stage.

50.  I next consider whether the Sols having been engaged by P as her solicitors since mid-February 2021 could have promptly filed their Notice of Change of Solicitors to replace the FSols as solicitors on the record for P in the present action, and thus be able to search the court file and to view and obtain copies of the 1^st Order and other filed court documents, eg the WoS, the ExP Summons, the P 1^st Aff (with exhibits) and the Douglas Aff (with exhibits) / 1^st Application (“Other Filed Documents”), or alternatively advised P to file Notice to Act in Person to replace the FSols on the record in the present action, so that she herself could have searched the court file and could have obtained copies of the 1^st Order and the Other Filed Documents. Had either of these steps been taken, then P / Sols would have learned from the 1^st Order on the court file that the 1^st Order did extend the validity of the WoS but such extended validity would expire on 30 April 2021, which in turn meant it might have been possible to file ex parte application for further renewal of the WoS before such expiry on 30 April 2021. But P /Sols did not take these steps. Is there a satisfactory explanation for not doing so?

51.  The FSols ceased to be solicitors on the record for P in the present action only on 18 June 2021 when the Sols filed their Notice of Change of Solicitors. P / Mr Douglas suggested it was for the FSols to apply under Order 67 rule 6 of the RHC to withdraw from the record in the present action upon P’s discharge of their retainer, but the FSols did not do so. In my view, the FSols’ failure to take steps to get off the record would not amount to any legal impediment for P to file/serve Notice to Act in Person or for the Sols (when engaged by P in mid-February 2021) to file/serve Notice of Change of Solicitors. Order 67 rule 4 of the RHC provides inter alia that “[where] a party, after having sued …… by a solicitor, intends and is entitled to act in person, the change may be made without an order for that purpose ……”, and Order 67 rule 1(1) of the RHC provides inter alia that “[a] party to any cause or matter who sues or defends by a solicitor may change his solicitor without an order for that purpose ……” (my emphasis).

52.  Thus, there was no legal requirement for P / Sols to await the FSols’ summons to withdraw from representing P in the present action and the consequent court order to such effect before P / Sols could appear on record to act on her own or by the Sols in the present action. This is also made clear in Order 67 rule 6(1) of the RHC which provides that a solicitor may apply to court to withdraw from the record “[where] a solicitor who has acted for a party in a cause or matter has ceased to so act and the party has not given notice of change in accordance with rule 1, or notice of intention to act in person in accordance with rule 4 ……” (my emphasis). Thus, it was legally possible under the RHC for P / Sols to file/serve Notice to Act in Person or Notice of Change of Solicitors, and then to search the court file and obtain copies of the 1^st Order and the Other Filed Documents whilst P negotiated to resolve her differences with the FSols over outstanding fees/costs and hence the FSols’ lien over P’s file.

53.  Notwithstanding such legal possibility, it still begged the question whether there was any satisfactorily explanation for not taking such step to so look for the 1^st Order to ascertain the status of the validity of the Wos.

54.  P / Mr Douglas complained that the FSols, who remained as P’s solicitors on the record in the present action notwithstanding P’s discharge of their retainer (ie what P / Sols described as the limbo state between change of solicitors), failed to discharge their duty to P by allowing the validity of the WoS to expire without properly and promptly advising her of the imminent lapse of validity of the WoS and the need to take steps to extend its validity, so P was unable to take action accordingly, eg (a) by instructing the FSols to apply for extension of the validity of the WoS or (b) by requiring the FSols to transfer sufficient documents to the Sols (for the Sols to make such application) whilst allowing the FSols to retain their lien over the remaining papers (see paragraphs 12(d) and 38 above), I pause to note (b) above contemplated the Sols would have filed a Notice of Change of Solicitors. It was said on such basis P / Sols were lulled into belief that the WoS was still valid, and it was not until 18 June 2021 that P / Sols discovered its expiry upon the Sols filing Notice of Change of Solicitors and the FSols delivering P’s file to the Sols (see paragraph 12(c) above).

55.  As explained in paragraphs 12(c) and 51 above, the FSols remained as P’s solicitors on the record in the present action until 18 June 2021 (when the Sols filed their Notice of Change of Solicitors – see paragraph 11 above) even though P discharged their retainer in late 2020 or early 2021 (ie before mid-February 2021 in any event). Order 67 rule 1 of the RHC provides that unless and until a Notice of Change of Solicitors “is filed and copies of the notice are lodged and served in accordance with this rule, the former solicitor shall, subject to rules 5 and 6, be considered the solicitor of the party until the final conclusion of the cause or matter ……” Further, it has been said that “[in] contentious business so long as the solicitor’s name remains on the record he is deemed by the court to be still acting for the client and is under a duty both to the court and to the client to act accordingly while his name remains on the record. The solicitor is entitled to charge the client for any work necessarily done between termination of the retainer and removal from the record”.[47]

56.  In Lady de la Pole v Dick,[48] the executrix of the estate of the testator obtained judgment for an account against the testator’s agent. Accounts were subsequently taken, and the agent was ordered to pay money into court, which was to be carried to the credit of an action for administering the estate. The agent went abroad without complying with the order. On appeal, the order was varied by ordering the agent to pay the money to the executrix who was to pay it into court in the administration action. It was held that the notice of appeal was properly served on the agent’s solicitors who stated they had ceased to act for him but they were still solicitors on the record. Cotton LJ said at pages 356-357 as follows:

“…… In the present case, however, I think it clear that, the fruits of the judgment not having been obtained by the Plaintiff, there was a duty imposed on the Defendant’s solicitor on the record as between himself and his client, so far as the client had not discharged him, and also as regards the other side, so as to make service upon him good service. The neglecting to change a solicitor when he ceases to act does not discharge him. Rolle, CJ, lays down in Lawrence v Harrison a principle on which we may act. He says, “The only question is, whether the warrant of attorney be determined by the judgment given in the suit wherein he was retained; and I conceive it is not, for the suit is not determined, for the attorney after the judgment is to be called to say why there should not execution be made out against his client, and he is trusted to defend his client as far as he can from the execution.” According to that principle, until the judgment has been worked out, there is a duty imposed on the solicitor on the record to defend his client against any improper steps taken for the purpose of enforcing the judgment. Until that time, therefore, the solicitor on the record must be taken, as between him and the opposite party, to represent the client, unless the client not only discharges him but substitutes another solicitor on the record. ……” (my emphasis)

57.  In my view, there is sufficient basis for P’s contention that the FSols should have promptly advised her that the validity of the WoS was about to expire, and that steps should be taken to extend the validity of the WoS before its expiry. After all, solicitors have obligations in relation to time (including time effecting service of the originating process during the period of validity for service),[49] and generally speaking, should not have failed to renew a writ in time to prevent the application of the Limitation Ordinance Cap 347.[50] Given such duty of skill/care that the FSols owed to P, and in the absence of any such notice/advice by the FSols, I accept P / Sols were lulled into a sense of complacency (which later transpired to be incorrect) that there was no concern over the validity of the WoS pending overseas service on D.

58.  Mr Douglas was right to accept this was not a “perfect explanation” for the delay in taking out the 2^nd Application until after expiry of the validity of the WoS. It was unlike the situation in Tso Yuet Kuk where the plaintiff in that case was unable to serve the originating process on the deregistered 1^st defendant until it was restored to the Companies Register. Here, had Mr Douglas / Sols, whom P engaged in mid-February 2021, taken steps to ascertain the outcome of the 1^st Application and the then status of the WoS (as discussed in paragraph 50 above) to see if prompt action was required, P might have been able to apply for extension of the validity of the WoS before 30 April 2021. As it were, P / Sols relied on the FSols as P’s solicitors on the record in the present action to let them know if there was anything untoward in relation to the WoS and/or if prompt protective action was required, but it was said that the FSols let them down.

59.  I bear in mind P did not have to demonstrate a “perfect explanation”, rather she had to show a satisfactory explanation for the delay beyond expiry of the validity of the WoS. In my view, given the FSols’ duty as solicitors on the record as explained in paragraphs 55-57 above, I cannot say the complacency and inaction by P / Sols until mid-June 2021 was unreasonable or, at the very least, amounted to any deliberate choice or non-compliance with the 1^st Order.

60.  Further, this should also be viewed in its proper factual context. From November 2020 to mid-February 2021, P deliberated whether she should change solicitors (see paragraphs 12 (a)-(b) above). During that period, the Mother who had Alzheimer’s disease contracted COVID-19, and P flew to the United Kingdom in December 2020 to look after her (see paragraph 12(h) above). After P engaged the Sols in mid-February 2021, the Sols promptly wrote to the FSols on 3 March 2021 to arrange transfer of P’s file to them (see paragraph 12(c) above). P engaged in protracted negotiations with the FSols over their outstanding fees/costs (see paragraph 12(c) above), but during such period P was not directly available most of the time because in February 2021 she travelled to the United States for her medical treatment for the Transmuted Diseases, and she only returned to Hong Kong and cleared quarantine in mid-April 2021 (see paragraph 12(h) above). P’s differences with the FSols over the latter’s outstanding fees/costs were not resolved until 18 June 2021, and in the meantime the FSols exercised lien over P’s file. Thus, neither P nor the Sols had access to P’s file kept by the FSols from November 2020 to 18 June 2021.

61.  At common law, a solicitor has a general lien to retain any money, paper or other property belonging to his client which properly comes into his possession until payment of his costs.[51] It has been said that if the retainer is terminated by the client other than for misconduct by the solicitor (as in the case of discharge of the FSols’ retainer by P), the solicitor’s lien is virtually absolute, and he cannot be required to hand over or produce for inspection any papers in his possession and he is entitled to keep them until his costs have been paid.[52]

62.  There is (a) inherent jurisdiction of the court over its officers to order a solicitor (upon summary application by his client by way of summons) to deliver up to his client in proper condition all documents in the solicitor’s custody or power belonging solely to the applicant,[53] eg for the purpose of drawing up of an order,[54] and (b) statutory jurisdiction under section 65(1) of the Legal Practitioners Ordinance Cap 159[55] and Order 106 rule 5 of the RHC[56] for the court to order a solicitor to deliver up documents in his possession, custody or power.[57] But not having been alerted by the FSols of the imminent expiry and the eventual expiry of the validity of the WoS, P did not see the need to break the FSols’ lien by making application to the court for delivery up of P’s file (and there was no suggestion she sought advice from the Sols on the same). In any event, even if such an application for delivery up of P’s file had been made, the court would have to bear in mind the existence of a concurrent lien over P’s papers even though the present action is still live in deciding whether or not to grant such order.

63.  Given that P was at the time engaged in protracted negotiations with the FSols over their outstanding fees/costs and that the FSols exercised their lien over P’s file upon termination of their retainer, I can see there would be practical constraints due to the non-availability of P’s file, eg the Sols might need materials/information from P’s file to liaise/contract PSN and GLN for update on their investigations about P’s residential address in the Philippines, and/or to put together the P 2^nd Aff to support the 2^nd Application. This (together with the need to take instructions from P) would also explain why P / Sols took 2 months after 18 June 2021 to file the 2^nd Application on 16 August 2021. As explained in the P 2^nd Aff, P’s file as transferred by the FSols on 18 June 2021 was incomplete, and the Sols received further documents from the FSols on 4 August 2021 (see paragraph 12 (e) above).

64.  As explained above, whilst engaged in protracted negotiations with the FSols over their outstanding fees/costs upon discharge of their retainer until mid-June 2021, P had to travel to (a) the United Kingdom in December 2020 to take care of the Mother, and (b) the United States in February 2021 for her medical treatment, and she only cleared quarantine in Hong Kong by mid-April 2021 (and it was unknown to her then that it was just 2 weeks shy of the expiry of the validity of the WoS). In short, P was not in Hong Kong or was incommunicado during the material period from December 2020 to April 2021 save presumably for electronic means, and I accept the constellation of factors discussed above, eg P’s / Sols’ reliance on the FSols’ duty to advise on the important matter of expiry of the validity of the WoS, the Mother’s illnesses, P’s own medical treatment and the non-availability of P’s file from the FSols, combined to provide a satisfactory explanation why the validity of the WoS lapsed before the 2^nd Application was made. I find in all the circumstances such delay was not a matter of P’s or her solicitors’ (ie the Sols’) deliberate choice or deliberate non-compliance.

65.  I do not think P could draw much assistance from Holman and/or Tso Yuet Kuk for the facts were far different from P’s situation. Holman was a straightforward case of solicitor’s neglect simpliciter, but here there was no legal impediment for P or the Sols to have taken the steps discussed in paragraph 50 above to ascertain the status of the WoS and perhaps to have gone on to take earlier steps to deal with the lapse of the validity of the WoS, and the true question was rather whether P had a satisfactory explanation in failing to take such step. As explained above, I have found for P on this question (see paragraph 64 above). I have in paragraph 58 above explained why P did not have a “perfect explanation” as the plaintiff in Tso Yuet Kuk did, but notwithstanding the absence of such “perfect explanation”, I accept P had a satisfactory explanation as to why she / Sols did not take file the 2^nd Application before 30 April 2021.

66.  Good reason  Mr Douglas submitted there was good reason to justify further extension of the validity of the WoS. He pointed out P would need further time to locate/serve D in the Philippines. Although P could no longer serve any concurrent WoS to be issued on D at the Residential Address, there was contemporaneous evidence to show D was still working in the Philippines, so there would be good opportunity to serve him at his place of work. Mr Douglas argued that extension of the validity of the WoS was required because D’s current residential address was unknown, and P would need further time to serve D at the Office Address or otherwise by publication.

67.  Mr Douglas suggested P did not evince any lack of will to prosecute her claim and/or to appear to await some future development, and submitted her act of changing solicitors and settling the FSols’ fees/ costs suggested otherwise, and in fact demonstrated her will to prosecute her claim. Mr Douglas also urged this court to take into consideration “the considerable hardship that P has been facing by being severely ill, requiring frequent medical attention and treatment, changing solicitors, keeping a demanding job, caring for her elderly mother with Alzheimer’s, and requiring much more rest than a normal person” in deliberating whether or not P had shown good reason for affording her further time to serve the WoS. Mr Douglas submitted that losing her claim would be too harsh an outcome for P when she had been acting reasonably in the circumstances.

68.  I note P had not yet answered the 6/4/20 Requisitions, had not obtained leave to issue a concurrent WoS, had not obtained leave of the court to serve D out of jurisdiction, and had not effected service on D in the Philippines even up to 30 April 2021 (ie the date of expiry of the extended period of validity of the WoS).

69.  The reason offered by the Douglas Aff as at 30 October 2020 was that P could no longer be found at the Residential Address, and despite “skip-trace” service PSN could not locate D’s then residential address in the Philippines, so further time was required for P (a) to obtain details of the “skip-trace” service by PSN, and to see what further could be done to locate D’s residential address so as to serve any concurrent WoS to be issued on D thereat, or (b) to seek leave to serve any concurrent WoS to be issued on D at the Office Address or by publication via newspapers or online through GLN (see paragraph 9(b)-(e) above). It was said P would answer the 6/4/20 Requisitions once further information about searches in relation to D were available to enable P to decide on the appropriate mode of service (see paragraph 9(f) above). Master Roy Yu obviously accepted these matters constituted a “good reason” for he granted the 1^st Order to extend the validity of the WoS to 30 April 2021.

70.  There was not much development since then up to the time of the 2^nd Application on 16 August 2021 except PSN told P D’s residential address remained unknown even though they had exhausted their investigations, so P had to consider alternative means of service on D at the Office Address or by way of publication via newspapers or online through GLN (see paragraph 12(j) above).

71.  According to the P 1^st Aff, P intended to effect service of the concurrent WoS to be issued on D in the Philippines in accordance with “local laws”, which service would be verified by notarised affidavit of service (see paragraph 6(e) above). At the Appeal Hearing, I was concerned there was no evidence before this court as to the applicable “local laws” on service of a foreign writ on a resident in the Philippines. However, on further consideration, PSN was in the professional business of service of process in the Philippines, and its CEO/owner was said to be a registered process server (see footnote 2 above). PSN placed much emphasis on service to be effected at D’s residential address, and considered service on D at his place of work and by way of publication as alternatives if service at D’s residential address failed (see paragraphs 9(d)-(e) and 12(j) above). I accept P had practical difficulty in ascertaining D’s current residential address after he left the Residential Address even though she engaged PSN to carry out various searches and investigations.

72.  Moreover, in the period from 6 November 2020 (when Master Roy Yu granted the 1^st Order) to 30 April 2021 (when the extended validity of the WoS expired), P / Sols had been plagued by the matters discussed in paragraphs 54-64 above. The change of solicitors leading to non-availability of P’s file (which would have contained contact details and communication records with PSN and/or GLN) due to the FSols’ exercise of their lien, P’s / Sols’ reliance on the FSols to advise them of any concerns over the status of the WoS, and/or P’s unawareness of the expiry of the validity of the WoS in the absence of notice by the FSols all contributed to P’s failure to take early steps to complete the searches and investigations for D’s current residential address, and hence to identify the appropriate mode of service on D under the “local laws” for proceeding further with the ExP Summons. In my view, the above factual matrix and P’s conduct did not reflect any desire to hold up proceedings or to delay service of originating process on D.

73.  Again, the above would not be a “perfect reason” or “exceptional circumstances”. But all that was required was a “good reason”, and I am satisfied that the above analysis showed there was good reason for extension of the validity of the WoS, and that P’s failure to progress the ExP Summons and to effect service on D was not her deliberate choice or deliberate non-compliance. P was guided by the FSols and PSN, and focused on D’s residential address which could not be ascertained after he left the Residential Address. However, as P now recognised, she should now turn to the Office Address and other means of service permissible under “local laws”. As for service on D at the Office Address where he worked, if D could be personally served with the originating process thereat, it might well be good service under the lex fori despite any of the “local laws”.[58]

74.  Balance of hardship / prejudice  Turning to the exercise of discretion in all the circumstances (including prejudice and hardship) under stage 2, Mr Douglas drew on the illustrative example in Jones v Jones.[59] In that case, the plaintiff was injured in a motor accident on 19 July 1965. He issued a writ on 13 June 1968 and served the same on the 1^st defendant (driver of car that carried the plaintiff as passenger) on 11 June 1969. The plaintiff’s solicitors misunderstood the effect of Order 6 rule 8 of the RSC and thought if the writ was served on the 1^st defendant within its 12-month validity period, it would still be valid for service on the 2^nd defendant (driver of the other car involved in the motor accident) after such period without renewal. The plaintiff’s solicitors sent the writ to the London agents (arrived on 17 June 1969) for service on the 2^nd defendant. The London agents consulted a practice master who considered the writ valid, and service was effected on the 2^nd defendant on 3 July 1969. The 2^nd defendant successfully applied to set aside service, but on appeal the judge extended time for service, taking the view the plaintiff ought not to be prejudiced because his solicitor held a view a reasonable man could hold. On further appeal to the English Court of Appeal, it was held there was no ground to interfere with the judge’s exercise of discretion as there was good cause for extending the time for service.

75.  Salmon LJ at p 584 explained as follows:

“In the present case the injured plaintiff was a passenger. He was clearly entitled to recover damages against one or other or both of the defendants. Should the order of the judge be reversed, the plaintiff might well be left without any remedy. That hardship must be balanced against the hardship which the judge recognised that the defendant may suffer as a result of the long delay. Although there has been serious delay, for which I do not suppose that the defendant is to blame, clearly the solicitors were in no way negligent before June 12.

…… There was no negligence [on the part of the plaintiff’s solicitor], although it is most unfortunate that there was the delay up to June 12. Nor …… was the solicitor negligent in mistakenly taking the view that he could properly serve the second defendant after June 12 without renewing the writ. Had the second defendant been served on June 12, he could have had no legal objection, although no doubt at the trial he could have argued that he had been prejudiced by the unnecessary delay with which the plaintiff’s advisers had conducted the litigation. The writ was served on him – not validly, it is true, but it was served on him and he knew all about it, on July 3, 1969; so on that basis he is only a few weeks worse off than he would have been if the writ had been served on time. The renewed writ was served on August 19, validly, as it now turns out; so even then he was only about nine weeks worse off than he would have been on June 12.

I think that, balancing the hardship to the plaintiff which would have followed had the appeal been dismissed against the hardship which the second defendant may now suffer, the judge was fully entitled to come to the conclusion that it was just and proper and that there was good and sufficient reason, to extend the time for service of the writ upon the second defendant.”

76.  I am unable to see how Jones would be helpful given the very different factual matrix. In that case, the belief of the plaintiff’s solicitors was held to be reasonable albeit mistaken, but in any event the defendant was served promptly and was only a few weeks worse off than he would have been if the writ had been served on time. Here, P had not even obtained relevant orders under the ExP Summons for service out of jurisdiction, so he could not have effected service of the WoS at all.

inter partes to set aside the ex parte order to extend the WoS.

78.  As regards any suggestion P would not suffer much hardship given her potential cause of action against the FSols, Mr Douglas submitted such claim had significant litigation risk due to the fact P (who carried the evidential burden) had terminated the retainer by the time of the FSols’ neglect. Mr Douglas further submitted “if P cannot continue her claim against D, justice would not be done, as the primary culpability of P’s suffering arises from D’s acts, not [the FSols’] lack of advice. D would get a free pass for his deplorable acts”.

79.  I accept that any refusal to extend the validity of the WoS would cause hardship to P who claimed to suffer from the Transmuted Diseases due to D’s wrong, and who therefore would not be able to seek redress and compensation from D due to limitation issue. But it was not correct to say D had no prejudice. He is presently in the Philippines, and his health/medical records and his witnesses for the indexed complaint in 2016 (if any) would be in Hong Kong. It might arguably be said that the delay in serving the concurrent WoS to be issued would add difficulty to D’s eventual efforts in getting hold of witnesses and gathering documentary evidence. Further, D now enjoys an accrued limitation defence (see paragraphs 9(g) and 12(k) above). This must be a consideration to be taken into account although it would not be an absolute bar to renewal of the WoS.

80.  Taking all matters discussed above into account, and weighing the balance of hardship and prejudice to P if the 2^nd Application was refused and the hardship and prejudice to D if such application was allowed, I exercise my discretion to renew the WoS. P had taken out the ExP Summons and also engaged PSN through the FSols to ascertain D’s whereabouts. She engaged the FSols and later changed to engage the Sols to prosecute her claim. She placed reliance on the FSols as to the vitality of the WoS, and on PSN as to the manner/mode of service, but was handicapped by her dispute with the FSols over their outstanding fees/costs which resulted in the non-availability of P’s file to the Sols, and by the FSols’ failure to inform her about the lapse of the WoS. P / Sols were lulled into belief as to the continued vitality of the WoS due to the FSols’ silence on the subject. Although P could have progressed the Ex P Summons by proposing to effect personal service on D at the Office Address, she / Sols felt guided by PSN on the manner/mode of service on D under “local laws”. Further, over the relevant period from November 2020 to August 2021, P had to deal with her dispute with the FSols over their outstanding fees/costs, the Mother’s illnesses, her Transmuted Diseases and its effect on her, and her own medical treatment whilst holding down her job during trying pandemic times. Taking all of the matters into account, I am persuaded that on a careful balancing exercise, and even taking into account D’s accrued limitation defence, I should exercise my discretion to renew the WoS.

V.  CONCLUSION

81.  I hereby allow the Appeal, and grant an order in terms of the Draft Order (see paragraph 13 above). Had the 2^nd Application been made prior to the expiry of the validity of the WoS on 30 April 2021, I would have extended the validity of the WoS only for 5 months. As it were, since the 2^nd Order dismissed the 2^nd Application, and time was required to hear/determine the Appeal, I now extend the validity of the WoS for 12 months from the date of its expiry, which in practical terms would allow P another 5 months from now to serve the WoS.