WONG KAM WING v. CHENG PUI LUN AND ANOTHER

CACV 413/2002

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 413 OF 2002

(ON APPEAL FROM HCA 479/2002)

_______________________

_______________________

__________________

J U D G M E N T

__________________

Hon Rogers VP:

1. This is an appeal from a judgment of Fung DJ given on 17 October on a summary judgment application under Order 14 of the Rules of the High Court. The claim is made by the plaintiff against the defendants, who are two solicitors and the solicitors' firm.

2. In respect of the major part of the claim the facts are set out in the judgment below and there is no need to repeat them here. There is no defence on the part of the firm to the claim made by the plaintiff which amounts to more than $7 million. The question which arises and arose in the course of the judgment below was as to whether the second named defendant, Mr Wong, was a partner of the firm and thus liable for the debts of the partnership.

3. It is clear that on a summary judgment application there should be no dispute as to fact. If there is a dispute as to fact, it must go to trial. The question as to whether somebody is a partner is a question of fact. The plaintiffs relied upon the partnership agreement. That partnership agreement makes the second named defendant, Mr Wong, a salaried partner. Despite that, the plaintiff puts forward its case that the second named defendant should be regarded as a full partner and liable as such.

4. Because this action will now have to go to trial, the less this court says about the matter the better. I have to say this, however, that I find difficulty in agreeing with the conclusion to which the judge came on the construction of the agreement and certainly would not do so at this stage. It suffices, in my view, to say that that is enough on the first aspect of the claim.

5. The judge, having decided primarily on a question of construction of the agreement that the second named defendant was a partner of the firm, then went on to consider, although it was unnecessary for him to do so, whether the second named defendant was liable on the basis that he had been held out as a partner. He also came to the conclusion that the second named defendant was liable as such. In doing so the judge drew various inferences.

6. In Order 14 proceedings when summary judgment is being considered, prudence dictates that considerable care must be taken as to what inferences are drawn, because inferences can only be drawn on the basis of all the facts of the case. I would not at this stage be prepared to draw the inferences which the judge drew to reach the conclusion that the second named defendant was liable on the basis of having been held out to be a partner of the firm.

7. In those circumstances I have no hesitation in saying that I consider that this judgment must be set aside and that leave to defend the action must be given.

Hon Le Pichon JA:

8. I agree.