XCHRX HUNG CHIN YING v. DRAGONCHEM CONSTRUCTION CO. LTD. AND ANOTHER

HCPI 461/98

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES NO. 461 OF 1998

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R U L I N G

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1. This is an application by the Plaintiff for an order that the limitation period applicable to the cause of action herein be disapplied under s.30 of the Limitation Ordinance, Cap. 347.

Background

2. This case arises from an accident which took place on 11th April 1995. The Plaintiff's pleaded case is that he was the employee of the 1st Defendant who was a sub-contractor of the 2nd Defendant. On the day of the accident, the Plaintiff's work involved the repaving of sections of Fan Kam Road with asphalt. To carry out that work, he had to lift up the lids of sandwells along the said road. However, due to shortage of workers, instead of the usual team of two workers lifting a sandwell, the Plaintiff was asked to do it alone. Furthermore, instead of being supplied with sandwell keys for that purpose, the Plaintiff was supplied, instead, with a metal hook to lift the sandwell lid. While using the metal hook to lift the sandwell lid, the hook suddenly lost the grip of the lid (which is very heavy) and as a result, the Plaintiff fell backwards on the ground and severely injured his back.

3. On these facts, the limitation period of three years as provided for by s.27 of the Limitation Ordinance would expire on 11th April 1998. It seems that the Plaintiff had applied for legal aid to pursue both claims for employees' compensation as well as for damages under common law. The Plaintiff was granted legal aid to pursue his claim for employees' compensation. However, his application for legal aid to pursue damages under common law was refused on 19th January 1998 by Legal Aid. It is not entirely clear when the Plaintiff applied for Legal Aid to pursue his common law claim, in his affirmation the Plaintiff stated it to be "several months" before its refusal. As a result of the refusal of Legal Aid, the Plaintiff filed a Notice of Appeal against that refusal on 16th February 1998, which was returnable on 15th April 1998. On 16th April 1998, Mr Registrar Betts made an Order that the legal aid appeal was to be adjourned for further enquiries to be made by Legal Aid. On 1st May 1998, legal aid was finally granted to the Plaintiff. Messrs Robin Bridge and John Liu were assigned as solicitors, and Mr Albert Yau as Counsel by Legal Aid.

4. Four days later, on 5th May 1998, the present writ was issued. However, by that time, it was already 24 days after expiry of the limitation period. At once it must be said that there can be no criticism whatsoever of the Solicitors or of Counsel for taking four days to issue the writ. By any standard, that was expeditiously done. The present application by summons was made on 5th June 1998 after the Defendants intimated that they will take the point that the limitation period had expired when the writ was issued. These are the facts leading up to the application which I have to deal with.

The Plaintiff's arguments

5. The Plaintiff's arguments can be briefly summarized as follows :

1. The Plaintiff says it is a short period of 24 days delay from the expiration of the limitation period. This delay was due not to the fault of the Plaintiff but because of the time it has taken for his appeal against the refusal of legal aid to be heard, and therefore beyond his control.

2. The Plaintiff says that it has not been shown from any of the affidavit evidence before the Court that the Defendants would suffer any form of prejudice due to this delay in the defence of this case should the limitation period be disapplied by the exercise of the Court's discretion. On the other hand, if the Court were not to exercise its discretion and to disapply the limitation period, the Plaintiff would be prejudiced in that he would not be able then to pursue his claim for damages under common law.

6. In these circumstances, the Plaintiff says it would be proper for the Court to exercise its discretion and to disapply the limitation period under s.30 of the Limitation Ordinance.

The Defendants' arguments

7. The first point taken by Mr Leung for the Defendants is that the Court has no power to exercise any discretion in this case. The reason for saying this, argues Mr Leung, is that the delay in issuing the writ in this case was by choice, and not by chance. In this connection, Mr Leung points at the Notice of Appeal against the refusal of legal aid which is dated 16th February 1998. In that very Notice of Appeal, the case was due to be heard on 15th April 1998. Therefore, says Mr Leung, it must have been clear to the Plaintiff even on 16th February, that by the time the appeal was heard, the limitation period would have expired. Mr Leung further points to the Plaintiff's own affirmation filed in respect of this application and says that nothing there suggests that the Plaintiff was so impecunious that he could not have issued a protective writ on his own even without the assistance of legal aid when he was aware that the appeal against Legal Aid was to be heard after the expiration of the limitation period. Therefore, Mr Leung invites me to come to the conclusion that the failure of the Plaintiff to issue a protective writ in this case was by choice, and not by chance. In this regard, Mr Leung relies on a number of authorities to say that because the delay was by choice, therefore, no good reason has been shown for it, and the Court should not entertain this application. The authorities relied on by Mr Leung in making this submission includes Chappell v. Cooper [1980] 1 WLR 958, Chow Ching Man & Ors. v. Sun Wah Ornament Manufactory Ltd. & Ors. [1996] 2 HKLR 338, Kleinwort Benson Limited v. Barbrak Ltd. [1987] 1 AC 597, Lee Fai v. Chan Kui [1997] 3 HKC 228 and Stevens v. Services Window & General Cleaning Co. Ltd. [1967] 1 QB 359. All these cases were decided on the wording of O.6, r.8 of the Supreme Court Practice or known in Hong Kong as the Rules of High Court, the wording of which is somewhat different from s.30 of the Limitation Ordinance.

8. In this respect, support can be found in the words of Lord Roskill in the case of Waddon v. Whitecroft Scovell Ltd. [1988] 1 WLR 309 at page 315 where he said :

"I would readily accept that there may be cases in which the court's discretion under R.S.C. Ord.6 r.8 to extend the period of validity of a writ already issued, and its other discretion under section 33 of the Limitation Act 1980 to extend the primary period of limitation, may fall to be exercised either in favour of or against an applicant on very similar grounds. I do not accept, however, that this will necessarily be so in all or even a majority of cases. The reasons for not serving a writ which has been issued before the expiry of the primary period of limitation, and the reasons for not issuing a writ at all within that period, may differ widely. I do not think, therefore, that it would be right to lay down any general principle that a judge deciding an application for extension of the period of validity of a writ in a personal injury case should be obliged to deal with the matter in precisely the same way as if he were deciding an application for extension of the primary period of limitation."

9. The only other authority relied on by Mr Leung which was not a decision based on the wording of O.6, r.8 was the case of Walkley v. Precision Forgings Ltd. [1979] 1 WLR 606. However, the facts in that case are quite different from the facts in the present case. There, an injured person issued a writ within the limitation period, but failed to proceed with the claim expeditiously and then issued a second writ out of time, and applied to the Court to disapply the time bar in respect of the second writ and at the same time discontinued the first action. The Court's discretion simply did not arise in that case for in the words of Lord Diplock, it was said that those were "self-inflicted wounds" and the provisions of s.2A (which is the equivalent of our s.27) caused the plaintiff no prejudice at all.

10. The alternative submission by Mr Leung is that even if the Court comes to the view that it has discretion in this matter, that discretion should not be exercised in favour of the Plaintiff. The reason given for so saying is, once again, that the delay is by choice, that no good reason has been shown for the Plaintiff's failure to issue a protective writ and that the Defendants have now been an accrued right to the limitation defence.

11. In so far as this last point of accrued right of the limitation defence is concerned, this was dealt with by Parker LJ in Hartley v. Birmingham City District Council [1992] 2 All ER 213 at 224, where he said :

" .... It appears to me to be apparent that in all, or nearly all, cases the prejudice to the plaintiff by the operation of the relevant limitation provision and the prejudice which would result to the defendant if the relevant provision were disapplied will be equal and opposite. The stronger the plaintiff's case the greater is the prejudice to him from the operation of the provision and the greater will be the prejudice to the defendant if the provision is disapplied. Likewise the weaker the case of the plaintiff the less is he prejudiced by the operation of the provision and the less is the defendant prejudiced if it is disapplied.

This might lead one to suppose that the prejudice referred to in section 33(1)(b) was not the deprivation of the fortuitous defence as such but prejudice to the defence on the merits caused by the delay. Both Lord Denning M.R. and Ormrod L.J. appear to have assumed that this was so. That this was the Parliamentary intent appears to be indicated by the fact that, as Lord Diplock pointed out, only section 33(3)(a) and (b) appear to go to prejudice and both are dealing with the merits. The decisions of their Lordships preclude such a construction of the section. In my view, however, as the prejudice resulting from the loss of the limitation defence will always or almost always be balanced by the prejudice to the plaintiff from the operation of the limitation provision, the loss of the defence as such will be of little importance. What is of paramount importance is the effect of the delay on the defendants' ability to defend. The specific example given in section 33(3)(b) so indicates."

12. The above cited passage by Parker LJ was further considered by Court of Appeal in the case of Ward v. Foss, The Times, 29th November 1993. In that case, Hobhouse LJ said this :

"For the purposes of section 33, if a defendant is to say that he is prejudiced he must show something more than merely that he is going to be required to meet his legal liabilities. The prejudice must arise from some other additional element - some change of his position which would not have occurred if the action had been brought within time - some belief by the defendant that he was not going to be troubled with the claim - some alteration in his financial position or some failure to make provision for the claim - the loss of relevant evidence - some difficulty in having a fair trial after the lapse of time. No list can be exhaustive and the statue requires the court to have regard to all the circumstances of the case, but it must be some factor over and on top of the legal liability of the defendant which creates the prejudice."

(The report in The Times not being a full report, these words of Hobhouse LJ cited above can be found at page 117 of Limitation Periods in Personal Injury Actions by Michael A. Jones.)

13. I am in full agreement with the words expressed by Hobhouse LJ above that the prejudice to a defendant is not the prejudice of having to meet his legal liabilities, but of having to deal with or defend the plaintiff's claim as a result of the delay. That this approach is correct can be seen from the express terms of our s.30 (which is equivalent to the English s.33) of the Limitation Ordinance.

The Court's discretion

14. Section 30 of the Limitation Ordinance gives the Court complete and unfettered discretion in the matter (see Lord Diplock in Thompson v. Brown Construction (Ebbw Vale) Ltd. [1981] 1 WLR 744 at page 752. This unfettered discretion of the Court is to be exercised by balancing the prejudice that may be caused to a plaintiff by the limitation period if that limitation period were to apply as against the prejudice that may be caused to a defendant if a Court were to disapply the limitation period to any action or to any cause in such action. In balancing these two matters, it would be for the Court then to decide whether it would be fair and just to allow an action commenced after the expiration of the limitation period to proceed or not.

15. In carrying out this balancing exercise, I have to take into consideration all the circumstances of the present case and in particular, to the six matters specified under s.30(3). In this regard, first of all, as to the length and reasons for the delay on the part of the Plaintiff, there is no dispute that the delay was for 24 days. Furthermore, there is no dispute that the Plaintiff was refused legal aid on 19th January, and that on 16th February, he filed Notice of Appeal against the refusal of legal aid, which appeal was returnable on 15th April. It is also not disputed that on 16th April the Registrar adjourned the matter for further enquiries by Legal Aid and that, on 1st May, the legal aid certificate was granted, and that the writ was issued on 5th May 1998.

16. Secondly, the extent to which the evidence adduced by either party is likely to be less cogent because of the delay. There is nothing to indicate by way of evidence before me that that is likely to be the case. Indeed, the fact that employees' compensation application was started by the Plaintiff in March 1997, and proceedings carried on throughout 1997 right up to the certificate of review of assessment issued on 23rd December 1997 shows that the Plaintiff as well as the Defendants have both been involved in preparation to meet the employees' compensation claim by the Plaintiff arising from this accident. And to that end, I would have expected the evidence and the witnesses to have been gathered and lined up by both parties, albeit that the workmen's compensation claim is not dependant on fault or negligence, but that the bringing of the employees' compensation claim would be a good indicator to the Defendants that there was a good possibility of the common law claim for damages to follow.

17. Thirdly, there is nothing before me to criticise the conduct of the Defendants after the cause of action arose, and nothing turns on that. Nor is there anything to suggest that any disability on the part of the Plaintiff arising after the day of accrual of the cause of action had contributed to the delay.

18. Fourthly, as to the extent to which the Plaintiff had acted promptly and reasonably, the Plaintiff made his application for Legal Aid several months before its refusal in January 1998. In the normal course of events that would not have been unreasonable nor should it have caused any delay as it was well within the limitation period.

19. Quite apart from these six factors, I should consider also all the circumstances of the case. In this regard, I take into account the following further matters. Firstly, it does not appear that the Plaintiff will have any alternative claim against the solicitors if the limitation period is not disapplied in this case. The reason I say this is that the writ was issued four days after legal aid was granted, and there can be no criticism whatsoever on the part of his solicitors for delay.

20. Moreover, the Defendants have argued that the Plaintiff, rather than sit and wait for the limitation period to expire while waiting for the appeal against the refusal of legal aid to be granted to him, should have instructed his own solicitors on his own steam to issue the writ before the expiry of the limitation period.

21. In para. 4 of the Plaintiff's affirmation, it is stated :

"The delay in issuing the Writ in this action is beyond my control. Because of the accident and my own limited financial means, I had to apply for Legal Aid to commence both the Employees' Compensation Claim against the Defendants and also this Common Law action ...."

22. I further note from the Legal Aid Certificate dated 1st May 1998 exhibited to the Plaintiff's affirmation that the aided person (i.e. the Plaintiff) neither has to pay any contribution nor to make any contribution towards the costs of the proceedings for which legal aid was granted.

23. Together this suggest to me is that the Plaintiff was not in any position financially to even commence his common law claim against the Defendants without the assistance of legal aid.

24. Furthermore, to accede to the Defendant's argument that the Plaintiff should have caused a protective writ to be issued on his own before the expiry of the limitation period would be to shoulder a layman in the financial position of the Plaintiff with an unjust burden which could only have been wrapped and packaged with all the sophistication of a lawyer. I have no hesitation in rejecting Mr Leung's submission on this point.

25. What stands out in this case is the fact that in his entire submission, there was not one word from Mr Leung to show how or in what way the Defendants have been prejudiced in the defence of this case by reason of the 24 days delay.

26. Therefore, what it boils down to, in this case, is this : Is it fair and just for the Plaintiff to be deprived of bringing this claim due to this 24 days' delay during which time he was fighting against the refusal of legal aid to be granted to him when, for this 24 days of delay, the Defendants cannot say that they have been prejudiced in the way as suggested by Hobhouse LJ in the case of Ward v. Foss. Having considered all the above, the answer to that question, in my mind, must be "No".

27. Accordingly, I shall exercise my discretion under s.30 of the Limitation Ordinance to disapply the limitation period provided for in s.27 of that Ordinance in respect of the present action by the Plaintiff against the Defendants.

28. I make the following costs order nisi. Costs of this summons be to the Defendants in any event. However as for the hearing before me, my decision was based mainly on the fact that the Defendants have not shown any prejudice in defending this action due to the delay. This must have been known to the Defendants from the outset. In the circumstances, I make no order as to costs in respect of the hearing before me. The Plaintiff's own costs to be taxed in accordance with Legal Aid Regulations.