THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL “OOCL CHINA” v. THE OWNERS AND/OR DEMISE CHARTERERS OF THE SHIP OR VESSEL “DARYA BHAKTI”

HCMP 403/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO. 403 OF 2013

(ON AN INTENDED APPEAL FROM HCAJ NO. 218 OF 2009)

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Admiralty action in rem against: The Ship or Vessel Darya Bhakti
of the port of Hong Kong

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D E C I S I O N

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1.  This is the plaintiffs’ application to serve a Notice of Appeal out of time. The application arose in somewhat unusual circumstances.

2.  The judgment that is the subject of the intended appeal was given by Deputy Judge Sakrhani on 10 December 2012 after the hearing of the plaintiffs’ claim in a reference under Order 75 rule 41 of the Rules of the High Court.  The claim was for damages by reason of a collision between the plaintiffs’ vessel and the defendant’s vessel.  Usually, the hearing of a claim in a reference would have followed the determination of liability for the collision and it would be before a registrar of the High Court.  In this instance, the parties agreed to put on hold the action to determine the apportionment of liability whilst the quantum of the claims was to be determined first. And the hearing was heard by a judge of the Court of First Instance because of the issues of law involved.

3.  By his judgment, the judge disallowed the plaintiffs’ claim in respect of the cargo transhipment costs and also part of the claim for loss of hire in the plaintiffs’ vessel by setting off savings of slot hire that the judge found would otherwise have been payable.

4.  On 21 December 2012, which was 11 days after the handing down of the judgment, the plaintiffs applied to the judge for leave to appeal.  As explained by the plaintiffs’ solicitors, they formed the view that the judgment could be considered “interlocutory” in nature and so would require leave to appeal, in that there could be no proceedings to enforce the judgment pending a determination on the apportionment of liability.  The plaintiffs’ counsel took a contrary view and advised that no leave to appeal was required.  Given the unusual circumstances, it was agreed it would be better to err on the side of caution on the assumption leave was required and the solicitors therefore issued a summons seeking leave to appeal, especially as the time for seeking leave to appeal (14 days) is shorter than that required for filing a Notice of Appeal (28 days).

5.  The earliest return date of the summons that the plaintiffs could secure before the judge was 28 February 2013.

6.  The judge dismissed the summons for leave to appeal on 28 February.  He was of the view the judgment was final in nature, not interlocutory, it being a final determination of the issue on quantum of the plaintiffs’ claim after a trial in open court.  As the time for filing a Notice of Appeal had expired by then, and any application for extension of time to the court below must be made before the expiration of time, the judge has no power to extend time and he had no other option but to dismiss the summons with costs.

7.  On 1 March 2013, the plaintiffs’ solicitors issued the present summons before this court for extension of time to file a Notice of Appeal.

8.  The governing principles concerning the exercise of discretion to extend time for appealing are well established and will not be rehearsed here, see Hong Kong Civil Procedure 2013, vol 1, para 59/4/9 and the cases there cited.

9.  The delay in applying for extension of time is 53 days.  This was not substantial although I would not say it was short.

10.  Mr Sussex, SC submitted that the plaintiffs’ solicitors could have filed a Notice of Appeal at the same time as issuing a summons for leave to appeal.  I do not think this is permissible.  I reject his contention the error of the plaintiffs’ solicitors was one which no reasonable solicitor could make.  I consider the delay entirely understandable and excusable given the unusual circumstances.  It was an honest but mistaken belief as to the correct procedure to be followed.

11.  The merits of the appeal will play little part in the balancing exercise if the delay is short and is wholly excusable, but where the delay is substantial and is not wholly excusable, much more merit is required to overcome it (Norwich & Peterborough Building Society v Steed [1991] 1 WLR 449 at 455G to H; Chiu Sin-chung v Yu Yan-yan Angela & Anr [1993] 1 HKLR 225 at 228 lines 25 to 30).  In Secretary for Justice v Hong Kong & Yaumati Ferry Co Ltd & Anr [2001] 1 HKC 125, in which the delay was inexcusable, the court required the applicant to show “a real prospect of success on the merits”, at 129I and 132F. In this instance, as I find the delay excusable, the hurdle of merits that the plaintiffs is required to satisfy the court would not be as high.

12.  As I am satisfied the plaintiffs do have a reasonably arguable appeal, I do not propose to go into the merits of the argument in any detail.  They have been set out at some length in the two skeleton arguments before the judge dated 21 December 2012 and 25 February 2013, which I have considered.  Mr Sussex’s arguments to the contrary only go to show that serious arguments of law would be involved in the grounds of appeal that are to be raised by the plaintiffs.  And I am satisfied these are viable grounds.

13.  As for prejudice to the defendants in extending time to appeal, I have taken the matters referred to in the affidavit of the defendants’ solicitors into account but do not think they come anywhere near to tipping the balance against granting an extension of time in the present circumstances.

14.  I therefore exercise my discretion to grant an extension of time to the plaintiffs to file a Notice of Appeal by tomorrow.  I order costs of the application to be borne by the plaintiffs.