WONG CHONG YIP v. CHAN YIN FONG

HCPI 755/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO. 755 OF 2006

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D E C I S I O N

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1.  This is an application for an unless order requiring compliance by Wing Lung Insurance Company Limited (Wing Lung) and TRM (Hong Kong) Limited (TRM) of an order of discovery of documents made by me on 21st of this month.

2.  On 21st of this month, I dealt with an application for specific discovery by the defendant and discovery by Wing Lung and TRM for the purpose of the trial of a preliminary issue in this action.  The preliminary issue is whether the plaintiff has already settled his claim with the defendant.  The plaintiff’s ground of opposition in the preliminary issue is that he had been tricked into signing the settlement documents by the financial duress and undue influence of the defendant, Wing Lung, and TRM.

3.  Mr Lam, counsel for the plaintiff, in his submissions on 21 February 2007 said that the documents sought to be disclosed may contain evidence of collusion and that would strengthen the credibility of the plaintiff and weaken that of the defendant.  I refer to paragraphs 10 to 13 of my decision of 21 February:

“10.     The plaintiff’s case is that the defendant, TRM and Wing Lung had colluded together to procure from him a very unfavourable settlement which was not enough even to cover his employee compensation entitlement, not to say his common law damages.  Their plan was for the defendant to firstly put him under financial difficulty by withholding from him part of his periodical payments payable under the Employees’ Compensation Ordinance.  …

11.      After the plaintiff was put into financial difficulty, TRM then got in touch with the plaintiff at about the end of March 2004 and befriended him.  TRM then expressed to him that it was wrong for the defendant to withhold the periodic payments.  They promised to help. 

12.      The plaintiff went to TRM’s office in mid-April 2004.  A Miss Hou of TRM advised him to settle the claim with the plaintiff. 

13.      As a result of the intervention by TRM, the plaintiff got all his outstanding periodic payments from the defendant on 2 May 2006.  …  He also got his last two periodic payments in full through TRM though a few days later than the due days.  As a result of TRM’s help, he developed trust and faith in TRM.  He therefore yielded to their undue influence and signed the release which gave him very poor terms of settlement.”

4.  I ordered discovery of documents pertaining to the settlement because of the allegation of collusion.  This morning, just before the commencement of the trial of the preliminary issue, the plaintiff presented a summons seeking an unless order requiring compliance with my order.  The plaintiff says that Wing Lung and TRM have failed to make discovery of a number of documents pursuant to my order of 21st of this month.

5.  For the first item, I was referred to an email dated 8 March 2004 issued by a Miss Hou of TRM to a Miss Chan of Equity Underwriters which represented Wing Lung.  Miss Hou referred to her interview of the plaintiff on 5 March 2004 and the plaintiff’s conditions.  At the end of the email, Miss Hou recommended, among other things, “proposed negotiation of direct settlement.”

6.  Mr Lam said that he needed the documents which preceded this email.  He said those documents might show whether there was an attempt by TRM to win over the trust and confidence of the plaintiff.  Mr Pang opposed it.  He said this email was the first document which recommended a negotiation for settlement.

7.  I agree with Mr Pang.  There is no indication that prior to this email, Wing Lung had instructed TRM to negotiate a settlement or that a settlement had been suggested by anyone.  I do not think any document earlier than this email would come within the scope of documents pertaining to the settlement.  I do not think it necessary for the earlier documents to be produced.

8.  The second item is the full report by TRM as referred to in an email dated 7 May 2004 also by Miss Hou.  Miss Hou said in paragraph 3 of that email:  “We will send a final report and all signed document to you after all the procedures completed.”  That was meant to be a final report of the whole case.  Mr Lam said that this full report would contain an overview of the matter though he accepted that TRM’s officer would not be foolish enough to record in the report that they had succeeded in their collusion against the plaintiff.  Whether it would have an overview or not, it was a document made after the settlement that had been entered into.  I do not think that it is a document that pertained to the settlement.

9.  There are a number of documents that comprised the third item.  They are an independent medical examination report by Dr Chan Yat-sang dated 24 March 2004, some medical invoices, some receipts of periodic payments and a report of the Orthopaedic and Traumatology Department of Yan Chai Hospital dated 21 April 2004.  They were enclosed in same email of 7 May 2004 by Miss Hou that has been referred to above.

10.  Mr Lam said that Miss Hou had relied on these documents generally to recommend a settlement, but I cannot see how they can be related to the collusion as alleged.  I do not think I can require discovery of these on the original ground for discovery.

11.  However, Mr Lam shifted his ground to say that the medical report may reflect a poor settlement for the plaintiff.  In that event, it may support the plaintiff’s case of undue influence.  I agree, but this is a new ground made at the commencement of the trial.  This ground should have been relied on in the original application made on 21st of this month.  On this new ground, I order Wing Lung to make discovery of the documents in this item.

12.  The fourth item comprised the interview records.  I do not think they can be within the scope of the original application or can be described as documents pertaining to the settlement.  However, on the new ground that the records should contain things said by the officers of TRM which may reveal undue influence, I also order Wing Lung to make discovery of them.

13.  The fifth and last item is a document prepared by a Miss Wong of TRM.  This was referred to by Miss Hou in her affirmation.  She said it contained information collected by Miss Wong.  Mr Lam said that it may contain information showing that Miss Wong had befriended the plaintiff which was part of their case of collusion.  I do not agree.  It was merely to collect information of the case by TRM.  It is not relevant to whether there was undue influence or collusion.  I do not think this document needs to be produced for the trial of the preliminary issue.

14.  I have ordered discovery of the third and fourth items but only on a new ground and not on the original ground.  I therefore will not make an unless order.  Since the documents are ready to be disclosed, I require Wing Lung to disclose them forthwith and to file and serve an affirmation verifying the discovery within 2 days. 

15.  As discovery is being made now and, subject to further submissions, if any, I do not think these documents are of a nature that will necessitate an adjournment of the trial of the preliminary issue.  I therefore direct that the trial of the preliminary issue will start at 10 am tomorrow.

Discussion re costs

16.  The plaintiff has been partially successful in this application for further discovery although I did not let them have an unless order.  Since they have only succeeded in part, I do not think they should be entitled to costs.  One option is to make no order as to costs.  The other one is to order costs be in the cause. 

17.  Mr Pang for the defendant says that the defendant has been acting very forthright throughout this application and has done nothing wrong.  Wing Lung and TRM have also offered the documents for the court’s inspection in determining whether they should be disclosed.  These submissions are attractive, appear to be reasonable, and on that basis, Mr Pang asked for an order that the defendant’s costs be in the cause.

18.  I was attracted by these submissions, but I also consider whether the plaintiff has delayed the application.  I think the unfortunate thing which sandwiched these applications into a very tight timeframe is because the trial day as fixed was quite close to the day for fixing the trial date.  Hence, there was not much time left in between for discovery to be done comfortably and with generosity of time.

19.  Looking at the matter in the round, I think neither side has behaved unreasonably although I do have some misgiving on the drafting of the ground in support of the application by the plaintiff.  The ground made for discovery under duress could have been improved.  However, I think it would be too harsh to order defendant’s costs be in the cause simply on that ground.  I think an order that costs be in the cause may not be far off from the fairest point for all.  Hence, I so order.