LEE SHING LAI t/a LEE LAI KEE CONSTRUCTION CO v. LOU TONG CHIU KEE CONSTRUCTION CO LTD

HCCT 46/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTRUCTION AND ARBITRATION PROCEEDINGS

NO. 46 OF 2005

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D E C I S I O N

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1.  In my view the Plaintiff's claim should be struck out for want of prosecution.  I briefly set out below the reasons for my view.

2.  The relevant construction project took place in around 1986 and 1987.

3.  The writ was issued on 28 December 1987.  In the prosecution of his claim, the Plaintiff accepts that there has been delay for 3 years from early 1990 and 9½ years from 1994.  The delay is plainly inordinate and inexcusable.  The Plaintiff attributes the delay to his former solicitors.  He says that he finally lost patience with them and replaced them with another firm.  That may be the case, but that cannot excuse the delay.

4.  Nonetheless, Mr. Yau (appearing for the Plaintiff) argues that there is no prejudice to the Defendant.  He suggests a fair trial is still possible.  I disagree.

5.  Mr. Yau says that the Plaintiff is prima facie entitled to his claim.  That claim is essentially for unpaid but largely certified sums due on a construction project.  The substantive defence raised is set-off.  The Defendant seeks to set-off damages alleged to have been incurred as a result of the Plaintiff’s defective work and delay.  There is a counterclaim for such damages.

6.  Mr. Yau points to a Valuation Report dated 3 March 1988 and an Inspection Report dated 21 October 1988 in respect of the building involved in the project.  There is also apparently a report by Jones Lang Wootton of which the Plaintiff has only had sight of the Appendix.  Mr. Yau suggests that any defects relied on by the Defendant ought, if significant, to have found their way into one or more of such reports.

7.  The fact that the Defendant and Mr. Sy Hing (the Defendant’s manager) would inevitably have difficulty remembering events which took place nearly 20 years ago should be mitigated (Mr. Yau submits) by the existence of the 3 reports.

8.  I am not persuaded by the submission. 

9.  The Defendant is now in his late 70s.  He has lost contact with Mr. Sy, who left his employment some 10 years ago.  If the action had proceeded to trial in around (say) 1994 (some time after the first period of 3 years delay), Mr. Sy would still have been with the defendant and it might have been possible to have a fair trial then.  That is no longer the case now.  I do not think that the Defendant can fairly be blamed for failing to keep in touch with Mr. Sy after so many years�inaction by the Plaintiff.

10.  Even if it were possible to locate Mr. Sy, I do not see how either Mr. Sy or the Defendant could give useful evidence to the Court after the lapse of so much time.  That would be the case even if proofs had been taken early on of their evidence.

11.  The Valuation and Inspection Reports do not purport to have been prepared for use as expert evidence at trial.  They are cryptic and lacking in particulars.  They may or may not have been comprehensive as to defects found in the building at the time the reports were made.  That would have to be ascertained by cross-examination of their makers.  However, after so much time, their makers can no longer be located.  Without supplemental oral evidence, the value of the reports to a trial judge would be minimal.

12.  I have not seen the full body of the Jones Lang Wootton Report, which has not been produced to the Court.  However, whatever it might contain, the delay is so long that I simply do not see how in practice any person (including experts who conducted any inspection) could usefully be cross-examined as to what defects they saw or did not see and as to the likely cause of any defects seen.  The best that could be done at any future trial would be to point to reports which would in reality not be capable of true or rigorous testing through cross-examination.  Where a party will be asserting one thing and the other party alleging the opposite, the Court will be in an impossible position to arrive at the truth.

13.  I note Mr. Yau’s point that the parties have taken photographs.  But photos by themselves without viva voce evidence to explain what they depict are unlikely to be of much help.  I do not think that I can give much weight to this factor.

14.  I conclude that overall there will be substantial prejudice to the Defendant if I were to allow this action to proceed.  The dimming of memories after so much time is, to my mind, an insurmountable obstacle to the conduct of a fair trial.

15.  Mr. Yau then submits that the Defendant has been at fault as well.  The Defendant has not proceeded on his counterclaim with despatch.

16.  That may be right.  But I do not think that absolves the Plaintiff from bringing his own case to trial within a reasonable time frame.

17.  Further, the Defendant is prepared, if the claim is struck out, for the counterclaim to be struck out as well.  It seems to me therefore that the conduct of the counterclaim is not relevant to a consideration of whether the claim should be allowed to proceed at this late stage.

18.  Mr. Yau blames the Defendant for apparently failing to take proofs of his witnesses and experts at around the time when the action was commenced.  Were the lapse of time something less than that here, I might have sympathy with Mr. Yau’s argument.  But (as I have said) the delay here is so long that, even if proofs had been taken, their ability to jog the memory so as to generate meaningful oral examination at trial must be minimal.

19.  Finally, Mr. Yau suggests the Defendant is estopped from applying to strike-out the claim.  That is because the Defendant (Mr. Yau says) took some time before he issued a strike out summons.

20.  I am not persuaded by the submission.  While it is true that the Defendant could have taken out its summons earlier, in view of the scale of delay involved here, I do not think that the delay on the Defendant’s part was such as to preclude him from making this application.

21.  In my judgment, the Defendant has discharged the burden of satisfying the Court that a fair trial is not possible.  Claim and counterclaim are struck out.  I shall hear the parties on costs and consequential orders. 

22.  I note that the Defendant originally counterclaimed against the project's architect.  That counterclaim was, however, compromised many years ago.