ANZ COMMODITY TRADING PTY LTD v. EXCELLENCE RAISE OVERSEAS LTD AND OTHERS

HCCL 4/2017

[2021] HKCFI 2781

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMMERCIAL ACTION NO 4 OF 2017

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D E C I S I O N

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1.  The pre-trial review is set to take place on 26 October 2021, and the trial of this action is scheduled to commence on 5 January 2022.

2.  Case management directions were first given by Hon A Chan, J on 19 December 2019.  The timetable for the filing of witness statements and to make interlocutory applications have since been extended, the last extension for the making of interlocutory applications being granted on 27 January 2021. This application for leave to amend the Defence of the 1^st, 9^th and 10^th Defendants (referred to hereinafter simply as “Defendants”) and for leave to serve the 3^rd witness statement of Mr Chui was made on 25 May 2021, just before the expiry of the deadline.

3.  The fact that the Court had extended time for interlocutory applications to be made, by 27 May 2021, does not absolve a party from the need to give good reasons for any application which can be said to be late - “lateness” to be judged in view of the history of the proceedings, the time when the pleadings had been filed and closed, when the witness statements had first been exchanged, and the time when the application is made.

4.  With milestone dates being imminent in this action, the Defendants are required to justify their application for amendment of the pleadings and to serve the witness statement of Chui.  There has been no explanation at all, apart from the assertion that the amendments do not introduce any new matters and the Defendants only seek to combine their respective defences.

5.  I accept the submissions made on behalf of the Plaintiff, that the amendment sought to be made to the Defences are either unnecessary, or are irrelevant. Paragraphs 4.17A to 4.17D of the draft Defences refer to English proceedings commenced by MCM (“English Action”), a third party, against the 2^nd and 3^rd Defendants in this action, to which neither the Plaintiff nor the 1^st, 9^th and 10^th Defendants are parties.  I agree that the amendments are irrelevant to the claims and issues for determination in these proceedings.  First, any cause of action or remedy which the Plaintiff may have against another party, MCM, in addition and separate to the Plaintiff’s causes of action against the Defendants in this action, does not affect the Plaintiff’s cause against the 1^st, 9^th and 10^th Defendants.  The Defendants seek to argue that where the Plaintiff has a contractual claim (against MCM for an indemnity under their agreement), an equitable proprietary claim in the form of a resulting trust is not available to it (relying on Westdeutsche Bank v Islington LBC [1996] ac 699).  The short answer to this is that whether the Plaintiff can succeed in its proprietary claims asserted against the Defendants is to be established at the trial of this action.  It is not necessary to plead the existence and claims made in the English Action in order to advance the submissions on law which the Defendants seek to make, as to whether the Plaintiff has a proprietary claim against the Defendants.  To include the proposed pleading by amendment would, however, inevitably lead to further discovery, particulars and evidence on issues which will only distract the parties from their preparations for the trial on the real matters in dispute.  The claim, that MCM is contractually liable to indemnify the Plaintiff, and that the Plaintiff has on the Defendants’ case suffered no loss and damage, is already pleaded in the original Defence of the 9^th and 10^th Defendants.  The Plaintiff’s proprietary claim asserted in the Statement of Claim against all defendants is already not admitted and put to proof in the original Defences of the Defendants.  The proposed amendments are in my view unnecessary.

6.  In any event, balancing any probative value of introducing the English Action into the pleadings against the costs and delay and resulting prejudice to the Plaintiff if the amendments are allowed, it is neither just nor proportionate to allow the amendments at this late stage.

7.  Apart from the amendments which are consented to by the Plaintiff, the application for amendment is not allowed.

8.  As for the 3^rd statement of Chui, I agree with the observations made by Marlene Ng J in Ho Wai Tung v Ho Fung [2020] HKCFI 1787, that it is totally inappropriate and unnecessary to have further rounds of witness statements for point-by-point rebuttal of the witness statements of the opposing party.  It is simply not the function of witness statements to do so, to permit witnesses to argue a party’s case, to argue with opposing witnesses, or to anticipate and answer questions that may be put in cross‑examination. This is what Mr Chui proposes to do by his 3^rd statement.

9.  Mr Chui had the opportunity in 2 rounds of witness statements (in June 2018 and June 2020) to give the explanation he now belatedly wishes to make, regarding his affirmation to oppose the injunction order made on 19 July 2017. He had chosen not to give the explanation in his earlier statements, and has furnished no justification now for the delay in adducing the proposed 3^rd statement.  I see no reason to permit the 3^rd statement on these points.

10.  To do justice and to enable the real dispute as to the source of the funds received by the 1^st, 9^th and 10^th Defendants to be tried, I will only and with reluctance permit the Defendants to file Mr Chui’s 3^rd statement to deal only with the source of funds, as set out in paragraphs 12 to 14 of his draft statement.  This is on the condition that a proper List of Documents is to be filed within 7 days for the documents he referred to in the 3^rd statement, to enable the Plaintiff to inspect the documents and to make such request for clarification as may be necessary.

11.  Paragraphs 9 to 11 of the statement only repeat what was already stated in Mr Chui’s 2^nd witness statement, and are unnecessary.  The other paragraphs only seek to rebut other witnesses’ statements and are disallowed.

12.  Unless Mr Chui’s permitted and signed witness statement is filed and served by 4pm on 20 September 2021, the Defendants are barred from adducing any further witness statement.  The Plaintiff is at liberty to file and serve, within 5 weeks of the service of Mr Chui’s 3^rd statement, any witness statement in reply.

13.  The order nisi is that the Defendants are to bear the Plaintiff’s costs of and incidental to the Summons of 25 May 2021 including the Plaintiff’s costs of preparing and filing any witness statement in reply to the 3^rd statement of Chui, with certificate for counsel.