WONG YIM HAN t/a DUTCH TRADING CO v. ORIENTAL UNION EXPRESS LTD AND ANOTHER

DCCJ14023/2001

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 14023 OF 2001

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R U L I N G

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1. I have before me three types of application comprising six summonses, all of which have been taken out by the Plaintiffs.

2. The first is for specific discovery of various classes of documents which the 1st and 2nd Defendants are required to verify by affidavit; secondly, a request for further and better particulars of the re-amended defence; and lastly, a request for interrogatories.

3. The action itself could not really be any simpler. The Plaintiffs are in the garment business. In April 2001 they sold a substantial quantity of jeans to a Spanish buyer, Polycotton SL ("the buyers"), who are the 6th Defendants, but who have not as yet been served with a writ. The transaction was worth US$70,667.54 (about HK$551,000).

4. They engaged the 1st Defendant, a local freight forwarding company, to arrange for the transportation of the jeans to the buyers in Spain. The buyers are in Malaga, but the port of arrival was Barcelona.

5. The 2nd Defendant is an associate of the 1st Defendant who, inter alia, arranged for the issue of Bills of Lading on behalf of the 1st Defendant.

6. The 1st Defendant then booked space through the 3rd Defendants' shipping and transportation company, who would transport the consignment to Spain. The 1st Defendant had an agent in Barcelona, Maritimo Del Estrecho ("Maritimo"), who would arrange for the receipt of the consignment there and, once paid for, they would release it to the buyer.

7. So it is all terribly simple. The story can be easily related. The jeans were duly loaded on board a ship owned by the 4th Defendants, the "MV Ming Trusty", at the Hong Kong Container Port. This was on either 5 or 6 April 2001. The 1st Defendant issued a Bill of Lading which contained the terms of the contract between the Plaintiffs and the 1st Defendants. It is clear from the available evidence at this stage that when the "Ming Trusty" arrived at Singapore, the consignment was transferred to another ship, the "Monte Rosa", which also belonged to the 4th Defendants. When the vessel arrived at Barcelona it was collected by Maritimo from the vessel and taken to a Spanish Customs bonded warehouse at the port which was operated by Wings Warehouse Company. At that stage, the jeans had not been paid for by the buyers. They could not be released by Maritimo or by the warehouse until they had been paid for. It appears that the buyers wished to have the consignment tested for quality, and they appointed a company to do that for them on condition that they would not be removed from Wings Warehouse.

8. Whilst all of this was going on, it appears to be perfectly clear that the buyers were unable to pay for the consignment and that there was some negotiation between the buyer and the seller to try and resolve the matter of payment. Nothing came of the negotiation, and the letter of credit by which payment would be made was cancelled. That being the case, the Plaintiffs made arrangements with Maritimo to have the jeans shipped back to Hong Kong, and whilst this was proceeding, it now appears that the consignment has, after all, gone missing or was released to the buyer without payment having been made, which of course is in breach of the terms of the Bill of Lading.

9. The Plaintiffs initially blamed the 1st and 2nd Defendants only. They subsequently changed solicitors to their present solicitors, who have decided to cast their net over a far larger range of defendants who now include the shipping company and its associated company (that is, the 3rd and 5th Defendants) and the German shipowners (the 4th Defendants), as well as the impecunious Spanish buyers (who, as I have already indicated, are the 6th Defendants).

10. The pleadings have, as a result, gone into "technicolour", with the Statement of Claim being re-re-amended. Every conceivable permutation for liability is going to be canvassed at the trial with very little regard to any sense of proportion between the costs that are now being accumulated and the rather modest ultimate prize, which is a little over HK$500,000.

11. Today I am only concerned with the apparent issues between the Plaintiffs and the 1st and 2nd Defendants. The Defendants have put the following matters in issue, against which I must decide whether the Plaintiffs are entitled to what they require under the summonses. Firstly, whether the 2nd Defendants, who are a logistical company associated to the 1st Defendants who issued the Bill of Lading, are the carriers under the terms of the Bill of Lading. If that is not so, they can on no view of the matter bear any responsibility for what has occurred. Secondly, it is denied that the goods were released to the buyers. Thirdly, that the 1st and, if necessary, the 2nd Defendants' liability ended once the consignment arrived at Barcelona, this under the terms of the Bill of Lading and/or the custom and practice of the Port Authority of Barcelona; alternatively, that the Defendants, through their representative Maritimo, acted as the Plaintiffs' agents in Barcelona to have the consignment stored there at their expense and risk and/or that they were entitled to have them so stored on behalf of the Plaintiffs. Once that was done the goods were deemed to have been delivered pursuant to the terms of the Bill of Lading. Fourthly, reliance is placed on exemption clauses in the Bill of Lading limiting or excluding liability; and lastly, a general denial of the Plaintiffs' alleged loss and damage. There is also a denial that the 1st and 2nd Defendants had the duty to have the consignment shipped back to Hong Kong, but nothing turns on this today.

12. Both parties have made discovery by list and there has been inspection. Witness statements have been exchanged and the Defendants have filed a legal opinion from a Spanish lawyer on the law in Spain, and this has been done by way of witness statement, although leave will be required to formally file that as expert evidence.

13. From that introduction, I now turn to the specific applications. Firstly, specific discovery: this all relates to the issue of what happened to the consignment once it had arrived at Barcelona. The particular requirements appear on the face of the summons itself, and so I do not propose to set these out again here. The Defendants say that all the documents that they have or have ever had appear in their list; there is nothing else. Mr Stock, who appears for the Defendants, has taken two broad points in resisting the summons: firstly, that when one looks at what has been asked for, this covers a very broad range of documents. The requirement under Order 24 Rule 7 is that in order to obtain such an order, the specific document or class of documents must be identified with precision. One cannot order a party to swear an affidavit without being more precise as to what document or class of documents is being addressed. The relevant principles are those set out in the judgment of Mustill LJ (as he then was) in Barclay Administration Inc v McClelland & Ors [1990] FSR 381 at 382-383. I propose to set out the material parts of the judgment here:

"(i)	There is no jurisdiction to make an order under RSC Order 24 Rule 7 for the production of documents unless:
	(a)	there is sufficient evidence that the documents exist which the other party has not disclosed;
	(b)	the document or documents relate to matters in issue in the action;
	(c)	there is sufficient evidence that the document is in the possession, custody or power of the other party.
(ii)	When it is established that those three prerequisites for jurisdiction do exist, the court has a discretion whether or not to order disclosure.
(iii)	The order must identify with precision the document or documents or categories of document which are required to be disclosed, for otherwise the person making the list may find himself in serious trouble for swearing to a false affidavit even though doing his best to give an honest disclosure."
(iv)	..........
"(v)	It is not an answer to an assertion that documents falling within a particular category are disclosable that no such documents are in the other party's possession or power, although if this information has already been conveyed on oath in the course of the proceedings, this would furnish a reason why, in the exercise of the court's discretion, it might well not make an empty order."

14. Looking at what is being asked for, I am satisfied that the Plaintiffs have failed to show that the documents are or have been in the possession, custody or power of the Defendants, this being under (i)(c) of Mustill LJ's statement of the requirements that need to be met before the order ought be made.

15. This all relates to what occurred at Barcelona. It needs to be remembered that the Defendants are in Hong Kong charged with the duty of booking space on a ship at Hong Kong for the Plaintiffs. Whilst I can see that such discovery may be obtainable in part from the 3rd and 5th Defendants, and indeed from the buyers (the 6th Defendants), the Plaintiffs have failed to pass the required threshold against these Defendants.

16. The other matter that causes me to dismiss the application is the more general one that the type of document asked for is far too general, with the result that the Defendants may find themselves swearing to a false affidavit even though the person swearing that affidavit is doing his best to be as accurate and honest as possible. (See (iii) of the judgment of Mustill LJ supra.)

The request for further and better particulars

17. I now turn to the consolidated request for further and better particulars.

Under paragraph 5

The answers to (a) to (c) and (e) are so plain on their face as to require no further elaboration, and (d) is a matter for the trial. This, as Mr Stock has submitted, is the ultimate question for the judge. (ii) I also refuse. Paragraph 5 pleads the terms of the Bill of Lading that are said to be material. This plea is not properly amenable to a request for further and better particulars.

Under paragraph 7

Here again the answer is plain: what is pleaded is sufficient.

Under paragraph 9

This is not a proper request. The primary plea is a denial for which no further particulars need to be given.

Under paragraph 13

(vii)

I refuse these particulars for the same reasons as under paragraph 9.

(viii) No particulars need be given. This is a matter for argument at the trial.

Under paragraph 14

This is also a denial for which no particulars will be ordered.

Under paragraph 18(a)

(x)(b)

The warehouse address should be provided if it has not already been provided.

(x)(c)

These particulars appear in the Defendants' witness statement. Strictly, these particulars should be provided, and I order them to be provided, presumably and conveniently by way of summary of the relevant parts of the witness' witness statement.

Under paragraphs 18(b) to 21

These are matters of evidence which should be addressed to the Defendants' witness at the trial insofar as he is able to answer them. Accordingly, I make no order under these paragraphs.

Under paragraph 22

This is a matter of law and no particulars need to be provided.

Interrogatories

Save for (i) to (iv) which have already been ordered, I refuse to order the remainder. All this information has already been given in the witness statement. No useful purpose can now be served by ordering these again, notwithstanding the point that is made by Mr Leung that interrogatories are provided on oath and the witness statement at this stage is not on oath, but in my judgment it would be a needless expense to order such interrogatories when the witness will have to go into the witness-box and give his evidence on oath at the trial.

18. Costs in the cause on these directions.