XCHRX KEEN TIME TRADING LTD. v. CHUEN HING MOTORS CO. LTD.

HCA7086/97

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. A7086 OF 1997

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R U L I N G

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1. Firstly, the defendant conceded, in the light of my earlier ruling this morning as to the addition of Yang Ching as a further plaintiff in this matter and allowing the amendments which the plaintiff sought to their Statement of Claim, that the defendants in those circumstances do not seek to support Master Jones' Order in respect of the striking out application. In those circumstances, the Order of Master Jones that the plaintiff's claim be struck out is set aside.

2. Secondly, dealing with the question of costs below, in striking out the plaintiff's claim, Master Jones clearly indicated in his Order that that claim was struck out on the basis that it showed no reasonable cause of action. Under Order 18, Rule 19, paragraph 1(A), on that basis there should be no evidence put before a Tribunal.

3. In respect of the costs argument for the hearing below, I had been referred to not only parts of certain affidavits but also the exhibits thereto. I take the view that my decision as to whether or not the Master was correct in making the Order that he did should be on the basis of looking at the pleadings put before him, and not the evidence. When I look at the Statement of Claim as it stood before the proposed amendments, I note first of all that throughout in that Statement of Claim, it was pleaded that Guangzhou Yang Cheng Enterprise Corporation was the plaintiff's principal.

4. And indeed, in certain parts of the Statement of Claim - in particular paragraph 12 - it is stated the plaintiff has acted as it's agents. I further note that nowhere in that Statement of Claim was it pleaded that the plaintiff had in any way acquired its own rights to bring the action. Indeed, in both paragraph 12 and 13 of the original Statement of Claim, it was pleaded that the plaintiff was authorised by Yang Cheng to carry out the acts or do certain acts therein stated. Looking at the Statement of Claim as a whole, I am unable to say that the Master was wrong in making the Order for striking out that he did.

5. In the circumstances therefore, the cost of the hearing below, insofar as the striking out application before the Master was concerned, I do not propose to change the Order in relation to costs as ordered by Master Jones; namely, that costs be to the defendant with a certificate for counsel, and that Order for costs will stand. However, in the light of the amendment this morning, proposed by the plaintiff, which was allowed by me, those amendments have cured much if not all of the defects of the earlier pleading.

6. In particular, paragraph 14, where it was pleaded that it was an implied term of the settlement agreement or the payment agreement, or by necessary implication, or by law or by business efficacy, that the money owed by the defendant to the 2nd plaintiff was assigned to the 1st plaintiff. I make it clear that that paragraph which I have referred to is but a pleading, pleaded in the amended Statement of Claim. In referring to it, in no way am I indicating one way or the other whether that paragraph is good or bad.

7. That is a matter that I must leave to the trial judge to determine after hearing evidence on this matter, for the reason that construction of a document is a mixed question of fact and law, and it can only be determined by the trial judge after hearing all the evidence in the case. However, insofar as pleading is concerned, that paragraph has cured the defects of the original Statement of Claim which led to it being struck out.

8. Insofar as costs of today's hearing is concerned, half of today's hearing was taken up by the application to add a new plaintiff and to amend the plaintiff's Statement of Claim. Ultimately, the plaintiff was successful in obtaining those orders to add a new plaintiff and to amend their Statement of Claim. The other half of today's hearing, was taken up by argument as to costs, and insofar as the costs below is concerned, the plaintiff has not been successful in persuading me to alter the costs Order made by the Master below.

9. Therefore, in all the circumstances of the matter, the fairest order that I can make insofar as today's costs is concerned is that each party to bear it's own costs.

10. That deals with the costs of today's hearing.

(Discussion re case matters)

11. I will order that the service of the Amended Statement of Claim be dispensed with, and give leave to the plaintiff to file the Affirmation of HAU Sai-man dated 9 May 1998, and give leave to the defendant to file affirmations within 14 days; leave for the plaintiff to file affirmations in reply 14 days thereafter. The orders sought in paragraph E and F of the Amended Notice of Appeal be adjourned to a date to be fixed for hearing in consultation with counsels' diary. The date for hearing shall be not be earlier than 25 June 1998.

(Discussion re costs)

12. Costs of the appeal in relation to the Order 14 application be reserved.