FINE RIGHT ENTERPRISE LTD v. WEALTH FINE LTD

HCA 524/2018

[2021] HKCFI 3242

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 524 OF 2018

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BETWEEN

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DECISION

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1.  There are two summons before me this morning:

(a) The summons of 11 October 2021 taken out by the plaintiff (“P”, and “P’s Summons”) for inter alia an order that §10(1)(i)(c) of D’s Re-Re-Amended Defence and Counterclaim (“RRADAC”) be struck out, and any other references to the same in the RRADAC be deleted or excluded; and

(b) The summons of 20 October 2021 taken out by the defendant (“D”, and “D’s Summons”) for inter alia:

(i) leave to amend D’s RRADAC as per the draft Re-Re-Re-Amended Defence and Counterclaim (the “Draft RRRADAC”);

(ii) extension of time for D to file its 2^nd supplemental witness statement.

2.  The basis of P’s application to strike out is the direct or indirect reference in §10(1)(i)(c) of the RRADAC to two without prejudice letters dated 29 January and 1 March 2019 issued by P’s legal advisers (the “29/1 Letter” and “1/3 Letter” respectively, and the “WD Letters” collectively).

3.  P’s Summons has however largely been superseded by events. The parts of the RRADAC which P takes issue with are now proposed to be removed by the amendments which D is seeking leave to effect via the Draft RRRADAC.

4.  One main issue that remains is costs. I will come back to it at the end.

5.  In respect of D’s Summons:

(a) As said, the proposed amendments to the RRADAC are to address the objections raised by P in relation to the reference in the RRADAC to the WD Letters;

(b) I grant D leave to amend its RRADAC, and to file its RRRADAC in terms of the Draft RRRADAC by close of business of 27 October 2021;

(c) Service of the RRRADAC be dispensed with;

(d) Time for P to make consequential amendments and file its Re-Re-Amended Reply and Defence to Counterclaim pursuant to §5 of the Order of 8 September 2021 be extended to close of business of 28 October 2021;

(e) Time for D to file and serve its 2^nd supplemental witness statement(s) of factual witness(es) pursuant to §4 of the Order of 8 September 2021 be extended to close of business of 3 November 2021;

(f) The time table directed during the Pre-trial Review otherwise remains unchanged.

6.  The above have also dealt with the main relief which P seeks via P’s Summons. I make no further order in respect of the same.

7.  On costs, the following matters are relevant.

8.  D refers to the 3^rd supplemental list of documents P filed on 31 December 2019. Item 1 of Part I thereof (“Item 1”) discloses copy correspondence between the parties “in respect of the access arrangement for the period from 12/2/2019 to 2/5/2019”.

9.  D says therefore that P has waived privilege in respect of the 1/3 Letter. D further says that whilst the 29/1 Letter is not covered by Item 1, the 29/1 Letter is referred to on the face of the 1/3 Letter, and that that is the way those WD Letters are pleaded in §10(1)(i)(c) of the RRADAC.

10.  In support of its submissions on waiver, D relies on Hong Kong Civil Procedure 2021, Vol 1, §§24/5/29 and 32A, and Guinness Peat Properties v Fitzroy Robinson Partnership [1987] 1 WLR 1027, 1044C-E.

11.  D further submits that it has acted reasonably. On the Monday (11 October 2021) after the Friday (8 October 2021) when D received P’s objections, D offered to cross out §10(1)(i)(c) of the RRADAC with consequential amendments.

12.  Ms Leung, counsel for P, on the other hand submits that the WD Letters are clearly and expressly marked “Without Prejudice Save as to Costs”, and the general reference to correspondence between the parties “in respect of the access arrangement for the period from 12/2/2019 to 2/5/2019” at Item 1 bears no indication of any waiver. In any event, it is not a clear case for the application of any exemption to the without prejudice rule.

13.  In my view, both parties have contributed towards the state of affairs which they are now in. P could have made the position clearer in Item 1 in terms of the privileged status of the WD Letters. On the other hand, in so far as D is concerned, one enquiry to P prior to the drafting and filing of the RRADAC could have saved both parties a lot of costs. I refer in this regard to §24/5/32A Vol 1 of Hong Kong Civil Procedure 2021, that:

“ … in the current regime of cooperative communication, a solicitor, who is unsure whether privilege had been deliberately waived by the disclosure of privileged document, should confirm the position with the disclosing solicitor …”

14.  Having considered the overall position, I make no order as to costs in respect of both of P’s and D’s Summonses. I also will not disturb §6 of my Order of 8 September 2021.