YUEN YUK KWAN MABEL v. LEAD BRIGHT LTD

HCA 336/2002

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 336 OF 2002

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R U L I N G

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1. This morning, I have to deal with two summonses taken out by the Defendant. The first one is a summons taken out on 11 June 2003 by which the Defendant asks for leave to file and serve supplemental expert report within 21 days and also asks for the action be withdrawn from the warned list for the time being. The second summons is a summons taken out on 14 June 2003 although it is wrongly typed on the summons as 2002. By that summons, the Defendant asks for an order to allow the Defendant's expert to inspect the premises in question and carry out tests set out in a letter of 12 June 2003 from the solicitors for the Defendant to solicitors for the Plaintiff.

2. It is necessary to have regard to the history of the matter. The writ in the present action was issued on 26 January 2002, an amended Statement of Claim was filed on 21 May 2002. Defence was filed by the Defendant on 20 June 2002 and thereafter there were list of documents and expert report has been filed by the Plaintiff on 20 December 2002. Witness Statements were filed in January 2003.

3. It is apparent from the history of the matter that the Defendant has not taken steps in preparation of the trial of the case as promptly as is required under the rules. So much so that on 9 April 2003 when the case came before the Listing Master, Master Lung had to make an unless order at the same time when he granted leave for the case to set down for trial in the running list. He made an unless order against the Defendant in these terms. The order was that unless the Defendant files and serves an expert report in response to the report already filed and served by Plaintiff in compliance with an order dated 8 December 2002 by 4 p.m. on 7 May 2003, the Plaintiff be at liberty to enter judgment against the Defendant.

4. The order of 8 December 2002 was in fact a previous order made by Master Lung when parties came before him for obtaining leave to set down the matter for trial. On that occasion, the Master granted leave to the Plaintiff to rely on some expert evidence and also directed the Defendant to file and serve expert report within 42 days.

5. On 18 December 2002, the Master also directed parties to obtain counsel advice within 14 days after exchange of witness statements and this direction was repeated again in the order of 9 April 2003, paragraph 3 of which directed that the Defendant shall within 42 days obtain counsel advice if so required.

6. This morning, I was told that the Defendant did not obtain counsel advice until a very late stage of the case and the reason given is that this is on specific instruction of the Defendant. The Defendant did file an expert report prepared by Prudential Surveyors International Limited dated 7 May 2003 to avoid the consequence of the unless order. According to that report, the Defendant's surveyor had inspected the premises and also carried out tests at the premises.

7. Those tests were noted in paragraph 5.3 of that expert report. At paragraph 6, the Defendant's own expert arrived at the following conclusions:

"Water stains and wrapped timber floor boards were found in the bedroom adjacent to the bathrooms. Furthermore, peeled off paint was noted on the walls outside the bathroom. It is of our considered opinion that the possible cause of the noted damages is persisted water penetration originated from water supply pipe leakage(s) located inside the bathrooms. Similar damages extended to the bedroom and others in the living area of the Premises."

8. I should also read what is set out in paragraph 7 in that report under the heading remedial recommendation:

"As the hydrostatic test only identified existence of leakage(s) in the cold water supply system but without identification on their exact locations, replacement of the entire cold water system is recommended to rectify the defect. As pipes are buried within the building fabrics (the floors and the walls), the rectification work would entail complete replacement of the floor and wall finishes that (tile and stone), so as to avoid mismatch between new and old finishing materials."

9. In paragraph 8, the Defendant's expert said:

"we basically agreed with the observations on the water damages as recorded in the Plaintiff's Expert Report of 31 October 2002."

Although they put in a qualification that due to insufficient time, the estimate on the cost of rectification and time required cannot be assessed at the moment, it is apparent from that report that the Defendant had been given a fair opportunity to carry out inspection in the premises of the Plaintiff and expert report had been produced accordingly.

10. However, I was told this morning by Mr Chow, counsel for the Defendant that the Defendant now wishes further tests to be carried out. In fact I was told that there would be tests of similar natures as those conducted previously, although it would be conducted in a more detailed manner in order to identify the exact location of the leakage in the cold water system.

11. I am not satisfied that I should allow that to take place. As I said in the course of the hearing, the expert himself had carried out tests and should have been satisfied that he had carried out sufficient test before he expressed the opinion set out in his report. If he considered more tests were necessary before any conclusion can be drawn, the expert should not have prepared his report or put down this conclusion in his report. But there is no suggestion in the report by the expert that he would like to carry out more tests before he can express a conclusion at he did in terms of paragraph 6 of his report.

12. I was told again this morning by Mr Chow that the reason why more tests were not carried out during the early inspection was that the Defendant refused to put the expert in fund to enable those tests to be carried out. If that were the case then the Defendant only had itself to be blamed for the inadequacy of the tests. As the matter stands, since the expert felt comfortable with the tests that had been conducted to support the conclusion set out in paragraph 6 of his report, these tests, on the face of it, would have to be sufficient.

13. Moreover, in today's hearing Mr Chow told me that the Defendant is prepared to admit liability with regard to damages caused by water leakage although there would be dispute as to quantum. Mr Chow said the purpose of the further tests and inspection were to enable the Defendant to find out what was the exact cause of the problem so that it could be rectified by the Defendant.

14. On the other hand, Mr Pirie told the court that the Plaintiff has lost confidence on the Defendant completely and therefore would not accept any proposal from the Defendant to carry out the rectification work by themselves. These are matters that the parties might have to canvass again at the trial but I have to consider the basis of the Defendant's application this morning against the background that there has been a history of lack of preparation or dilatory preparation on the part of the Defendant on its own choosing.

15. Mr Chow also made a submission by reference to the inadequate information on the material presently available to the court to determine the extent of damages. However Mr Pirie told me that the Plaintiff is quite content with the existing material and is prepared to go to trial on this evidence.

16. In my judgment, if Mr Chow is correct as to his observation as to the inadequacy in terms of the evidence of the Plaintiff with regard to damages, it is a point that the Defendant could canvass at the trial. I would also note that the Defendant can cross-examine the Plaintiff's expert and other witnesses of the Plaintiff in order to invite the trial judge to come to a conclusion as to the extent of damages.

17. In substance as I see it, the purpose of today's application is to enable the Defendant to salvage or to bolster up their evidence which they should have filed a long time ago, but chose not to do so. Bearing in mind that the case has been set down in the running list and it has been put on the running list since 9 June, it is likely that the case will come on for trial in the very near future. I will consider today's application by reference to similar criteria laid down in respect of adjournment of trial to enable a party to make further preparation with regard to his case, and I take the relevant principles from R v Kingston-upon-Thames Justices, ex parte Martin [1994] Imm AR 172 which is referred to in the commentary in Hong Kong Civil Procedure 2002, paragraph 35/3/1. The following are matters that should be taken into account in deciding whether or not to grant an adjournment:

(1) the importance of the proceedings and the likely adverse consequences to the party seeking the adjournment;

(2) the risk of the party being prejudiced in the conduct of the proceedings if the application were refused;

(3) the risk of prejudice or other disadvantage to the other party if the adjournment were granted;

(4) the convenience of the court;

(5) interest of justice generally in the efficient despatch of court's business;

(6) the desirability of not delaying future litigants by adjourning early and thus leaving the court empty;

(7) the extent to which the party applying for the adjournment had been responsible for creating the difficulty which had led to the application.

18. Factor (6) is not relevant in the present context, but the other factors should be taken into account in the consideration of today's application. I think Mr Chow accepted to the extent that the Defendant would be prejudiced by a refusal of the relief sought in these summonses, it is caused by the Defendant's own dilatory conduct of this action and therefore the factor identified under sub-paragraph (7) is highly relevant in the present context.

19. At the same time, I take into account of the prejudice that the refusal of this application might cause to the Defendant. As I said, the Defendant had accepted that they should be liable for damages caused by water leakage, the only question is what was the extent of those damages. In fact the water leakage is quite clear from the evidence (not only from the expert's opinions but also from the various photographs annexed to the reports), and at least some of the complaints about water leakage were included in the first defect notice.

20. Although the Defendant raised in the defence that those defects had been rectified and such rectification had been acknowledged by the Plaintiff, I understand from what Mr Chow told me that the rectification was only done on visible defects. There is no suggestion that the Defendant had done any rectification work in term of leakage in the water supply or drainage system.

21. If the real dispute or the only realistic dispute between the parties is confined to the extent of damages caused by water damages or water slippage or leakage, I do not consider the further test to be essential. As I said the Defendant's expert had been given opportunity to carry out tests and they felt able to express certain conclusions from those tests. Moreover, as I said, the extent of damages can be explored by means of cross-examination of witnesses and that include the Plaintiff's expert and surveyor. It would be a matter for the trial judge to come to a conclusion after hearing the evidence. If there were defects in the Plaintiff's evidence and if there is insufficient evidence for the Plaintiff to establish quantum by reference to the quotation or estimate provided by contractor, then again this point can be advanced by the Defendant at the trial.

22. On the other hand, if the matter is to be taken out from the running list in order to enable the Defendant to make this belated preparation of the case, the Plaintiff would have to wait again for a considerable period of time before the matter would come to trial and the Plaintiff might also need to prepare further evidence to deal with the new evidence (if any) from the defence.

23. Moreover, I have to bear in mind that this is about a property bought by the Plaintiff for residence and due to this problem about the premises, it has caused the Plaintiff much inconvenience and also anxiety ever since they came into possession of the premises.

24. In my judgment, on balance, the matter should go to trial as soon as possible and bearing in mind that the Defendant has been given more than fair opportunity to put in their evidence and they had been fore-warned by the unless order of the Master, one cannot say that they had not been told about the need to comply with directions and time-table for preparation of trial promptly.

25. In the exercise of my discretion balancing the interest of the parties and having regard to all the relevant factors which I have mentioned and also the other factors set out in the case of Ex parte Martin, I would refuse the application.

26. I would just add that I have considered whether there should be an inspection notwithstanding that I refuse to have the case removed from the warned list and refuse to grant the Defendant leave to file further supplemental expert report. However, at the end of the day, I do not think it would be appropriate for me to grant such any inspection because that might just unnecessarily complicate the matter.

27. Firstly, as I said, the Defendant's expert has already had opportunity to carry out whatever tests they deem necessary and they felt able to come to certain conclusions and set those out in their report.

28. Secondly, once I allow inspection there would be a temptation on the part of the Defendant to put in further evidence which might result in having the trial adjourned or delayed. That would defeat the purpose of my refusal of the first application.

29. So the order I make is that those summonses are dismissed.