XCHRX SILVER SEN NAVIGATION INC. v. XIAMEN SHENG LI ECONOMY AND TRADING DEVELOPMENT CO. and Another

1996, No. CL-110

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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J U D G M E N T

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1. The plaintiff and the 2nd defendant appeared on two matters before me. By an order made on 3 July 1996, Master O'Donnell extended the time for filing and service of a defence by the 2nd defendant for a period of 14 days from the date of the order. The plaintiff appealed against the order. On the other hand, the 2nd defendant applied for a further extension of the time for filing and serving its defence for a period of 14 days from the date of the order to be made by me.

2. At the conclusion of the hearing on 16 July 1996, I granted leave to the 2nd defendant to file and serve its defence by 5 p.m. on Monday 29 July 1996, with a warning that any further application by the 2nd defendant for time to serve its defence would be closely scrutinized, and ordered that the costs of the application be to the plaintiff in any event. I reserved judgment on the question of the appeal against the Master's order and the costs of the appeal.

3. The plaintiff's only argument against the Master's decision to grant extension of time is that the Master had no jurisdiction to make the order. The argument is based on the provisions of Order 72, rule 2(3) of the Rules of the Supreme Court. I set out hereunder Order 72, rule 2, sub-rules (2), (3) and (4):

(2) In this Order references to the judge shall be construed as references to the judge for the time being in charge of a particular list.

(3) The judge shall have control of the proceedings in his particular list and, subject to the provisions of this Order and to any directions of the judge, the powers of a judge in chambers (including those exercisable by the Registrar) shall, in relation to any proceedings in such an action (including any appeal from any judgment, order or decision of the Registrar, given or made prior to the transfer of the action or proceedings in the relevant list) be exercisable by the judge.

(4) Paragraph (3) shall not be construed as preventing the powers of the judge being exercised by some other judge.

4. The provisions of the English Order 72, rule 2 (2), (3) and (4) are also set out for comparison:

(2) In this Order references to the judge shall be construed as references to the judge for the time being in charge of the commercial list.

(3) The judge shall have control of the actions in the commercial list and subject to the provisions of this Order and to any directions of the judge, the powers of a judge in chambers (including those exercisable by a master or registrar) shall, in relation to any proceedings in such an action (including any appeal from any judgment, order or decision of a master or registrar, given or made prior to the transfer of the action to the commercial list), be exercisable by the judge.

(4) Paragraph (3) shall not be construed as preventing the powers of the judge being exercised by some other judge.

5. The Hong Kong Supreme Court Practice, at para. X[43], has this to say:

Prior to the 1988 amendments, Order 72 applied only to commercial actions for which a Commercial List had been established. The corresponding English Order still only deals with commercial actions. The Order was broadened in scope in Hong Kong in 1988 so as to embrace other 'particular proceedings' so that other lists can be opened under its aegis. The advantage in the extension is that formerly other lists had to be governed by practice directions specifically made to cater for each list. All the particular lists are now covered by one general order. ...

Although the English Order 72 covers only commercial actions, many of the Hong Kong provisions are taken almost verbatim from the English Order with such amendments as the enlarged context to all particular proceedings requires. Such is the case in respect of Order 72 rules 2, 4, 5, 6, 7, 8 and 10.

6. It is therefore clear that the English Order 72 applies only to commercial list actions whereas the Hong Kong Order 72 applies to actions which are entered in a particular list. Apart from that limited distinction, the two versions of Order 72, rule (3) are virtually identical. The learned editors of the Supreme Court Practice, 1995, state in Vol. 1, para. 72/2/1 as follows:

"A judge is assigned to the Commercial List. Interlocutory orders are made by the Judge and not by a Master."

7. With respect, I agree. The master has power and jurisdiction to deal with most interlocutory matters in civil proceedings in the High Court. Order 32, rule 11(1) of the Rules of Supreme Court provides that with certain exceptions, including matters involving the liberty of the subject,

"The Registrar and any master shall have power to transact all such business and exercise all such authority and jurisdiction as under any Ordinance or by these rules may be transacted and exercised by a judge in chambers ..."

One of the exceptions is:

"(f) any other matter or proceeding which by means of any of these rules is required to be heard only by a judge."

8. In respect of commercial list actions, according to Order 72, rule 2(3) "the powers of a judge in chambers (including those exercisable by the Registrar) ... shall be exercisable by the judge". It seems to me that by the wording of the rule as quoted, the powers of a judge in chambers, which are generally exercisable in other actions by masters, are reserved for the commercial list judge and other judges insofar as they relate to actions in the commercial list. What makes it abundantly clear is the words in brackets in the rule, which specifically includes the powers of a judge in chambers that are exercisable by the Registrar or masters (see Order 1, rule 7A whereby "Registrar" is equated with "Master"). By side-stepping the usual practice of having masters to deal with interlocutory matters, one tier of appeal has been dispensed with. This measure, I believe, provides the benefit of speeding up proceedings and saving costs for commercial list actions. I am therefore of the view that the Master had no jurisdiction to make a decision on the application of the 2nd defendant for an extension of time to file and serve its defence, unless there is a direction from the commercial list judge to allow him to do so.

9. I have consulted Findlay J., the commercial list judge, and the Clerk of Court. Findlay J. has not given any direction under Order 72, rule 2(3) to enable masters to deal with interlocutory proceedings in commercial list actions and the Clerk of Court cannot find any such direction having been given by any of the judge's predecessors. I must therefore conclude that all matters in the commercial list actions which are within the powers of a judge in chambers must be exercised by the commercial list judge or by another judge, and not by masters.

10. Mr. Balmer for the 2nd defendant told me that he well appreciated that the 2nd defendant's application for extension of time should usually be dealt with by the commercial list judge, but the court staff to whom the summons taken out by the 2nd defendant was given for handling placed it before a master. It followed, so the argument went, that the matter of lack of jurisdiction was a mistake caused by the court and not by the 2nd defendant. I dismiss this argument by simply referring to the summons dated 2 July 1996 which clearly states "LET ALL PARTIES CONCERNED attend before the Master in Chambers ...". The summons was issued to be heard before a master, and it is therefore incorrect to lay the blame on the court staff.

11. In the result, the plaintiff's appeal is allowed, and the costs of the appeal before me and before the Master be the plaintiff's in any event.

12. Since this judgment may be of interest to those who conduct actions in the commercial list, I propose to have it released and deposited with the Supreme Court Library. Unless I hear from the parties within 14 days to the contrary, my proposal be carried out.