ALAN CHUNG WAH TANG AND KAN LAP KEE (JOINT AND SEVERAL LIQUIDATORS OF WAN HIN AND CO LTD (in Liquidation)) v. CHUNG CHUN KEUNG AND OTHERS

HCA 64/2020

[2021] HKCFI 3785

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 64 OF 2020

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R E A S O N S  F O R  D E C I S I O N

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1.  On 25 May 2021 the 1^st and 2^nd Defendants (who for convenience I shall refer to as the “Defendants” unless the context otherwise requires) issued a summons pursuant to Order 18 rule 19 of the Rules of the High Court (“RHC”) to strike out the Plaintiff’s Statement of Claim dated 5 June 2020 (“Summons”) on the grounds that:

(1)   It discloses no reasonable cause of action;

(2)   It is scandalous, frivolous and/or vexatious;

(3)   It is an abuse of the process of the Court; and

(4)   It is otherwise suitable to be struck out under the inherent jurisdiction of the court.

2.  On 1 November 2021 the Plaintiff amended the Statement of Claim as it was entitled to pursuant to RHC O20 r3(1) (“Amended Statement of Claim”).  None of the Defendants exercised their right under RHC O20 r4(1) within 14 days of service of the Amended Statement of Claim to apply to the Court for the amendments to be disallowed.  Mr Barlow, who appeared for the Plaintiff, invited me to dismiss the Summons on the basis that it is redundant and that if the Defendants had wanted the Court to strike out the Amended Statement of Claim they should had issued a summons to amend the existing one: RHC O32 r2(2).

3.  Mr Barlow identified another procedural shortcoming by the Defendants.  The Summons lists all the four grounds referred to in RHC O18 R19(1).  It does not identify whether one ground is the principle basis for making the application.  Practice Directions 19.1 Part III requires, in applications to strike out pleadings as disclosing no reasonable cause of action or where no letter has been written by counsel for the applicant to counsel for the respondent signifying his intention to make the application stating on which ground the application will be made, that the applicant should inform the respondent of the grounds in writing at least five clear working days before the day fixed for the hearing.  This has not been done.

4.  The Defendants’ skeleton argument makes no reference to RHC O18 r19, any of the grounds specified in it or the principles, which govern the determination of strike out applications.  It contains an undisciplined narrative explaining why the claims advanced are bound to fail by reference to evidence filed, which has been drafted without any attempt to explain how the Amended Statement of Claim or particular paragraphs come within one or other of the grounds referred to in Rule 19.  This made pre-reading the papers and assessing the application unnecessarily difficulty.

5.  It seems to me that in the circumstances the Defendants should amend that Summons and identify precisely what part of the Amended Statement of Claim is attacked and why.  I invited Mr Maurellet to consider if the Defendants wished to apply to amend.  Mr Maurellet took the view that it was better for the Defendants to take time to consider how they should proceed in the circumstances.  Mr Barlow agreed that there be no order on the Summons save for costs, over which there was no material controversy, and I ordered that the costs up to and including 14 November 2021 be to the Defendants in any event and thereafter the costs be to the Plaintiff in any event with a certificate for two counsel.