YOKVIEW CO LTD v. LO YING KIT HENRY t/a AGT AND OTHERS

DCCJ 5136/2009

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO.5136 OF 2009

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JUDGMENT

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Introduction

1.  This is an action for libel.

Background

2.  On 4 December 2009, the Plaintiff commenced the present proceedings against the 1^st and 2^nd Defendants. It said that, on or about 3 October 2009, they sent to some of its overseas customers various e-mails (the “e-mails”) which were grossly defamatory to it.

3.  The defamatory words were:

“ … Our factory company is a partner of your supplier – Yokview Co., Ltd. [i.e. the Plaintiff]; but now we have developed separately since beginning of this year, no long produce and supply fashion handbags to Yokview.

We are a real manufacturer with own factory for Brands Fashion Handbags since 1994… We replaced the production of all fashion handbags, while Yokview was only responsible for packaging and shipping to the buyers. They are marketing company, responsible for liaising with the trade shows to find overseas buyers…

…

Tiffany HO [i.e. the 2^nd Defendant]

Sales Marketing Coordinator (Export)

AGT Group

…” 

4.  It was said that the defamatory words, read as a whole, bore and were understood to bear in their ordinary and natural meanings the following imputations.

“A. There was some form of business relationship or co-operation between the Plaintiff and AGT in the Plaintiff’s carrying on of its handbags business, and the Plaintiff’s success in its business was attributed to AGT’s involvement in such business relationship/co-operation.

B. The Plaintiff was not a true handbags manufacturer with its own factory for production, but need to rely on AGT or other third party to manufacture handbags for the Plaintiff to fulfil the Plaintiff’s customers’ orders. The Plaintiff was only a trading company and earned the price difference by liaising with suppliers and buyers. Furthermore, as a result of the cessation of the business relationship between the Plaintiff and AGT, the Plaintiff would be short of a source of supply of goods to the Plaintiff’s customers.

C. The goods previously supplied by the Plaintiff to the recipients of the said E-mail were actually manufactured by AGT or other third party, rather than by the Plaintiff.

D. The Plaintiff was dishonest in not disclosing to the recipients of the said E-mail that the goods previously supplied by the Plaintiff to them were in fact not produced in the Plaintiff’s own factory.

 E.  At least 40% of the prices previously charged by the Plaintiff on the recipients of the said E-mail was unjustified, as such costs could/should have been saved because the Plaintiff was just a trading company. Such costs could be saved if the recipients of the said E-mail dealt with AGT instead.” 

       (Paragraph 6 of the Statement of Claim)

5.  The Plaintiff asked for an injunction order, damages, including aggravated and exemplary damages, interest and costs.

6.  The 2^nd Defendant did not file her notice of intention to defend the proceedings, default judgment (final judgment on injunction and interlocutory judgment on damages to be assessed) with costs were obtained by the Plaintiff against her on 23^rd February 2010.

7.  On the other hand, the 1^st Defendant defended the claim. He said, inter alia, the followings.

(a)  He did not employ the 2^nd Defendant or any staff.

(b)  He did not send or ask anybody to send the e-mails.

(c)  He indeed never used any e-mail for communication in his business.

(d)  His trade name was “AGT” only and he never traded and/or represented himself as “AGT Group”.

(e)  On or about 22 October 2009, he received an envelope addressed to “AGT Group” only and as such, he returned it by putting the same into a public post box with the marking of “冇此人”.

8.  In light of the Defence of the 1^st Defendant, the Plaintiff sought a discovery order against Hong Kong Telecommunications (HKT) Limited to reveal the subscriber of the subject e-mail account. This Court made the order and the identity of the 3^rd Defendant was later made known. She was indeed a sales marketing coordinator of the Plaintiff and worked there for some 5 months until being dismissed.

9.  On 17 May 2010, the 3^rd Defendant was joined in the present proceedings.

10.  She also defended the proceedings herself. In her Defence, she said, among others, that she was suddenly dismissed by the Plaintiff on 25 February 2009. She was asked to pack up her own things and left immediately. She was not even allowed to touch any document or the computer. The Plaintiff wrongfully deducted her wages but she was unable to contact the boss, Mr. Fong Chi Keung (“Mr. Fong”) of the Plaintiff. She denied the claim and said that:

“4. 本人是有關電郵的登記用户，同時並相信原告人和/代理人知道該電郵的登入密碼。本人認為原告人是故意逃避支付有關拖欠薪金，逃避負上刑事法律責任，而作出無理的惡毒指控。”

     (2010年7月12日存檔的抗辯書)

11.  Parties thereafter went through the usual discovery stages, including filing of lists of documents and exchanging of witness statements. Leave was also later granted to set down the case for trial.

12.  On 1 March 2011, parties appeared before me at the pre-trial review hearing. The following points were noted.

(a) The Plaintiff confirmed that it would not pursue against the 2^nd Defendant for damages to be assessed at the trial.

(b) Parties could not agree on Issues in Disputes. To save time and costs, the matter would not be further pursued.

(c) The Plaintiff filed 5 witness statements, one from Mr. Fong and four from its oversea customers. The latter purported to confirm that they had received the e-mails at the material times. The question of time, costs and proportionality were discussed in relation to whether the four oversea customers should or should not be attending the trial. No agreement was reached and the Court indicated that it would be a matter for them to try to come up with consensus, if possible.

13.  The trial commenced on 27 May 2011, as scheduled. Mr. Ken To of Counsel appeared for the Plaintiff. The 1^st Defendant no longer had legal adviser to help him, and he acted in person, as the case of the 3^rd Defendant.

Preliminary matters

14.  At the outset of the trial, Mr. To informed me that his client, for the purpose of saving costs and time, had decided not to call for the four overseas customers to come to Hong Kong to give evidence. Hearsay notices were therefore issued on 4 March 2011. The 3^rd Defendant did not respond to it. However, those instructing Mr. To engaged in some argument in writing with the then solicitors acting for the 1^st Defendant. The correspondence ended when the solicitors ceased acting for the 1^st Defendant.

15.  It therefore appeared that the question as to whether the witness statements of the four overseas customers was admissible or not was still alive. Mr. To asked me to accept them. Both the 1^st and 3^rd Defendants argued otherwise. In order to save time and costs, I allowed them on a de bene esse basis.   Now, after thought, Ihave decided to formally confirm such decision.  In short, I agree with the submissions made by Mr. To.

(a)     Order 38 rule 21 of the Rules of the District Court regulates the position.

“21. – (1) Where a party tenders as hearsay evidence a statement made by a person but does not propose to call the person who made the statement to give evidence, the Court may, on application-

(a) allow another party to call and cross-examine the person who made the statement on its contents;

(b) allow any party to call-

(i) additional evidence to attack or support the reliability of the statement;

(ii) additional evidence to attack or support that first-mentioned additional evidence.

(2) Where the court allows another party to call and cross-examine the person who made the statement, it may give such directions as it thinks fit to secure the attendance of that person and as to the procedure to be followed. ”

(b)   There has been no application taken out by either the 1^st Defendant or the 3^rd Defendant. It is too late for them to make any complaint.

(c)   I should perhaps go a step further. Even if there were such an application before this Court, I would have ruled the same in favour of the Plaintiff. The crux of the evidence of the four overseas is that they did receive the e-mails. Further, one of them, namely Mr. Bruno Zerdoun went a bit further than the others by engaging in some further communication with the 2^nd Defendant. However, there has been no challenge by any of the Defendants that the e-mails were untrue or inaccurate. The essence of their cases is that, inter alia, they were not the sender.  It would therefore be a waste of time and costs, if one insists the attendance of the overseas customers in the witness box to confirm something which are not in dispute or controversial, especially upon taking into account the costs involved, including air fares and accommodation.

(d) Finally, I have also taken the view that, even if I would have ruled against the Plaintiff in the matter by rejecting the evidence of the 4 overseas customers as inadmissible, it did not materially affect my assessment of the cases of the parties before me.    

The parties’ arguments

16.  Unlike the usual trial for defamation, the Defendants did not raise the usual defence touching on the interpretation of the meaning of the words of the e-mails, justification, fair comment or qualified privilege. To sum up the matter, the parties ran completely different cases.

(a)   The Plaintiff’s case is that:

“… D1 and D3 have known each other well since D3’s working for D1 at Geotech. Just a week after D3 had been laid off by P, D1 quickly set up AGT in a hope to rely on P’s client contacts obtained in the course of D3’s employment with P to engage in trades relating to fashion bags. In order to divert P’s clients to AGT, D1 D2, and D3 sent out the said Emails to defame P in an attempt to divert P’s business”

(Mr. To’s Closing Submission)

(b)    The 1^st and 3^rd Defendants said that they did not know each  other.

(c)     It was the 1^st Defendant’s case that he was wrongly sued because of many coincidences.

(d)    On the other hand, the 3^rd Defendant argued that the Plaintiff set up the matter against her as revenge.

17.  Therefore, in the end, the crux lies on: Whose case is to be believed? Did the 1^st and 3^rd Defendants publish the e-mails?

18.  Upon consideration of all the evidence authorities and submission before the Court, I have decided to accept the case of the Plaintiff on balance. Its case is to be preferred to those of the 1^st and 3^rd Defendants, in terms of the documents produced, credibility of the witnesses and the inherent probability/improbability of their respective cases.

Documents

19.  The parties in the present proceedings have not produced too many documents. Nonetheless, they all support and corroborate with the Plaintiff’s case.

(a)   The Plaintiff produced the e-mails received from its customers. There has never been any attempt by either the 1^st and 3^rd Defendant to challenge the authenticity of them.

(b)   In relation to the 1^st Defendant, his business search record showed that he commenced the business as “AGT” for fashion bags from 1 March 2009 at 5/F, 93 Catchick Street, Kennedy Town, Hong Kong.

(c)   From the e-mails issued by the 2^nd Defendant with the customers of the Plaintiff, she adopted the above address for correspondence. She apparently used “AGT” and “AGT Group” interchangeably.

(d)   The Plaintiff further produced the company search of Geotech. It showed that the 1^st Defendant was its secretary, director and shareholder.

(e)   The CV of the 3^rd Defendant recorded that she worked as a sales officer at Geotech from January 2001 to July 2007.

(f)    The web site of Geotech downloaded by the Plaintiff contains reference of L&M Group, L&M Investments Company Ltd. and the 3^rd Defendant.

(g)   The company search of L&M Investment Company Ltd. recorded that the 3^rd Defendant was its director.

20.  From the documents, one can see that there were so many connections among the Defendants. It is simply unbelievable or not to be believed that the 1^st Defendant and the 3^rd Defendant did not know each other at the material times.

Credibility of witnesses

21.  3 witnesses appeared before the Court. With respect, both the 1^st and the 3^rd Defendants are not reliable witnesses.

22.  In relation to the 1^st witness, I have the following observations.

(a)   The 1^st Defendant traded as “AGT”. It is a special trade name. Everyone expects that it will mean and/or stand for something. Upon being questioned by Mr. To, he explained:

“i. D1 stated that AGT has no meaning. D1 explained that it was casually picked from the Internet, as these letters were used by a friend of him who was a reporter. D1 also stated that he did not ask this friend of him what the meaning of AGT may be. He adopted AGT as his company name because it is easy to remember…”

    (Para. 10(a) (i) of Mr. To’s Closing Submission)

(b) The 3 letters “AGT” cannot be picked at random. The 1^st Defendant was simply refusing to tell the truth. On balance, I find that it should come from the e-mail address of the 3^rd Defendant “ApexGeoTech1991@netvigator.com”.

(c)   The 1^st Defendant admitted that he did receive the demand letter in October 2009, but did not open it as the same was addressed to “AGT Group”, not “AGT”. Apart from the close resemblance of the two names, one should not forget that it was sent to the address of AGT. There was also the reference of a firm of solicitors on the envelope. It is again far from believable that a “recipient” in the position of the 1^st Defendant would simply return the same by throwing it into a public post box with the marking of “冇此人”.

(d) The 1^st Defendant also purported to explain in the witness box as to the setting up of AGT, its running of business and cessation. Nonetheless, as summed up by Mr. To, his explanation is far from satisfactory.

“10 (b) For D1’s setting up of AGT:-

i. D1 explained in his witness statement that his setting up of AGT was triggered by the approach of a friend of him who knew buyers of handbags. This formed the basis of his clientele;

ii. Surprisingly…D1 gave evidence that he did not even know the name of his friend. He also did not know which company his friend worked for. All he knew was his friend’s nickname, ‘意粉’, who seemed to work as an editor in the media. D1 met ‘意粉’ at some media events, and ‘意粉’may have some contact in China;

iii. Given the fact that D1 had no previous experience in manufacturing and trading, it is simply inconceivable that for D1 would just set up a handbag trading company by relying on someone he knew so little about and chose not to inquire. Bearing in mind that  ‘意粉’ is supposed to provide the very source of buyers, which is the main reason why D1 set up AGT;

iv. Such improbability us even clearer in light of the lack of financial means of D1:-

1. D1 gave evidence that he only had a total of assets of $50,000, with a monthly income of $3,000 to $10,000. He provides $3,000 per month to support his parents’ living;

2. This is the background against which he suggested in his witness statement that a $2,000 reduction in government levy for the business registration was a consideration for his setting up of AGT; and

3. D1 has therefore to be financially conscious. It is improbable that he would risk his highly limited assets by relying on someone he has very little knowledge about in order to engage in a business in which he has no or little experience.

(c) Cessation of running of AGT:-

i. D1 explained that after the setting up of AGT, he realized that he was too busy to run it. Therefore, he has ceased to run AGT. This flies in the face of his evidence that he has a freelance job as a photographer, with sometimes low income due to insufficient jobs.  

….

11. (a)…

(b) For the business nature of AGT:-

i. D1 for the very first time described the business of AGT as the production of camera bags, not fashion bags;

ii. This is contradictory to clear documentary evidence that in the business registration of AGT, its business nature is described as ‘fashion bags’;

iii. Such invention of D1 cannot be more inconsistent with the tenor o all the pleadings and the witness statements of D1. All along the case of P and the Said Emails are related to fashion bags. If AGT has a line of production which is so distinctive from P’s business, there is no reason why D1 could not and would not have stated the same earlier.

 …”

(Para. 10 and 11 of Mr. To’s Closing Submission)

23.  The position of the 3^rd Defendant is no better than that of the 1^st Defendant, if not even worse.

(a)  The 3^rd Defendant suggested that the whole defamation matter was a set up by the Plaintiff against her. She said that the Plaintiff did so because it wanted to avoid the liability to pay her outstanding wages and the criminal liability.

(b) However, she has not adduced any evidence and/or explained her calculation of outstanding wages. She said that she had consulted the Labour Department and it confirmed her case. Regrettably, she produced no document of proof. She was dismissed by the Plaintiff some 2 years ago. Yet, she has not lodged any complaint with the labour Department, not to mention a claim in the Labour Tribunal. She explained that she had no time to do so. I do not consider it a reasonable explanation at all.

(c) If the 3^rd Defendant has not done anything objectively to pursue her claim for outstanding wages, what liability the Plaintiff has to avoid?

(d) As the case of the 1st Defendant, the 3^rd Defendant only gave short witness statement, but came up with a long story at the witness box. Such “approach” does not help her. It only discredits her only. Her explanation of her e-mail address and the password are indeed fatal to her case.

“13. Fatal to her case, in the course of cross examination, D3 gave evidence that effectively ruins her own defence that P misused D3’s email by taking her password from her working computer at P’s premises:-

(a) D3 saved her login and password of the Email Address at the time when she first joined P on or about 16.09.2008 for the purpose of opening a bank account;

(b) D3 stated that from 12.2008 to 28.02.2009, her own computer was [not working]and therefore could not use the same nor access the Email Address;

(c) In May 2009, D3 received notification from PCCW that there was record for three unauthorized attempts to access the Email Address. As a result, the password was changed by PCCW and nobody can access the same;

(d) Later, D3 received a SMS at her mobile phone that in order to access the Email Address, she would need to call PCCW and go through a confirmation process in order to obtain the new password;

(e) Such confirmation process was not carried out;

(f) The combined effect of this set on new evidence by D3 would be that whatever login and password saved at D3’s working computer at P’s premises would be render useless. Even if D3 did save such password information on that computer, there is simply no way anyone could just rely on that password to access the Email Address after May 2009.

(g) The defamatory documents in issue, the Said Emails, were sent out on 03.10.2009;

(h) Therefore, the one and only one defence in D3’s Defence is completely demolished.

…

15. D3’s evidence is contradictory:-

(a) The use of the Email Address:-

i. D3 tried very hard to disassociate herself from the Email Address. She repeatedly and emphatically told the Court that she abandoned the Email Address since 10.2008 or 11.2008, and she has not used it ever since;

ii. This is contradictory to the message she admitted posting on the web for the inquiry about plush photo album on 07.01.2009. In the message, D3 still comfortably relied on the Email Address as her business email for future correspondence.

(b) The provision of the password of the Email Address to P    

 i. D3 invented a new story that in order to obtain different price quote for the plush photo album, she provided her email address and password to the wife of Mr Fong of P. The purpose is to hide her identity as an employee of P to get a second quote. This provides a convenient answer to D3’s case of how P obtained the password of the Email Address;

ii. She urged the Court to allow her to include this new evidence…

iii However, when D3 was challenged that such proposition is inconsistent with D3’s pleaded case in her Defence, D3 immediately said that she was actually referring to a second set of password, which is not related to the Email Address; and

iv. Also, when D3 was challenged as to why she stated P’s company name, ‘Yokview Co. Ltd’ in the message when she claimed that the reason to use her email address is to hide her indentify of she being an employee, she said that it was a mistake she made as it was late at night when she prepared the message…” 

      (Para. 13 and 15 of Mr. To’s Closing Submission)

24.  As compared with the 1^st Defendant and the 3^rd Defendant, the Plaintiff’s witness Mr. Fong Chi Keung is far more trustworthy. He explained that the Plaintiff had decided not to call the 4 overseas customers to come to Hong Kong to testify because they asked for business class flight, accommodation and costs for extra days to adjust the jet-lag. He also said that it would cost $200,000. I agree with his explanation, especially, having taken into account the fact that these customers only confirmed that they had received the e-mails only. There has not been any suggestion that they made up the same with the Plaintiff.

25.  Further, as to why he did not call for the employees who helped him to dig out the information from the computer of the 3^rd Defendant and to download the particulars from the internet, I also accept his answers. The documents have been disclosed for a long time. Neither the 1^st nor the 3^rd Defendant has said that the information or the particulars were made up. They have also not sought to adduce contrary evidence to rebut the same. It is therefore pointless to call for the employees to tell how they did their job.

Inherent Probability/Improbability

26.  Finally, at the trial, I did discuss with the 1^st Defendant about his case. In short, he was simply unnecessarily and unfortunately dragged into the matter. It could only have happened by many coincidences which were very fatal to him. He was therefore almost one of the unluckiest persons in the world. He maintained his story. However, as agreed by Mr. To, the case of the 1^st Defendant is highly improbable.

“3. D1’s case is one of multiple coincidences of the improbables, which happened with a probability close to the infinitesimal. D1 has absolutely no a relationship with D3, but D1’s company, Geotech, was somehow selected by D3 and put on her CV and job application form as a company D3 had worked for. The improbable fact was consistently supported by numerous website printouts. Nonetheless, to D1, this is no more than another coincidence that Geotech’s information was misrepresented on the web by someone unknown to him. To continue this series of improbable, D1’s company, AGT, was chosen as the apparent sender of the Said Emails to defame P, coincidentally using D1’s address and D3’s mobile phone number. This chain of coincidences is the reason why although D1 is someone completely unrelated to this defamation, but has been most unfortunately dragged into the case.”

     (Para. 3 of Mr. To’s Closing Submission)

27.  Again, the case of the 3^rd Defendant is in no better position.

“(a) It is highly unlikely that in order to avoid paying any outstanding salary, P would choose to send out defamatory emails to its long-term clients to damage its own reputation;

(b) It is even more unlikely that in the email exchange with Bruno Zerdoun, P would rely on D3’s mobile number as the contact for P’s very own client. This is so particularly when D3 was fired by P some eight months ago and Bruno Zerdoun has been a long term client of P;

(c) It is inherently improbable that by sending the Said Emails, P would be able to avoid paying the alleged outstanding salary; and

(d)  It is inherently improbable that by sending the Said Emails, P would be able to avoid any potential criminal liability arising from the alleged outstanding salary.”

(Para. 42 of Mr. To’s Closing Submission)

28.  As a matter of fact finding, on balance, I accept the case put forward by the Plaintiff.

(a)  The Plaintiff has engaged in the business of manufacturing and selling handbags to different countries. It also enjoys a good reputation generally.

(b) The 3^rd Defendant worked as a sales representative for the Plaintiff for about 5 months from 16 September 2009 to 25 February 2009.  In the course of her employment there, she had access to the customers of the Plaintiff.

(c)  The 3^rd Defendant was dismissed by the Plaintiff. She was even asked to leave the office immediately.

(d) The Plaintiff did not owe the 3^rd Defendant any outstanding salary.

(e)  After the dismissal, the 3^rd Defendant decided to set up a business to compete with the Plaintiff. She also decided to solicit the customers of the Plaintiff to her new business. However, in order to hide her identity in the matter, the 1^st Defendant formed AGT on 1 March 2009, i.e., 4 days after her dismissal.

(f)   All the Defendants have known one another, and they played different roles in the new business.

(g)  The 2^nd Defendant was the sales marketing coordinator. In the course of performing her duties, she sent the emails to the overseas customers of the Plaintiff, attempting to divert them to the new business.

(h) The e-mails contained wrong misleading and defamatory information about the Plaintiff. Wearing the hat of the jurors, I further find that they read bore and understood to mean those imputations as cited in paragraph 6 hereinabove.

(i) However, the customers relayed and passed the e-mails and matter to the Plaintiff, leading to a series of investigation by the Plaintiff.

(j) Ultimately, the identities of all the Defendants were revealed one by one.

(k) The 2^nd Defendant simply ran away from the matter and did not defend for the proceedings. The 1^st and the 3^rd Defendants however made up all sorts of excuses and stories to try to deny their involvement in the matter, although they had been almost caught red-handed.

29.  With the above, I then move to answer the issues suggested by the parties.

30.  The Plaintiff said that there were 6 issues to be decided. They are:

“1. Whether the Plaintiff or its agent knew of the 3^rd Defendant’s email account login password?

1. If yes, whether the Plaintiff or its agent logged into the 3^rd Defendant’s email account and sent and/or caused, allowed or permitted to be sent the subject emails in these proceedings via the 3^rd Defendant’s registered email account to some of the Plaintiff’s customers?

2. If not, whether the 3^rd Defendant sent and/or caused, allowed or permitted to be sent the subject emails via the 3^rd Defendant’s registered email account to some of the Plaintiff’s customers?

3. Whether the 1^st, 2^nd and 3^rd Defendants were jointly concerned in the publication of the subject emails via the 3^rd Defendant’s registered email account to some of the Plaintiff’s customers?  

4. Whether the subject emails are defamatory of the Plaintiff?

5. Whether the Plaintiff should be entitled to aggravated and/or exemplary damages if liability of the 1^st and/or 3^rd Defendant(s) is established?”

I will answer the above in the followings.

(1) Neither the Plaintiff nor its agent knew the 3^rd Defendant’s email account login password.

(2) Not applicable.

(3) The 3^rd Defendant did send, and/or cause, allow or permit to be sent the subject e-mails via the 3^rd Defendant’s registered e-mail account to some of the Plaintiff’s customers.

(4) The 1^st, 2^nd and 3^rd Defendants were jointly concerned in the publication of the subject emails via the 3^rd Defendant’s registered email account to some of the Plaintiff’s customers.

(5) The subject emails are defamatory of the Plaintiff.

(6) Liability of the both the 1^st and 3^rd Defendants has been established, the Plaintiff is entitled to aggravated and/or exemplary damages.

(a)  From my finding of facts, the Defendants did publish the defamatory e-mails.

(b) There is no doubt that the 3^rd Defendant knew that those defamatory e-mails contained untrue statements. The 1^st Defendant either knew or was reckless as to whether they were true or not.

(c)  The Defendants did so in the hope and expectation of diverting the customers of the Plaintiff to the new business.

(d) Both the 1^st and the 3^rd Defendants have decided to contest the proceedings, including a prolonged and hostile cross examination upon the Plaintiff.

31.  On the other hand, the 1^st and the 3^rd Defendants have their own issues identified:

“Issues

1. Whether the maker of the alleged defamatory statements, namely, “AGT Group” might be taken for the name of the 1^st Defendant who was and is at all material time trading under the name of “AGT”?

2. Was the letter before action dated 14^th October 2009 duly served on the 1^st Defendant?

3. Is there sufficiency of the evidence to enable the Plaintiff to presume the 1^st Defendant was the maker, ender and/or publisher of the alleged defamatory statements?

4.  Whether the Plaintiff is entitled to aggravated and/or exemplary damages, if liability of the 1^st Defendant was established? ”

(Issues attached to the Questionnaire  filed by the 1^st Defendant’s previous solicitors dated 8 February 2011)

I answer them as below.

(1) “AGT Group” and “AGT” was at all material time used by the Defendants interchangeably.

(2) The letter before action was duly served on the 1^st Defendant. He just turned a blind eye on the same by returning it to the sender.

(3) There is sufficient evidence to prove, not just to presume, that 1^st Defendant was the maker, sender and/or publisher of the defamatory statements.

(4) The Plaintiff is entitled to aggravated and/or exemplary damages.

32.  Regarding the 3^rd Defendant, she indentified one issue for her Court to decide in her questionnaire filed on 8 February 2011, namely, “To find out the person who use the internet account.” My answer to it is that: she herself or through the other 2 Defendants. 

  Appropriate relief to be granted

33.  I now turn to the appropriate relief, including the amount of damages, to be granted in the circumstances.

34.  In these respects, I heard nothing from the 1^st and 3^rd Defendants. Mr. To, on the other hand, referred me to a number of useful authorities, including in particular the following.

(a)  In Hung Yuen Chan Robert v. Hong Kong Standard [1996] 4 HKC 519

“ …The objective is to ‘restore the plaintiff, as far as money can do so, to the position he would have been in if the tort had not been committed…Where there has been no retraction or apology, an order for damages is the only solatium available to the plaintiff …

In the recent Court of Appeal decision in Cheung Ng Sheong Steven v. Eastweek Publisher Ltd [1995] 3 HKC 601, it had to consider the question of damages for libel. It accepted…the submission that:

…damages for libel must provide for several disparate elements, not only damage to esteem and reputation. They also ‘must be sufficient to publicly and demonstratively and absolutely vindicate the plaintiff and to compensate for seriously injured feelings…”

(b) In Downtex v. Flatley [2004] EWHC 333 QB, it was said that:

“26. Publication to a relatively small number of persons who are already in a business or professional relationship with a claimant may be as serious or worse than a wider publication to persons who are not, and are unlikely to contemplate being, in such a relationship…”

(c)  In Gatley on Libel and Slander,

“The conduct of the defendant, his conduct of the case

, and his state of mind are all matters which the claimant may rely on as aggravating the damages in so far as they bear on the injury to him…

…There may be malevolence or spite or the manner of committing the wrong may be as such as to injure the plaintiff’s proper feelings of dignity and pride…”

(d) Paragraphs 9.22 of Gatley:

‘…the sum awarded by way of exemplary damages should be the minimum necessary to punish the defendant, to show that tort does not pay and to deter others…An award of exemplary damages may properly exceed the award of compensation damages by a large margin but there should be some proportion between the two.

35.  Applying the above principles to the present case, I take the view that a sum of $100,000 compensatory damages as well as a further sum of $200,000 aggravated and/exemplary damages are appropriate in the circumstances. Interest is to be calculated at the statutory rate from the date of writ herein to the date hereof, and thereafter at judgment rate until payment.

36.  On the other hand, the Plaintiff also prayed for an injunctive relief. I have not heard too much argument from the parties in relation to it. However, I see no particular reason not to grant such relief, especially when I have found that both the 1^st and 3^rd Defendants simply denied the obvious. I so order the injunction as prayed. 

Costs

37.  Costs generally follow event, I see no reason to depart from such rule.  There will be an order nisi, which will become absolute after 14 days from the date hereof, that the 1^st and 3^rd Defendants shall pay costs of the Plaintiff in the proceedings, including Certificate for Counsel for the trial dates before me, to be taxed, if not agreed.

Summary

38.  To conclude, I order the followings.

(a) There is an injunction order restraining both the 1^st Defendant and the 3^rd Defendant, whether by themselves or through their servants, agents, employees whosoever from howsoever publishing and/or causing the publication, printing and/or distribution of the defamatory words or similar words defamatory of and concerning the Plaintiff.

(b) Both the 1^st Defendant and the 3^rd Defendant do jointly and severally pay the Plaintiff compensatory damages in the sum of $100,000.

(c) Both the 1^st Defendant and the 3^rd Defendant do also jointly and severally pay the Plaintiff aggravated and/exemplary damages in the sum of $200,000.

(d) There will be an order nisi, which will become absolute after 14 days from the date hereof, that the 1^st and 3^rd Defendants shall jointly and severally pay costs of the Plaintiff in the proceedings, including Certificate for Counsel for the 3 trial dates before me, to be taxed, if not agreed.