XCHRX WONG SAU KAM & YEUNG KON v. SHUM YUK FONG AND OTHERS

HCPI 798/1998

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO. 798 OF 1998

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J U D G M E N T

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APPLICATION UNDER ORDER 14A OF THE RULES OF THE HIGH COURT

1. This is an application under Order 14A (commenced by summons dated 4th May 1999) by the 7th defendant for the determination of 2 questions of law.

Background

2. The application arose in this way. In the early evening of 15th November 1995 Mr Yeung Ki Yee was standing on the pavement outside premises in Kwun Tong when a section of an unauthorised canopy extension collapsed onto him causing him fatal injuries.

3. The plaintiffs in this case (the principal respondents to the application) are the administrators of Mr Yeung's estate and have brought the action against seven defendants, the first six of whom were owners or occupiers of the premises.

4. Putting it shortly, for present purposes, the statement of claim of the plaintiffs seeks damages against the first six defendants based upon public nuisance; under the Rule in Rylands v.Fletcher; in negligence and for breach of statutory duty, in relation to various sections of the Buildings Ordinance, Cap 123.

5. As to the 7th defendant (who is sued on behalf of the Building Authority, defined under Section 2 of Cap 123 as the Director of Buildings) the plaintiffs' statement of claim firstly seeks damages arising out of alleged breaches of a duty of care to protect members of the public from dangers posed by canopies and other projections overhanging public rights of way and, secondly, in negligence.

6. In relation to the alleged breach of a duty of care 11 facts and matters are pleaded. I do not propose to recite those here but, suffice it to say, that they are wide ranging and suggest, inter alia, firstly that the Building Authority was fully aware (by reason of recent inspection) of the danger posed by the canopy in question, yet failed to take any steps to protect the public from its imminent collapse; secondly that the Building Authority is empowered by statute, and has the means and resources, to take steps necessary to protect the public from such occurrences; and thirdly that the Building Authority, by reason of a serious canopy collapse in Aberdeen in August 1994, was fully aware of the urgent need for a system of monitoring, repairing and/or removing canopies and/or canopy extensions (particularly if unauthorised) and to prevent such collapse.

7. In relation to the allegation of negligence some 20 particulars are pleaded which relate, inter alia, to failures to act and to permitting construction without approval.

The questions of law

8. The 2 questions posed by the Order 14A application are as follows:-

1)	Does section 37 of the Buildings Ordinance, Cap 123 exempt the Building Authority from liability in respect of a common law claim in negligence for failure by the Building Authority to exercise its powers under the ordinance as to the removal, and/or demolition and/or repair of building works which following an inspection by the Building Authority of the same are revealed to be dangerous to the public.
2)	In the absence of section 37 of the Buildings Ordinance, Cap 123 would the Building Authority be under a common law duty to exercise its powers under the Ordinance as to the removal, and/or demolition and/or repair of building works which following an inspection by the Building authority of the same are revealed to be dangerous to the public.

9. By the Order of the Suffiad J in Chambers on 7th May 1999, inter alia, dates were to be fixed with the Listing Clerk for the hearing of this application (with an estimated time of 2 days), and the Pre Trial Review (originally fixed for 26 July 1999) was vacated with a new date to be fixed not earlier than one month after the hearing of this application.

Preliminary Points

10. During the course of the hearing before me two preliminary questions required my determination, albeit that they did not come into full focus until well into the hearing. Firstly; did the parties have an opportunity of being heard (and were they heard) regarding the questions set out in the application before Suffiad J on 7th May (R1(3)(a)) or, alternatively, did they consent to an order or judgment on such determination (R1(3)(b))?

11. Secondly; if so, was it incumbent upon Suffiad J on 7th May to satisfy himself about the suitability and finality of determining the questions of law or construction without a full trial and, assuming that he had done so, did that preclude me from considering the questions of suitability and finality.

12. On hearing arguments from leading counsel for the plaintiff and leading counsel for the 7th defendant; on being referred to various papers relevant to the proceedings conducted on 7th May before Suffiad J and having listened to a recording of those proceedings I answered both of those questions in the negative.

13. The purpose of that hearing was, so it seems clear to me, no more than to set a time table for case management; to assess the likely interests of the various parties in the Order 14A application; to estimate a hearing date for that application and to adjourn the Pre Trial Review until after it had been heard.

14. At that hearing it was indicated that the Order 14A application would be opposed by the plaintiff and by at least one defendant, and that the position of some other defendants could not be determined until counsel had been instructed and advice given.

15. No arguments concerning the subject matter of the Order 14A application were put before Suffiad J at that hearing, either on behalf of the applicant or any of the other parties, but Suffiad J's order required that each party make its position plain to the 7th defendant concerning the Order 14A application within 7 days.

16. I was quite satisfied that it was for me, before whom the application was set down for hearing, to either ensure that the parties had an opportunity of being heard by me if they opposed the application and, if none did oppose it, that they consented to an order or judgment on such determination, and that it was for me to satisfy myself (irrespective of the attitude of the parties) about the suitability and finality of determining the questions posed in the summons dated 4th May1999 without a full trial.

Order 14A Procedure

17. Rule 1(1) reads as follows:-

" The court may upon the application of a party or of its own motion determine any question of law or construction of any document arising in any cause or matter at any stage of the proceedings where it appears to the court that

(a)	such question is suitable for determination without a full trial of the action and
(b)	such determination will finally determine (subject only to any possible appeal) the entire cause or matter or any claim or issue therein"

18. Rule 1(3) reads:-

" The court shall not determine any question under this order unless the parties have either

(a)	had an opportunity of being heard on the question
or (b)	consented to an order or judgment on such determination."

Am I satisfied that the questions posed in the summons of the 7th defendant are suitable for determination without a full trial of the action?

19. Before endeavouring to answer this question I should say that I had the advantage of listening to several hours of argument from Mr Ozorio concerning the questions posed by the Order 14A application before it became apparent that he was assuming (he would, I think, say that he had been led to believe by the inactivity of the lawyers for the other parties between May 1999 and the hearing of this application on 18th January 2000) that such other parties were consenting to an order or judgment on the determination of the questions posed in the application. It was plain from the written and oral submissions of Ms Eu that that was a patently wrong assumption.

20. In particular she doubted the appropriateness of the Order 14A summons because, so she said, it raised hypothetical questions that may or may not arise in the trial and that answers to such questions may depend on evidence that has to be adduced at trial.

21. As to the nature of those questions, Mr Ozorio argued that both of them seek determination of the common law liability of the 7th defendant, which is the only basis upon which the plaintiff puts its case against the 7th defendant and thus must arise in any trial.

22. In particular, says Mr Ozorio, under Order 14A r1 the court is entitled (and I dare say obliged) to determine such questions if they are suitable for determination, and such determination will finally determine the entire cause or matter or any claim or issue therein.

23. He says, and in my view there can be no doubting this, that a determination of the first question set out in the application would finally determine the liability of the 7th defendant to the plaintiff, and that a determination of the second question in favour of the 7th defendant would do likewise.

24. But are the questions suitable for determination?

25. In considering this matter it is, I think, helpful to set out here the relevant parts of para 14A /2/5 of the Supreme Court Practice (1999 Edition) as follows:

"Suitable question of law or construction-The ambit of O.14A was considered by the Court of Appeal in Korso Finance Establishment Anstalt v. John Wedge..... The following principles are laid down thereby:-

1.	An issue is "a disputed point of fact or law relied on by way of claim or defence".
2.	A question of construction is well capable of constituting an issue.
3.	If a question of construction will finally determine whether an important issue is suitable for determination under O.14A and where it is a dominant feature of the case a Court ought to proceed to so determine such issue.
4.	Respondents to an application under O.14A are not entitled to contend they should be allowed to hunt around for evidence or something that might turn up on discovery which could be relied upon to explain or modify the meaning of the relevant document. If there were material circumstances of which the Court should take account in constructing the document, they must be taken to have been known, and could only be such as were known, to the parties when the agreement was made. In the absence of such evidence the Court should not refrain from dealing with the application.
.....
Sir Thomas Bingham M.R., considering the inter-relation of striking out and O.14A, expressed unease at "...deciding questions of legal principle without knowing the full facts". However he continued "But applications of this kind are fought on ground of a plaintiff's choosing, since he may be generally assumed to plead his best case ... [If] the legal viability of a cause of action is unclear (perhaps because the law is in a transition), or in any way sensitive to the facts, an order to strike out should not be made. But if, after argument, the court can be properly persuaded that no matter what (within the reasonable bounds of the pleading) the actual facts [are] the claim is bound to fail for want of a cause of action, I can see no reason why the parties should be required to prolong the proceedings before that decision is reached" (E (A Minor) v. Dorset C.C. [1995] 2 A.C. 633; [1994] 4All E.R. 640). These words were approved on appeal to the House of Lords by Lord Browne-Wilkinson (the other members of the Appellate Committee concurring).... It was said that where the law is not settled but is in a state of development it is normally inappropriate to decide novel questions on hypothetical facts; however where construction of statutes is conclusive this is not so.
....
The question of law or construction to be determined by the Court under the Order should be stated or formulated in clear, careful and precise terms, so that there should be no difficulty or obscurity, still less any ambiguity, about what is the question that has to be determined (see Allen v. Gulf Oil Refining Ltd [1980] Q.B. 156; [1979] 3 All E.R. 1008, CA, reversed on another point [1981] A.C. 101; [1981] 1 All E.R. 353), and this is all the more important since the determination will be final (see para. 1(I)(b)). Moreover it should be remembered that among the facts which are to be treated as proved or admitted, there must be no hypothetical or future facts (see Summer v. William Henderson & Sons [1963] 1 W.L.R. 823; [1963] 2 All E.R. 712, CA) and still less any fictitious facts, even though they may be admitted in the pleadings (see Royster v. Cavey [1947] K.B. 204; [1946] 2 All E.R. 642, CA). Where the issues of fact are interwoven with the legal issues raised, it will be undesirable for the Court to split the legal and factual determination, for to do so would in effect be to give legal rulings in vacuo or on a hypothetical ruling, which the Court will not do (see per Taylor L.J. in State Bank of India v. Murjani Marketing, March 1, 1991 CA Transcript 91/0304)."

26. In the course of her argument that the Order 14A procedure is inappropriate here, Ms Eu has said that the point in issue in the case of Stovin v Wise [1996] AC 923, upon which the 7th defendant places much reliance in support of its substantive application under Order 14A, was determined after- not before-trial. And that the points similarly in issue in Anns v. Merton London Borough Council [1978] AC 728 and X (Minors) v. Bedfordshire County Council (upon which again the 7th defendant places much reliance) where the questions were dealt with as preliminary issues, the common law negligence claims were allowed to go to trial.

27. Ms Eu cites the following observation of Lord Browne-Wilkinson in X (Minors) v. Bedfordshire County Council (at pp 740 & 741) in support of her argument (and the emphases are hers):-

"In all these cases the defendants are seeking to strike out the claims at an early stage, before discovery has taken place and before the facts are known. It is therefore necessary to proceed on the basis that the facts alleged in the various statements of claim are true. It must be stressed that these allegations are not admitted by the defendants.

Actions can only be struck out under R.S.C. Ord. 18, r. 19 where it is clear and obvious that in law the claim cannot succeed. Where the law is not settled but is in a state of development (as in the present cases) it is normally inappropriate to decide novel questions on hypothetical facts. But I agree with Sir Thomas Bingham M.R. ante, p.694B-D that there is nothing inappropriate in deciding on these applications whether the statutes in question confer private law rights of action for damages: the answer to that question depends upon the construction of the statutes alone.

Much more difficult is the question whether it is appropriate to decide the question whether there is a common law duty of care in these cases. There may be cases (and in my view the child abuse cases fall into this category) where it is evident that, whatever the facts, no common law duty of care can exist. But in other cases the relevant facts are not known at this stage. For example, in considering the question whether or not a discretionary decision is justiciable, the answer will often depend on the exact nature of the decision taken and the factors relevant to it. Evidence as to those matters can only come from the defendants and is not presently before the court. I again agree with Sir Thomas Bingham M.R. that if, on the facts alleged in the statement of claim, it is not possible to give a certain answer whether in law the claim is maintainable then it is not appropriate to strike out the claim at a preliminary stage but the matter must go to trial when the relevant facts will be discovered."

28. I might just add here, because I think it helpful, what Lord Browne-Wilkinson said at page 737E:-

".... in seeking to establish that a local authority is liable at common law for negligence in the exercise of a discretion conferred by statute, the first requirement is to show that the decision was outside the ambit of the discretion altogether, if it was not, a local authority cannot itself be in breach of any duty of care owed to the plaintiff.

In deciding whether or not this requirement is satisfied, the court has to assess the relevant factors taken into account by the authority in exercising the discretion. Since what are under consideration are discretionary powers conferred on public bodies for public purposes the relevant factors will often include policy matters ..... It is established that the courts cannot enter upon the assessment of such "policy" matters. The difficulty is to identify in any particular case whether or not the decision in question is a "policy" decision."

29. During the course of argument I was referred, by both Mr Ozorio and Ms Eu, to the recent case of Barrett v. Enfield London Borough Council [1999] 3 All ER 193.

30. At page 197 Lord Browne-Wilkinson states:-

" I find it impossible to say that all careless acts or omissions of a local authority in relation to a child in its care are not actionable: .... If certain careless conduct (operational) of a local authority is actionable and certain conduct (policy) is not, it becomes necessary to divide the decisions of the local authority between those which are 'policy' and those which are 'operational'. It is far from clear what the expressions 'operational' and 'policy' connote. Therefore unless it can be said .... that operational carelessness could not have caused the damage alleged in the present case it would be impossible to strike out any part of the claim. But causation is quintessentially a matter of fact and one would have thought that where there is a substantial doubt as to what is an operational decision there must equally be doubt as to the extent or nature of the damage capable of being caused by negligence in making such an operational decision.

Moreover, there have been two developments since the conclusion of the argument in the present case, both of which have been drawn to our attention by the parties. For reasons which I will seek to demonstrate, they both emphasise the extreme care which must be taken in striking out claims in this confused and developing area of the law, and clearly reinforce the conclusion that the case cannot be struck out."

31. He went on to say

" In my speech in X (minors) v Bedfordshire CC ... with which the other members of the House agreed, I pointed out that unless it was possible to give a certain answer to the question whether the plaintiff's claim would succeed, the case was inappropriate for striking out. I further said that in an area of the law which was uncertain and developing (such as the circumstances in which a person can be held liable in negligence for the exercise of a statutory duty or power) it is not normally appropriate to strike out. In my judgment it is of great importance that such development should be on the basis of actual facts found at trial not on hypothetical facts assumed (possibly wrongly) to be true for the purpose of the strike out."

32. Referring then to a case in which reliance had been placed to a substantial extent on dicta of his in the Bedfordshire case, to the effect that where a local authority provides a psychology service such authority could be liable in damages for failure of the service to diagnose dyslexia (which dicta had been based upon a mistaken assumption), Lord Browne-Wilkinson said (at p 198a)

" This erroneous dictum of mine made in the course of seeking to determine a striking out application on hypothetical facts has apparently given rise to 'a proliferation of claims' against psychology services provided by local authorities in dealing with those suffering from reading disability. It vividly illustrates how important it is to decide these cases on actual facts and not on mistaken hypotheticals."

33. I read that last sentence to mean actual facts as established by the evidence at trial and not hypothetical facts or facts which have not been proved.

34. Whilst Ms Eu argues that many of the cases cited to me by Mr Ozorio in support of the answers to the two questions which he seeks, may be of little assistance because they relate, for example, to child care authorities or to a fire fighting authority (which call for very different considerations to a building authority), she says that I can nevertheless find assistance from them in seeking to determine the appropriateness, or otherwise, of the Order 14A application. Ms Eu submits that whether or not a statutory duty or power gives rise to a private cause of action varies from statute to statute, and it depends not only on construction of the statute but also upon public policy; social and economic conditions and the reliance or legitimate expectation of the public. Such matters, she argues, may not be fit for determination on an Order 14A summons but require evidence at trial, and she cites (with her emphasis supplied) from Stovin's case what Lord Hoffman said (at p 952F) as follows:-

"Whether a statutory duty gives rise to a private cause of action is a question of construction: see Reg. v. Deputy Governor of Parkhurst Prison, Ex parte Hague [1992] 1 AC 58. It requires an examination of the policy of the statute to decide whether it was intended to confer a right to compensation for breach. Whether it can be relied upon to support the existence of a common law duty of care is not exactly a question of construction, because the cause of action does not arise out of the statute itself. But the policy of the statute is nevertheless a crucial factor in the decision."

35. By way of response to these submissions Mr Ozorio argues that it is not for the court to assess policy decisions but that, even if it were otherwise, Stovin's case is good authority for the proposition that where a public authority is not under a duty, then the question of rationality of an exercise of discretion by that authority does not arise.

36. Mr Ozorio also seeks to draw a distinction between Barretts case and the case before me. He argues that the principal difference is that in that case the authority, having by its actions put itself under a duty, then became liable to account for its decisions thereafter (i.e. those very decisions became justiciable) whereas in the case before me the 7th defendant had no statutory duty and had taken no steps which might have put itself under such a duty.

37. Putting it another way Mr Ozorio says that none of the factors that persuaded the court in Barrett to say that the matters at issue were for trial apply in this case. Those factors would apply if the Building authority had exercised its discretion to exercise a power, because then it would have placed itself in proximity to those who might be affected by the exercise of that power. The authority would then have been under a duty of care to choose the various options open to its discretion e.g. requiring an owner to rectify the canopy; engaging an independent engineer; engaging a sub-contractor or carrying out the work itself. The plaintiff could then have alleged that the choice of one option or another was unreasonable, as was the situation in Barrett, and in those circumstances (which do not pertain in the present case) clearly an Order 14A application would not have been appropriate.

38. Mr Ozorio adds that any submission made by Ms Eu that the Order 14A application is inappropriate because the law is in a state of development, is misconceived. He argues that such a submission is not sustainable because, even if it were so that the law is in such a state (which the 7th defendant does not accept), that state is unlikely to have changed by the time of trial, and the trial judge would not be entitled to refuse to resolve the issues which the Order 14A application was issued in order to resolve.

Conclusion

39. In my judgment the 7th defendant has failed to satisfy me concerning the suitability and finality of determining the questions posed in the Order 14A application without a full trial.

40. Based on the papers before me and the most able arguments put forward by both Mr Ozorio and Ms Eu I find myself unable to conclude, not because the law is in transition but, because the legal viability of the cause of action is unclear and in many ways sensitive to the facts, that it would be appropriate to proceed to the determination sought.

41. It also seems to me to be the case that whilst I confess to not fully understanding what is meant by a 'hypothetical fact' in the context of pleadings the inevitable issues of fact that which will need to be resolved in this case are closely interwoven with legal issues raised regarding liability and thus it would be

"undesirable for the court to split the legal and factual determination, for to do so would, in effect, be to give legal rulings in vacuo or on a hypothetical ruling, which the court will not do" [I bid].

42. Further, whether or not the 7th defendant did in fact make a discretionary decision concerning the canopy in this case, or canopies or other similar unauthorised structures generally is a matter of fact and a matter for evidence. If it did so, as has been said, whether such a decision (even if it was a decision to do nothing) is justiciable will depend in this case "on the exact nature of the decision taken and the factors relevant to it. Evidence as to those matters can only come from the defendants and is not presently before the court".

43. I am in no doubt that based simply on the facts alleged in the statement of claim in this case, "it is simply not possible to give a certain answer whether in law the claim in maintainable" and thus, by analogy with striking out applications, it is not, in my view, appropriate to proceed by way of the Order 14A application and accordingly the summons must be dismissed and the matter must go to trial when the relevant facts will be discovered.

44. It is, to put it extremely mildly, a matter of some concern that in consequence of my ruling some 8 months have been wasted in setting this matter down for trial. I venture to suggest that had the lawyers to the parties respondent to this application diligently applied themselves to complying with the 3rd order of Suffiad J's order of 7th May 1999 in precise and understandable terms this might not have been the case. What was required by that order was not merely an indication as to whether or not the application would be opposed but further, if it was to be opposed, the basis for such opposition e.g. that it was considered to be inappropriate.