GOLD DRAGON LTD v. POON LAI BING

DCCJ2299/2006

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 2299 OF 2006

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D E C I S I O N

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1.  This is the Plaintiff’s application to strike out paragraphs 14, 15, 24, 25, 26, 27, 29 and 30 in (2) of the prayer of the Amended Defence and counterclaim.

2.  By letter dated 13.4.2007 the Plaintiff asked the Defendant for particulars in respect of paragraphs 14, 15, 17, 24 to 30 of the Amended Defence and counterclaim, but paragraph 15 does not refer to forgery or dishonesty.  Therefore although this paragraph does not contain full particulars of the allegations made therein, it should not be struck out.

3.  The Defendants assert that the Plaintiff is estopped from making the application.  The amended defence and counterclaim was filed in June 2005, and the Plaintiff’s amended reply and defence to counterclaim was filed in July 2005.  The amendment was made pursuant to the consent order of Registrar Chan on 15.6.2005 to give leave to the Defendants to amend their defence and counterclaim.  The Plaintiff did not object to the Defendants’ application to amend.  So how can the Plaintiff complain that the Defendants’ defence lack particulars?  Therefore, the Plaintiff is estopped from doing so. 

4.  The Defendants say that when the Plaintiff received the amended defence and counterclaim two causes of action were open to her.  First, she could oppose the amendment.  Second she could consent to the application.  She consented to the amendment and filed her amended reply and defence and counter-claim.  This gave rise to an estoppel by election.  The Defendant relied on the case of Wing Han Trading Company Limited v Tang Yan Kit & Other HCA000013/1989. 

5.  In my judgment, that case does not help the Defendants, as the Plaintiff in that case had different causes of action open to him.  But in the present case the issue of a cause of action simply does not arise because the application for amendment was taken out by the Defendant, and the Plaintiff was playing a passive role.  She did not have any causes of action open to her because she was not taking any cause of action in its true meaning.

6.  The Defendants also rely on paragraph XIII.2.37 of the book, The Law Relating to Estoppel by Representation, 4th edition written by Piers Feltham and others.  In that paragraph, it is so stated:

“In the course of litigation, it frequently happens that a party is confronted with the necessity of making an immediate choice between two possible causes of action which are mutually exclusive.  Whenever this occurs, the principle of election comes into play.  If, by words or by conduct or in action, one party represents to the other party his or her intention to adopt one of the two alternative and inconsistent proceedings or positions, that party is precluded from resorting afterwards to the course which he has waived or abandoned.  Thus, where two alternative tribunals are available to a litigant, each having jurisdiction over the dispute and a party resorts to one tribunal in preference to the other, he is precluded as against his opponent from any subsequent recourse to the second tribunal, at least where judgment has been obtained or an award made.  Although it is rare today for a party to be required to elect between tribunals with concurrent jurisdictions, there are a number of other situations in which a party to litigation is commonly called upon to make an election.”

7.  In my judgment, this paragraph does not help the Defendants because the issue of an election of causes of action does not arise for the same reason as stated above, namely, the Plaintiff was merely responding to an application to the court for amendment of the defence and counterclaim.

8.  The application for amendment to the Defence and counterclaim was to be heard on 15.6.2005 before a master.  The Plaintiff was to respond to the application whether she was to object or to consent to the application.  So she was not making an election of two possible causes of action which are mutually exclusive.  In so far as the Plaintiff is concerned, the application does not involve any cause of action taken by her, as it is not her application.  So the principle of election does not come into play.  In the circumstances, it follows that no representation has been made to the Defendants. 

9.  It is also my judgment that to consent to the application for amendment does not amount to a waiver of the application under a striking-out application, assuming that there was really an election of causes of action open to the Plaintiff, which did not arise in this case.  I conclude that the Defendants’ submission relating to estoppel must fail. 

10.  The Defendants also submit that the Plaintiff’s application has no merit.  They submit that the allegations of dishonesty, forgery and fraud relate only to the Attendance Record Incident, and that clearly boils down to 7 points listed out in the Defence’ Counsel’s written submission.  Those 7 points ( (a) to (g) ) have the same substance as the seven points ( (1) to (7) )as set out on P.2 of the letter dated 14.4.2007 addressed by the Defendants’ solicitors to the Plaintiff’s solicitors.  In their letter, the Defendants say that they are advised by counsel that the Amended Defence and Counterclaim has contained all the necessary material particulars to support their clients’ claim of fraud, forgery and dishonesty.  They take exception to any suggestion be it explicit or implicit that the Amended Defence and Counterclaim is deficient for want of material or necessary particulars. 

11.  The Defendants say that without admitting that the pleading on the “Attendance Record Incident” is short of material particulars they provided to the Plaintiff with particulars to assist the Plaintiff to comprehend the Defendants’ case on the “Attendance Record Incident”.  These particulars include the abovesaid subparagraphs (1) to (7).  Therefore these sub-paragraphs are clearly not part of the pleadings.  So whether the relevant paragraphs contain full and necessary particulars relating to fraud, forgery, dishonesty or not, one has to look at the actual pleadings themselves.  After looking very carefully at the relevant paragraphs as applied for by the Plaintiff, I find that it is abundantly clear that the relevant paragraphs only contain vague and general statements relating to fraud, forgery or dishonesty, with no particulars specifically pleaded to support their case.  Therefore, these paragraphs are liable to be struck out.  Accordingly I order that these paragraphs be struck out. 

12.  I order that save and except paragraph 15 of the amended defence and counterclaim, the other paragraphs as stated in the summons taken out by the Plaintiff be struck out.

(Discussion re costs)

13.  The 1st day adjournment was caused by the late application of the summons taken out by the Plaintiff.  Although the Plaintiff informed the Defendants that she would object to some of the paragraphs in the Amended Defence and Counterclaim, so that the Defendants should have time to prepare for the argument, the Plaintiff did not specifically inform the Defendants when she would take out this application.  Until and unless she has taken out a formal application, the Defendants are not obliged to prepare their submissions in writing beforehand.  Therefore I conclude that the 1^st day adjournment was caused by the Plaintiff and so she was liable for that.  The Plaintiff has succeeded in her application save in one part.  For the part the Plaintiff fails to succeed, she has to bear 1/10 of the costs.  Therefore, for the part she has succeeded, she is to have 9/10 of the costs.  In conclusion, the Plaintiff should have 80% of the costs of this application. 

14.  I therefore order that the Plaintiff is to bear costs of the 1st day adjournment.  Subject to that, the Defendant is to pay 80% of the costs of this application to the Plaintiff, with certificate for counsel.

(Discussion re certificate for counsel and wording of order)

15.  The costs to be taxed in default of agreement, and to be paid in any event.

(Discussion re costs)

16.  The Plaintiff’s own costs to be taxed in accordance with Legal Aid Regulations.