HARBOUR KING LTD v. THE PRUDENTIAL ASSURANCE CO LTD

HCA 2314/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 2314 OF 2009

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BETWEEN

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DECISION ON THE PLAINTIFF’S SUMMONS TO AMEND
ITS STATEMENT OF CLAIM (“THE SUMMONS”)

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1.  Pursuant to my Order given on 30 May 2011, the Plaintiff was ordered, inter alia, to provide various answers to the Defendant’s Request for Further and Better Particulars.  Since the Plaintiff’s Counsel indicated that they might have to further amend its draft Amended Statement of Claim (as attached to the Summons), I adjourned the Summons and gave consequential directions (see para.3 of the Order).

2.  The Plaintiff has since then changed its solicitors and obtained a final extension of time until 10 August 2011 to comply with the Unless Order dated 15 July 2011 for filing and serving its Answer and providing a revised Amended Statement of Claim to the Defendant.  As I understand, the Plaintiff’s Answer was filed on 10 August 2011 and on the same date, a revised draft Amended Statement of Claim was provided to the Defendant’s solicitors.

3.  At the same time, under my directions dated 3 August 2011, parties have to consider if they can agree on the proposed amendments to the Statement of Claim so that the Summons could be disposed of by agreement.  If no agreement can be reached by 24 August 2011, parties be at liberty to restore the Summons for hearing before me.  I also directed parties to report to me by 26 August 2011 the estimated length of the adjourned hearing so that I can give further directions on the adjourned hearing of the Summons.

4.  Parties cannot come into terms in full disposal of the Summons. However, I cannot see any reason why parties cannot sensibly enough to sign a Consent Summons to dispose of the main part of the Summons leaving the disputed issues for determination.

5.  From the letter dated 26 August 2011 of the Plaintiff’s solicitors, I note that the Defendant’s solicitors have no objection to the proposed amendments to the Statement of Claim subject to certain reservations.  Two issues remain in dispute by the parties :-

(a)  when the Defendant should file and serve the Defence (whether 28 days as argued by the Plaintiff or 56 days as put forward by the Defendant); and

(b)  the technical wordings of the costs order (when the Plaintiff conceded that in principle they should bear the costs of the Summons).

6.  Both parties agreed to dispose of the Summons in particular the said two issues by papers without an oral hearing.  I accede to such request.  However, it is appropriate for me to mention at this juncture that by directing that parties to report the status of the matter to the Court, parties are expected to report factually the current status of the matter without giving their own views over the matters such as the conducts or arguments of one party.  It is a waste of costs and resources to set out in details parties’ arguments especially to circulate correspondence exchanged between parties for the court’s perusal.  I must say that I am not interested in reading those exchanges which are not conductive to resolving the disputes.

7.  Further, while the Court is yet to give further directions on the disposal of the Summons, parties should not assume that the Court must agree to determine the Summons on papers without an oral hearing and send along their written submissions in support of their own arguments.  Not until the Court gives such directions to deal with the Summons on papers under Order 32 r.11A of the Rules of High Court, parties should refrain from sending along their written submissions to the Court.

8.  I have considered the arguments of both parties as appeared in their letters dated 26 and 30 August 2011 on the above two issues.

9.  On the time for filing of the Amended Defence, by reading the proposed Amended Statement of Claim, this is not a kind of case whereby the norm should apply.  The Court took two hearings to understand the true nature of the Plaintiff’s claims and identifying the issues for trial.  There are substantial amendments made to the original Statement of Claim and the Plaintiff dropped its previous liquidated claim.  It took the Plaintiff more than 10 weeks to finalise the revised draft before sending along to the other side for consideration.  I agree with the Defendant’s solicitors that it is unfair to count from 12 August 2011 for them to prepare the Amended Defence since at that time, the Defendant and its legal representatives had to consider first whether they could agree to the proposed amendments made to the Statement of Claim. After then, they would need to take further instructions from the Defendant on matters happened a long time ago not to say that many of them were conducted allegedly through oral communications between parties.

10.  The underlying objectives encourage parties to agree a realistic and workable timetable for all procedural steps so long it will not affect the milestone events taking into account the background and complexity of the case. The Court will no longer tolerate multiple applications for extension of time.

11.  In this case, bearing in mind of all the above, I accept that the Defendant’s proposal for 56 days is a realistic and genuine estimate for filing the Amended Defence.  Since the pleading stage of this case has been dragging on for a considerable period of time since I first heard the matter in December last year, without any special reasons, the Court will expect compliance of such timetable and there may not be any further extension of time.

12.  Regarding the technical terms of the costs order, the Plaintiff is prepared to give “costs of the Plaintiff’s summons filed on 15 December 2010 and the costs of incidental to and occasioned by the amendments relating to the Amended Statement of Claims be borne by the Plaintiff and paid to the Defendant in any event.”  On the other hand, the Defendant contends to have “costs of the Plaintiff’s Summons filed on 15 November (sic) 2010 and costs of and occasioned by the amendments to the Statement of Claim, including the cost of any consequent amendment to the Defence, be to the Defendant”.

13.  As I understand, the Defendant’s solicitors are concerned with those costs incurred for the consequential amendments made to the Defence.   Of course, the leave granted for the Defendant to amend its Defence must only cover those consequential amendments to be made to the Defence resulting from the amendments to the Statement of Claim.  Arguably, if the Defendant wishes to make amendments to the Defence beyond the terms of consequential amendment, they have to apply for leave before doing so.

14.  On one hand, I am of the view that the terms of costs order proposed by the Plaintiff including costs occasioned by the amendments are sufficient broad enough to cover those cost incurred for the consequential amendments of the Defence.  Nevertheless, if the Defendant has a concern over such terms of the costs order and wishes to add a clarification so that it spells out clearly that it would include costs of the consequential amendments, I should not see why the Plaintiff should take such a strong objection if it is all along their intention that they are prepared to concede that part of the costs to the Defendant.  That is the reason why I all along refer the dispute as an argument on the technical terms of the costs order.  In real term, it lacks any substance which must require the Court’s intervention.  For this issue, it is apparent that both parties fail their duty to exercise their good and reasonable sense to resolve the dispute in a costs efficient way avoiding any unnecessary and technical arguments.

15.  If it is necessary, I make clear in this decision that the costs occasioned by the amendments would include those costs incurred by the Defendant for making the consequential amendments to the Defence.  I think that will assist not just the parties but also the taxing master in case if any doubt is raised at taxation.

16.  Accordingly, I make the following orders in respect of the Summons:-

(a)  Leave granted to the Plaintiff to amend the Statement of Claim in red as per the draft Amended Statement of Claim served upon the Defendant by the letter dated 12 August 2011;

(b)  The Amended Statement of Claim be filed with the Court within 7 days from the date of this Order and re-service of the Amended Statement of Claim on the Defendant be dispensed with;

(c)  Leave granted to the Defendant to file and serve its Amended Defence within 56 days from 1 September 2011; and

(d)  Costs of the Plaintiff’s summons filed on 15 December 2010 and the costs of and occasioned by the amendments to the Amended Statement of Claims be to the Defendant in any event.

17.  For the costs of the application for paper disposal of the Summons, I see that if both parties can exercise more good sense with a view to saving costs and court’s resources, there is no need for the Court to be involved in giving this decision.  I would make a costs order nisi that the costs of this application be in the cause.  Such order nisi will become absolute within the next 7 days if no application is made to vary the same.