LU GUO XIANG v. HONG KONG MING WAH SHIPPING CO LTD

CACV 308/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 308 OF 2008

(ON APPEAL FROM HCPI NO. 254 OF 2006)

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REASONS FOR JUDGMENT

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Hon Tang VP (giving the reasons for judgment of the Court):

1.  The plaintiff was the master of “MV Pacific Paradise” (“the vessel”).  On 6 November 2000, he sustained serious injuries on board when the vessel was on its way to the port of New Orleans.

2.  By writ issued on 17 March 2006, he commenced proceedings against the defendant.

3.  On 3 August 2006, the plaintiff issued a summons asking for an order under section 30 of the Limitation Ordinance, Cap. 347, that the plaintiff be allowed to proceed with his claim notwithstanding that the writ was issued out of time.

4.  On 29 March 2007, by consent, it was ordered that the issue of limitation and liability be tried together but separately from quantum.

5.  Those issues will be tried before Yam J on 1 December 2008.

6.  By summons dated 25 August 2008, the plaintiff applied for leave to file and serve the medical report of Dr Fung Ching Fai dated 23 July 2008, and the medical report of Dr Lau Hoi Kuen dated 7 August 2008 within 7 days from the date of the order to be made.

7.  On 29 September 2008, Yam J dismissed the application.

8.  As Yam J has noted in his judgment, about a year after the consent order on 29 March 2007, on 12 March 2008, the plaintiff’s solicitors’ notice of pre-trial review (“PTR”) had confirmed that:

“… there will be no medial experts and non medical experts in the forthcoming trial.”

9.  On 5 May 2008, Messrs Siao, Wen and Leung (“SWL”), the plaintiff’s solicitors, informed the defendant’s solicitors, Messrs Clyde & Co, that the plaintiff wished to adduce medical report.  The letter said:

“… on Counsel’s advice, we need to adduce evidence and quantum, including medical reports from a Hong Kong orthopaedist and a neurologist, even for the purposes of resolving the preliminary issues (please note not for the purposes of resolving the issue of quantum per se).”

10.  After referring to Robinson v St Helens Metropolitan Borough Council [2002] EWCA Civ 1099, Adams v Bracknell Forest Borough Council [2005] 1 AC 76, and McGhie v British Telecommunications plc [2005] EWCA Civ 48, the letter went on to say:

“Further, in view of those cases, and on reflection, we tend to take the view that it is perhaps more costs effective to resolve both liability and quantum in one go. That said, we remain prepared to consider any sensible proposal that you may put forward with a view to resolving the present dispute efficiently and economically. For example, it seems to us that a practical alternative is for you to accept that the quantum is such that it would cause a material prejudice to our client, were our client to be barred from pursuing the present claims pursuant to the Limitation Ordinance. Your attention is drawn to S. 30 of the Limitation Ordinance. We hope that the parties can resolve this by consent and we look forward to hearing from you within the next 3 days (as the returnable date is drawing near).”

11.  Messrs Clyde & Co in their reply dated 8 May 2008 said:

“More Importantly, even assuming that you have correctly interpreted the proportionality principle, given all that have been agreed between the parties (i.e. spilt trial of liability and quantum) and done, it is just too late for you to now say your client needs medical evidence even just in the context of time-limit. McGhie and Adams were decided in 2005 and well before your client commencing the present action and asking for the Court to override the time-limit. We really do not see why the Court should at that 11th hour give your client a second chance when at the time of commencing the present action your client has already chosen not to rely on any medical evidence, presumably upon your (and your Counsel’s) legal advice which you now say is not correct.”

12.  The defendant has given an undertaking that it would not argue that legal costs would be disproportionate to the value of the plaintiff’s claim.  Counsel for the defence has also conceded that the plaintiff has made a very sizeable claim against the defendant.

13.  There is a statement of damages dated 27 August 2008 where the following appear:

“7.  The Plaintiff’s present complaints include:-

(a) dizziness, headache and decreased memory;

(b) mild and continuous pain over the right face;

(c) mild ache over the right chest;

(d) pain and stiffness of the right shoulder;

(e) mild pain over the right side of the abdomen;

(f) persistent pain in his right hip;

(g) difficulty in squatting;

8.  Orthopedic wise, the Plaintiff was assessed by Dr. Lau Hoi Kuen to have suffered a total of 16% of permanent impairment of the whole person which was attributed to his fractured neck of the femur with AVN and collapse, soft tissue injury to right shoulder with stiffness and chest injury.

9.  As to the head injury, the Plaintiff was evaluated by Dr. Fung Ching Fai to have suffered an impairment of cerebral function of 3% of the whole person.”

14.  Briefly stated, the plaintiff’s claim amounted to about $7 million, which included a claim for pain suffering and loss of amenity in the sum of $800,000, pre-trial loss of earnings of $3 million odd and future loss of earnings for almost $2.5 million.  Also, the claim for future medical expenses included a claim for a total hip replacement and a second total hip replacement in 10 years’ time.

15.  It is against such background that the learned judge’s decision to dismiss the plaintiff’s summons has to be considered. 

16.  The decision was made by way of case management.  The occasions when this court will feel able to interfere with a case management decision must be rare. 

17.  The jurisdiction to disapply the limitation period is conferred by section 30.  Section 30(1) provides:

“(1)   If it appears to the court that it would be equitable to allow an action to proceed having regard to the degree to which- 

(a)  the provisions of section 27 or 28 prejudice the plaintiff or any person whom he represents; and

(b)  any decision of the court under this subsection would prejudice the defendant or any person whom he represents,

the court may direct that those provisions shall not apply to the action, or shall not apply to any specified cause of action to which the action relates.”

18.  Mr Tim Kwok, who appeared on behalf of the plaintiff, submitted that the medical reports are relevant to the exercise of discretion, and he relied in particular on the words highlighted below:

“(1) If it appears to the court that it would be equitable to allow an action to proceed having regard to the degree to which-

(a) the provisions of section 27 or 28 prejudice the plaintiff …” [Emphasis added]

Also that under section 30(3) that:

“(3)   In acting under this section the court shall have regard to all the circumstances of the case …”

19.  Mr Kwok has referred us to the following authorities:

(1)     Dale v British Coal Corporation [1992] PIQR 373 at P382 where Stuart-Smith LJ said:

“The onus is on the plaintiff to satisfy the court that the primary limitation period should not apply. He must show that there is evidence which, if accepted, will establish the necessary ingredients of his cause of action. In many cases his own evidence on affidavit may suffice. If it is accepted, then he should succeed. It is not normally appropriate for the defendants to try and counter the evidence at that stage.”

(2)     The judgment of Sir Murray Stuart-Smith (as he then was) in Robinson at P139, 140:

“[32] The Limitation Acts are designed to protect defendants from the injustice of having to fight stale claims especially when any witnesses the defendants might have been able to rely on are not available or have no recollection and there are no documents to assist the court in deciding what was done or not done and why. These cases are very time consuming to prepare and try and they inevitably divert resources from the education authority to defending the claim rather than teaching. Under s 33 of the 1980 Act the onus is on the claimant to establish that it would be equitable to allow the claim to proceed having regard to the balance of prejudice.

[33] The question of proportionality is now important in the exercise of any discretion, none more so than under s 33. Courts should be slow to exercise their discretion in favour of a claimant in the absence of cogent medical evidence showing a serious effect on the claimant’s health or enjoyment of life and employability. The likely amount of an award is an important factor to consider, especially if, as is usual in these cases they are likely to take a considerable time to try. A claim that the claimant’s dyslexia was not diagnosed or treated many years before at school, brought long after the expiry of the limitation period, extended as it is until after the claimant’s majority, will inevitably place the defendants in great difficulty in contesting it, especially in the absence of relevant witnesses and documents. The contesting of such a claim would be both expensive and likely to divert precious resources. Courts should be slow in such cases to find that the balance of prejudice is in favour of the claimant.”

(3)     Lastly, the judgment of May LJ in McGhie at paragraph 35:

“[35] In my judgment this is not a correct interpretation of what Sir Murray Stuart-Smith had said. The question of proportionality is, in my judgment, in the first place, a proportionality between the size of the claim and the legal and other costs of running it. The question of proportionality also has an eye, in my judgment, to the strength of the claimant’s claim. In my judgment, taking the matters in the round, it would be a great prejudice to a claimant who was very badly injured and likely to suffer the consequences of that injury for many years to come if, what would otherwise be a very large claim, based upon very strong evidence, were to be lost through a refusal to exercise the discretion under s 33.”

20.  But these are not authorities, as Mr Kwok seemed to have submitted, which showed that the court would invariably allow medical evidence to be adduced on behalf of the claimant on a section 30 application.  Whether medical evidence is required, and if so, how much, must depend on the circumstances of the particular case.

21.  Mr Kwok accepted that the learned judge had a discretion whether or not to allow the further evidence.  He submitted however that the learned judge erred because he regarded the evidence as irrelevant.  We believe the judgment has to be read in its context.  So read, we believe the learned judge was saying no more than that the further evidence was not of such value as he should in his discretion admit.

22.  As the learned judge has explained, it was not the plaintiff’s case that the delay in issuing the writ was caused by any disability.  He has noted the defendant’s concession referred to in para. 12 above, which satisfied the practical alternative mentioned in SWL’s letter of 5 May 2008 referred to in para. 10 above.

23.  The learned judge also noted:

“… the plaintiff’s previous medical records in respect of his injury and treatment have been disclosed by the plaintiff and included in the trial bundle to be used at the trial …”

There was also the statement of damages.

24.  We agree with Mr Kwok that Horton v Sadler [2006] 2 WLR 1346 is authority that section 30 gives the court a wide discretion and that judicial fetters should not be imposed on this valuable discretionary power.  Also that Lord Bingham of Cornhill had said in Horton:

    “32    In resolving an application under section 33 the court may make a decision of which the inevitable effect is either to deprive the defendant of an accrued statute-bar defence or to stifle the claimant’s action against the tortfeasor who caused his personal injuries. In choosing between these outcomes the court must be guided by what appears to it to be equitable, which I take to mean no more (but also no less) than fair, and it must have regard to all the circumstances of the case and in particular the six matters listed in subsection (3). …” 

25.  Mr Herbert Au-Yeung, counsel for the defendant, has referred us to Nelson-Jones, Burton and Roy, Personal Injury Limitation Law (2^nd edition, 2007), where it is said:

“It is therefore apparent that in cases where the defendant has no defence save for limitation and the claimant has no claim over against the solicitor the claimant’s prejudice is probably at its highest. If added to these factors the claim is of high value and there is no overt costs disproportionality the claimant’s prospects are considerably enhanced. It is axiomatic that a tetraplegic who is statute barred will suffer greater economic prejudice than a claimant who has a minor whiplash injury.”

26.  Of course, proportionality is not limited to the size of the plaintiff’s claim, as May LJ said in McGhie, cited in para. 19(3) above:

“… The question of proportionality also has an eye … to the strength of the claimant’s claim. …”

27.  Mr Kwok submitted that even where the claim may be small, the seriousness of the injuries may itself be a reason to disapply the limitation period.  (Hence, the medical evidence should have been allowed.)  This is not such a case.  It is accepted that the claim is likely to be substantial.  In any event, on proportionality, we are inclined to the view that the court is concerned more with the quantum of the claim than the seriousness of the injuries although, normally, the more serious the injuries, the larger the quantum.  It has to be remembered that the plaintiff claims compensation and not vindication.  The court’s primary concern must be with the quantum of the claim and it is that which has to be taken into account in deciding whether the costs may be disproportionate.

28.  In the circumstances of this case, we do not believe the exercise of discretion by the learned judge could be faulted in any way.  Indeed, if we were called upon to exercise our own discretion in the matter, we would have exercised our discretion in the same way.

29.  For the above reasons, we have dismissed the appeal with costs.