TSANG SHUK KWAN v. SHIU YIM FONG LOUISA AND ANOTHER

DCCJ893/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 893 OF 2008

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D E C I S I O N

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1.  This is the defendants’ application to strike out the plaintiff’s statement of claim.

2.  The application is made on two grounds:  namely, (a) that it discloses no cause of action; and (b) the claim was made on the basis of being an abuse of the judicial process of this court.  I will first deal with ground (a).

3.  The defendant’s reasoning for this ground is that in the statement of claim the plaintiff pleaded that the sum of $292,000 was paid to the 1st defendant pursuant to an alleged agreement between the plaintiff and her son, Lau, and the 1st defendant.  Then in the reply filed by the plaintiff, the plaintiff changed her stance.  It was pleaded there that an agreement was made between Lau and the plaintiff, and not between the 1st defendant and the plaintiff.  This stance was confirmed and clarified in paragraphs 4 and 5 of the plaintiff’s witness statement and in paragraphs 8 and 9 of Mr Lau’s witness statement.  It cannot be disputed that the agreement to lend money was made between Lau and the plaintiff; thus, the defendants concluded that it is clear that the plaintiff’s case can only be that any alleged loan agreement was made between the plaintiff and Lau.  There is simply no contractual relationship between the plaintiff and the 1st defendant and no basis for any claim by the plaintiff against the defendants.  This conclusion is made on the basis that the changed stance of the plaintiff was confirmed in paragraphs 4, 5, of her witness statement and paragraphs 8 and 9 of Lau’s witness statement.

4.    This conclusion cannot be right because this court, when considering whether there is any cause of action, must not look at the evidence.  It can only confine to the pleadings themselves.  So this court considers the pleadings alone.  It appears that there is a conflict in the statement of claim but it is not for this court to make a conclusion whether one version should be adopted and dismiss the other option.  That is the stance taken by the defendants, which is not right.  The apparent conflict should be left to stand and be tried out at the trial.

5.  The reason for dismissing the plaintiff’s claim for disclosing no cause of action cannot stand.

6.  The next ground is abuse of judicial process.  The defendants submit that it is only after the defendants notified the lawyer of Lau, in around 5 November 2006, that the other side realised that Lau was not in a position to institute the formal action on 1 November 2006, and so the plaintiff commenced her present action.

7.  The defendants submitted that the plaintiff’s explanation for the discrepant position between the previous action and the present action is that she had wished for the case to be dealt with in a simple way, with the minimum number of people involved, and that the previous action was claimed by Lau on her behalf.  The defendants submit that such an explanation is unreasonable and incredible.  It is difficult to imagine that any legal adviser would advise or agree to their client’s suggestion to commence an action in somebody else’s name simply because it would be simpler if the instruction given was truly that the agreement was made between the plaintiff and the 1st defendant, rather than between Lau and the 1st defendant.

8.  It is submitted that the present action was clearly only commenced by the plaintiff simply to get round the problem that Lau could not proceed with the previous action himself, being an undischarged bankrupt, so the present action lacks bona fides and is an abuse of process by the plaintiff, and as such, it is frivolous or vexatious.

9.  The crucial point for this ground of striking out is whether the plaintiff’s explanation given by her in her witness statement is unreasonable and incredible in respect of the institution of the previous action.  The defendants submit that the explanation is unreasonable and incredible because it is difficult to imagine any legal adviser would so advise the plaintiff in her terms of explanation.

10.  There is no evidence to refute the plaintiff’s explanation.  It is only when more evidence is explored then the court can form the view as to whether her explanation is truthful.  It is simply unsafe for me to make a finding that no reasonable legal adviser would so advise her, because that would mean that every legal adviser would act in a way that cannot be attacked or assailed.  That cannot be true because there have been many cases where the case should not commence; still, people represented by solicitors, simply commence their actions.  Unless it is a matter of fact that every legal adviser would give some sound legal advice, otherwise, the submission made by the defendants cannot stand.  I cannot simply rely on an observation and make a finding that the explanation given by the plaintiff cannot be believed.  I refuse to do so in this case and so ground 2 for striking out cannot stand.  I dismiss the defendants’ application.

(Submissions by counsel on paragraph 3 of the summons)

11.  The entire application by the defendant be dismissed.

(Submissions on Costs)

12.  Costs of this application be to the plaintiff, to be taxed if not agreed, with certificate for counsel.