QUANTUM DESIGNS (HK) LTD AND ANOTHER v. FEDERAL EXPRESS CORPORATION

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMMERCIAL LIST

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JUDGMENT

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1. This is an application for a trial of preliminary issue or a separate trial of a separate issue by the Plaintiff. The claim of the Plaintiff is for the full value of cargo lost amounting to some US$200,000 odd. The claim is disputed by the Defendant which has raised the standard Warsaw Convention defence of the sum HK$7,000 limit.

2. A large number of issues had been raised in the action. For example, firstly, the contracting party was not the defendant; secondly, the limitation of time of the claim was not within the 9 months as stipulated in the air waybill; thirdly, whether there was wilful misconduct by the Defendant to break the Warsaw limit; and fourthly, whether the Warsaw Convention limit applies because of the omissions in the air waybill such as the lack of stopping places, the lack of statements in the air waybill of the nature of the property and marks and numbers, and the lack of statements in the air waybill of volumes and dimensions, and the lack of statements in the air waybill of the condition of the cargo and packaging.

3. The Plaintiff now wishes to have a separate trial of a separate issue on the matter of the omissions from the air waybill which, if successfully established, would entitle the carrier to rely on the Warsaw Convention limitation. It is clear that factual issues will have to be resolved in this separate trial on air waybill omissions. It is therefore not a straightforward preliminary issue of law.

4. The general principle is that all issues in an action should be tried at the same time and that separate trials of separate issues should only be made in exceptional circumstances or on special ground. It is held in Telford Development Ltd. v Shui On Construction ([1990] 2 HKC 110), which I applied in Chan Jak Tung (t/a Forward & Company v Baltrans Limited ([1997] 1 HKC 89), that a departure from the general principle will only be justified if it is just and convenient.

5. I am not persuaded it is just and convenient in all the circumstances of this case or that there had been such exceptional circumstances, that there ought to be a departure from the general principle that all issues in an action should be tried at the same time. A separate trial of the air waybill omission issue will not be simple or straightforward; it involves both factual and expert evidence and a great deal of complex matters of law. Any determination by the court on the air waybill omission issue will not necessarily be conclusive and will be subject to the full appeal procedures with the resulting delays. Decided either way, the air waybill omission issue would not be determinative of the whole action as there are in any event other issues which stand between the parties. The full trial therefore will be very much further delayed with the possible duplication of evidence, witnesses, etc. These are all considerations which suggest to me very forcefully that it is not the appropriate case where the court should order or sanction a separate trial of a separate issue, even though I recognise the significance to the parties, especially to the Plaintiff, of the separate issue.

6. In the exercise of my discretion, I therefore decline to make the order sought by the Plaintiff's summons. The application is dismissed with cost.