The Sunshine Capital Investment Ltd. and Another v. Daiwa Securities (H.K.) Ltd. and Another

CACV 30/1999

HEADNOTE

Application to set appeal down out of time. - Appellants requested to explain circumstances of delay - Failure of Appellants to explain who took the decision and why not to set down the appeal. - Court unable to exercise discretion to extend time.

CACV 30/1999

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 30 OF 1999

(ON APPEAL FROM HCA NO. 5582 OF 1991)

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D E C I S I O N

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Rogers, J.A. :

1. This is an application for leave to set down an appeal out of time. The action relates to events the first of which took place in 1985 and 1986. Some events took place later, in 1988, although the majority of events took place earlier. The writ in the action was issued on 25th July 1991 which was about 41/2 years after the events in 1986.

2. The action is an action in relation to the purchase and sale of shares and is brought by the Plaintiffs who are investment companies against the Defendants who are well-known stock brokers. One of the major people in the Defendants' organisation who was concerned with the events relating to this action was Mr. Ishikawa. By 1991, he had left the Defendants' employment although I understand he may still be employed in Hong Kong by a company associated with the Defendants. On the Plaintiffs' side, it seems that Mr. James Lee had a great deal to do with the events in 1985-86 and 1988.

3. The action lumbered slowly to discovery stage but after September 1993 and certainly, as the Judge below held, from 1994 through to 1998, nothing happened. There was some activity in 1998, but hardly any. On 11th August 1998, application was made to strike the action out for want of prosecution. That matter was heard on 26th November 1998. The Master took the serious step of striking the action out for want of prosecution. There was an appeal to the Judge in Chambers. That was heard with apparently some expedition. It was heard on 9th December last year.

4. Findlay, J. handed down his decision on 16th December 1998. He upheld the Master. He said that there had been inexcusable and inordinate delay. He considered that it was such that the conduct of the action would be prejudiced. The Defendant would be prejudiced as a result of the delay. The just course in his view was to strike the action out.

5. The order was perfected on 14th January of this year. The Notice of Appeal was served on 26th January of this year. The appeal should then have been set down within 7 days thereafter. Again, nothing happened. There was some correspondence that I have been shown on the 9th April. On the 13th April, the Defendants' solicitors reminded the Plaintiffs' solicitors that they still had not set down the Appeal. The Plaintiffs' solicitors promised to do something about it. They did not do anything about it for another month. They were reminded again. The Defendants threatened to apply to strike out the appeal. Then, it was said that the solicitor handling the matter was away. It was not until 25th May that a "consent" summons was filed.

6. That consent summons was put before me. I indicated that I required an explanation for the delay. What was forthcoming was an affirmation of Mr. Wong Hoi Leung. It was said that the person in charge of the litigation in the Plaintiffs' offices was a Mr. Lo, and that he had given in his notice and left the Plaintiffs. There was nobody else suitable to handle the matter apart from Mr. James Lee and Mr. Wong. They had been busily engaged on other matters, to a certain extent, outside Hong Kong.

7. The important matter as far as I am concerned in exercising a discretion to extend the period for leave to set down the Notice of Appeal is by whom and why the decision was taken not to set down the appeal within the relevant time. That, as Mr. Kotewall, S.C. has had to admit, has not been explained. I can only assume that those concerned were well aware that the appeal had to be set down. I can only assume that they were aware of the time limit of 7 days. I can only assume that they had advised their clients accordingly. I can only assume that a deliberate decision was taken not to set the appeal down whilst Mr. James Lee and Mr. Wong were otherwise engaged and whilst other inquiries were made with a view perhaps to negotiating a settlement. It is said that prices and figures had to be researched. I have to say that if after a minimum of 11 years and a maximum of 14 years from the events, the figures were not available to the Plaintiffs, it is a particularly sorry look out.

8. Initially, Mr. Kotewall on behalf of the Plaintiffs relied heavily upon the "consent" given by the Defendants to the application to set the appeal down out of time. As it transpired, that "consent" was given, more accurately it is notification that no objection would be taken, on the basis that it was contemplated that the Court would grant leave. The Defendants simply wanted the matter disposed of as quickly as possible. That conception that the Court would grant leave, as I have indicated forcefully, is a misconception. Setting down the appeal is an important but simple step. It requires almost no brain power at all. It is almost totally mechanical. But if the step is not taken, the appeal does not proceed and there is more delay. The Court will not countenance delay particularly if it entails a breach of the Rules which prevents the matter proceeding.

9. In this case, I regard the delay as inexcusable. The Plaintiffs have already been guilty of inexcusable delay, at least as found by the Courts below. They have failed to proceed with the action in the manner that they should have done. They have been negligent of their obligations.

10. In my view, it is impossible for the Court in these circumstances to exercise any discretion to extend the time for setting down the appeal. I regret that I have to refuse this application.

Representation: