CHARTER SENSE LTD v. NG KIN YAN ALSO KNOWN AS PATRICK NG KIN YAN

HCA 2082 /2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

HIGH COURT ACTION NO HCA 2082 OF 2011

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D E C I S I O N

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1. By three summonses, the plaintiff seeks the following:

a.  sufficient answers to the plaintiff’s Further Request for Further and Better Particulars of §§15B(3), 16(7) and 21 of the Re-Amended Defence (see Schedule 1 to the F&BP summons dated 27 March 2014);

b.  sufficient answers to the interrogatories (see Schedule 2 to the F&BP Summons; (A/4));

c.  time be extended to the plaintiff to file an application for leave to adduce additional expert evidence (the Time Summons); and

d.  Leave be granted to the plaintiff to adduce further expert evidence (the Expert Summons).

2. The defendant opposes all these applications and asks the Court to dismiss them with costs.

3. The parties are legally represented.[1]

4. The plaintiff’s claim against the defendant is mainly on the defendant’s alleged breach of the contracts of employment and a confidentiality agreement that he had signed for his employment with the plaintiff over a period of about 11 years.  The defendant’s employment was terminated on 11 June 2011.  The substance of the complaints against the defendant are that the defendant had failed to return the Response to the plaintiff [2]; having joined a rival business of the plaintiff’s, the defendant had made use of the confidential documents of the Clients’ Contact List and the Price Matrices to solicit the plaintiff’s clients, causing damage to the plaintiff [3]; and had failed to return the confidential documents of the Clients’ Contact, the Price Matrices and Response to the plaintiff.[4]

5. The defendant’s defence is that he had never signed the employment contracts or the confidentiality agreement as alleged by the plaintiff and that he had never breached his duties as the employee of the plaintiff.  He also denied having made use of the confidential documents in favour of the new employer, the plaintiff’s rival business.

6. I shall deal with the summonses in the order as set out in Mr. L. Remedios’s written submissions.

The Time Summons & the Expert Summons

7. The plaintiff does not dispute that there was a delay in taking out the application for additional expert evidence.  Mr. Remedios, counsel for the plaintiff submits it was not due to the plaintiff’s or its legal advisor’s fault.  Ms. Tjia, counsel for the defendant retorts that the plaintiff has given no explanation for the delay.[5]  I tend to agree with Ms. Tjia.  She submits that the plaintiff’s applications for extension of time and leave for the additional expert evidence should be struck out. She also says that the proposed additional expert evidence is for the purpose of cross-examining the single joint expert (“SJE"), Mr. Leung, who has given a rather detailed expert report which supports the defendant’s case.  She is of the view that the proposed additional expert report is not very helpful.[6]

8. In my view, the time summons has to be considered together with the plaintiff’s summons for additional expert evidence.  After all, the time summons will be useless if the Court finds that leave should not be given to the plaintiff to call the additional expert evidence.  The Court has to take into consideration of the additional expert evidence on the merit of the plaintiff’s case, an important factor under O.2 r.5(1)(a) for its consideration for extension of time: the interest of administration of justice.

9. Mr. Remedios refers to Daimler AG v Leiduck (re: expert evidence) [2014] 3 HKLRD 56 in support of his proposition that the SJE agreed by the plaintiff does not prevent the plaintiff from calling another expert to challenge the SJE’s evidence.  See paragraphs 32-33.  At §34 of the judgment, the Recorder referred to the decision of Neuberger J in Cosgrove v Pattison [2001] CP Rep 68, in which the learned judge had set out the relevant factors for consideration of a second expert in addition to the evidence of an expert instructed jointly:

a.  The nature of the dispute;

b.  The number of disputes on which the expert evidence is relevant;

c.  The reason for requiring the 2nd report;

d.  The amount at stake or the nature of the issues at stake;

e.  The effect of permitting a second report on the conduct of the trial;

f.   The delay in making the application;

g.  The delay that might be caused in the conduct of the trial;

h.  Any other special features;

i.  The overall justice to the parties.

10. Mr. Remedios explains why a second expert report is required in this matter.  He does not dispute that the evidence of the SJE does not support the plaintiff’s case.  This is the reason for calling the second expert report.  He submits that Mr. Purdy is a highly qualified and internationally recognised forensic document examiner and his opinion differs from that of the SJE.  He further submits that while the Court is not bound to accept the SJE’s analysis and conclusions, in the absence of additional expert evidence to the contrary, it is much more likely that the court would attach the greatest weight to and accept the SJE’s conclusions (see Daimler AG v Leiduck (re: expert evidence) [2014] 3 HKLRD 56 at §41).  He argues that on the material presently before the court it cannot be said that that the views set out in Purdy’s Reports are patently fanciful, certainly not without hearing from him (see Daimler AG v Leiduck at §44) and the plaintiff will be prejudiced if leave were not granted.  The matter has not been set down for trial.

11. Ms. Tjia does not dispute with Mr. Remedios on the above submissions.

12. The plaintiff should be given leave to adduce the additional expert report if not for the delay.

13. The question will then turn on whether, because of the plaintiff’s delay in taking out the application within the time as directed by the Court, the plaintiff should be denied the leave.

14. I consider that to deny the plaintiff’s right to adduce the additional expert evidence because of the delay, taking into account that the matter has not been set down for trial and no milestone date will be affected, the penalty for the delay will be disproportionate.

15. I grant the extension of time and leave to the plaintiff to adduce the additional expert evidence.

The F&PB Summons

16. Under paragraph 15B(3) of the Re-Amended Defence, the plaintiff requests the defendant to state all facts and matters relied on in support of the allegation that the plaintiff (including Ms. Lau) allegedly always knew that the defendant and many other parties had a copy of the Response.  The plaintiff complains that the answers given by the defendant by saying that “the plaintiff is aware of the answer” is not sufficient.[7]

17. The defendant argues that the defendant had given the particulars “Ms. Lau was the director of the Plaintiff at the material times and she was familiar with and involved in the whole process of the compilation of the Response which required her approval. The Response was highly circulated to and retained by many parties, including staffs of Hendi Group and Unimac Financial.”.

18. Mr. Remedios has not stated in what respect the above particulars are insufficient.  At the hearing today, it appears that the answer is sufficient for the request.  The plaintiff’s request under 4 of schedule 1 is not supported and should be dismissed.

19. Under paragraph 16(7) of the Re-Amended Defence, the plaintiff requests the defendant to state whether the “client” as mentioned in the paragraph refers to the plaintiff’s clients and to identify the clients that contacted the defendant directly at his mobile phone number and also to identify the clients that knew the defendant personally.  The plaintiff complains that the answer given by the defendant, saying that the plaintiff is aware of the answer is not sufficient.

20. The defendant argues that he had given the particulars other than only saying that the plaintiff was aware of the answer.  In the answer, the defendant said “The Plaintiff (including Ms. Lau) should know that they were at all material times part of the circulation list and were therefore fully aware of the fact that those circulations were copied and forwarded to many different parties and people.”  In the further answer, the defendant said “The Plaintiff is aware of the answer.  Ms. Lau was the director of the Plaintiff at the material times and she was familiar with and involved in the whole process of the compilation of the Response which required her approval.  The Response was highly circulated to and retained by many parties, including staffs of Hendi Group and Unimac Financial.”

21. Mr. Remedios has not stated in what respect the above particulars are insufficient.  The plaintiff’s request under 5 of schedule 1 is not supported and should be dismissed.

22. Under paragraph 21 of the Re-Amended Defence, the plaintiff requests the defendant to identify the clients whose records the defendant kept on his laptop computer or email account.  The plaintiff again is not satisfied with the defendant’s answer that the plaintiff should be aware of the answer.

23. The defendant argues that he had given the answer, other than that the plaintiff was aware of the answer.  In the answer, the defendant said “The Plaintiff is aware of the answer.  At the time when the Defendant was working as a salesperson and marketing manager for the Plaintiff, the Defendant was instructed to service only those clients that he brought into the Plaintiff, and the Defendant had the records of those clients.”  In the further answer, the defendant said: “The Plaintiff is aware of the answer.  These clients were clients all brought in by the Defendant to do business with the Plaintiff.”

24. Mr. Remedios has not stated in what respect the above particulars are insufficient.  The plaintiff’s request under 6 of schedule 1 is not supported and should be dismissed.

25. Under paragraph 2 of the plaintiff’s summons, the plaintiff asks for an order that the defendant should within 14 days from the date hereof give further and better particulars of his answers to the Interrogatories 6 and 14-17 as set out in Schedule 2 of the summons.

26. The defendant complains “The Plaintiff’s Skeleton only set out a list of dates of the interrogatories and answers.  It did not explain to the Court or the Defendant why it says the answers were insufficient, or why it is entitled to an Order for more particulars.  The Plaintiff’s counsel merely suggests in a very simple sentence in paragraph 75 of the Plaintiff’s Skeleton that the interrogatories “relate to matters in question between P and D namely the 1^st and 2^nd Agreements and damages”, without even telling us how or why.”[8]

27. It is obvious that the defendant had in his 3^rd affirmation dated 6 November 2013 given answers to those Interrogatories.  See Bundle B pages 39-44.

28. Interrogatory 6 attempts to extract evidence from the defendant on the employment contract.  The defendant has already denied that he had ever signed any employment contracts or the so-called confidentiality agreement.  These are clearly pleaded in the Re-Amended Statement of Claim and the Re-Amended Defence.[9]  It is a cross-examination of the defendant on the issue whether the defendant had signed the employment contracts and the confidentiality agreement.

29. Interrogatories 14-17 are cross-examination of the defendant over his denial of the allegations in paragraph 16 of the Re-Amended Statement of Claim.  See paragraphs  25-27 of the Re-Amended Defence.

30. Despite the defendant having given some answers to those Interrogatories,[10] the Interrogatories remind me of the legal principles set out in Kao Lee & Yip v Koo Hoi Yan & Others HCA8847/1993 [2002] HKEC 585 by Ma J. (as he then was).  At paragraph 7(5) of the judgment, the learned Judge set out the relevant legal principles for considering the interrogatories, quoting the authority of Det Danske Hedeselskabet v KDM International plc [1994] 2 Lloyds 534, the relevant parts of which are that the interrogatories should not be used for the purpose of cross-examination or for deposition-taking exercise.  The learned Judge said at paragraph 7(6) “The administering of interrogatories is not for the purpose of enabling a party to indulge in some sort of deposition-taking exercise or to enable him to have a “dry run” in cross-examination against the other side prior to trial.  As I have already said, the key consideration is the factor of necessity referred to the RHC, Order 26, rule 1(1).”

31. The Interrogatories in Schedule 2 of the summons are disapproved.  However, the defendant has given some answers to them as I have indicated above.

32. The plaintiff’s requests under Schedule 2 are dismissed.

Costs

33. The plaintiff succeeds in the Time Summons and the Expert Evidence Summons.  However, the plaintiff has to admit that there has been unexplained delay in the application. The defendant has referred me to the letters on the proposals, in which the defendant had proposed to accede to the plaintiff’s request to adduce the second expert report, but with the consequential directions as to the meeting of the experts to prepare a joint report, which proposal was rejected without reasons from the plaintiff.  I have to take into consideration of the factors under O.62, r.5, especially the conduct of the parties.  Costs are at the discretion of the Court.  Although Mr. Remedios submits that the proposal of having the experts to meet is not a viable proposal because Mr. Purdy had already stated in his report he did not agree with some of the approaches of the SJE, however, the plaintiff has failed to bring this to the defendant’s attention and consideration.  This disagreement, if the plaintiff had brought to the defendant’s attention, could have been resolved by their further agreement or by submitting it to the Court for further directions, obviating the necessity of argument on the leave to the plaintiff to adduce the second expert report, saving costs and time for the argument on the summons today.  I shall now exercise my discretion to make no order as to costs for these two summonses.  As to the F&BP summons, the plaintiff has failed.  The costs of this summons should follow the event, with counsel’s certificate. See O.62, r.3(2).  The costs are to be assessed under O.62, r.9A at $54,000 to be paid within 14 days from the date hereof.

Order

34. The Court now makes an order in terms as follows:

a.  The plaintiff’s Time Summons be granted;

b.  The plaintiff be granted leave to adduce Mr. Purdy’s expert report at trial;

c.  The plaintiff’s F&BP summons be dismissed;

d.  The costs of the above summonses be as per paragraph 33, supra.

Case Management Conference Directions

35. As leave has been given to the plaintiff to adduce additional expert evidence, the SJE shall within 60 days from the date hereof serve his expert report in response, if so advised on the plaintiff and the plaintiff be at liberty to serve an expert report in reply within 30 days thereafter.

36. Liberty to apply.

37. Leave be given to the plaintiff to set down for trial within 42 days commencing on 2 January 2015 for a 8-day trial before a Judge alone in the fixture list in consultation with counsel’s diaries.  The parties shall appear before the trial judge on a date 12 weeks before trial for a pre-trial review of 30 minutes.  The parties shall prepare the agreed/certified translation for the Chinese documents and raise any issue of recusal at the PTR.  All interlocutory applications before the PTR shall be fixed before the Registrar or a Master for argument.

38. Costs of the Case Management Conference today (30 minutes) be in the cause.