WADDINGTON LTD v. CHAN CHUN HOO THOMAS AND OTHERS

cacv 134/2006

in the high court of the

hong kong special administrative region

court of appeal

civil appeal no. 134 of 2006

(on appeal from HCA 3291/2003)

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J U D G M E N T

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Hon Rogers VP:

1.  This matter comes before us on a re-amended notice of appeal which was filed on 2 March this year.  This is an appeal from a judgment of 7 March 2006 of Barma J.  The appeal is somewhat out of time in this respect because after Barma J gave his judgment in March of last year, this court gave judgment on 30 May in respect of what is really the fundamental basis of the action and that is, to put it crudely, whether a double derivate action is maintainable.  So to a large extent, Barma J’s judgment of 7 March now becomes, in certain respects, history because matters have taken a slightly different course.

2.  Whether or not the action will be put back to something different on the basis that a double derivate action is not maintainable and any action is then struck out, remains to be seen.  However, one thing seems to me to be clear: it is now time really to get on with this action.  The matters are getting a little bit stale.  The plaintiff has been forced to take out a protective writ on the basis that it is possible that it might be said that the action is statute barred.

3.  There are two matters which the plaintiff requires.  To put it simply they wish to have the statement of claim in the form that is annexed to the notice of appeal.

4.  The first matter concerns whether intermediate subsidiaries should be joined into the action.  As far as is known, this is the first case in which a double derivative action is likely to go ahead to trial in Hong Kong.  Quite what the ultimate outcome will be and whether it will be held that it is maintainable and the basis on which it would be held it is maintainable - remains to be seen and will not be decided for some time to come, unfortunately.

5.  But as to whether the intermediate subsidiaries should be joined, it seems to me that there are points which can be raised that the plaintiff should be allowed to join them.  Mr Lee SC,who appeared on behalf of the 1st and 2nd defendants, has, very frankly, not alleged that there is going to be any major difficulty caused by this except the generation of more paper.  But apart from that, it does not seem that it is going to cause the parties any difficulties nor, importantly, slow the action down.

6.  Since there may be a point in joining them - and it may be necessary to join them – it would be much better to join the companies now than at some later stage when the court says that they are a necessary and proper party and have to be joined in order for the plaintiff to get relief.  It seems to me to be much better to join them now and allow this action to get on, at least as far as this court is concerned.

7.  There are other amendments which relate to the substantive part of the action and I simply say that following this court’s judgment last May, they would seem to be appropriate amendments to be made.  Generally speaking, this court does not give leave to amend in that sort of respect because of the difficulties and it is really a matter of Court of First Instance.  But it is within the jurisdiction of an appellate court to grant leave to amend and, in my view, rather than this matter find its way back to the Court of First Instance or even the Master with more delay, it is much better for this court, in view of the fact that there are no substantive objections to the amendment, to allow the amendment at this stage.  All I can say at the conclusion of this judgment is that I really hope that this action can proceed with some expedition before matters get so delayed that everybody has forgotten everything about the facts of the case.

Hon Le Pichon JA:

8.  I agree.