KEEN LLOYD ENERGY LTD v. BANK OF CHINA (HONG KONG) LTD

CACV 34/2008, CACV 35/2008, CACV 36/2008 & CACV 37/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NOS. 34 AND 35 OF 2008

(ON APPEAL FROM HCA NO. 1092 OF 2006)

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REASONS FOR JUDGMENT

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Hon Rogers VP:

1.  I agree with the reasons given by Le Pichon JA.

Hon Le Pichon JA:

2.  These were four applications by the plaintiff for leave to appeal to the Court of Final Appeal from orders of this court dated 23 September 2008 dismissing the plaintiff’s appeals from decisions and judgments of Poon J.  At the conclusion of the hearing the applications were refused with written reasons to be handed down which we now do.

Background

3.  The full background appears in paragraphs 3 to 13 of the reasons for judgment of Rogers VP handed down on 23 September 2008 to which reference should be made.  For present purposes, it is only necessary to state that the underlying actions, HCA 1299 of 2004 (“the 2004 action”) and HCA 1096 of 2006 (“the 2006 action”), were actions brought by the plaintiff against the defendant.  The plaintiff, the holding company of the Keen Lloyd group of companies, claimed damages against the defendant in respect of alleged misrepresentations regarding the grant of general banking facilities to the group.

4.  Poon J heard the defendant’s strikeout summonses in July 2007.  After the hearing had been completed but pending the judge’s decision on those summonses, on 21 November 2007, the plaintiff applied to adduce and rely on (1) a letter dated 18 May 1998 from the defendant, then known as Sin Hua Bank Ltd, Hong Kong Branch (“SHHK”) to the Hong Kong Monetary Authority (“HKMA”) and (2) a letter dated 17 July 1998 from the HKMA to SHHK.

5.  On 4 January 2008, the judge dismissed the plaintiff’s applications to admit further evidence.  On 11 January 2008, the judge struck out the 2004 action and the 2006 action.  CACV 34 & 36 of 2008 relate to the judge’s refusal to admit further evidence and CACV 35 & 37 of 2008 relate to the judge’s decision to strike out the two actions.

6.  The substantive appeals to this court were dismissed because, irrespective of the representations, the defendant was entitled to withdraw the facilities at any time.  In addition, the statements were promises rather than statements of fact, there was no actionable loss pleaded and the claim in the 2006 action was also time-barred.  For the appeals on the judge’s refusal to admit fresh evidence, this court considered that there was no basis for interfering with the judge’s exercise of his discretion as the judge had not erred in principle.

The leave applications

7.  In relation to CACV 34 & 36 of 2008 (the refusal to admit further evidence), the plaintiff relies on both grounds contained in section 22(1)(b) of the Court of Final Appeal Ordinance: namely, that they involve questions of great general or public importance; alternatively, that leave should be granted on the “or otherwise” ground.

8.  In relation to CACV 35 & 37 of 2008, it is not contended that they raise any questions of great general or public importance.  Reliance is placed solely on the “or otherwise” ground.

Great general or public importance

9.  For CACV 34 & 36, the questions said to be of great general or public importance within section 22(1)(b) read:

“(1)  when a party applies to adduce further evidence after a hearing but before judgment is delivered, whether the Court should apply the test laid down in Smith v. New South Wales Bar Association (1992) 176 CLR 256 and Urban Transport Authority of NSW v. NWEISER (1992) 28 NSWLR 471 or the one in Secretary of State for Trade and Industry v. Pauling [2005] 2 BCLC 667;

(2)  whether an appellate Court declined to entertain an appeal on the ground that no substantive order could be made when the substantive decision of the Court below is manifestly wrong and the appellants should have the costs of the hearing below.”

10.  The first matter to note is that question (1) did not feature in the appeal hearing and does not arise from the judgment of this court or, for that matter, from the judgment below.  In the proceedings below, the parties had proceeded on an agreed basis.  After noting the fact that the plaintiff had cited a number of Australian authorities, the judge stated as follows:

“7.  For the purpose of today’s hearing, I do not think I need to decide or come to a definite view as to which approach is correct, because both counsel agree that the main factor in considering these applications is whether the letters are relevant to the striking-out application and whether they would have an impact on the outcome of the striking-out application.”

Those were the matters the judge went on to consider.

11.  Question (2) is opaque.  In so far as it is suggested that this court declined to entertain the appeal, the suggestion is unfounded.  This court considered that the judge had not erred in law and there was nothing to warrant any interference with the judge’s exercise of his discretion.

12.  Accordingly, I do not consider that either of the questions posed arises, much less that matters of great general or public importance are involved.

The “or otherwise” ground

13.  It is well settled that the granting of leave under the “or otherwise” ground is an “exceptional” course.  See per Ribeiro PJ in Chao Keh Lungv Don Xia (2004) 7 HKCFAR 260, 263J.  It is incumbent on the party seeking leave to meet the high threshold requirement of showing the existence of exceptional circumstances.  That the defendant has not done.  It is not sufficient to show that there is an arguable case.  In any event, I consider that whether the circumstances are sufficiently “exceptional” should normally be decided by the Court of Final Appeal.