LAU MUK FAT (SUING AS THE MANAGER OF LAU SHAU WO TSO) v. WONG KWOK WA AND OTHERS

HCA 1006/2017, HCA 1879/2011,
HCA 896/2012, HCA 897/2012 &
[HCA 802/2019 and HCMP 944/2018 (Consolidated)]
(Heard together)

[2023] HKCFI 135

HCA 1006/2017

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1006 OF 2017

_____________

_____________

AND

HCA 1879/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1879 OF 2011

_____________

_____________

AND

HCA 896/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 896 OF 2012

_____________

_____________

AND

HCA 897/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 897 OF 2012

_____________

_____________

AND

HCA 802/2019

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 802 OF 2019

_____________

_____________

AND

HCMP 944/2018

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 944 OF 2018

_____________

_____________

(HCA 802/2019 and HCMP 944/2018 Consolidated by the Order of

Madam Recorder Rachel Lam SC dated the 18^th day of October 2022)

_____________

(Heard Together)

________________________________

DECISION  ON  COSTS

________________________________

1.  On 18 October 2022, I handed down a decision in these matters concerning various case management issues [2022] HKCFI 3166 (“18 October Decision”). This decision on costs is to be read together with that decision. Abbreviations and defined terms are adopted from the 18 October Decision.

2.  This costs decision deals with the costs in respect of:

(1)  WKW’s Application;

(2)  Madam Mok’s Application; and

(3)  The Strike Out Application.

WKW’S APPLICATION

3.  WKW’s Application for global consolidation of the various proceedings was dismissed.

4.  Counsel Mr Tony H. H. Chow, who appeared for WKW, referred the Court to various cases where the Court had made neutral costs orders where applications for consolidation were rejected (Mass Ocean International Limited v Trinity Holdings (Hong Kong) Limited & Ors[2019] HKCFI 2323; Komal Patel & Ors v Chris Au & Ors, HCA 183/2014, unreported judgment dated 14 January 2016) and also where consolidation had been granted despite unsuccessful opposition (Wong To Yick Wood Lock Ointment Limited v Merika Medicine Factory Limited & Ors, HCA 562/2014, unreported judgment dated 10 March 2017). In each of these cases, the costs that were ordered after substantial argument was still “costs in the cause”.

5.  The rationale underlying this approach appears to be that consolidation is often a complex and difficult case management issue (see for example paragraph 53 of Mass Ocean). Where any party does not act in a culpable way, the Court will be slow to impose costs consequences on any side if such issue of consolidation needs to be considered in due course.

6.  Mr Chow further pointed to the fact that the Tso had not succeeded in persuading the Court to stay the Subsequent Actions, and as such, the overall stance taken in opposition had also failed.

7.  Counsel Mr Billy Ma, who appeared for the Tso, sought to persuade the Court that the usual approach of costs following the event should apply (citing Kinetics Medical and Health Group Company Ltd & Ors v Dr Tse Ivan Cheong Yau, HCA 1115/2010, unreported judgment dated 7 April 2014).

8.  At the hearing on costs, Mr Ma further submitted that there had been “culpable conduct” on the part of WKW in his conduct of the actions thus far, citing in particular his alleged fraudulent arrangement with Madam Mok (which core complaint is the subject of the Subsequent Actions), and also the sharp practice of WKW in seeking to further delay matters by raising the possibility of amending his defence if he were unsuccessful in his consolidation application (as had been foreshadowed in paragraph 49 of the 18 October Decision).

9.  On the first point, I pointed out to Mr Ma that this Court would not consider this complaint of fraud as an established fact as yet, given this is the very subject matter of the consolidated action (as ordered in paragraph 62 of the 18 October Decision) and is yet to be determined. On the latter point, I was informed by Mr Chow that although at the subsequent case management hearing before the master, his client had sought leave to amend if so advised, such application was ultimately not made. There has thus not been any step taken which would further delay the trial of the Main Actions, which I understand will be set down shortly.

10.  Considering matters in the round, and taking into account the case management steps taken to date in the lengthy history of this matter falls on the shoulders of all parties rather than any particular party being more culpable than the others (paragraph 47 of the 18 October Decision refers), I shall adopt the approach as customarily taken. The costs of and occasioned by WKW’s Application, including the costs of the hearing on costs, are thus to be costs in the cause of the respective actions (wherein the various summonses were issued).

MADAM MOK’S APPLICATION

11.  Insofar as Madam Mok’s application is concerned, she was successful in her application to consolidate the Subsequent Actions. At the hearing, she had also argued that she was supportive of WKW’s Application, and her own application was an integral aspect of this “global consolidation” position.

12.  Counsel Mr Raymond Tsang, who appeared for Madam Mok, also prayed in aid of Komal Patel (above) to suggest that the usual starting point was costs in the cause. He then cited Ling Man Yiu Raymond t/a Build Tech Engineering Co v Yau Luen Metal Works Ltd[2022] HKDC 18, to argue that the court will depart from the usual order if the application is unreasonably opposed. He submitted that the Tso had unreasonably opposed Madam Mok’s Application in seeking to stay the Subsequent Actions, and/or (as a fallback) in opposing consolidation and instead proposing that they should only be heard together.

13.  Considering matters in the round, I similarly do not think that the Tso’s position was altogether unreasonable. Insofar as the Tso’s predominant stance (in answer to the proposal for global consolidation) was to proceed to trial for the Main Actions, this aspect was successful. Madam Mok’s stance as to her own application for consolidation was not entirely straightforward, in that it was not confined to her application alone. Both in her written submissions and at the substantive hearing, she had tied her fortunes together with WKW’s Application in supporting the “global consolidation” proposed by WKW, of which her own application was a crucial piece. In the circumstances, the parties had had to argue the various options, in order to enable the Court came to the determination in the 18 October Decision.

14.  Taking into account the above circumstances, I order that the costs of Madam Mok’s Application, including the costs of the hearing on costs, shall be costs in the cause of the consolidated action (which consolidation has been ordered at paragraph 60 of the 18 October Decision).

15.  Parties were also agreed that the costs of the amendments to pleadings (ordered at paragraph 60 of the 18 October Decision) shall be costs in the cause of the consolidated action, and this I order accordingly.

16.  I would also note that I had considered whether Madam Mok and/or the 1006 Dings should be made liable in costs together with WKW for the approach taken in terms of the “global consolidation”. However, at the end of the day I did not consider this necessary or appropriate. First, I have accepted that the overall picture was complex and necessitated by the developments over the long history of the case, thus making costs in the cause a fairer outcome. Secondly and in any event, I accept the submissions that Madam Mok’s and the 1006 Dings’ stance at the substantive hearing did not substantially add to the arguments to be canvassed. This is particularly so in the case of the 1006 Dings, who had remained essentially neutral to the question of global consolidation. Their respective approaches thus did not cause much by way of additional costs.

THE STRIKE OUT APPLICATION

17.  Insofar as the Strike Out Application was concerned, the 1006 Dings were not successful in striking out, but the action was stayed.

18.  Ms Evelyn Cheng by her written submissions proposed that:

(1)  Costs up to the call-over hearing on 16 December 2021 for the Strike Out Summons should be to the 1006 Dings, to be taxed if not agreed, with certificate for counsel; and

(2)  Thereafter, there should be no order as to costs. This applies to the hearing on costs as well.

19.  Mr Ma proposed that the 1006 Dings should pay all costs of and occasioned by the Strike Out Application on the grounds that the application was unreasonably taken out, and unreasonably maintained (despite the Tso having indicated that it was amenable to a stay).

20.  On balance, I consider Ms Cheng’s proposal to be the fairest in the circumstances where:

(1)  The Strike Out Application was partially successful in that the HCA 1006/2017 Action has been stayed. This was a necessary outcome insofar as case management was concerned.

(2)  However, the parties had all proceeded to argue the strike out and, as I had alluded to in paragraphs 56 and 57 of the 18 October Decision, neither side had followed up on the possibility of the stay after the events of late 2021.

21.  I thank counsel for their assistance.

Mr Billy Ma instructed by Messrs Hong Lee & Co for the Plaintiff in HCA 1879/2011, HCA 896/2012, HCA 897/2012, HCA 1006/2017 & the consolidated action of HCA 802/2019 and HCMP 944/2018

Mr Ho Hin Chow Tony instructed by Messrs Cheung, Chan & Chung for the 1^st Defendant in HCA 1006/2017, HCA 1879/2011, HCA 896/2012, HCA 897/2012 & the consolidated action of HCA 802/2019 and HCMP 944/2018

Wriiten Submissions from Ms Evelyn Cheng instructed by Messrs S H Chou & Co, and hearing attended by Mr Chou Sing Hong of Messrs S H Chou & Co for the 2^nd - 12^th Defendants in HCA 1006/2017, the 2^nd Defendant in HCA 896/2012 and the 2^nd - 13^th Defendants in HCA 1879/2011 & the consolidated action of HCA 802/2019 and HCMP 944/2018

Mr Raymond Tsang instructed by Messrs K B Chau & Co for the 14^th Defendant in the consolidated action of HCA 802/2019 and HCMP 944/2018

HCA 1006/2017, HCA 1879/2011, HCA 802/2019,
HCA 896/2012, HCA 897/2012 & HCMP 944/2018
(Heard together)

[2022] HKCFI 3166

HCA 1006/2017

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1006 OF 2017

________________________

________________________

AND

HCA 1879/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1879 OF 2011

________________________

________________________

AND

HCA 802/2019

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 802 OF 2019

________________________

________________________

AND

HCA 896/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 896 OF 2012

________________________

________________________

AND

HCA 897/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 897 OF 2012

________________________

________________________

AND

HCMP 944/2018

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 944 OF 2018

________________________

________________________

(Heard Together)

________________________

DECISION

________________________

A.  INTRODUCTION

1.  These matters have a long and somewhat tortuous history.  At issue before the Court at the present hearing was how to best case manage the 6 sets of proceedings going forward.

2.  There are, in essence, three proposals before the Court, which can be summarized as follows:

(1)  The application of Mr Wong Kwok Wa (“WKW”)[1]: to effectively consolidate all but one of the proceedings (namely, HCA 1006/2017), with a full recast of pleadings, but adopting the evidence and discovery that had already been filed to date.  At the hearing, this was further developed into a fallback option of consolidating HCA 1879/2011 with HCA 802/2019 and HCMP 944/2018, whilst leaving HCA 896/2012 and HCA 897/2012 undisturbed. (“WKW’s Application”)

(2)  The application by Madam Mok Mei Ling Rekei (“Madam Mok”)[2]: to consolidate HCA 802/2019 and HCMP 944/2018, with consequential directions to be given in respect of pleadings and further conduct thereof (“Madam Mok’s Application”).

(3)  The position put forward in answer to the above applications by Lau Muk Fat (“LMF”, suing as manager of Lau Shau Wo Tso)  (“the Tso”): to proceed to trial of HCA 1879/2011, HCA 896/2012 and HCA 897/2012 (collectively, “the Main Actions”, for which directions had already been given on 13 September 2013 that they should be heard together),without further consolidating the Main Actions with the subsequent sets of proceedings. It was further suggested that those subsequent proceedings ought to be stayed pending the resolution of the Main Actions.

3.  There was also before the Court a strike out application by the 2^nd to 12^th Defendants in HCA 1006/2017 (“the 1006 Dings”)[3] to strike out the action against them (“the Strike Out Application”).

4.  At the hearing, WKW was represented by Counsel Mr Tony H H Chow, Madam Mok was represented by Counsel Mr Raymond Tsang, the Tso was represented by Counsel Mr Billy N P Ma, and the 1006 Dings were represented by Ms Evelyn L C Cheng.

B.  BACKGROUND

5.  Given the various issues that arise for consideration in contemplating which course to adopt, it is necessary to set out the background and procedural history in some detail. What follows is not intended to be an exhaustive summary of the background or all the issues in the cases, but only what is essential for the purposes of the present decision.

B1.  The Development Agreement

6.  By a development agreement originally dated 15 December 1994 between the Tso and WKW, as varied by supplemental agreement dated 31 August 1995, LMF as manager of the Tso was to provide various lands to WKW as developer to coordinate and develop small houses with the involvement of various indigenous villagers (“Dings”)  (“the Development Agreement”).  In consideration for the provision of the lands, the Tso would obtain a share of the houses to be constructed thereon.

7.  Pursuant to the Development Agreement, WKW eventually procured 17 small village houses to be constructed on 17 building lots.  The houses were to be split between the Tso and WKW at a ratio of 4 to 6 (the Tso being entitled to 6 houses, WKW being entitled to 9 houses, and the parties to split the interest for the remaining 2 houses at 4:6 interest).

8.  There is some dispute as to the precise mechanism for selection and allocation, but what is not disputed is that the Tso had been allocated and conveyed 6 houses/lots in around June 2011 (“the Tso’s 6 Houses / Lots”).  There thus remained 11 houses/lots which were unallocated (“the 11 Unallocated Houses / Lots”), and which are the subject of the various actions now before the Court.

B2.  The Main Actions

9.  The first action to be initiated was HCA 1879/2011.  In a lengthy Amended Statement of Claim dated 23 March 2012 (“1879 ASOC”), the Tso makes various claims against inter alia that WKW.  It is unnecessary to set out each and every aspect of the claim, but for present purposes, the following are most pertinent. In essence, the Tso claims that:

(1)  WKW is in breach of and/or liable for delay in various aspects of the Development Agreement, such that the Tso has suffered loss and damage;

(2)  WKW misrepresented various matters to the Tso, leading to the Tso selecting the 6 houses in June 2011, which were inferior in quality, and in consequence the Tso has suffered loss and damage;

(3)  WKW is liable to specifically perform the Development Agreement in that he should: (i)  select 9 houses/lots out of the 11 Unallocated Houses / Lots and (ii)  assign and transfer 40% interest and benefit in the remaining 2 houses/lots to the Plaintiff; and in addition thereto, he is liable for damages owing to his breaches and/or delay in performing the Development Agreement.

(4)  Alternatively to the relief for specific performance, the Tso seeks declaratory relief that it is entitled to 2/11 of the rights and interest in the other 11 Unallocated Houses/Lots; and yet further or alternatively, damages in lieu of or in addition to specific performance.

10.  The HCA 1879/2011 action also involves the 2^nd to 13^th Defendants therein (“the 1879 Dings”), who are certain other of the Dings (not the same as the 1006 Dings)  whose involvement in the arrangements were necessary in order to render the Development Agreement workable.  The Tso seeks inter alia declaratory relief against them that their Lots are held on trust for the Tso, damages for breach of trust, and orders that they do transfer or assign their Lots to the Tso or other persons nominated by the Tso.  Save for filing defences wherein they largely indicate that they have “no knowledge” of the various matters in the 1879 ASOC, they have not taken an active part in the proceedings.  

11.  HCA 896/2012 and HCA 897/2012 were commenced on 28 May 2012 by the Tso.

12.  In HCA 896/2012, the Tso alleges again various breaches and/or delay in performance of the Development Agreement and seeks inter alia relief against WKW for:

(1)  Specific performance of the Development Agreement to the effect that he is liable to procure and transfer assignment of a lot in the name of the 2^nd Defendant in HCA 896/2012 (Tsang Hon Lung, a Ding involved in the arrangement who has similarly taken a non-active stance)  to the Tso; and

(2)  Alternatively to the above, damages for breach of the Development Agreement in addition to or in lieu of specific performance.

13.  In HCA 897/2012, the Tso alleges various breaches of the Development Agreement, makes an allegation that there had been an express grant of easement whereby the Tso would be afforded access to the Tso’s 6 Houses / Lots, and makes a further claim that there had been misrepresentation in respect of a box sewerage system for the Tso’s 6 Houses / Lots (which was promised, but not built). The Tso seeks relief against WKW for inter alia:

(1)  A declaration that WKW had expressly granted the easement;

(2)  Specific performance of the agreement for the grant of the said easement;

(3)  Damages for breach of the said agreement for grant of the easement;

(4)  Damages for misrepresentation in respect of the box sewerage system, or alternatively specific performance to construct the same.

14.  WKW filed defences and counterclaims in the respective actions on 15 November 2012[4]. He makes various denials and factual averments regarding the allegations in the various actions. By way of the Counterclaims in each of the actions, WKW seeks inter alia:

(1)  Declaratory relief that the Development Agreement is “unlawful, illegal, contrary to public policies and hence unenforceable and void”;

(2)  Injunctive relief restraining the Tso from executing, performing or carrying out the Development Agreement;

(3)  Declaratory relief that the Tso is estopped from alleging any breach of the Development Agreement on the basis of WKW’s delay in its performance; and

(4)  Declaratory relief that the Tso is estopped from asserting any interest in the 11 Unallocated Houses / Lots.

15.  As can be seen from the above, the Main Actions concern various disputes centering around the performance and alleged breaches of the Development Agreement. The matters pleaded by both sides concern events from the time of the origination of the Development Agreement up to around 2012 at the latest.  To state the obvious, Madam Mok is not a party to the Main Actions.

16.  As mentioned above, a direction had been given relatively early on in September 2013 that the Main Actions were to be heard together (and quite properly so).  I confirmed with the parties at the hearing that essentially all relevant steps had been taken in the Main Actions to bring the matters to trial (viz. discovery, filing of witness statements and expert reports, etc.).  The only outstanding question was whether the Main Actions should be somehow consolidated or heard together with the subsequent actions (discussed below).  If not, then the Main Actions are ready to be set down for trial.

B3.  Subsequent Developments

17.  Because of subsequent developments, the material particulars of which are outlined below, the Main Actions have been languishing in somewhat of a procedural no-man’s land for a number of years now.

18.  The first event of note is the initiation of HCA 1006/2017 by the Tso on 26 April 2017.  The action is brought against WKW as 1^st Defendant, with the 2^nd to 12^th Defendants being other Dings involved in the arrangements for the Development Agreement, who had not been made parties in the original HCA 1879/2011.  The pleading largely repeats the pleading in HCA 1879/2011, except there is additional relief sought as directed against the 1006 Dings (essentially mirroring the relief sought against the 1879 Dings, see paragraph 10 above).   The Tso readily admits that this action has served as a “protective writ” to prevent the 1006 Dings from dissipating the subject Lots or the Unallocated Houses, and thus the sealed copy of the writ had been registered in the Land Registry on 28 April 2017 against the relevant lots / houses.

19.  On 12 February 2018, WKW sent a letter to the Tso through his legal representatives (“Selection Letter”)  purporting to select 9 Houses / Lots per the selection mechanism in the Development Agreement.

20.  Subsequently, on 25 June 2018, Madam Mok initiated HCMP 944/2018 (“the 944 OS”).  By the 944 OS and evidence filed in support thereof, she alleges that she is the registered owner of 9 of the 11 Unallocated Houses, having allegedly been assigned the relevant legal titles by various registered owners solicited by WKW under the Development Agreement by way of a sale and purchase agreement dated 21 April 2017 (i.e. allegedly a few days prior to the initiation of HCA 1006/2017)  (“the Mok SPA”).  By reason thereof, she seeks declaratory and injunctive relief, the effect of which is to inter alia withdraw or vacate the registration of the various instruments in the Land Registry in respect of those 9 houses / lots.

21.  The Tso’s case is that the Mok SPA is plainly a sham. There is presently no dispute between the parties that Madam Mok is WKW’s wife, nor is there any dispute that no money actually changed hands pursuant to the Mok SPA.  There is also no dispute that the Mok SPA was only registered in the Land Registry on 25 July 2017, some three months after the initiation of HCA 1006/2017.  There are various other unusual features of the transaction which need not be fully set out herein.

22.  In view of the above, the Tso commenced HCA 802/2019 on 7 May 2019, which names WKW, Madam Mok and 12 of the Dings as Defendants (these Dings overlapping substantially with those in HCA 1006/2017). The Statement of Claim repeats much of what is set out in HCA 1879/2011 and HCA 1006/2017, but then importantly and substantively adds claims and causes of action specifically in relation to Madam Mok and the Mok SPA.  In particular, there is a plea of conspiracy to defraud, followed by pleas of dishonest assistance and knowing receipt.  To summarise the prayer for relief, it seeks inter alia:

(1)  Declarations that the Mok SPA (and subsequent assignments based thereon)  is/are unlawful and/or invalid and should be voided;

(2)  A declaration that Madam Mok does not have legal title or interest in the 9 Unallocated Houses / Lots;

(3)  A declaration that Madam Mok (or alternatively Madam Mok and the 3^rd and 4^th Defendants)  is/are holding the legal titles of the Unallocated Houses / Lots on trust for the Tso and WKW (at the 4 to 6 ratio);

(4)  A declaration that the Selection Letter was not a valid or binding selection by WKW;

(5)  A declaration that WKW had breached the Development Agreement by disposing of the 9 Unallocated Houses before proper selection;

(6)  Various consequential orders premised upon WKW being required to specifically perform the Development Agreement;

(7)  Pleas for return of the unused land; and

(8)  Various pleas for damages and/or accounts.

23.  HCA 802/2019 and the 944 OS are hereinafter referred to as “the Subsequent Actions”.  Neither of the Subsequent Actions has progressed beyond the initial pleadings. This is similarly so for HCA 1006/2017.

24.  As is evident from the above summary, a key point of dispute and the main complaints in the Subsequent Actions concern the events surrounding the Mok SPA and the impact thereof on the title to the 9 Houses / Lots.  These events occurred well after the events complained of in the Main Actions.

25.  Notwithstanding the above, Madam Mok pressed ahead with the hearing of the 944 OS, and was initially successful in obtaining relief thereunder before Recorder Linda Chan SC (as she then was)  on 28 June 2019.  This was, however, subsequently set aside by the Court of Appeal on 14 May 2021.  The full reasoning of the Court can be found at [2021] HKCA 706.  Suffice to say for present purposes that the Court of Appeal considered there were triable issues, in view of the various unusual features of the Mok SPA (paragraph 21 above)  and other features as discussed more particularly at paragraphs 38 to 50 of the Court of Appeal decision.  The Court of Appeal concluded at paragraph 43 that:

“43. In this respect, we should add that, given that there is a triable issue as to whether the SPA and the Assignment are sham transactions, there is also a triable issue as to whether Wong has made any selection of 9 Houses/Lots out of the 11 Unallocated Houses/Lots in accordance with the Development Agreement.”

26.  Directions were then given by the Court of Appeal that the 944 OS was to continue as if begun by writ, and that further directions should be sought from the Court of First Instance on the future conduct of the proceedings, including (a)  directions on the filing of pleadings and evidence as appropriate and (b)  directions on whether, and if so how, the proceedings should be tried together with HCA 802/2019.

27.  The parties then attended before Master Ho on 31 August 2021, who directed that the present summonses be taken out. The applications thus came before this Court, over a year later.

C.  RELEVANT LEGAL PRINCIPLES - CONSOLIDATION

28.  There is no great dispute between the parties as to the principles on consolidation.

29.  O.4, r.9(1), Rules of the High Court provides:

(1)   Where two or more causes or matters are pending, then, if it appears to the Court -

(a)   that some common question of law or fact arises in both or all of them, or

(b)   that the rights to relief claimed therein are in respect of or arise out of the same transaction or series of transactions, or

(c)  that for some other reason it is desirable to make an order under this rule, the Court may order those causes or matters to be consolidated on such terms as it thinks just or may order them to be tried at the same time, or one immediately after another, or may order any of them to be stayed until after the determination of any other of them.

30.  On the relevant principles, I would gratefully adopt the summary by Deputy High Court Judge MK Liu in China Health Group Ltd (formerly China Healthcare Holdings Ltd)  & Ors v Li Zhong Yuan & Ors [2021] HKCFI 3806 at paragraphs 13 to 14:

“13. As explained by Zervos J (as he then was)  in Komal Patel v Chris Au(HCA 183/2014, 2063/2015, 14 January 2016), [12] – [17]:

(1)  In deciding whether to order consolidation, the court has an unfettered discretion. The power is to be exercised in a flexible way with regard to the particular circumstances of the situation. The objective of such an order is to save time and costs. There is no hard and fast rule that just because the parties are identical and some common question of fact or law is involved in both actions, it would be expedient and proper to order consolidation.

(2)  The court has an unfettered discretion in deciding whether to order consolidation of two or more causes or matters. Even though the power is to be exercised with some degree of flexibility, a court must nevertheless be satisfied that it would be proper and expedient to make such an order, having regard to the particular circumstances of the situation, including, amongst other things, that the objective of such an order is to save time and costs, and that where there is a substantial overlapping of issues and parties, it is desirable to resolve the disputes in the different actions on one occasion by the same judge.

(3)  Where there was “substantial overlapping of issues and parties” it was desirable that the disputes in the different actions to be resolved on one occasion and by the same judge.

(4)  The question of whether actions should be tried together or one after another had to be approached from the perspective of case management rather than principles of law; the Court is primarily concerned with savings of time and costs, and also with the avoidance of unnecessary delay, undue complexity and overloading of issues. In considering “the practical implications of trying the actions together”, relevant factors include, inter alia, the additional time needed to address further issues, the adoption or admission of the evidence of witnesses in subsequent trials, the risk of losing reserved trial dates and the different stages the actions had reached before going to trial.

(5)  The emphasis is on the efficient and just resolution of disputes before the courts. The court should take a practical and common-sense approach to meet the justice of the situation.

14. See also Chan Shing Lam v Winscore International Ltd [2021] HKCFI 3563 in which Recorder Dawes SC said:

‘12. The principles under [Order 4 rule 9(1)] are trite:

(1)  The Court has a wide and unfettered discretion under Order 4, rule 9. There is no hard and fast rule on how this discretion ought to be exercised, but the Court should take a practical and common sense approach to ensure justice is best served.

(2)  Even though the Court’s discretion should be exercised flexibly, it must be satisfied that it would be proper and expedient to make such an order, having regard to the all the circumstances. It should consider, amongst other things, that the objective of the rule is to save time and costs, and where there is a substantial overlapping of issues and parties, it is desirable to resolve the disputes in different actions on one occasion before the same judge.

(3)  Following the Civil Justice Reform, the emphasis is on ensuring the efficient and just resolution of disputes before the courts.’

See Komal Patel and Ors v Chris Au and Ors, HCA 183/2014 and HCA 2063/2015 (14 January 2016)  at §§11-17; Yong Li Investments Ltd v Lee Sing Leung Robin [2018] HKCFI 1711 at §§16-17, 22, and 25-27.”

31.  Whilst there were various other cases cited by the parties, those citations largely served to illustrate certain aspects of similarities in the facts.  I have borne the above principles in mind when considering the arguments raised by all parties as to the way forward.

D.  CONSOLIDATION – WKW’S APPLICATION

32.  Having considered the parties’ submissions and the relevant papers in the hearing bundles, I would exercise my discretion against WKW’s application and disallow the application to consolidate the Main Actions with the Subsequent Actions. This is the case whether for the application as originally made, or in relation to the fallback argument developed by Mr Chow at the hearing.

33.  First, I am conscious of the very different stages where the actions find themselves. Whilst the Main Actions are essentially ready for trial, the Subsequent Actions are very much at a nascent stage, the 944 OS having gone through the process of the appellate procedure and only just having been ordered to continue as if begun by writ (per paragraph 26 above).

34.  It is unfortunate that the setting down of the Main Actions had been held up by the appeal process in the 944 OS, and then by the applications presently before the Court. It would be even more unfortunate that they should be further held up or delayed to allow time for the consolidation process to run its course.

35.  Second, as mentioned at paragraphs 15 and 24 above, the key complaints or matters raised in the Main Actions and the Subsequent Actions concern different time periods. The options presented to the Court are twofold in this regard.  Either those disputes regarding the events earlier in time could be determined first (in the Main Actions), or everything could be determined in the proposed consolidated action:

(1)  Factually and logically, there should be little dispute that it is necessary to determine the disputes in the Main Actions prior to considering what happened afterwards, since whatever findings there are in that respect will impact on how the Court approaches the issues and the events in the Subsequent Actions.  The only question is whether this should take place separately or whether it ought to be consolidated to be coherently considered.

(2)  This also includes, in particular, consideration of what aspects of the findings against WKW in the Main Actions will flow into and impact the position in the Subsequent Actions.  In this regard, whilst I do not consider the disposal of the Main Actions would (contrary to the Tso’s submissions)  naturally cause the Subsequent Actions to be settled or fall away, there is at least some clear overlap insofar as WKW is concerned. He would be bound by issue estoppel insofar as the “background” to the Subsequent Actions is concerned.  This would then hopefully crystalize or narrow down those aspects of the dispute to be dealt with in the Subsequent Actions.  In this regard, there is some apparent benefit in having the Main Actions heard first.

(3)  Whilst there is a degree of attraction in everything being consolidated and determined together (as to which, see the discussion below on the matters which had given me some pause), on balance, I did not think that this outweighed the overall prejudice to be suffered by the Tso if the matters were to be consolidated.

36.  Third, WKW’s proposal for consolidation entails entirely recasting the pleadings and joining together a total of 27 defendants.  It does not seem to me that such a course of action would save costs at all when the Main Actions are at such a progressed stage:

(1)  Across the two groups of actions, there are 27 defendants in total, the majority of whom are the Dings.  Whilst it is true that many of the Dings have taken no active part in the process to date, at least some of them have filed defences in HCA 1879/2011.

(2)  I also bear in mind that the HCA 802/2019 action includes not only pleas regarding the events pre-dating 2012, but also serious allegations of conspiracy to defraud against quite a number of the Dings (together with WKW and Madam Mok).   As such, one cannot assume that the Dings in HCA 802/2019 can or would necessarily continue to adopt a neutral stance throughout.

(3)  On the other hand, there are no allegations of conspiracy to defraud, dishonest assistance or knowing receipt levelled against the 1879 Dings.  It would similarly be unwieldy, time consuming and costly to have to subject the 1879 Dings to the time and expense of being involved with these subsequent allegations when they do not concern them at all.

(4)  The recasting exercise would thus likely not just involve the limited participation of the Tso, WKW and Madam Mok, but could well entail quite a number of defendants incurring additional time and costs.

(5)  There would, presumably, also need to be further evidence filed to deal with the events subsequent to the matters complained of in the Main Actions.  The events in question concern Madam Mok and the circumstances surrounding the Mok SPA. These matters occurred long after the original breaches complained of and are, by and large, evidentially separate from what is in issue in the Main Actions.  It would similarly not make sense to incur these later costs in a consolidated action involving all 27 defendants.

37.  The above are relatively straightforward and, in the circumstances of this case, what I consider to be rather self-evident points against the proposal for consolidation.

38.  There were, however, two issues which have given me some pause, and which I explored at length with parties during the course of the hearing.

39.  First, I had some concerns over how the relief sought by the Tso in the Main Actions could be maintained in view of the prima facie transfer of the 9 Houses / Lots to Madam Mok as currently reflected on the register.  In essence, I queried whether the specific performance aspects prayed for in the statements of claim in the Main Actions against WKW could be ordered by the Court given the current disputed status of the 9 Houses / Lots.  I also queried what impact this potential difficulty would have on the conduct of the Subsequent Actions, particularly since the relief in HCA 802/2019 is partially premised upon WKW being ordered to specifically perform the Development Agreement (paragraph 22 above).

40.  Second, and relatedly, I queried with Mr Ma what impact and bearing the findings in the Main Actions might have on the issues raised in the Subsequent Actions, and more particularly, whether Madam Mok would be bound by any of the findings.  This query was raised in the context of the argument put forward by the Tso that if the Tso were successful and the Development Agreement were enforceable “it would follow that [Madam] Mok would have no interest in the subject Houses”.  This was further developed by Mr Ma during the hearing that Madam Mok might be bound by res judicata and/or some form of estoppel.

41.  Both of the above issues arise because of the subsequent involvement of Madam Mok, the fact that she is not party to the Main Actions, and the fact that the Main Actions as currently pleaded do not deal with or mention the Mok SPA events at all.

42.  On the first query, Mr Ma impressed upon the Court the submission that the Tso and WKW are the key parties to the dispute surrounding the Development Agreement, and that any orders to be made would be made against WKW personally.  That may well be the case.  However, there remains a concern that the Court will be hesitant to order specific performance when there is an apparent impediment to it being effectively carried out.  The only fallback position for the Tso that I could see from the papers was the fact that the Tso has sought damages in addition to or in lieu of specific performance - an option that is undoubtedly open to the judge if the Tso is in fact successful.

43.  As to the second query, despite Mr Ma’s best efforts to persuade me otherwise, I cannot presently see how Madam Mok, not being party to the Main Actions and indeed not even being a witness to be called in the Main Actions, (i) would herself be bound by the result of the Main Actions; and (ii)  could be compelled to comply with any order made in the Main Actions.  There certainly could not be any res judicata insofar as she is concerned.  And indeed, I do not consider from the evidence before me that there would be issue estoppel vis à vis Madam Mok. At best, one might say that WKW would be bound by the findings in the Main Action, and Madam Mok’s case that could be run would necessarily be limited insofar as she relies on WKW as the key protagonist involved in the execution of the Development Agreement.

44.  I would note that this is not the occasion to pre-judge or finally determine questions of scope of relief, or res judicata or any form of estoppel, issues that are best fully argued and left to the trial judge(s)  who will have full grasp of the facts and evidence.  The pertinent question for the Court is whether on the possibility of there being such limitations if the matters are to proceed separately, it is still nonetheless viable and appropriate in the particular circumstances of this case to allow the Main Actions to proceed without consolidating the actions.

45.  The above queries would be essentially solved, of course, if the matters were consolidated. The issues surrounding the Mok SPA would be determined in addition to those already set out in the Main Actions.  Consequently, the relief to be ordered could be fashioned in a way which takes into account the involvement and position of all actors in this drama.  This would also negate the possibility of there being old ground traversed in the Subsequent Actions, and the danger of there being inconsistent findings by a different court if the Subsequent Actions are heard by a different judge.

46.  I must confess that this has not been an easy decision to weigh, but on balance, I consider that despite the limitations and possible complications that could arise, they do not render it impossible for the Main Actions to proceed first. Whatever potential concerns there are in the circumstances of this case, I consider that such concerns are outweighed by the factors discussed above at paragraphs 32 to 36.

47.  Finally, I note that the Tso had pointed to prior correspondence where WKW himself had suggested that the Main Actions should proceed and HCA 802/2019 should be stayed pending the resolution of the Main Actions.  Various other points had also been made concerning WKW’s deployment of delaying tactics, circumvention of procedural rules concerning pleadings and the like.  These are peripheral points at best.  Certainly, one might observe that WKW has changed his stance and been somewhat intransigent in the case management of the matters thus far.  Indeed, the case management steps taken by all parties to date leave much to be desired.  However, the more relevant question for this Court remains whether it is proper and expedient on the present set of circumstances to order consolidation.  For the reasons above, I consider that it is not.

48.  As such, WKW’s Application is dismissed.

49.  I would note at this juncture that in the course of submissions, Mr Chow had indicated that if WKW’s Application was unsuccessful, there was a possibility of WKW seeking to amend the defence in the Main Actions in order to bring in the subsequent developments relating to the Selection Letter and the Mok SPA.  This Court has not been asked to consider such an application and no draft had been produced at the hearing.  As indicated to the parties at the hearing, it would be incumbent upon WKW to apply and justify such a late amendment if he really considers it necessary and appropriate to bring these matters in via such a channel.

E.  HCA 1006/2017 – STRIKE OUT APPLICATION

50.  The background to the Strike Out Application is found in the decision of Hon Keith Yeung J in [2020] HKCFI 2789, where he found against the Tso in its default judgment application against WKW.  In essence, the judge found that the Writ had not been served on WKW, which meant that its validity had expired.  HCA 1006/2017 is thus an action which no longer concerns WKW. Following Hon Keith Yeung J’s decision, the remaining defendants (the 1006 Dings)  have applied to strike out the action against them.

51.  There is little dispute on the relevant principles for strike out applications. O.18, r.19, RHC states as follows:

“(1)  The Court may, either of its own motion or on application, at anystage of the proceedings order to be struck out or amended any pleading or the indorsement of any writ in the action, or anything in any pleading or in the indorsement, on the ground that - … (L.N. 152 of 2008)

(b)  it is scandalous, frivolous or vexatious; or

(c)  it may prejudice, embarrass or delay the fair trial of the action; or

(d)  it is otherwise an abuse of the process of the court;

and may order the action to be stayed or dismissed or judgment to be entered accordingly, as the case may be.”

52.  I would also gratefully adopt the following trite principles on striking-out as recently summarised by DHCJ Douglas Lam SC in Chan Kai Yan v Leung Chi Kit [2019] HKCFI 1828 at §8 as follows: -

“(1)  Striking out is for plain and obvious cases. The question for the court is whether the allegations as pleaded in the statement of claim disclose some cause of action or raise some question that ought to be tried. It is not concerned with an assessment of the strength or weakness of the case. The mere fact that the case is weak and not likely to succeed is no ground for striking it out. The court would only strike out when it is impossible, and not just improbable, for the case to succeed:§8(1), (emphasis added)

(2)  A reasonable cause of action means a cause of action with some chance of success when only the allegations in the pleading are considered. The court will therefore assume the facts as pleaded in the statement of claim to be proved and determine, on that basis, whether the pleading discloses a reasonable cause of action: §8(2), (emphasis added)

(3)  Where a statement of claim does not disclose the cause of action relied upon but there is reason to believe that the case can be improved by amendment, the court may give an opportunity to amend, even though the formulation of the amendment is not before the court: §8(3).[5]

(4)  A proceeding is frivolous when it is not capable of reasoned argument, without foundation or where it cannot possibly succeed. A proceeding is vexatious where it is oppressive and/or lacks bona fide. To strike out a litigant's claim on the grounds that it is frivolous or vexatious and he has thus abused the process of the court is a serious finding to make, and one would expect the discretion to be sparingly exercised”: §8(4).”

53.  The 1006 Dings rely on the limbs in O.18, r.19(1)(b)  to (d), RHC. As developed by Ms Cheng at the hearing, the arguments are in essence:

(1)  To maintain HCA 1006/2017 would be an abuse of process considering the great degree of overlap with HCA 802/2019 (the pleadings are largely similar, save that HCA 802/2019 adds the matters concerning Madam Mok and the Mok SPA)  (citing inter alia Lam Pak Cheung v Lin Zhen Lue [2009] 1 HKLRD 35 at §§37-58).

(2)  HCA 1006/2017 is frivolous and/or vexatious because it discloses no independent cause of action against the 1006 Dings in the absence of WKW being a party, and the action is bound to fail.

(3)  Relatedly, it is suggested that the absence of WKW would prejudice, embarrass or delay the fair trial of the matter given the centrality of his role as set out in the pleading and the fact that he would not be a party to the eventual trial.

54.  In answer, the Tso refers to the following matters:

(1)  It was rational and reasonable for HCA 802/2019 to have been taken out, as they had not discovered or been made aware of the events concerning Madam Mok and the Mok SPA until after HCA 1006/2017 was commenced. Given their case is that the Mok SPA was a sham created after the date of initiation of HCA 1006/2017, this was not something which could have properly been amended or pleaded into the earlier case.

(2)  It is, however, necessary to maintain HCA 1006/2017 given the registration on the land register as a “protective writ” in relation to the 1006 Dings.

(3)  There were and are thus sensible reasons for bringing successive actions and advancing both the claims in HCA 1006/2017 and HCA 802/2019 (citing Yifung Developments Ltd v Liu Chi Keung Ricky & Ors, HCA 3020/2015, unreported judgment dated 29 August 2016 at §§36-43; as applied in Cheung Ping Sum v Wong Chi Hang [2018] HKCFI 70 at §§21-26).

55.  I accept the Tso’s submission that the initiation of HCA 802/2019 was necessary in light of the developments as to the Mok SPA and the events which transpired after HCA 1006/2017 had been initiated.  They could not have known or anticipated the subsequent developments as at the date of initiation of HCA 1006/2017.  I do note, however, that there is a great degree of overlap in the two actions, and further, it makes much more sense for HCA 802/2019 to proceed given WKW is still a party to the later action.  As such, it would be prudent to stay HCA 1006/2017 as there is no purpose in maintaining the actions in tandem.  A stay rather than a striking out is more appropriate given the writ has been registered in the Land Registry.

56.  There were also two other points made by the Tso:

(1)  First that there had been a breach of Practice Direction 19.1 by the 1006 Dings in that they had not spelt out the grounds upon which they relied for striking out at least 5 clear working days before the hearing. In this regard, Ms Cheng referred me to correspondence dated 31 August 2021 from those instructing her where there was reference to HCA 802/2019 “render[ing] [HCA 1006/2017] unnecessary.  It would be a waste of costs and Court’s time, and thus, an abuse of process to let [HCA 1006/2017] hang in the air any longer” and thus proposing the option of strike out (or alternatively staying HCA 1006/2017).

(2)  Second that the Tso had indicated in the affirmation evidence filed on 13 December 2021 that HCA 1006/2017 should be stayed, but that this proposal was not taken up by the 1006 Dings.

57.  The above are not dispositive points, but will have some bearing on costs.  Suffice to say that:

(1)  I consider that whilst the pre-action correspondence was not particularly detailed, in the circumstances of this strike out where the primary complaint is abuse of process, the broad reasons previously given suffice to comply with Practice Direction 19.1.

(2)  As I had observed at the hearing, despite the indications from both sides suggesting the possibility of staying HCA 1006/2017, it would appear neither side followed up after the filing of evidence by the Tso in December 2021.  The matter then proceeded to the present hearing where both sides argued on the strike out in addition to stay.

58.  In the circumstances, HCA 1006/2017 is ordered to be stayed.

F.  CONSOLIDATION – MADAM MOK’S APPLICATION

59.  This aspect is relatively less controversial.  I consider it right and appropriate that the Subsequent Actions should be consolidated.  They concern aspects of the same events (mainly centering around the Mok SPA), and involve overlapping parties.  Given both actions are at a nascent stage, and the fact that the 944 OS has already been ordered to continue as if begun by writ, it makes sense that the two matters should be consolidated.

60.  Accordingly, I give the directions that:

(1)  The two sets of proceedings, namely HCA 802/2019 and the 944 OS, be consolidated, with HCA 802/2019 as the lead action (“the Consolidated Action”).

(2)  Madam Mok’s claim in the 944 OS shall continue as per Paragraphs 3 and 4 of the Order of the Court of Appeal dated 14 May 2021 in the 944 OS, as a counterclaim in the Consolidated Action.

(3)  The Tso, as the plaintiff in the Consolidated Action, do file and serve its Consolidated Statement of Claim within 42 days of the date of this Order.

(4)  The Defendants in the Consolidated Action do file and serve their respective Consolidated Defence(s)  (and Counterclaim(s), if any)  within 42 days therafter.

(5)  The Plaintiff in the Consolidated Action do file and serve its Consolidated Reply(ies)  (and Defence(s)  to Counterclaim, if any)  within 28 days thereafter.

(6)  There be liberty to apply.

61.  As part of the proposals by the parties, it had been suggested that the Subsequent Actions ought to be stayed pending the determination of the Main Actions. (As indicated above, WKW had previously suggested this but resiled from it by the time of the hearing, instead preferring the option of global consolidation; conversely, the Tso had put forward a suggestion for stay at the hearing).

62.  Having considered matters in the round, I do not consider it appropriate to stay the Subsequent Actions.  This is for the following reasons:

(1)  Assuming the Main Actions are not further held up by any other interlocutory applications, they should proceed to setting down. Given the complexity of the issues involved, one can assume that the trial date eventually fixed will not be for some time, being at least months if not over a year away.

(2)  If the Subsequent Actions were to be stayed at such a nascent stage, by the time the Main Actions are determined (and perhaps any appeal processes are dealt with), it will likely be years before the Subsequent Actions are restarted. To only then go through the exercise of preparing pleadings, witness statements and the like, will not be conducive to parties recalling the relevant events and being able to give coherent instructions. It is better that these steps leading towards trial are taken sooner rather than later.

(3)  Further, there is a possibility that if the parties are diligent in their case management, the Subsequent Actions will be able to ‘catch up’ somewhat in timetabling to the Main Actions.  It would be far better for this suite of disputes to be dealt with efficiently and closer in time than for there to be yet further years where the remainder of the disputes are left languishing in abeyance.

(4)  Despite the Tso’s optimism, it is not necessarily the case that the Subsequent Actions will fall away or be settled upon the conclusion of the Main Actions. Certainly if WKW’s defence succeeds in the Main Actions, then such an outcome is more likely.  However, if the Tso succeeds, then one would presume that they would wish to further pursue the reliefs sought in the Subsequent Actions (paragraph 22 above).  In order to do so, they would need to establish the causes of action specifically pleaded in HCA 802/2019 as those matters would not have been dealt with in the Main Actions.

(5)  Considering matters in the round, and bearing in mind one cannot presume that WKW would be successful in his defence in the Main Actions, it is better that the parties press ahead with the Subsequent Actions.

63.  In the circumstances, the Subsequent Actions will be consolidated per the directions above, and will not be stayed.

G.  COSTS

64.  As there are quite a few different aspects and considerations to deal with, parties are directed to fix a date (in consultation with counsel’s diaries)  for a 1 hour hearing to address the Court on costs. Submissions, no longer than 5 pages, are to be filed 7 days prior to the hearing.

65.  I thank counsel for their assistance.

Mr Billy Ma instructed by Messrs Hong Lee & Co for the Plaintiff in HCA 1879/2011, HCA 896/2012, HCA 897/2012, HCA 802/2019 & HCA 1006/2017 and the Defendant in HCMP 944/2018

Mr Ho Hin Chow Tony instructed by Messrs Cheung, Chan & Chung for the 1^st Defendant in HCA 1006/2017, HCA 1879/2011, HCA 896/2012, 897/2012 & HCA 802/2019

Ms Evelyn Cheng instructed by Messrs S H Chou & Co for the 2^nd - 12^th Defendants in HCA 1006/2017, the 2^nd Defendant in HCA 896/2012 and the 2^nd - 13^th Defendants in HCA 802/2019 & HCA 1879/2011

Mr Raymond Tsang instructed by Messrs K B Chau & Co for the 14^th Defendant in HCA 802/2019 and the Plaintiff in HCMP 944/2018

HCA 1006/2017

[2020] HKCFI 2789

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1006 OF 2017

______________

BETWEEN

______________

______________

DECISION

______________

1.  This is the application by the plaintiff (“P”) by Summons of 12 March 2020 (the “Summons”) for default judgment against all the defendants (“D1” to “D12”, and collectively “Ds”).

2.  The issues are whether service of the Writ herein has been validly effected, and whether, given the history of the disputes between the parties and the nature of the relief sought (which include Declarations), this is in any event an appropriate case for default judgment to be granted.

3.  Mr Kenneth C L Chan together with Mr Billy Ma appear for P.  Mr Tony Chow appears for D1.  Ms Evelyn Cheng appears for D2 to D12.

The parties

4.  P is the Manager of Lau Shau Wo Tso (the “Tso”), a tso within the meaning of s 15 of the New Territories Ordinance, Cap 97.  It owns land in the New Territories.

5.  D1 is a developer.

6.  D2 to D12 are indigenous villagers, or dings.

Background facts

7.  The disputes concern the development of ding houses in the New Territories.

8.  Back in 1994, P as manager on behalf of the Tso entered into a development agreement with D1 (the “Development Agreement”)[1]. Under the same, development and construction of small village houses were contemplated.  The Tso would provide land, whilst D1 would be responsible for procuring dings (D2 to D12 being some of the dings subsequently procured), assigning the land to the dings, making the relevant applications to the government, and the building and construction of small houses.  The completed houses would be split amongst the Tso and D1 in the ratio of 40:60, and would be selected by the Tso and D1 following an agreed selection mechanism (the “Selection Mechanism”).

9.  Ultimately, 17 ting houses have been built.  6 were allocated to the Tso in 2011 (the “6 Houses”).  The other 11 have been called the “11 Unallocated Houses” or the “Other 11 Unallocated Houses”, and the lots of land on which there were build the “Other Unallocated Building Lots”, which terms I adopt as appropriate.

10.  On the bases of the agreed 40:60 split and Selection Mechanism, the Tso should arithmetically be allocated 6.8 houses.  P says therefore that despite the allocation of the 6 Houses, the Tso still have some interest over the Other 11 Unallocated Houses.  

11.  Disputes eventually arose between the parties.  They have resulted in no less than 3 sets of proceedings before the High Court.  They are as follows.

The Main Actions

12.  In late 2011 and early 2012, P commenced HCA 1879/2011 (the “2011 Action”, and the Writ thereof the “2011 Writ”), HCA 896/2012 and HCA 897/2012 (collectively the “Main Actions”) against D1 and some dings (not any of D2 to D12 in the present case).  His claims are for, and as summarized by Mr Chan[2], inter alia:

(a) D1’s breaches and delay etc in the Development Agreement (and hence the Tso’s loss of use / rental income etc);

(b) D1’s misrepresentations (which misled P into selecting the 6 Houses, which P says are the most inferior ones);

(c) Specific performance against D1 to select his 9 houses out of the 11 Unallocated Houses, and to assign and transfer to the Tso its interest in 0.8 houses (ie 40% interest of and in 2 of the 11 Unallocated Houses) (§(6) of the prayer)[3];

(d) the return and assignment of the substantial unused parts of the Tso’s lots, and declaration of certain grant of easement;

(e) a Declaration that P is “entitled to 2/11 shares on the other Unallocated Building Lots and houses erected thereon and an order that there be charge in favour of [P] of 2/11 shares on theother Unallocated Building Lots and houses erected thereon” (§(7) of the prayer);

(f) a Declaration that “each of the 2^nd to 13^th Defendants respectively holds D2’s to D13’s Lots on trust for the Tso” (§(10) of the prayer).

13.  In each of those 3 Actions, a Defence and Counterclaim has been filed.  Specifically in the 2011 Action, D1 seeks:

(a) a declaration that inter alia the Development Agreement is “unlawful, illegal, contrary to public policies and hence unenforceable and void”;

(b) an injunction restraining P from executing, performing or carrying out inter alia the Development Agreement;

(c) a declaration that P is estopped from alleging any breach of the Development Agreement on the basis of D1’s delay in its performance; and

(d) a declaration that the Tso is estopped from asserting any interest in the 11 Unallocated Houses.

14.  The Main Actions have been ordered to be heard together[4]. They have not yet been set down to be tried.  Both sides are blaming the other side for that.  The next Case Management Summons is scheduled to take place on 22 December 2020[5].

HCA 1006/2017 (“Present Action”)

15.  Then, on 26 April 2017, P took out the Writ herein (the “2017 Writ”) and commenced the Present Action against D1 and 11 other dings (ie D2 to D12).  Those 11 other dings were, until a sale in favor of D1’s wife by 9 of them in April 2017 in circumstances very much in dispute, the registered owners of the 11 Unallocated Houses.

16.  The 2017 Writ is indorsed with a Statement of Claim bearing the same date (the “2017 SOC”):

(a) In the 2017 SOC, P pleads primarily the same facts relied upon by P in the 2011 Action;

(b) At §54 and 55 thereof, P pleads:

“ 54. By reason(s) of [D1’s] above breach(es) / wrongdoings, [P] issued the [2011 Action] on 3 November 2011 against inter alia [D1] (and other villagers who held the land on trust for [P]) for inter alia the breach(es) of the Development Agreement, the 1st Allocation Agreement, the 2^nd Allocation Agreement, misrepresentation, breach of trust etc., and claim against them for specific performance(s), and for all loss and damage arising thereof, etc.

55. [P] shall apply to the Court for leave to set the case down for trial in respect of the [2011 Action] in due course.”

(c) At §60, P pleads that D2 to D12 held the 11 Unallocated Houses “as nominee and/or agent of [D1]… for the purpose of the Development Agreement”, and that “[D1] had and still has full control and possession of all the Other 11 Unallocated Building Lots (and the 11 houses erected thereon)”;

(d) P then pleads, at §61, that by reason of the forgoing, D2 to D12 held the legal titles of the 11 Other Unallocated Building Lots (together with the Other 11 Unallocated Houses thereon) on resulting and/or constructive trust for P and D1;

(e) P seeks a variety of relief, that:

(i) Against D1:

“ (a.) An Order that [D1] on his capacity (as the principal of [D2] to [D12]) do procure the assignment and transfer to [P] / Tso of the 40% interest and benefit of and in the 2 Remaining Houses on, and of and in, the 2 Remaining Building Lots free from encumbrances;

(b.) Damages for the loss of use of the 40% interest and benefit of and in the 2 Remaining Houses …

(c.) An account of any benefits and/or profit(s) derived from the 2 Remaining Houses … and an Order that [D1] do pay to [P] the profits(s) …

(d.) Pending the due execution of the aforesaid assignment and transfer to [P] / Tso:

(i) [D1] must not … sell and/or dispose of any of the Other 11 Unallocated Houses …

(ii) [D1] must not …create … encumbrance(es), which may affect the title(s) of the Other 11 Unallocated Houses …

…”

(ii) Against D2 to D12:

“ (f.) A Declaration that [D2] to [D12] are respectively holding the legal titles of the Other 11 Unallocated Building Lots (together with the Other 11 Unallocated Houses thereon) … on resulting and/or constructive trust for [P] and [D1] (on the proportion of 40% of 2/11 share (for [P]) and 9/11 plus 60% of 2/11 share (for [D1]);

(g.) An Order that [D2] to [D12] do assign and transfer … the 40% interest and benefit of and in the 2 Remaining Houses on the 2 Remaining Building Lots to [P]. i.e. the 40% interest and benefit of and in 2 out of the Other 11 Unallocated Building Lots (and the houses erected thereon);

(h.) [D2] to [D12] do assign and transfer … the 60% interest and benefit of and in the 2 Remaining Houses on the 2 Remaining Building Lots, and the 9/11 interest and benefit of and in 9 out of all the Other 11 Unallocated Building Lots (and the houses erected thereon), to [D1];

(i.) Pending the execution of the aforesaid assignment and transfer to [P]:

(i) [P] is entitled to 40% of the 2/11 shares on all the Other 11 Unallocated Building Lots (and the 11 houses erected thereon);

(ii) [P] is entitled to a charge and/or lien over all the Other 11 Unallocated Building Lots (and the 11 houses erected thereon) for his proprietary interest of 40% of the 2/11 shares thereof;

(iii) [D1] must not …cause to be sold and/or disposed of any of the Other 11 Unallocated Houses on, and, the Other 11 Unallocated Building Lots;

(iv) D1 must not … create or take any step to create encumbrance(es), which may affect the title(s) of the Other 11 Unallocated Houses on, and, the Other 11 Unallocated Building Lots;

(v) [D2] to [D12] must not … sell and/or dispose of the Other 11 Unallocated Houses on, and, the Other 11 Unallocated Building Lots;

(j.) Further or alternatively, [P] is entitled to 40% interest and benefit of and in the 2 Remaining Houses on, and of and in, the 2 Remaining Building Lots free from encumbrances; and [P] is entitled to select the same from the Other 11 Unallocated Houses on the Other 11 Unallocated Building Lots;”

(f) I set out the prayer in the 2017 SOC nearly in full because those variety forms of relief are what P is now seeking default judgment for.

HCA 802/2019 (“The 2019 Action”)

17.  By letter of 12 February 2018 (the “12/2/2018 Letter”) from Messrs Cheung, Chan & Chung (“CCC”, solicitors for D1) to Messrs Hong Lee & Co (“HL&Co”, solicitors for P), D1:

(a) referred to the Main Actions;

(b) selected 9 ding houses out of the Other 11 Unallocated Houses (the “9 Selected Houses”);

(c) indicated that after the selection, he agreed to share with P the interest and benefit of the remaining 2 houses;

(d) said at the last paragraph that “For the avoidance of doubt, nothing herein contained shall prejudice to [D1’s] Amended Defence Counterclaim filed herein”.

18.  According to the land search records, D2 and D5 to D12 each entered into a sale and purchase agreement dated 21 April 2017 selling the 9 Selected Houses to D1’s wife (the “Sales of the 9 Houses”) (and that was the sales I have mentioned in §15 above).  The related assignments were effected on 6 July 2017. 

19.  On 7 May 2019, P commenced HCA 802/2019 (ie the 2019 Action). As can be gleaned from the Statement of Claim indorsed on the Writ:

(a) P is again the only plaintiff;

(b) D1 to D12 are the same as those in the Present Action.  D14 is D1’s wife;

(c) P relies on the matters pleaded in the Main Actions;

(d) P relies on the matters pleaded in the Present Action;

(e) P refers to the Sales of the 9 Houses and claims inter alia that the related agreements had been backdated, and that the 9 assignments were “in fact a ‘sham’ and/or only ‘fraudulent transactions’ ”[6];

(f) P refers to the 12/2/2018 Letter and claims that “the purported ‘selection’ under the [12/2/2018 Letter] is false, fraudulent, not bona fide, and/or does not amount to a valid or binding selection under the Development Agreement…”[7];

(g) P pleads against D1, D2, D5 to D12 and D14 the causes of action of conspiracy to defraud, dishonest assistance, and knowing receipt;

(h) at §(25) of the prayer, P seeks that “there be an Order for   consolidation of this action and the HCA 1006 of 2017 proceedings …”.

Whether service of the 2017 Writ on D1 valid

20.  I consider now whether the service of the 2017 Writ on D1 is a valid one.  I will consider the validity of the service upon D2 to D12 separately.

21.  The relevant affirmation of service is that of Mr Lee Siu Hong (“Mr Lee”) filed on 20 January 2020 (“Lee/Aff#1”).   Mr Lee is the sole proprietor of HL&Co.

22.  According to Mr Lee:

(a) at §3 of Lee/Aff#1, the 2017 Writ was on 28 April 2017 via registered post served upon D1 at an address at Tai Po Tsai Village[8] (which Mr Lee calls “D1 Address”) under the cover of a letter dated 28 April 2017 (the “Covering Letter”);

(b) at §§4 and 5 of Lee/Aff#1:

“ 4. D1 Address was the last known address of [D1] used in the [2011 Action] in which [P] is the plaintiff and [D1] is the first named defendant who is represented therein as herein by [CCC]. [D1] never gave any notice of change of address in [the 2011 Action].

5. D1 Address was [D1’s] address and was, as such, the last address of [D1] known to [P] for the purposes of service of the [2017 Writ] on [D1]. A letter written by [CCC] to the Post Office dated 20^th September 2018 described hereinbelow effectively confirmed this. Whether or not [D1] was using D1 Address as his permanent residence at the time is of no significance.” (emphasis added)

23.  Mr Lee has not clarified what he meant by saying in §4 of Lee/Aff#1 that D1 Address was D1’s last known address “used in” the 2011 Action.

24.  At §15(2) of his written submissions, Mr Chan, with reference to §4 of Lee/Aff#1, submits that:

“ [D1’s] last known (‘D1 Address’) was extracted from and used by him in the earlier [2011 Action], and he never gave any notice of change of address in the 2011 Action …” (emphasis added)

25.  Mr Chan has not clarified in his written submissions as to what he meant by the words “used by him”.

26.  In the course of the hearing, I sought clarifications from Mr Chan on the above.  Having taken further instructions, Mr Chan confirmed that by saying at §4 of Lee/Aff#1 that D1 Address was “the last known address of [D1] used in” the 2011 Action, Mr Lee meant merely that D1 Address was the address which P (or his solicitors) put down in the 2011 Writ as D1’s address. 

27.  The fact that D1 Address was put down by P (or his solicitors) on the 2011 Writ as being D1’s address constitutes little proof that D1 Address was in fact D1’s usual or last known address for the purpose of effecting service of the 2017 Writ.  There is no evidence before me that P (or his solicitors) was, back in 2011, correct in adopting D1 Address as D1’s address on the 2011 Writ. The basis of P’s case in this regard is circular.

28.  The above should also be read and understood in the context of D1’s unopposed evidence that service of the 2011 Writ was not effected upon him at D1 Address, but was accepted by his solicitors on his behalf.  At §28[9] of affirmation in opposition (“D1/Aff”), reciting §§8-10 of his earlier affirmation filed in HCMP 944/2018, D1 says that:

“ 8. First of all, I say definitely that up to the date I have never received the Covering Letter (let alone any enclosures therewith).

9. By the time the [2017 Writ] was issued by [P] viz 26^th April 2017, I no longer lived at the [D1 Address].

10. The fact that [D1 Address] was extracted from the Amended Writ in the 2011 Action in neither here nor there.  TPY never served on me any sealed copy of the Writ in the 2011 Action.  Nor did TPY ever serve on me any sealed copy of the Amended Writ in the 2011 Action.  It was only after Norman Yeung replacing TPY (as solicitors on the record acting for [P] in the 2011 Action) that Norman Yeung then proceeded to serve the Amended Writ in the 2011 Action on me, not at [D1 Address] but through my solicitors CCC accepting service on my behalf.”

29.  There is further evidence that the Covering Letter (together with the enclosures) sent to D1 Address had in fact not been claimed by the addressee, but was sent to the Dead Letter Office and subsequently destroyed[10]:

(a) By letter of 20 September 2018, CCC on behalf of D1 wrote to the Postmaster General and made enquiry as to whether the delivery of the Covering Letter had been successful;

(b) I add that that was the letter which Mr Lee says (at §5 of Lee/Aff#1) “effectively confirmed” that D1 Address was D1’s last known address.  I do not see how that letter has confirmed that;

(c) By letter of 24 September 2018 (the “Postmaster General’s Reply”), the Postmaster General replied and said that:

“ According to our records, delivery of the item was attempted on 2 May 2017 without success. The addressee was notified to collect the item at Ngau Chi Wan Post office. However, the item was not collected within the retention period and was subsequently returned to Sender due to the reason of ‘unclaimed’ on 20 May 2017.

As per our normal procedure, if there is sender address on the item, it would be returned to sender.  If not, it would be transferred to our Dead Letter Office. The Item was sent to the Dead Letter Office on 24 May 2018 and it was disposed of on 12 February 2018.”

(d) The contents of the Postmaster General’s Reply have raised one further issue;

(e) At §10 of Lee/Aff#1, Mr Lee says:

“ To the best of my knowledge, information and belief, the envelopes each containing the Writ Documents addressed to [D1] to [D12] have not been returned through the dead letter post.”

(f) According to the Postmaster General’s Reply, if there is sender address on an item which cannot be delivered, the normal procedure is that the item would be returned to the sender;

(g) The fact that the parcel addressed to D1 Address was sent to the Dead Letter Office suggests that there was no sender address on it;

(h) If that is indeed the case, one queries why HL&Co did not put down any sender address on the parcel.  If there was indeed no sender address on it, one queries further the value of the statement that the 2017 Writ (and the related documents) have not been returned through the dead letter post to HL&CO;

(i) In the course of the hearing, I seek clarification from Mr Chan as to whether there was any sender address on the parcel addressed to D1 Address. I did not receive any confirmation either way.

30.  I note further these matters.  At the time when the Present Action was commenced, P and D1 were and had been litigating over the Main Actions in relation to the same subject matter.  D1 was represented.  P himself pleads in the 2017 Writ that it would apply to set down the 2011 Action for trial.  The Main Actions and the Present Action arose from largely common facts.  There is no evidence before me as to what D1 would have to gain by ignoring service of the 2017 Writ.  I note further that P had made no attempt to approach CCC to ascertain whether they were prepared to accept service of the 2017 Writ on behalf of D1. 

31.  In conclusion, there is no evidence before me that D1 Address was D1’s usual and last known address for effecting service of the 2017 Writ.  I have no reason not to accept D1’s evidence that at the material time, he was no longer living there, and that he did not receive the 2017 Writ.

32.  Mr Chan submits that D1 must have had knowledge of the Present Action.  But given the bad mode of service, any knowledge which D1 might subsequently have on the Present Action would not in my view render the service good and effective.  Mr Chan has not produced any authority in support of that possibility.

33.  For the reasons set out above, I rule that the attempted service of the 2017 Writ on D1 was bad.

Whether service of the 2017 Writ on D2 to D12 valid

34.  I next consider whether the service of the 2017 Writ on D2 to D12 was valid.

35.  As I have summarized above, D2 to D12 were, until the Sales of the 9 Houses by 9 of them in April 2017, the registered owners of the 11 Unallocated Houses.

36.  According to Mr Lee[11], the 2017 Writ was served on each of D2 to D12 at the relevant lots which they held.

37.  I have considered the scheme under the Development Agreement.  Each of D2 to D12 was only the ding procured by D1 for the purpose of development. Whilst they had been assigned the relevant lots, that was again done for the purpose of the Development Agreement.  There is otherwise no evidence that they lived in or occupy the lots.  The likelihood is that they did not.  

38.  I however accept Mr Chan’s legal submissions[12] on the meaning of “address”, citing Hong Kong Civil Procedure 2021, Vol 1 at §10/1/12, that:

“ … The word ‘address’ is not confined exclusively to a person’s residence. The essence is a location where the person may be reached or where contact or communication in written form, such as by letter, could be established. (AIA International Ltd v Cheng Chung Sing (unrep., DCCJ 804/2016, [2017] HKEC 1011 ); Hou Tsun Tat v Wong Wai Chung (unrep., DCPI 96, 439 & 476/2015, [2017] HKEC 2348))…”

39.  I note also that in respect of D2 and D5 to D12, in the Stamping Request forms dated 11 May 2017[13] submitted to the IRD, the addresses at which the 2017 Writ was served upon them were described as their postal addresses.

40.  I regard also as important that none of D2 to D12 has filed any evidence disputing the validity of the service.

41.  On balance, I accept that the service of the 2017 Writ on D2 to D12 was valid.

Exercise of discretion

42.  As the 2017 Writ contains claims not mentioned in Order 13, rules 1 to 4 and Order 19, rules 2 to 5, the present application is governed by Order 19, rule 7(1).  Under that rule:

“ … the plaintiff may, after the expiration of the period fixed by or under these rules for service of the defence, apply to the Court for judgment, and on the hearing of the application the Court shall give such judgment as the plaintiff appears entitled to on his statement of claim.”

43.  The parties accept, and it is clearly correct in my view, that whilst Order 19 rule 7(1) uses the words “the Court shall”, “the rule is not mandatory but discretionary, and the court retains its discretionary power whether to give judgment …” — see Hong Kong Civil Procedure 2021, Vol 1, paragraph 19/7/13.  It is further stated at paragraph 15/16/2 that:

“ The power to make binding declaration of right is a discretionary power ... A declaration can only be made after proper argument and cannot be made merely on admissions by the parties whether in pleadings or otherwise ... nor in default of compliance with rules of court.”

Similarly, it is stated at paragraph 19/7/20 that:

“ It is not the normal practice of the court to make a declaration without a trial, particularly where the declaration is that the defendant in default of defence has acted fraudulently …”

44.  On the other hand, as has been explained at paragraph 15/16/2 of Hong Kong Civil Procedure 2021, Vol 1:

“ ...the rule of the court that a declaration will not be granted when giving judgment by consent or in default without a trial is a rule of practice and not of law and will give way to the paramount duty of the court to do the fullest justice to the plaintiff to which he is entitled; …” (See also to the same effect paragraph 19/7/20.)

45.  Mr Chan further accepts, and in my view also correct, that whilst the consideration of the Court is confined to what a plaintiff appears entitled to “on his statement of claim” so that the Court cannot receive any evidence on merits, the Court may receive evidence on otherwise how the court should exercise its discretion, and this is particularly so when declaratory relief is involved — and see Fung Shek Wa v Chang Lai Yue, unrep, HCA 2258/2013 (18 September 2014).

46.  I point out first of all the obvious, that P is seeking, amongst other forms of relief, binding declarations on legal rights and titles over land.  I have set out above the prayer pleaded in the 2017 SOC.

47.  The discretion of this Court engaged.

48.  Mr Chan highlights at §32 of his written submissions that the practice of the court not granting declaratory relief on default may be departed from in order to do fullest justice to P.  He then submits at §33 that:

“ P submits that the Tso is entitled to the relief sought under the [2017 SOC]. It is the common ground (or at least challenged [sic] (unchallenged?) evidence that the subject houses at all material times have been rented out for incomes, and the declaration sought under the [2017 SOC] is necessary for P to seek damages for the loss of the TSO’s interest and benefit of and in the TSO’s entitlement out of the said houses and the building lots over the years, and the account of any benefit and/or profits derived thereunder.”

49.  In my view, whilst those reasons may explain why P is seeking declaratory relief, they do not even start to justify why any such relief should be granted at this stage in default. 

50.  On the other hand, there are in my view overwhelming reasons why the default judgment sought should not in the exercise of this Court’s discretion be granted.

51.  The Main Actions are still on foot.  The Main Actions and the Present Action arose out of primarily the same set of facts.

52.  Some forms of the relief sought in the Main Actions and the Present Action overlap — see eg §6 of the prayer in the 2011 Writ and §(a.) of the prayer in the 2017 SOC. 

53.  In the Main Actions, the legality and hence enforceability of the Development Agreement is challenged.  It is D1’s case that it is unenforceable and void.  It is a fundamental challenge.  In addition, various estoppels against P have also been raised.

54.  P is seeking in the Present Action declaratory relief in default on a set of facts which is subject to fundamental challenges in the Main Actions to be tried. 

55.  The grave concern is that, if this Court were to grant any judgment and any binding declaration of rights in default at this stage, the basis upon which this Court does so might ultimately be found to be inconsistent with the conclusions which another Court reaches after trial of the Main Actions.

56.  In particular, there is a risk that the Development Agreement (which would necessarily form the basis of any judgment which this Court might grant at this stage in default) could be found after trial of the Main Actions to be an illegal one.

57.  The risk is a real one, and is one impossible to gauge because this Court, when considering the Summons, is required by law to consider on merits only what P appears entitled to “on his statement of claim”.

58.  As P has himself said at §24 of his affirmation filed in support of the Summons (and repeated at §63 as he thinks it is important):

“ The Development Agreement is the cornerstone of every dispute, every litigation and every registration of document in the Land Registry flowing therefrom. Thus, the [Main Actions] are the only forum and jurisdiction where issues of the Development Agreement can properly and legally be determined. The final judicial determination of the Development Agreement is the authority on which matters peripheral to the Development Agreement can be legally settled. It is thus essential that the [Main Actions], as mother of all actions, be set down for trial as soon as possible.”

59.  Yet, whilst the Main Actions are still on foot, and when there has not yet been any judicial determination of the Development Agreement, P is seeking default judgment under the Present Action.

60.  In the above regard, Mr Chan submits that by making the selection pursuant to the 12/2/2018 Letter, D1 has been barred from running the illegality defence.

61.  I do not accept that submissions.  In the 12/2/2018 Letter, it was specifically said that nothing therein “shall prejudice [D1’s] Amended Defence Counterclaim filed herein”.

62.  The bottom line is this.  Mr Chan’s contention that D1 has been barred from running the illegality defence could be found upon trial of the Main Actions to be correct.  That however is only something which the trial judge after trial can decide.  It is impossible for this Court in the course of an application for default judgment to so conclude.

63.  I note further that as part of the relief sought in the Present Action, P is seeking an account.  Ds would be obliged to undertake the exercise, and effect the profits found due immediately if this Court were to grant any default judgement.  That would in my view be clearly undesirable when the Main Actions have not been tried.

64.  There is further no urgency in P getting any judgment.  Service of the 2017 Writ was effected (or attempted to be effected) in April or early May 2017. The present Summons was only taken out almost 3 years later in March this year.

65.  For the reasons set out above:

(a) in the case of D2 to D12, despite my finding that the service of the 2017 Writ on them was valid, I refuse in the exercise of my discretion to grant the default judgment sought; and

(b) in the case of D1, even if I had found the service of the 2017 Writ on him to be valid, I would still in the exercise of my discretion have refused the Summons.

Disposition

66.  For the reasons set out above, I dismiss the Summons.

HCMP 944/2018

67.  I record that Mr Chow has made reference to the Decision Madam Recorder Linda Chan (as Her Ladyship then was) handed down on 28 June 2019 in HCMP 944/2018.  Mr Chow submits that as a result of certain findings made therein by the learned Recorder, P is precluded by the doctrine of issue estoppel to argue some of the points which Mr Chan has taken in the present application on P’s behalf.

68.  Mr Chow has confirmed that it is not his position that the doctrine of issue estoppel would prelude this Court from considering the question of service afresh.  In the end, I have reached my decisions above independent of the learned Recorder’s Decision.  The question of issue estoppel does not arise.

Costs

69.  I make a costs order nisi that P should bear the costs of the Summons, to be assessed summarily.  Ds are to lodge their statements of costs within 7 days of the date hereof, and P to lodge his objections within 7 days of receipt.  Any party who seeks any variation of the costs order nisi may also lodge submissions within 7 days from the date hereof, submissions in response within 7 days of receipt, and reply within 7 further days.  Both the summary assessment and any application for variation will be disposed of on the papers.

Mr Kenneth C L Chan and Mr Billy N P Ma, instructed by Hong Lee & Co, for the Plaintiff

Mr Tony H H Chow, instructed by Cheung, Chan & Chung, for the 1^st Defendant

Ms Evelyn L C Cheng, instructed by S H Chou & Co, for the 2^nd to 12^th Defendants