Case Detail

HCA 1929/2017 &
HCA 1069/2018

[2021] HKCFI 3028

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1929 OF 2017

____________

BETWEEN
	TACHING PETROLEUM COMPANY, LIMITED	Plaintiff
and
	MEYER ALUMINIUM LIMITED	Defendant
____________

AND

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1069 OF 2018

____________
BETWEEN
	SHELL HONG KONG LIMITED	Plaintiff
and
	MEYER ALUMINIUM LIMITED	Defendant
____________
	(Heard Together)

Before: Hon Au-Yeung J in Court

Dates of Hearing: 27-30 July, 2, 3 and 9 August 2021

Date of Judgment: 12 October 2021

_______________

J U D G M E N T

_______________

1. This is a claim for payment for goods sold and delivered with a defence under competition law.

2. Taching and Shell were both suppliers of industrial diesel to Meyer. By these 2 actions, Taching and Shell respectively claim against Meyer for costs of industrial diesel sold and delivered in the sum of HK$4,435,150 and HK$2,287,811.45 respectively.

3. There is no dispute about the sale and delivery. Meyer’s sole defence is based on the allegation that Taching and Shell had contravened the First Conduct Rule by agreeing/engaging in a concerted practice to fix price or exchange of price information (“Alleged Contravention”). Meyer contends that:

(1) The “relevant agreement” pursuant to which Taching and Shell have respectively supplied the industrial diesel between 1 April and 5 June 2017 (in respect of Taching) and between 5 April and 4 July 2017 (in respect of Shell) were tainted with illegality and unenforceable against Meyer; and
(2) Meyer is entitled to set off the damages it has suffered as a result of the Alleged Contravention to extinguish its liability to Taching and Shell for the outstanding price.

4. Meyer’s pleaded case on the Alleged Contravention was evidenced by and/or inferred from 2 factors only:

(1) There were 118 Pairs of corresponding Price Adjustment Notices issued by Taching and Shell respectively, between January 2011 and June 2017 (“Relevant Period”). Those 118 pairs of List Price Adjustment Notices made the same adjustments to the List Price of industrial diesel.
(2) The adjustments of List Price specified in the 118 Pairs of Price Adjustment Notices were not public information and the striking uniformity in such changes could not be explained by mere coincidence.

5. Based on these 2 factors alone, Meyer claims that the only reasonable inference for the uniformity in the 118 Pairs of Price Adjustment Notices is that it was the result of anti-competitive collusion between Taching and Shell.

6. The Alleged Contravention has been transferred to the Competition Tribunal pursuant to section 113(3) of the Competition Ordinance, Cap 619 (“the Ordinance”) for determination as a preliminary issue in CTA 1 and 2 of 2018.

7. As these 2 High Court Actions were heard together with the 2 actions in the Competition Tribunal, I have directed all evidence to be taken under the High Court Actions in view of the unlimited jurisdiction of the High Court. If evidence is taken under the Competition Tribunal, the parties could not, even by consent, confer jurisdiction on the Competition Tribunal to hear evidence that may be outside the scope of competition law.

Illegality defence

8. For the reasons given in the judgment of today’s date in CTA 1 and 2 of 2018 concerning the same parties, the Competition Tribunal has found that there was no breach of the First Conduct Rule.

9. The pleaded illegality defence has no independent existence from the breach of the First Conduct Rule and must fail.

10. I would add two observations. Firstly, unlike the EU and UK parallel legislation, the Ordinance does not contain any provision that renders an agreement in contravention of the First Conduct Rule automatically void.

11. Paragraph 1 of Schedule 3 to the Ordinance gives power to the Tribunal to make orders under section 94 which include an order in:

(g)     prohibiting a person from giving effect to an agreement;
(h)     requiring the parties to modify or terminate an agreement; or
(i)     declaring an agreement to be void or voidable.

12. Whether it should be the CFI or the Tribunal which should deal with the question of illegality and how the Tribunal should exercise its discretion under section 94 shall be left to a more appropriate case in future.

13. Secondly, on the question of illegality, Hong Kong is bound by the Court of Appeal decision in Arrow ECS Norway v M Yang Trading[2019] HKCA 176, Cheung JA which followed Tinsley v Milligan [1994] 1 AC 340. Since then, in UK, there have been Supreme Court decisions which propound approaches different to Tinsley v Milligan, such as Patel v Mirza [2017] AC 467. Again, which approach to follow should be left to a more appropriate case in future.

Set-off

14. In respect of the defence of set-off, in [2021] HKCA 294, §58, the Court of Appeal identified 3 sub-issues, ie (i) whether or not the defence of set-off has been impliedly abrogated by the Competition Ordinance; (ii) whether contravention of the First Conduct Rule can give rise to a cross claim by Meyer against Taching and Shell on the basis of common law principles concerning breach of statutory duty; and (iii) if that cross-claim is sustainable, whether the common law criteria for equitable set-off can be satisfied.

15. The question of set-off does not arise in the present case in view of the Tribunal’s judgment. Those 3 sub-issues are fact-sensitive. It is more appropriate for them to be argued in an actual case with proper pleadings than for this Court to give an advisory opinion on a hypothetical situation of no relevance to the immediate parties.

Interest

16. For pre-judgment interest, I award to Taching P+1% from the date of writ to date of judgment and thereafter at judgment rate until payment: Chow How Yeen Margaret v Wex Pharmaceuticals Inc [2018] 3 HKLRD 163, §§45 and 75, CA.

17. The Shell-Meyer Agreement contained, amongst others, the following terms:

"1. Payment of the purchase price … for each Delivery shall be due … as of the end of the month in which the relevant delivery took place.”
“Payment Date: The last day of the month following the month in which delivery took place, except that if the last day of such month is not a Business Day, then payment shall be made not later than the immediately preceding Business day.”

18. The General Terms and Conditions at Section B of the Shell-Meyer Agreement further stated that:

“6.4 Buyer agrees that payments not received by Shell or still owing more than ten (10) days past the due date will bear interest of 2% per annum above the Prime Rate quoted by the Hong Kong and Shanghai Banking Corporation Limited from time to time, calculated on a daily basis.”

19. Shell should be awarded pre-judgment interest in accordance with clause 6.4 and thereafter at judgment rate until payment. I accept Shell’s computation of interest as per Annex 3 to its closing submission.

Costs

20. Meyer survived the applications for summary judgment but failed in its competition defence. Meyer’s illegality defence raises substantial arguments on law which turns out to be unnecessary in view of the Tribunal’s judgment. For the same reasons given in Section N of the Tribunal’s judgment, the same costs order shall apply.

Conclusion

21. There being no defence to the claims, there shall be judgment against Meyer as follows:

(1)     Payment of HK$4,435,150 to Taching;
(2)     Payment of HK$2,287,811.45 to Shell;
(3) On a nisi basis, there shall be payment of interest to Taching at the rate of prime+1% per annum from the date of writ to the date of judgment and thereafter at judgment rate until payment;
(4)     On a nisi basis, there be payment of interest to Shell at the rate of 2% per annum above the HSBC prime rate from the due date of payment to the date of judgment and thereafter at judgment rate until payment;
(5)     There be payment out of the sums in Court with accrued interest to Taching and Shell respectively in partial satisfaction of the judgment sums; and
(6)     On a nisi basis, Meyer do bear the costs of Taching and Shell, such costs in respect of the proceedings after close of pleadings in the Tribunal shall be on indemnity basis, to be taxed if not agreed, with certificates for 2 counsel.

22. I extend my greatest gratitude to counsel for their enlightening arguments and their dedicated efforts in this case.

(Queeny Au-Yeung)
Judge of the Court of First Instance
High Court

Ms Catrina Lam and Ms Cherry Xu, instructed by Herbert Tsoi & Partners, for Taching, the Plaintiff in HCA 1929/2017

Ms Eva Sit, SC and Mr Joshua Chan, instructed by Clifford Chance, for Shell, the Plaintiff in HCA 1069/2018

Mr Kenneth K H Lee, Ms Nana Lui and Mr William Tse, instructed by Robertsons, for Meyer, the Defendant in both cases

HCA 1929/2017 &
HCA 1069/2018

[2021] HKCFI 1690

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1929 OF 2017

____________

BETWEEN

	TACHING PETROLEUM COMPANY, LIMITED	Plaintiff
	and
	MEYER ALUMINIUM LIMITED	Defendant

____________

AND

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1069 OF 2018

____________

BETWEEN

	SHELL HONG KONG LIMITED	Plaintiff
	and
	MEYER ALUMINIUM LIMITED	Defendant

____________

(Heard Together)

Before:

Hon Au-Yeung J in Chambers

Date of Hearing:	8 June 2021
Date of Decision:	8 June 2021
Date of Reasons for Decision:	10 June 2021

_________________________________

REASONS FOR DECISION

_________________________________

Introduction

1. This was the pre-trial review hearing. The trial would commence in 7 weeks’ time on 27 July 2021 with 10 days reserved.

2. Meyer applied for a split trial of liability and quantum. After hearing submissions, I dismissed the application. These are my reasons.

Background

3. In its defence, Meyer sought to set off the unliquidated damages arising from the alleged anti-competitive conduct of Taching and Shell against the price of industrial diesel delivered to Meyer.

4. At the Competition Tribunal (“the Tribunal”), Meyer has sought to, amongst others, adduce expert evidence on loss and damages it suffered, but it was refused by the Tribunal. Meyer appealed to the Court of Appeal.

5. The Court of Appeal held that since only the allegation of contravention of the First Conduct Rule was transferred to the Tribunal for trial, Meyer had applied for expert evidence on loss and damages in the wrong forum (paragraphs 32-34 and 56 of the judgment dated 11 March 2021 [2021] HKCA 294.

6. The Court of Appeal further expressed the view that there would be sub-issues arising from the defence of set-off:

“58. … the Tribunal has no jurisdiction in the present proceedings to address if set-off should be available in the context of the High Court actions. It is a matter for the Court of First Instance. As further elaborated below, the Court of First Instance has to consider the question of set-off by addressing these sub-issues:
(a) As there is no express provision for conferring private right other than follow-on action, whether a contravention of the conduct rule under the Ordinance can give rise to cross-claims by Meyer against Taching and Shell on the basis of common law principles concerning breach of statutory duty;
(b) Whether there is an implied abrogation by the Ordinance of the common law cause of action by way of cross-claim as a defence;
(c) If a cross-claim for contravention of the conduct rule is sustainable in law, whether the common law criteria for equitable set-off can be satisfied in accordance with the test in Geldof Metaalconstructie NV v Simon Carbes Ltd [2010] EWCV Civ 667; [2010] 4 All ER 847; and
(d) The damages suffered by Meyer as a result of such contravention and the quantum thereof.”

7. Having given guidance as to the sub-issues above, the Court of Appeal refrained from dealing with those matters. The Court of Appeal expressly stated that the application to file expert evidence on damages and split trial was a case management possibility for the Court of First Instance.

“66. In terms of the application to file expert evidence on damages and quantum, there is also another case management possibility. Assuming an application for expert evidence on damages and quantum is made in the Court of First Instance, it is open to the court to adjourn that application until the Tribunal made a determination of the allegations. Adoption of such option may entail the splitting of trials in the High Court actions. The court could still address sub-issues (a) to (c) and issues on illegality in the trials taking place at the same time of the trials in the Tribunal proceedings. If the Tribunal found against Meyer [on the contravention of the First Conduct Rule] or if the [Court of First Instance] ruled against Meyer on [the sub-issues in §58(a) to (c)] and the defence of illegality, judgments can be given in the High Court actions. On the other hand, in the event of determinations in favour of Meyer in the Tribunal and in the Court of First Instance (except on the issue of illegality), the court would have to hold the second part of the trials to consider the quantum of set-off.
67. We have not heard submissions on that option and these are again matters of case management of the High Court actions for the Court of First Instance. It is therefore not right for Mr Lee [counsel for Meyer] to assume that the Tribunal would exercise the discretion in the same way as did the Court of First Instance. This Court cannot speculate what would have been the outcome had there been no procedural mistake on the part of Meyer in issuing the expert evidence summons in the Tribunal instead of the Court of First Instance.”

8. Meyer invited this Court to adopt the Court of Appeal’s “cost-effective and practical approach”, so that the question of quantum of set-off, including expert directions, could be hived off to the second part of the trial. Taching and Shell opposed that application.

Legal principles for ordering a split trial

9. The general rule is for all issues to be tried at the same time and the general rule will be departed from only if it would be just and convenient to do so. The burden is on the party seeking a split trial to demonstrate why there are “exceptional circumstances” and “special grounds” to justify the departure: Ying Cheong Construction Co Ltd v Lam Woo & Co Ltd[2019] HKCFI 1654, at §3, Mimmie Chan J.

Analyses

10. Firstly, Meyer had previously suggested a stay of the High Court actions pending resolution of the competition issue in the Tribunal. That suggestion was not accepted by the Court. Instead, the Court specifically directed that the trial of these 2 actions should be carried out at the same time as the competition proceedings in CTA 1 & 2/2018, before the same judge constituting the Tribunal. (See decision dated 22 February 2019 [2019] HKCFI 515). Meyer has not begun to show why it was just and convenient to depart from the general rule and this specific direction.

11. Secondly, Mr Lee submits that the only reason why the Tribunal refused to give leave to adduce expert evidence on loss and damage was due to Taching and Shell’s erroneous argument that the set-off defence was entirely bad. There was a change of circumstances since the Court of Appeal’s decision cited above.

12. With respect, Mr Lee has forgotten that his stance at the 3^rd CMC, if not earlier, was similar to Taching and Shell’s – that Meyer had no right of action without a determination of a contravention of a Conduct Rule (§7 of the decision dated 22 February 2019 [2019] HKCFI 515). At that time, Mr Lee considered that Meyer had to pay the amounts claimed even if the Tribunal were to rule in his favour on the competition issue, and resort to a follow-on action. In any case, Taching and Shell’s stance on the set-off is yet to be adjudicated in the light of the Court of Appeal’s views on the sub-issues.

13. However, even if there was a change of circumstances brought about by the Court of Appeal’s decision, the Court of Appeal has left the case management issue to this Court. It was incumbent on Meyer to make a timely application to this Court for a split trial or for expert directions.

14. Thirdly, as a matter of case management,

(1) This was a late application made by submission, without a summons, 7 weeks before trial. This was way beyond 6 December 2019, the deadline for taking out interlocutory applications laid down at the 3^rd CMC. Late interlocutory applications may be dismissed on the basis of delay alone: PD 5.2, §34. Unless there are exceptional circumstances and there are good reasons for the delay, one should not expect the courts to grant any late applications taken out shortly before the pre-trial review; Waddington Limited v Chan Chun Hoo Thomas, HCA 3291/2003, 7 May 2013, at §53, DHCJ Lok (as he then was). No exceptional circumstances were shown.
(2) If, as Mr Lee submits, the Court had no difficulty understanding that the loss and damage to Meyer was the higher price paid for the diesel, there was no reason why Meyer could not have applied for expert directions in order for the trial on quantum to proceed at the same time as the trial in July. The Court of Appeal had given guidance orally on 5 January 2021 after hearing the appeal, and the written reasons were handed down on 11 March 2021. And yet nothing has been done by Meyer since January until this pre-trial review to seek expert directions.

15. Fourthly, as a matter of pleading, as early as 22 February 2019, this Court has observed that Meyer has pleaded nothing to set off against any sum to be awarded to Taching/Shell. As the pleadings then stood, there was simply nothing left for the court to investigate on quantum after determination of the issue of liability. The Court saw no basis for ordering a split trial.” See §§7-8 of the decision dated 22 February 2019 [2019] HKCFI 515.

16. For 2 years and 3 months since, the defence has never been amended to plead a case that would justify investigation on quantum.

17. As rightly pointed out by Ms Lam (and Ms Xu) counsel for Taching:

(1) In a follow-on action, the statement of claim must set out with full particulars the loss and damage suffered under each head of loss and the respective amount of damages claimed as well as the aggregate amount claimed: CTPD 1, §99. The defence must plead specifically with as full particulars as possible to each item of loss and damage allegedly suffered by the plaintiff under each head of loss and to the amount of damages claimed: CTPD 1, §103. I agree with Ms Lam that, by the same token, the same requirement applies where a defence of set off is premised on loss and damage caused by the plaintiff’s alleged anti-competitive conduct. Meyer’s defence does not satisfy this requirement.
(2) The burden is on a defendant to particularize the amount of his set off or the manner in which the amount is to be computed. This is reinforced by the approach in a summary judgment application, where the Courts have held that a bare defence of set-off, without particulars, is insufficient to give rise to a triable issue: 浙江省鐵投國際貿易有限公司 v HK Zexin Resources Co Ltd, HCA 3243/2016, 16 October 2017, at §§21-24, DHCJ Alex Lee (as he then was); Legend Pacific Ltd v Ng Choi Chi, HCA 1320/2009, 11 August 2009, at §§15-16, Registrar Au-Yeung (as she then was).
(3) In the context of competition law, there can be different types of damages to compensate for being subject to a cartel overcharge, loss of profit, loss of opportunity or even exemplary damages. Various methods and models may be used to evaluate quantum, depending on the circumstances of each case: Brealey QC & George, Competition Litigation UK Practice and Procedure, 2^nd ed, §§16.01-16.14. It is all the more important for a claimant to at least identify the type of loss he has allegedly suffered.

18. Fifthly, all 3 parties agreed that even if there was no trial on the quantum of loss and damages of Meyer, there would be no prejudice to Meyer, as it could have a follow-on action if the Tribunal were to rule in its favour. Even if Meyer has to pay the price for the diesel and costs to Taching and Shell now, any prejudice can be compensated for in money terms in the follow-on action.

Conclusion

19. Meyer’s application for a split trial was late and against the specific direction for 4 sets of proceedings to be tried together. There was no good reason for the delay in application. As a matter of case management and pleading, it has not been shown that it would be just and convenient to hive off the quantum issue to a second part of the trial. There would be no prejudice to Meyer anyway even if the trial were to proceed without dealing with the quantum of Meyer’s alleged loss and damage. For all the reasons given, I therefore dismissed the application for a split trial.

	(Queeny Au-Yeung)
	Judge of the Court of First Instance
	High Court

Ms Catrina Lam and Ms Cherry Xu, instructed by Herbert Tsoi & Partners, for Taching, the Plaintiff in HCA 1929/2017

Ms Eva Sit, SC, instructed by Clifford Chance, for Shell, the Plaintiff in HCA 1069/2018

Mr Kenneth K H Lee, Ms Nana Lui and Mr William Tse, instructed by Robertsons, for Meyer, the Defendant in both cases

HCA 1929/2017 &
HCA 1069/2018

[2019] HKCFI 515

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1929 OF 2017

____________

BETWEEN
	TACHING PETROLEUM COMPANY, LIMITED	Plaintiff
and
	MEYER ALUMINIUM LIMITED	Defendant

____________

AND

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1069 OF 2018

____________

BETWEEN
	SHELL HONG KONG LIMITED	Plaintiff
and
	MEYER ALUMINIUM LIMITED	Defendant
____________
	(Heard Together)

Before: Hon Au-Yeung J in Chambers

Date of Hearing: 21 January 2019

Date of Decision: 22 February 2019

_____________

D E C I S I O N

_____________

Introduction

1. These 2 cases were heard together with related competition proceedings. This decision should be read with the decision of the Competition Tribunal handed down on the same date in respect of CTA 1 and 2 of 2018 (“the Tribunal’s Decision”).

2. Taching and Shell respectively sue Meyer for the costs of industrial diesel oil. Meyer contends that there was breach of the First Conduct Rule in the Competition Ordinance, Cap 619 (“CO”) in that Taching and Shell colluded to fix the price or exchange price information.

3. Meyer now suggests that there be a stay of the High Court proceedings pending resolution of the competition issue in the Tribunal. Taching is neutral. Shell suggests that all issues on liability in both the High Court Actions be tried at the same time, separate from the issues on quantum.

Analyses

4. The general rule is that all issues in a case are to be tried at the same time. Departure from this rule would only be ordered if it is just and convenient to do so: Hong Kong Civil Procedure 2019, Vol 1, §33/4/9. This general rule applies notwithstanding competition issues are involved and are hived off to the Tribunal.

5. The pleadings disclose that the only issue on liability in these High Court Actions that is not found in the CT Actions is the averment that “by reason of” the breach of the First Conduct Rule in the CO, the relevant agreement for supply of industrial diesel oil between Shell/Taching and Meyer “is tainted with illegality and unenforceable” against Meyer. Meyer seeks to set off unpleaded damages against the liquidated sums claimed by Taching/Shell.

6. It is plain that the issues of illegality and unenforceability in the HC Actions have no independent existence from the competition defence in the Tribunal. So all issues on liability must be tried together with the Tribunal proceedings.

7. What then is left of the trial on quantum? Meyer’s indication is that it has no right of action without a determination of a contravention of a Conduct Rule by virtue of section 110(1) CO. Meyer has pleaded nothing to set off against any sum to be awarded to Taching/Shell.

8. As a matter of law, I fail to see how a future cause of action can support a defence to a present claim. As the pleadings now stand, there is simply nothing left for the court to investigate on quantum after determination of the issue of liability. I see no basis for ordering a split trial.

9. I therefore order as follows:

(1) The trial of the High Court Actions should be carried out at the same time as the Competition Tribunal proceedings, before the same judge constituting the Tribunal.
(2) The Tribunal’s Decision on inspection of documents, specific discovery, filing of witness statements and case management conference shall apply to these 2 High Court Actions.
(3) The witness statements filed in the Competition Tribunal Proceedings shall stand as witness statements of the parties in these 2 High Court Actions.
(4) The filing of witness statements in these 2 High Court Actions is dispensed with.
(5) Half of the costs of this CMC on 21 January 2019 (excluding costs of the Confidentiality Summons and Redaction Summons in the CTA proceedings), including 30 minutes of the hearing time, shall be in the cause of these 2 High Court Actions. Such costs are to be equally divided between the 2 High Court Actions.
(6) There shall be liberty to apply.

10. I thank counsel for their assistance.

	(Queeny Au-Yeung)
	Judge of the Court of First Instance
	High Court

Ms Catrina Lam and Ms Cherry Xu, instructed by Herbert Tsoi & Partners, for Taching, the plaintiff in HCA 1929/2017

Ms Eva Sit and Mr Joshua Chan, instructed by Clifford Chance, for Shell, the plaintiff in HCA 1069/2018

Mr Kenneth K H Lee and Ms Nana Lui, instructed by Robertsons, for Meyer, the defendant in both cases

HCA 1929/2017
and HCA 1069/2018
(Heard Together)
[2018] HKCFI 2095

HCA 1929/2017

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1929 OF 2017

____________

BETWEEN
	TACHING PETROLEUM COMPANY, LIMITED	Plaintiff
and
	MEYER ALUMINIUM LIMITED	Defendant

____________

AND

HCA 1069/2018

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1069 OF 2018

____________

BETWEEN
	SHELL HONG KONG LIMITED	Plaintiff
and
	MEYER ALUMINIUM LIMITED	Defendant

____________

(Heard Together)

Before: Hon Au-Yeung J in Chambers

Date of Hearing: 7 September 2018

Date of Decision: 7 September 2018

Date of Reasons for Decision: 12 September 2018

_________________________________________

REASONS FOR DECISION

_________________________________________

1. This decision should be read with the decision in CTA1/2018 handed down on the same date.

2. HCA 1929/2017 (“the Taching Action”) was listed to be heard together with CTA1/2018. Shell appeared as an intervener and had made representations as regards directions over HCA 1069/2018(“the Shell Action”). This was a hearing for directions, most of which had been agreed. I only need to deal with the following matters briefly.

Transfer of proceedings

3. It was confirmed that there was a common defence in both the Taching Action and the Shell Action, namely, that Taching and Shell had colluded in price fixing, in breach of the First Conduct Rule (“the Allegation”) under the Competition Ordinance, Cap 619 (“CO”).

4. By consent of Shell and Meyer, I therefore gave leave for the transfer of the Allegation in the Shell Action to the Competition Tribunal (“the Tribunal”).

Whether the remainder of the High Court Actions should be consolidated, heard together or tried together with the proceedings at the Tribunal

5. Having regard to the common defence, it was clearly appropriate to list both High Court Actions together to be heard with the 2 sets of proceedings in the Tribunal for case management purpose. The question of trial of the remainder of the High Court Actions shall be revisited at the next CMC when the pleadings have closed.

Pleadings

6. Meyer has admitted the delivery of diesel oil by Taching and Meyer. Insofar as the defence would rely on contravention of the First Conduct Rule, Meyer could state simply in its defence that it would rely on the pleadings filed in the Competition Tribunal. The same shall apply to Taching and Shell’s replies.

Discovery

7. The parties have agreed that all discoveries among them shall be disclosed to one another, subject to any confidentiality protocol approved by the Tribunal.

8. Parties have agreed that the requirement for general discovery in these 2 High Court Actions shall be dispensed with. This costs-saving approach was most welcomed by the court, and was in line with the approach of the Tribunal.

9. I have directed the parties to make discovery of directly relevant documents including all documents referred to in the pleadings without the need for a request from another party. Discovery before the next CMC would aid the parties in giving realistic estimates of time for witness statements, application for specific discovery, directions for expert evidence, and time for mediation.

Summary

10. I had therefore ordered at the hearing that:

(1)The Allegation in the Shell Action be transferred to the Tribunal;
(2)In line with the directions in the Tribunal, the balance of the High Court Actions shall be listed and heard together with the 2 sets of proceedings in the Tribunal for case management purpose until further order. There shall be discovery of only directly relevant documents and all documents referred to in the pleadings. All pleadings and discovery shall be served on one another among Taching, Shell and Meyer.
(3)The pleadings in the High Court Action shall incorporate those filed in the Tribunal by reference insofar as competition issues were concerned.
(4)General discovery shall be dispensed with.

	(Queeny Au-Yeung)
	Judge of the Court of First Instance High Court

Ms Catrina Lam and Ms Cherry Xu, instructed by Herbert Tsoi & Partners, for Taching, the Plaintiff in CTA 1/2018 and HCA 1929/2017

Mr Kenneth K H Lee and Ms Nana Lui, instructed by Robertsons,
for Meyer, the Defendant in all cases

Ms Eva Sit, instructed by Clifford Chance, for Shell, the Intended Intervener in CTA 1/2018 and the Plaintiff in HCA 1069/2018

SHELL HONG KONG LTD v. MEYER ALUMINIUM LTD

Related cases with same parties

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