SAM FAI CONSTRUCTION CO LTD v. YAT MING CONSTRUCTION & ENGINEERING LTD AND ANOTHER

HCCT 64/2020

[2023] HKCFI 1474

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTRUCTION AND ARBITRATION PROCEEDINGS

NO 64 OF 2020

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BETWEEN

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D E C I S I O N

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1.  After the trial of the action originally fixed for 20 June 2022 was adjourned as a result of leave being sought by and granted to the Defendants to adduce expert evidence, the Plaintiff applied by summons on 28 February 2023 to amend its Reply (“Amendment Summons”). This was to amend its original pleading on an alleged error in the drawings provided by the 1^st Defendant to the Plaintiff, on which error and consequent work the 2^nd Defendant had sought leave to adduce expert evidence. The Court has already made orders on expert evidence, on the basis of the amendments sought to be made to the Reply.

2.  The Defendants opposed the amendment application, as indicated in their letters of 24 February 2023 and 9 March 2023. By letter dated 1 March 2023, the Court reminded the parties that trial dates have not been fixed, and that the Defendants should consider whether they had grounds to oppose the application for amendment, the question of costs being a separate matter which can be dealt with.

3.  For the purpose of a hearing on 2 March 2023, Counsel for the Defendants indicated in the skeleton submissions that instructions had still not been obtained from the Defendants as to whether they would oppose the Amendment Summons.

4.  By letter dated 7 March 2023, the Plaintiff proposed to pay the costs of the amendment application, as the Amendment Summons initially provided for costs to be in the cause.

5.  At the hearing of the Case Management Conference on 5 May 2023, the Defendants maintained their stance of opposing the Amendment Summons.

6.  Unable to obtain the Defendants’ consent to the Amendment Summons, the Plaintiff fixed 7 June 2023 for the substantive hearing.

7.  It was not until 12 May 2023, that the Defendants informed the Plaintiff that they would consent to the Amendment Summons, but the parties were apparently unable to agree on the costs provision. The matter was directed to be dealt with by paper submissions – which have since been filed.

8.  It is correct, that the usual order to be made on an application for amendment of pleadings is that the applicant should pay the costs of and occasioned by the amendment, which would normally include the costs of the hearing of the summons for leave to amend. This is the usual course unless there are special circumstances which militate against such an order (Poon Wong Yee See v Lo Sau Woon Diana[2021] HKCFI 3410).

9.  In this case, the Defendants have not been able to explain satisfactorily why they chose to oppose the amendments sought to be made to the Reply. Any complaint of prejudice or costs wasted by reason of the Plaintiff’s delay in making the application can be dealt with by an appropriate order for costs. As the Court pointed out as early as 1 March 2023, the trial dates had not even been fixed, and any question of prejudice or need of time to be spent, to deal with the matters raised in the Reply, would unlikely be of such materiality as to lead to an order refusing leave to make the amendments.

10.  The procrastination and delay on the Defendants’ part in finalizing instructions on whether to oppose the amendments in substance is highly undesirable. The amendments are not substantial, and it is inexcusable for the Defendants to delay informing the Plaintiff, until 12 May 2023, that it consented to the amendments. If the Defendants had earnestly considered the proposed amendments within a reasonable time of the Amendment Summons, much of the time and costs of argument in correspondence on the entire matter, and much of the Court’s time, would have been avoided. Litigation should not be a game of gaining tactical delay or of building up legal costs. Trials should be reasonably prepared for without undue delay and unnecessary costs, and parties and their legal advisers have the duty to assist the Court to further the underlying objectives under Order 1A RHC, bearing in mind that a waste of court resources is against public policy and a matter of public interest.

11.  Having considered the particular circumstances and background history of this case, and to discourage parties from engaging in unnecessary interlocutory skirmishes to avoid, delay or complicate trial, I consider that the appropriate order of costs to make is that the costs of the Amendment Summons should be in the cause.

The plaintiff was represented by MinterEllison LLP

Mr Billy NP Ma, instructed by Ha & Ho, for the 1^st and 2^nd defendants

HCCT 64/2020

[2023] HKCFI 284

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTRUCTION AND ARBITRATION PROCEEDINGS

NO 64 OF 2020

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D E C I S I O N

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1.  Before me is the plaintiff’s application by summons dated 8 June 2022 for interim payment against the 1^st and 2^nd defendants.

2.  The plaintiff is a sub-contractor for concrete and plastering works in a proposed residential redevelopment at No.5 Henderson Road (“Project”). The 1^st defendant is the main contractor of the Project.

3.  The plaintiff’s case is that the 1^st defendant sub-contracted the concrete works of the Project to the plaintiff on or about 15 December 2017 and sub-contracted the plastering works of the Project to the plaintiff in or about May 2018. Such works were respectively completed on or about 21 March 2018 and 31 January 2019. In addition, on the 1^st defendant’s request, the plaintiff carried out and completed various additional works and dayworks by about June 2019. The plaintiff claims against the 1^st defendant for the sum of $3,615,324.37 (“Sum”), being the outstanding sum for all the works that it has carried out.

4.  The 1^st defendant admits that it is the main contractor of the Project, and claims that it has sub-contracted the main contract works to the 2^nd defendant. The 1^st defendant has no agreement or contract with the plaintiff at all, and it is the 2^nd defendant which engaged the plaintiff to carry out the subject concrete and plastering works.

5.  The 2^nd defendant admits that it is the plaintiff’s employer for the subject concrete and plastering works and the contracting party with the plaintiff. It disputes quantum for the concrete and plastering works. It denies that it has engaged the plaintiff to carry out a substantial part of the claimed additional works and any dayworks. It also counterclaims against the plaintiff for additional site expenses and liquidated damages levied by the 1^st defendant arising from substantial and critical delay caused by the plaintiff’s use of defective materials in the drainage works.

6.  The plaintiff claims that the 2^nd defendant was the appointed agent of the 1^st defendant in respect of the contract works, to which the 1^st defendant directed the plaintiff to submit payment applications, and from which the plaintiff had received interim payments. In the event that the 2^nd defendant is held to be the contracting counter-party to the plaintiff, the plaintiff claims loss and damage against the 2^nd defendant for breach of warranty of authority as the 1^st defendant’s agent, and for the Sum.

7.  Trial of the action was originally scheduled to take place on 20 June 2022 with 5 days reserved but was adjourned by Mimmie Chan J on 31 May 2022 upon the defendants’ request, essentially to allow time for the defendants to put in expert evidence on quantum, defects and delay: see Decision [2022] HKCFI 1612.

8.  The key dispute in this action is the identity of the plaintiff’s employer. Only one of the 1^st and 2^nd defendants can be held liable for the Sum. The Statement of Claim made clear that reliefs are sought against the 1^st and 2^nd defendants in the alternative. Whilst the plaintiff’s summons seeks an order for interim payment against the 1^st defendant and/or the 2^nd defendant jointly or severally, Mr Solomon Lam appearing for the plaintiff confirmed at the hearing that the plaintiff is only seeking interim payment against either the 1^st or the 2^nd defendant, not both of them.

9.  As regards the amount of interim payment, the plaintiff is seeking a sum of $2,338,605.68 said to be based on the lowest assessment by the single joint expert, or alternatively a sum of $1,324,796.85 said to be based on alleged admissions from the defendants.

10.  The applicable legal principles on interim payments are not in dispute and are set out by Madam Recorder Sit SC in Binchuang Resources Co Ltd v Lockwood Group Ltd [2022] 2 HKLRD 221 at [10]. In short, the court has to be satisfied on a balance of probabilities that, if the claim were to go to trial, based on the materials before the court at the time of the application, the applicant for interim payment would succeed in its claim and would obtain a substantial amount of damages. It is insufficient that the claim is likely to succeed. There must be no arguable defence, and no sufficient doubts regarding the genuineness of the defence, such that if it were a summary judgment application before the court, the court would not grant unconditional leave to defend to the party resisting payment.

11.  Mr Lam relies on the following in support of the plaintiff’s case that the 1^st defendant is the employer:

Concrete works

(1)  The tender interview took place at the 1^st defendant’s office and was attended by the representatives of the 1^st defendant, including Mr Eddie Lau who provided a name card showing his title as the project director of the 1^st defendant. There was no discussion at the interview on the role of the 2^nd defendant as a sub-contractor of the 1^st defendant.

(2)  The draft sub-contract agreement prepared after the interview was sent via the 1^st defendant’s email account to the plaintiff, and named the 1^st defendant as a contracting party.

(3)  Instructions to commence works were given by the staff of the 1^st defendant to the plaintiff.

Plastering works

(4)  The invitation for quotation was sent to the plaintiff via the 1^st defendant’s email account, and the sender signed off the email under “Yat Ming” which is the 1^st defendant’s name. The plaintiff submitted quotation by email to the 1^st defendant.

(5)  Instructions to commence works were given by the staff of the 1^st defendant to the plaintiff.

Additional works

(6)  The requests for quotation for steel and metalworks (VO-4) and drainage work (VO-16) were sent via the 1^st defendant’s email account, and both emails were signed off by the sender “for and on behalf of” the 1^st defendant.

(7)  Instructions to commence works under VO-4 were given by the staff of the 1^st defendant to the plaintiff.

Dayworks

(8)  The dayworks were agreed by the staff of the 1^st defendant with the plaintiff’s representative.

12.  On the other hand, Mr Billy Ma appearing for the defendants relies on the following as supporting the 2^nd defendant being the employer:

(1)  All payment submissions were made by the plaintiff to the 2^nd defendant directly, upon which substantial interim payments were made by the 2^nd defendant to the plaintiff.

(2)  Quotations and invoices for payments for the additional works were issued and addressed to the 2^nd defendant.

(3)  The invoice for the dayworks was issued and addressed to the 2^nd defendant.

(4)  The plaintiff’s demand letter dated 20 April 2020 was issued to the 2^nd defendant only and referred to the 2^nd defendant as being liable under its subcontract with the plaintiff (貴司於上述分判合約上欠我司).

(5)  The pre-action demand letter by the plaintiff’s solicitors dated 29 June 2020 was issued to the 2^nd defendant and referred the plaintiff as “one of your sub-contractors under the Project”.

(6)  No demand letter was issued to the 1^st defendant.

13.  In my view, whether the 1^st or 2^nd defendants is the plaintiff’s employer is a triable issue that can only be resolved at trial. The precise role and capacity of the staff involved in the negotiation and giving of instructions to the plaintiff must be tested and determined with the benefit of cross-examination of witnesses. The matters set out in [12], in particular the pre-action demand letter which must have been prepared and issued with the benefit of legal advice, do corroborate the defendants’ case, and cannot be brushed aside summarily on papers.

14.  Likewise, the 2^nd defendant’s admission that it is the employer does not assist the plaintiff, when the plaintiff’s own primary case is that the 1^st defendant is the employer and the plaintiff says that the evidence (including the matters at [11] above) points to such a conclusion.

15.  Since the question on the identity of the employer could not be resolved at this stage, the plaintiff’s application for interim payment against either the 1^st or 2^nd defendants must be dismissed.

16.  In light of my conclusion above, it is unnecessary to deal with the merits of the 2^nd defendant’s counterclaim against the plaintiff, and I prefer not to express any view when there will be a trial of the action.

17.  Costs should follow the event. I order the plaintiff to pay the costs of the defendants in the application, summarily assessed at $350,000 and payable forthwith.

Mr Soloman Lam, instructed by MinterEllison LLP, for the plaintiff

Mr Billy NP Ma, instructed by Ha & Ho, for the 1^st and 2^nd defendants

HCCT 64/2020

[2022] HKCFI 2119

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTRUCTION AND ARBITRATION PROCEEDINGS

NO 64 OF 2020

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D E C I S I O N

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1.  On 31 May 2022, this Court handed down its decision, inter alia, to adjourn the trial of the action (“Decision”), and made various costs orders. The reasons for the orders made on the interlocutory applications, including the Defendants’ application for leave to adduce additional expert evidence, and for the costs orders, were stated in the Decision and will not be repeated here. On 13 June 2022, both the Plaintiff and the Defendants made separate applications by summonses to vary the costs orders, and the summonses were ordered to be dealt with by paper disposal.

2.  The abbreviations used in the Decision are adopted below.

3.  The Plaintiff seeks to vary the costs orders, for summary assessment and payment forthwith of the costs of the Expert Evidence Application and of the costs of the Adjournment Application. The Defendants seek variation to provide for summary assessment and payment forthwith of the costs of and the withdrawal of the Specific Discovery Application, the costs of the Supplemental List Strike Out Application, and for variation of the costs of the Adjournment Application.

4.  There is no substantial opposition to the Defendants’ application to expressly exclude from the costs order of the Expert Evidence Application the costs of and occasioned by the preparation of the expert report(s) by the Single Joint Expert(s), and the court attendance of such expert(s), which are to be in the cause of the action. I accede to the variation to such extent, and also agree to order summary assessment of such costs, with certificate for Counsel, and for the costs assessed to be paid forthwith.

5.  I am also prepared to vary the orders made in the Decision, to provide for the costs of and occasioned by the Supplemental List Strike Out Application, and the costs of and the withdrawal of the Specific Discovery Application to be summarily assessed, both with certificate for counsel and for the assessed costs to be paid forthwith.

6.  However, in relation to the costs order made on the Adjournment Application, the reasons have been stated in the Decision, and there is no good ground shown for the Defendants’ application to vary same to be reserved. Nor am I prepared to order that such costs should be summarily assessed or to be paid forthwith. The question of the costs occasioned and thrown away by the adjournment need to be considered in some detail by reference to the work carried out, the documents involved, and whether they were thrown away by the adjournment. Such exercise is more appropriately to be conducted by the taxing master in the usual course. It is also open to the Court to order after trial that the costs be taxed on the scale appropriate to the amount awarded at trial, after the Plaintiff’s original claim and the Defendants’ counterclaim have been determined.

7.  The timetable proposed by the parties for the filing and service of Statements of Costs and Statements of Objections are allowed and made in the terms sought.

8.  In respect of the interlocutory applications, since both parties seek variation by summary assessment with certificate for counsel (apart from the Defendants’ stance on the Adjournment Application), there is no reason why they cannot agree on the terms of the variation made by the 2 summonses, and narrow the scope of their dispute. To discourage unnecessary applications to the Court, I refuse to allow any costs on the variation summonses.

The plaintiff was represented by MinterEllison LLP

Mr Billy NP Ma, instructed by Ha & Ho, for the 1^st & 2^nd defendants

HCCT 64/2020

[2022] HKCFI 1612

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTRUCTION AND ARBITRATION PROCEEDINGS

NO 64 OF 2020

________________________

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D E C I S I O N

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1.  This is yet another case in which parties appear only to engage in a flurry of activities on the eve of trial, upon last minute preparations and review of their respective case when trial is imminent.

2.  These proceedings were commenced by the Plaintiff against the 2 Defendants by Writ and Statement of Claim issued in September 2020.  The Plaintiff as contractor for concrete works and plastering works (“Contract Works”)  claims against the 1^st Defendant as the alleged Main Contractor for superstructure works in a project on Henderson Road, Hong Kong (“Project”). The Plaintiff claims that the 2^nd Defendant was the 1^st Defendant’s agent in respect of the Contract Works.  In these proceedings, the Plaintiff seeks payment from the Defendants of a sum of $3,615,324.37 claimed to be outstanding in respect of the Contract Works carried out.

3.  The 1^st Defendant admits to being the Main Contractor for the Project, and claims that it had subcontracted the Main Contract works to the 2^nd Defendant.  The 2^nd Defendant engaged the Plaintiff to carry out the Contract Works.

4.  As early as 22 April 2021, this Court issued directions at the case management conference (“4/21 Directions”), on the parties’ consent application. These directions included the filing and service of witness statements by 10 June 2021, and for single joint expert (“SJE”)  evidence to be filed on quantum. Questions were framed to be answered by the SJE, for amounts payable by the Defendants to the Plaintiff for the Contract Works, and for alleged additional works and day works claimed in the SOC.  The directions included the manner of appointment of the SJE, and for joint instructions to be prepared and finalized for the SJE, within 21 days. The parties can be under no uncertainty as to the substance of and timetable for the instruction and filing of the expert evidence.  Such directions were proposed to the Court, jointly, by the parties themselves.

5.  In accordance with the 4/21 Directions, the case was set down for trial, with dates given in May 2021, for the trial to commence on 20 June 2022.

6.  Discovery was made by the parties in the course of 2021, with lists of documents filed by each side. However, no steps were taken for the service of witness statements, and it was only in January 2022 that the Plaintiff applied for leave to serve its own witness statements and for an unless order to be made by the Court for the Defendants’ service of their witness statements. Trial was already 5 months away. Expert evidence obviously cannot be finalized until witness statements on facts have been exchanged, as to the factual matters relied upon by the Plaintiff for its claims, and by the Defendants by way of defence.

7.  On 16 February 2022, this Court ordered witness statements to be filed and exchanged by 9 March 2022.

8.  The parties had throughout been represented by lawyers, but on 7 January 2022, the Defendants’ solicitors ceased to act. The Defendants claim that they required time to engage a new team of lawyers due to this “involuntary change”.

9.  Further activities then began. The Plaintiff applied on 1 March 2022 for leave to amend the SOC and made discovery of additional documents on 9 March 2022 by filing a Supplemental List.

10.  It was only on 14 March 2022 that the parties made joint application to the Court for appointment of the SJE, when the appointment and instructions to the SJE had already been the subject matter of the 4/21 Directions, and the time for doing so had already expired. The Court queried the late instruction of the SJE and sought explanation from the parties as to the impact of the late instructions to the expert on the milestone dates of the PTR and trial.

11.  By the time of the hearing of the pretrial review on 21 April 2022 (“PTR”), there were at least 4 outstanding applications made by the parties: the Plaintiff’s application for leave to amend the SOC (“Amendment Application”); the Plaintiff’s application for specific discovery against the Defendants (“Specific Discovery Application”); the 2^nd Defendant’s application for leave to adduce additional expert evidence on quantum (“Expert Evidence Application”); and the 2^nd Defendant’s application to strike out the Plaintiff’s Supplemental List of documents filed on 20 April 2022 (“Supplemental List Strike Out Application”).  The Supplemental List Strike Out Application was made on the basis that the Supplemental List was served late, without leave of the Court, and without justification shown for the new and additional documents produced. The Defendants indicated at the hearing of the PTR that a further application by the 2^nd Defendant for leave to adduce expert evidence would be issued.

12.  As the Court had queried before the PTR, on 11 April 2022, the parties did not appear to be ready for trial to commence on 20 June 2022. According to the parties, the instructions to the SJE had not been sent in April 2022, expert evidence could not be finalized before the Defendants’ application to adduce further expert evidence is determined, a Scott Schedule had to be prepared in good time before trial, and the Scott Schedule had to be delayed until the pleadings are finalized and the expert report is issued. It was against such background that this Court was not prepared to decide the Amendment Application piecemeal and separately to the matters to be considered at the PTR.

13.  Needless to say, the delay in the making of all these late applications 9 weeks before trial must be explained with good reasons.

14.  At the PTR, Counsel for the Plaintiff confirmed that the Amendment Application would be withdrawn. The Court ordered the remaining outstanding summonses to be adjourned for argument, together with any application for adjournment of the trial, but Counsel for the parties could not even agree on a date for the hearing before the commencement of trial.  Ultimately, the Court directed paper disposal of the outstanding applications.

15.  After the hearing of the PTR, the Defendants issued on 10 May 2022 a summons to strike out specific paragraphs of the Plaintiff’s witness statement (“Striking Out Witness Statement Application”), on the ground that it dealt with unpleaded claims, and a summons to adjourn the trial (“Adjournment Application”). The Defendants also issued a summons on 11 May 2022 for expert evidence to be adduced on issues of defect and delay referred to in the pleadings.  The Court did not permit the Striking Out Witness Statement Application to be included in the direction for paper disposal, as it was a new matter not contemplated at the time of the PTR.

16.  Directions were finally issued on 17 May 2022 for written submissions to be filed by 23 May 2022 for paper disposal of the Specific Discovery Application, the Expert Evidence Application (including the application by summons issued on 11 May 2022), the Supplemental List Striking Out Application and the Adjournment Application.

17.  The essential question is the impact of these applications on the trial dates.  As such, they will be considered conjunctively, rather than individually and separately without regard to the others.

18.  Needless to say, with the imminent trial dates, it is for the applicants to justify the delay.

19.  The Defendants’ change of legal team in January 2022 is clearly not a good reason for their delay and inactivity. This is trite. The legal advisers’ failure in April 2021 to obtain directions for expert evidence on the relevant issues of quantum for the Counterclaim, defect, programming and delay as raised in the pleadings (as this Court pointed out at the PTR)  is no excuse for the Defendants’ late applications in April and May 2022 for the missing and necessary leave. If the Defendants have a claim against their own legal advisers, that is for them to pursue.

20.  There is no excuse whatsoever in this case for any of the summonses to be issued only in March, April and May 2022, when the directions had been issued on 22 April 2021 in respect of the trial dates which were fixed in May 2021, for trial to commence on 20 June 2022.  No explanation whatsoever has been given by either party as to why witness statements had been deferred and were only exchanged in March 2022.  On the Plaintiff’s own case, it was only in January 2022 that it sought to file its own witness statements and applied for an unless order in respect of the filing of the Defendants’ statements. Under the 4/21 Directions, witness statements should have been exchanged by 10 June 2021.

21.  There was no reason whatsoever why the instructions to the SJE could not and were not finalized in the interim between April 2021 and April 2022. The Plaintiff’s solicitors claimed that the appointment of the SJE was only agreed on 3 March 2022, and that the Defendants’ comments on the joint instructions were received on 11 April 2022.

22.  If the Defendants had delayed the progress of the action in whatever way, the Plaintiff cannot sit idly by and condone such inactivity, unless it was itself procrastinating, or had no genuine intention to proceed with the trial in June 2022. The Plaintiff should have pressed for action to be taken by the Defendants and could have obtained from the Court orders for the instructions to be sent to the SJE in good time before early 2022, which was when the parties finally decided to commence preparations.  5 months (from 25 January 2022 when the Plaintiff applied for the unless order for the filing of witness statements to 20 June 2022)  cannot be said to be adequate time to finalize the witness statements on facts, and to collate the necessary materials to finalize the instructions to the expert, for an expert report to be prepared and issued in good time before the commencement of trial. The PTR was scheduled for 21 April 2022, and witness statements and expert reports should have been ready by then at the very latest.

23.  The summonses issued by the parties were all inexcusably and unduly late, with serious and disrupting effect on the milestone dates.  In my view, both parties were guilty of inordinate and inexcusable delay.

24.  The Plaintiff abandoned the Amendment Application because of the Court’s concerns on the impact of the application on trial, and the Amendment Application was dismissed at the PTR on 21 April 2022. Since the hearing on 21 April 2022, the Plaintiff further indicated that it would withdraw the Specific Discovery Application. It was on that basis that the Plaintiff claimed that it was ready for trial, but for the Defendants’ late applications.

25.  The more substantial applications are the Defendants’ summonses for leave to adduce expert evidence on issues of the amounts payable to the Defendants on their counterclaim, on defects, and on delay.  The expert evidence on quantum depends on expert evidence on whether the Plaintiff had used the wrong material for the drainage work, which allegedly necessitated a change in design and amendment of the drawings for approval.  According to the Defendants’ case, these caused a delay of 3 months and necessitated additional site expenses and contra charges, resulting in damages being sustained by the Defendants, including their liability to indemnify the employer for liquidated damages. All these were pleaded in paragraphs 42 to 44 of the Defence and Counterclaim.  As such, expert evidence on whether the Plaintiff had used the wrong materials, whether delay was caused as a result, and what damages and additional costs resulted, are relevant issues, on which expert evidence is required. The Defendants highlighted the fact that a director of the Plaintiff had admitted in contemporaneous correspondence that the wrong materials had been used as a result of his inadequate supervision, and that they have strong merits on their Counterclaim.

26.  It is true, as the Plaintiff sought to emphasize, that for reasons not explained, the Defendants’ legal advisers had not, when applying for the 21/4 Directions on expert evidence, sought directions for expert evidence on these issues of defect and delay to be included. Yet, I accept the submissions of the Defendants, that without the necessary expert evidence on liability for the defects, on whether the alleged defects had effect on the program of works, and on assessment of the reasonableness of any additional costs incurred, the Court will not be in a position at trial to decide on the defence and the Counterclaim.

27.  Whilst the Court does not condone the delay in this case, I agree with Counsel for the Defendants, that the Court must bear in mind and pay heed to its primary objective and aim in exercising its powers, which is to secure the just resolution of disputes in accordance with the substantive rights of the parties. To refuse leave to adduce the additional and necessary expert evidence sought by the Defendants would gravely affect the just resolution of the substantive rights of the Defendants. It would also seriously hamper the Court from making the necessary findings on the disputed issues in this case.

28.  For these reasons, I accede to the Defendants’ Expert Evidence Application (which includes the applications by summonses of 13 April 2022 and 11 May 2022). In my view, this necessitates the adjournment of the trial, as the parties obviously need time to instruct the SJE on defects and programming, and for all the expert reports to be prepared before trial, which cannot sensibly be done in the remaining 3 weeks.

29.  I will give the parties 21 days to confer and agree on the directions for SJE evidence on quantum, defect and delay, and to submit these directions for the Court’s approval by 4 pm on 21 June 2022.

30.  The delay in the instructions to the expert was mainly caused by the delay in the exchange of factual witness statements. Both parties cannot be excused for either the delay in the exchange of witness statements or the delay in the instructions to the expert. The Plaintiff’s last minute withdrawal of the Amendment Application and the Specific Discovery Application do not alter the overall situation of the disruption in the preparations for trial and the parties’ lack of readiness for trial to commence on 20 June 2022.

31.  As for the Supplemental List Strike Out Application, I agree that for last minute discovery which is not done by way of consent, a party has the burden to provide to the Court a good and credible explanation, by affidavit, as to why the documents had not been disclosed earlier, and why the documents are said to be relevant to the issues before the Court, stating the provenance and identifying the makers of the documents, with an indication as to whether the maker is available to attend Court for cross-examination, and if not, why not. The applicant must also satisfy the Court that the late document will not cause any prejudice to the other side, and that the trial will not be unduly disrupted by the late production of documents (see Big Island Construction (HK)  Ltd v Wu Yi Development Co Ltd HCA 1957/2005, 22 February 2010). The continuing obligation of discovery does not excuse the Plaintiff from the need to satisfy the Court of any of the foregoing.

32.  When the Plaintiff’s Supplemental List was served on 9 March 2022, there was no affidavit to explain the late production of the documents, or the provenance and relevance of the documents, and how they are sought to be relied upon by the Plaintiff’s witnesses in their evidence.  It was only when the Supplemental List Strike Out Application was made on 20 April 2022, that the affidavit of the Plaintiff’s solicitor was filed on 28 April 2022.

33.  I bear in mind that the trial dates have to be vacated now.  Since the Plaintiff’s solicitor has, in the affidavit of 28 April 2022, explained the nature and relevance of the new documents, in the exercise of my discretion, I will allow the Supplemental List to stand, but without prejudice to the Defendants’ right to seek further discovery or information relating to the documents now disclosed, or to seek to file further evidence in response thereto.

34.  The essential question which remains is liability for the costs of the adjournment of the trial.

35.  Bearing in mind my views on both parties’ apparent procrastination, the orders nisi I make on costs are as follows:

(1)  The costs of and the withdrawal of the Specific Discovery Application be paid by the Plaintiff to the Defendants;

(2)  The costs of and occasioned by the Expert Evidence Application be paid by the Defendants to the Plaintiff;

(3)  The costs of and occasioned by Supplemental List Strike Out Application be paid by the Plaintiff to the Defendants; and

(4)  50% of the costs of, occasioned and thrown away by the Adjournment Application be paid by the Defendants to the Plaintiff and 50% be borne by the Plaintiff.

36.  All costs orders will include certificate for Counsel, and shall become absolute unless application for variation is made within 14 days.

37.  A date shall forthwith be fixed for a case management conference to review the status of the proceedings, before new trial dates are to be fixed.

Mr Solomon Lam, instructed by MinterEllison LLP, for the plaintiff

Mr Billy NP Ma, instructed by Ha & Ho, for the 1^st & 2^nd defendants