|
CACV 53/2020
[2020] HKCA 1090
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF APPEAL
CIVIL APPEAL NO. 53 OF 2020
(ON APPEAL FROM HCPI NO. 32 OF 2016)
________________________
| BETWEEN |
|
|
| CHAN HON, |
|
|
THE ADMINISTRATOR OF THE ESTATE OF POON LAI MING, DECEASED |
Plaintiff |
|
|
and |
|
| BAYER HEALTHCARE LIMITED |
| |
(拜耳醫療保健有限公司) |
1st Defendant |
| |
formerly known as |
|
| |
BAYER DIAGNOSTICS LIMITED |
|
| |
(拜耳診斷產品有限公司) and |
|
| |
formerly known as |
|
| |
BAYER DIAGNOSTICS LIMITED and formerly known as CHIRON LIMITED |
|
| |
(康仁(香港)有限公司) and |
|
| |
formerly known as CIBA CORNING DIAGNOSTICS (H.K.) LIMITED |
|
| |
(汽巴康寧(香港)有限公司) |
|
| BAYER WEIMAR GMBH UND CO. KG (formerly known as SCHERING GMBH UND CO. PRODUKTIONS KG, WEIMAR and formerly known as |
2nd Defendant |
| |
GEHE MEDICA PRODUKTIONSGESELLSCHAFT MBH & CO., KG, WEIMAR) |
|
| |
BAYER PHARMA AKTIENGESELLSCHAFT |
3rd Defendant |
| |
(formerly known as |
|
| |
BAYER SCHERING PHARMA AKTIENGESELLSCHAFT, BERLIN |
|
| |
and formerly known as SCHERING AKTIENGESELLSCHAFT, BERLIN) |
|
________________________
| Before : |
Hon Lam VP and Cheung JA in Court |
| Date of Hearing : |
3 December 2020 |
| Date of Judgment : |
31 December 2020 |
________________________
J U D G M E N T
________________________
Hon Cheung JA (giving the Judgment of the Court) :
I. The parties
1.1 The plaintiff is the widower and administrator of the estate of Poon Lai Ming, deceased (‘the Deceased’).
1.2 The 1st defendant is a Hong Kong company and is the authorized distributor of a contraceptive pills called ‘Yasmin’ (‘the Pills’) in Hong Kong.
1.3 Both the 2nd and 3rd defendants are German companies. The 2nd defendant is the contract manufacturer of the Pills, using active ingredients provided to it by the 3rd defendant. The 2nd defendant then sold the finished product to the 3rd defendant. The 1st defendant purchased the Pills from the 3rd defendant and imported them into Hong Kong for sale on its own account.
II. Background
2.1 The Deceased consumed the Pills. She died on 27 January 2013 at 45 years of age. The cause of death as recorded in the autopsy report was massive pulmonary embolism resulting from thrombosis in the inferior vena cava. In layman terms it means blockage of an artery in the lungs by blood clot that had moved from the large vein of the lower body.
2.2 The 3‑year limitation period for bringing an action for damages for negligence or breach of duty in respect of personal injuries or death was due to expire on 26 January 2016. On 13 January 2016, the plaintiff issued a general endorsed writ claiming against the defendants for negligence, breach of statutory duties in manufacturing, distributing and causing to be distributed in Hong Kong the Pills. The writ was served on the 1st defendant on 6 December 2016.
2.3 The validity of the writ was for one year expiring on 12 January 2017. On 16 December 2016, Master Roy Yu ordered that the validity of the writ be extended for three months from the date of its expiry i.e. until 12 April 2017 (‘the 1st Extension Order’).
2.4 On 29 December 2016, Master Leong granted the plaintiff leave to serve the writ out of the jurisdiction on the 2nd and 3rd defendants (‘the Service Out Order’).
2.5 On 20 March 2017, Master Roy Yu granted a further extension of the validity of the writ for six months from the date of its expiry until 12 October 2017 (‘the 2nd Extension Order’).
2.6 The concurrent writ and its translation were sent to the High Court Registry for service out of jurisdiction on the 2nd and 3rd defendants on 14 March 2017. The actual service of the writ was carried out by the Central Authorities appointed under the Hague Conference on Private International Law. The concurrent writ was served on the 2nd and 3rd defendants on 9 August 2017. They filed their acknowledgement of service on 28 August 2017.
2.7 On 3 January 2018, the 2nd and 3rd defendants filed the summons to discharge the 1st Extension Order, the 2nd Extension Order and the Service Out Order, and to set aside the service of the concurrent writ on them. The application was made pursuant to Order 12, rule 8(1)(c) and (d) of the Rules of the High Court (Cap. 4A) (‘RHC’).
2.8 Master Roy Yu dismissed the 2nd and 3rd defendants’ application. Amongst other things, he found the 2nd and 3rd defendants had submitted to jurisdiction. They appealed to Bharwaney J (‘the Judge’) who, as he was entitled to do, conducted the appeal as a rehearing de novo. The Judge dismissed the appeal. The 2nd and 3rd defendants now appeal to this Court.
III. The Judge’s decision
3.1 The Judge found that the plaintiff had established the two gateway requirements for service out of jurisdiction under Order 11, rule 1 of the RHC namely,
1) rule 1(1)(c) that ‘the claim is brought against a person duly served within or out of the jurisdiction and a person out of the jurisdiction is a necessary or proper party thereto’; and
2) rule 1(1)(f) that ‘the claim is founded on a tort and the damage was sustained, or resulted from an act committed, within the jurisdiction’.
3.2 The Judge also found (notwithstanding the challenge by the 2nd and 3rd defendants) that the plaintiff had demonstrated a serious issue to be tried. He, however, accepted the 2nd and 3rd defendants’ submission and held that there was a material non‑disclosure in the ex parte application by the plaintiff before Master Leong, namely, the caution contained in the Packing Insert of the Pills which stated that ‘while you are receiving this medication, you should see a doctor at least once a year for advice on suitability of continued use’ (‘the Caution’). The Judge held that he would set aside the leave granted to serve outside the jurisdiction on the 2nd and 3rd defendants and he would consider whether he would recall the parties to address him on regranting leave. The Judge then went on to hold that the 2nd and 3rd defendants had in fact submitted to jurisdiction and had waived any irregularities concerning the Service Out Order. As a result he dismissed the appeal brought by the 2nd and 3rd defendants. Accordingly, he did not need to recall the parties to address him further on regranting leave to serve out of the jurisdiction.
3.3 The Judge went on to consider the validity of the two extension orders. He held that if he had not concluded that the 2nd and 3rd defendants had waived any prior irregularities, he would have allowed the appeal by setting aside the 2nd Extension Order. He held that the plaintiff had not demonstrated any good reason for the 2nd Extension Order to be granted, thus the discretion to extend the writ did not even arise.
IV. The appeal
1) Submission to jurisdiction
(1) Order 12, rule 8 and inherent jurisdiction
4.1 The plaintiff is entitled to sue as of right against the 1st defendant who is a Hong Kong company. The position of the 2nd and 3rd defendants is different. As they are not Hong Kong companies, the plaintiff must obtain an order for the service of the writ out of jurisdiction on them under Order 11, rule 1 of the RHC. The 2nd and 3rd defendants’ challenge to the validity of the Service Out Order was brought under Order 12, rule 8 of the RHC and the inherent jurisdiction of the Court. The relevant parts of Order 12, rule 8(1) of the RHC provides that,
‘ Dispute as to jurisdiction (O. 12, r. 8)
(1) A defendant who wishes to dispute the jurisdiction of the court in the proceedings by reasons of any such irregularity as is mentioned in rule 7 or on any other ground shall give notice of intention to defend the proceedings and shall, within the time limited for service of a defence, apply to the Court for ―
......
(c) the discharge of any order giving leave to serve the writ on him out of the jurisdiction, or
(d) the discharge of any order extending the validity of the writ for the purpose of service, or’
4.2 This is a challenge to the jurisdiction of the Hong Kong Court. However, a party may be precluded from objecting to the Hong Kong Court’s jurisdiction by conduct deemed to amount to a voluntary submission to that jurisdiction or a waiver of the challenge.
(2) The principles
4.3 In Miruvor Ltd v Panama‑Globe Steamer Lines SA [2007] 1 HKLRD 804, this Court (Rogers VP and Le Pichon JA) adopted the principles identified in the line of cases which began with Astro Exito Navagacion SA v WT Hsu, The Messiniaki Tolmi [1984] 1 Lloyds Rep 266; Sage v Double A Hydraulics Ltd; Chambers v Starking [1992] Times Law Reports 165; Spargos Mining NL v Atlantic Capital Corp (unrep., The Times, 11 December 1995) and SMAY Investments Ltd & Another v Sachdev & Others [2003] 1 WLR 1973. The principles to be gathered from these authorities are that whether a party submits to the jurisdiction is to be gathered from the circumstances of the case and a useful guide is whether a third party with knowledge of the case would have regarded the acts of the defendant or his lawyers as inconsistent with his challenge to the jurisdiction. The acts of the defendant in order to constitute submission to jurisdiction must be wholly unequivocal.
4.4 In Astro Exito Navagacion SA, Goff LJ (as he then was) at p.270 held :
‘ Now a person voluntarily submits to the jurisdiction of the Court if he voluntarily recognizes, or has voluntarily recognized, that the Court has jurisdiction to hear and determine the claim which is the subject matter of the...
| 
