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Ng Yat Chi v Max Share Ltd And Another

Judgment Cited authorities 23 Cited in Precedent Map Related
Vincent
Judgment Date20 January 2005
Year2005
Citation[2005] 1 HKLRD 473; (2005) 8 HKCFAR 1
Judgement NumberFACV5/2004
Subject MatterFinal Appeal (Civil)
CourtCourt of Final Appeal (Hong Kong)
FACV000005/2004 NG YAT CHI v. MAX SHARE LTD AND ANOTHER

FACV No. 5 of 2004

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

FINAL APPEAL NO. 5 OF 2004 (Civil)

(ON APPEAL FROM CACV Nos. 306 & 414 of 2002)

_______________________

Between:
NG YAT CHI Appellant
and
MAX SHARE LIMITED 1st Respondent
CHINA RESOURCES (HOLDINGS) COMPANY LIMITED 2nd Respondent

_______________________

Court: Chief Justice Li , Mr Justice Bokhary PJ, Mr Justice Chan PJ, Mr Justice Ribeiro PJ and Lord Scott of Foscote NPJ

Date of Hearing: 29 November 2004

Date of Judgment: 20 January 2005

_______________________

J U D G M E N T

_______________________

Chief Justice Li :

1. The judgment of Mr Justice Ribeiro PJ deals comprehensively with the inherent jurisdiction of the court to make an extended order and how that jurisdiction should be properly and effectively exercised. I am in complete agreement with his judgment. Having regard to the importance of the subject in the proper administration of justice in our courts, I wish to make some observations on certain aspects of this jurisdiction. These observations are intended to be and should be read as entirely consistent with what is contained in Mr Justice Ribeiro PJ’s judgment.

Abusive proceedings

2. It is not difficult to recognise the activities of the vexatious litigant. The person concerned will almost invariably be unrepresented and will pursue abusive proceedings which usually exhibit some of the following features. Hopeless claims are instituted. Totally misconceived appeals are launched. Judgments of the court, both interlocutory and at trial and both first instance and appellate, may not be accepted. There are likely to be attempts, often repeated, to re-litigate the same matters as have already been determined. The materials filed will often be irrelevant, incoherent or scandalous. When present at a hearing, some vexatious litigants are unable to conduct themselves with decorum and may hurl abuse at the opposite parties and/or the judge.

3. Abusive proceedings are oppressive to the other parties and result in unfairness to them. To protect themselves against such proceedings, time, effort and stress are involved and costs have to be incurred. They may be in a weak position to cope. Often, there may be little prospect of recovering the costs incurred.

4. Quite apart from causing unfairness to the other parties, abusive proceedings lead to unfairness to other litigants before the courts. Judicial resources are inevitably finite. The time which judges and their supporting staff have is of course limited. Where much needed resources are diverted to dealing with abusive proceedings, litigants with cases of real merit suffer as a result. It will take a longer time for their cases to be dealt with. Courts should concentrate their resources in dealing with meritorious cases. Their attention should not be unnecessarily diverted to dealing with abusive proceedings.

The right of access

5. The constitutional right of access to the courts is well established under the common law and is guaranteed by the Basic Law (Article 35). But it would be absurd to suggest that the right of access involves a right to abuse the court’s process. The pursuit of abusive proceedings would be an improper exercise of the right of access and may be regarded as adversely affecting the right of access of others with meritorious cases.

The prevention of abuse of process

6. The categories of abuse of process are never closed. In the context of the civil justice system as it evolves from time to time, there is an infinite variety of abuse that may arise. The courts are equipped with various powers by legislation, including rules of court, to deal with abuse of process. In addition to and in parallel with the statutory powers, there is no doubt that the courts have an inherent jurisdiction to prevent abuse of process. The proper and effective exercise of the courts’ jurisdiction to prevent abuse, both statutory and inherent, is essential to the prevention of injustice to the other parties to the litigation in question as well as the operation of a fair and efficient judicial system. In exercising such jurisdiction, the courts should be flexible in developing remedies which are proportionate to the abuse that has to be dealt with.

Grepe v Loam orders

7. The courts of course have the inherent jurisdiction to deal with abusive proceedings that have already commenced. The power to make a Grepe v Loam order is well established and is widely accepted in many jurisdictions. Such an order relates to existing proceedings. The party subject to the order is not allowed to make any further application in the proceedings already instituted without the leave of the court. The order is preventive in nature and constrains future applications in existing proceedings, requiring the party concerned to obtain the court’s leave. The justification for controlling future applications in this way is that, having regard to the party’s past conduct in making abusive applications, it is apprehended that future abusive applications may be made.

Extended orders

8. There is no reason in principle why the inherent jurisdiction should be confined to dealing with anticipated abusive applications in existing proceedings. In my view, there is every reason in principle why it should also extend to preventing abusive proceedings which have not been commenced but are anticipated. See Ebert v Venvil [2000] Ch 484 at 496F – 497D (Lord Woolf). I agree with Mr Justice Ribeiro PJ that for the reasons explained in his judgment, the courts have the inherent jurisdiction to make an extended order. Just as the court can protect itself against anticipated abuse by making a preventive order directed at future applications in existing proceedings, so it can similarly protect itself by making a preventive order directed at abusive proceedings that may be instituted in the future. The justification is that in view of the past conduct of the party concerned, it is apprehended that that party may commence fresh proceedings which may be abusive. The extended order does not bar the institution of any new proceedings. Its scope is limited to constraining new proceedings which may be abusive.

9. In his able submissions as an amicus, Mr Bernard Man advanced the arguments referred to by Mr Justice Ribeiro PJ as the statutory displacement argument and the constitutional right argument in support of the contention that there is no inherent jurisdiction to make an extended order and that the making of such an order requires statutory authority. As to the latter argument, once it is understood that the constitutional right of access to the courts plainly cannot involve a right to abuse the court’s process, that argument must be rejected.

10. The question arising in relation to the statutory displacement argument is whether the suggested inherent jurisdiction to make an extended order has been abrogated by implication by s.27 of the High Court Ordinance, Cap 4. Under this provision, on an application by the Secretary for Justice and upon being satisfied of the prescribed criteria, the court may make an order prohibiting any new proceedings without leave. Such an order is a blanket order prohibiting all new proceedings in the absence of leave. The smaller the difference between the statutory jurisdiction and the inherent jurisdiction contended for, the stronger is the argument of implied abrogation. Here, having regard to the material differences between the statutory jurisdiction to make a blanket order and the inherent jurisdiction to make an extended order, including the differences between the two kinds of order, the statutory provision has not ousted the court’s inherent jurisdiction in this regard.

Prohibited class of proceedings

11. The focus of an extended order is on a defined class of proceedings which is prohibited without leave. The class should be defined with clarity. Its permissible scope is laid down in Mr Justice Ribeiro PJ’s judgment. That being its focus, an extended order is capable of protecting persons who were not parties to the original proceedings in which the extended order was made. If after the order was made, fresh proceedings are instituted against such persons, they would be protected by the extended order if the proceedings fall within the defined class.

Prevention of further abuse

12. A Grepe v Loam order and an extended order are intended to prevent further abuse of process. It would be unfortunate if the orders, particularly the requirement for leave thereunder, give rise to yet further abuse. It is important that arrangements are put in place as part of the court system to prevent this from occurring, such as the issue of an appropriate practice direction and effective use of the courts’ information technology system. At the same time, it is essential that in individual cases, orders are formulated with appropriate supporting directions to ensure that the orders can be effectively implemented and that the opportunity for further abuse is minimised.

Requirement for leave

13. The requirement for leave is of course a central feature of an extended order, as it is for a Grepe v Loam order. It is a mechanism to prevent further abuse as well as a safeguard to ensure that meritorious claims are not shut out. In relation to an extended order, the leave requirement would be dealt with as follows :

(1) Where leave is sought, the first question for the court to determine is whether the new proceeding is within the prohibited class of proceedings specified in the order. In considering this question, the court should look at the substance of the matter.

(2) Where the court concludes that the new proceeding is not within the specified...

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