Sir Elly Kadoorie & Sons Ltd (For And On Behalf Of Itself, Its Current And Former Officers, Employees And Agents, Including Its Legal Representatives, Messrs Simmons & Simmons) v Samantha Jane Bradley

HCA 518/2022

[2023] HKCFI 1478

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 518 OF 2022

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DECISION

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INTRODUCTION

1. This action is founded on the tort of harassment and has been commenced by the plaintiff (“SEKSL”) (a corporate entity) as a representative action for and on behalf of itself, its current and former officers, employees and agents, including its legal representatives, Messrs. Simmons & Simmons (“S&S”) (collectively, “the Representees”).

2. This Decision will deal with two summonses:

(1) The Amended Summons filed by the defendant on 3 February 2023 (“the First Summons”)[1] pursuant to Order 14A rule 1 and Order 18 rule 19(1)(a) of the Rules of the High Court (Cap. 4A, Laws of Hong Kong) (“RHC”), for:

(a) a declaration that, as a matter of law, a corporate entity has no cause of action against a person under the tort of harassment and, as a consequence:

(i) SEKSL’s claims for injunctive relief and/or damages be dismissed; and

(ii) SEKSL has no locus standi as plaintiff to represent the Representees and that the action herein be dismissed.

(b) alternatively, if SEKSL is permitted to proceed to act as the representative plaintiff in this action, an order that the claims of all the Representees, except those of John Andrew Harry Leigh (“Mr Leigh”), be struck out on the grounds that, on the pleaded facts in the Statement of Claim, they have no common interest and/or cause of action against the defendant.

(2) The Summons taken out by the defendant on 8 September 2022 (“the Second Summons”) pursuant to, inter alia, Order 15 rule 12(1) and Order 18 rule 19(1)(b) to (d) of the RHC, for an order that:

(1) the Writ and Statement of Claim herein be struck out and the action dismissed on the grounds that it is scandalous, frivolous or vexatious, or it may prejudice or embarrass the fair trial of the action, or it is otherwise an abuse of process of the court;

(2) alternatively, this action be stayed pending the conclusion of ongoing criminal and regulatory investigations of SEKSL and any of the Representees;

(3) alternatively, SEKSL be prohibited from continuing this action as a representative action.

LEGAL PRINCIPLES ON PROCEDURAL MATTERS

3. As various applications have been made by virtue of the two summonses before this Court, it may be more convenient to set out the legal principles applicable to the procedural matters involved at one go before I deal with those applications separately.

Striking out

4. Au-Yeung J has helpfully summarised the relevant principles applicable to a striking out application in Sealegend Holdings Ltd v China Taiping Insurance (HK) Co Ltd (HCAJ 95/2012, unreported, 24 October 2014), which I would adopt as follows:

“24. The court may, either of its own motion or on application, at any stage of the proceedings order to be struck out any claim on the basis, amongst others, that it is scandalous, frivolous or vexatious or is otherwise an abuse of the process of the court: Order 18, rule 19(1)(b) and (d).

25. A proceeding is frivolous when it is incapable of reasoned argument, without foundation or cannot possibly succeed. A proceeding is vexatious when it is oppressive or lacks bona fides. The expression ‘frivolous or vexatious’ includes proceedings which are an abuse of the process: Hong Kong Civil Procedure 2014, §18/19/8.

26. An ‘abuse of the process of the court’ connotes that the process of the court must be used bona fide and properly and must not be abused. The court will prevent the improper use of its machinery, and will, in a proper case (eg where an action is absolutely groundless or time-barred) summarily prevent its machinery from being used as a means of vexation and oppression in the process of litigation: Hong Kong Civil Procedure 2014, §18/19/10.

27. The court has inherent jurisdiction to stay all proceedings before it which are obviously frivolous or vexatious or ‘hopeless’ in the sense of being bound to fail: Hong Kong Civil Procedure 2014, §18/19/12, 16 and 21.

28. There should be no trial on affidavit. Disputed facts are to be taken in favour of the party whose pleading is under attack. See Hong Kong Civil Procedure 2014, at §18/19/4, paragraph (1).

29. The power to strike out should only be exercised in plain and obvious cases where the claim is obviously unsustainable. A claim must be so obviously unsustainable, the pleading unarguably bad, and it must be impossible, not just improbable, for the claim to succeed before the Court would strike it out. That a case may be weak and unlikely to succeed is no ground for striking it out. See Hong Kong Civil Procedure 2014, at §18/19/4, paragraph (1).

30. Strike out is not justified merely because the story told is highly improbable, and one which it is difficult to believe would be proved. A party’s claim or defence would be struck out only if it is a sham so that to rely on it must be an abuse of the process of the court. Even if one side has a ‘formidable case’, it does not mean that the other has no case. See Hutchvision Asia Ltd v Asia Television Ltd, HCA 6757/1992, 8 September 1993, per Godfrey J (as he then was), p6.

‘But any lawyer with any experience of private practice will be able to remember, only too well, those cases which appeared to be certainties but which, to his surprise, nevertheless failed and, by the same token, those cases which seemed bound to fail but which, to his surprise, nevertheless succeeded. It is for just this reason that the court will not embark, at this stage of an action, on a consideration whether the case of one side or the other is true or false. It will consider only whether the nature of the defence is such that it has to be characterised as an abuse of the process of the court, which is something else altogether.’

31. Where a party seeks to strike out another’s case as unsustainable, he will have to show the other party’s case to be ‘wholly imaginary, a myth or not bona fide’: Overseas Trust Bank Ltd v Coopers & Lybrand & Ors, CACV 109/1989, Fuad VP, 15 December 1989, p15.

32. It is not sufficient to adduce evidence that is relevant for consideration. The lack of proper explanation from the party whose pleading is sought to be struck out is not enough. See Viva Steamship Co Ltd v Chow Lim Choy & Ors [2003] 1 HKLRD 663 (CA), at §11.”

Order 14A

5. In Shell Hong Kong Limited v Yeung Wai Man Kiu Yip Company Limited [2003] 3 HKLRD 62, Chan PJ examined the nature of the Order 14A procedure as follows:

“20. The Order 14A procedure was first introduced in England in 1991 and in Hong Kong in 1992. The underlying policy of this Order is, as the Supreme Court Practice 1993 described, ‘to accelerate the final judicial disposal of an action at the interlocutory stage and thereby save the expense and delay which would otherwise arise not only if the action were to proceed to a full trial but also if the parties would be required to undertake the necessary pre-trial steps to prepare for such trial.’ Vol. 1 para. 14A/1-2/1, p. 175.

21. For the purpose of this appeal, I need only refer to the main provision in Order 14A rule 1(1) which provides:

‘(1) The Court may upon the application of a party or of its own motion determine any question of law or construction of any document arising in any cause or matter at any stage of the proceedings where it appears to the Court that –

(a) such question is suitable for determination without a full trial of the action; and

(b) such determination will finally determine (subject only to any possible appeal) the entire cause or matter or any claim or issue therein.’

22. This rule may be invoked for a determination of a question of law or construction of any document by the court, provided that the two conditions in (a) and (b) above are fulfilled. The parties must either have consented to adopt such a procedure or have had the opportunity to be heard. Order 14A rule 1(3).

23. In cases which involve the determination only of a question of law or the construction of a document or where the whole case largely depends on the resolution of a question of law or the construction of a document, the Order 14A procedure is often adopted to put an early end to the entire case. However, it can be seen that under the condition in (b), this procedure can be invoked for the purpose of finally determining not only the entire cause or matter but also ‘any claim or issue’ in the cause or matter. It is not necessary for the making of an application under Order 14A that the determination of a question of law or construction of any document would finally determine the whole action. Such a requirement would be wrong as a matter of ‘interpretation of the order and as an exercise of discretion’. See Leggatt LJ in Korso Finance Establishment Anstalt v. Wedge & others, unreported, February 15, 1994, CA Transcript, at p.7 (in which it was held that an issue of construction was still suitable for determination under Order 14A even though a determination of this issue would not finally determine the entire action between the parties). It is sufficient if an issue in the case can be...