Civil Justice Reform: An introduction to Four New Possibilities 27 June 2008 [WARNING: This presentation does not necessarily represent the views of the

Civil Justice Reform: An introduction to Four New

Possibilities

27 June 2008

[WARNING: This presentation does not necessarily represent the views of the Department of Justice, the HKSAR Government, the Judiciary or the High Court Rules Committee’s, nor should it be regarded as a substitute for legal advice.]

Civil Justice Reform: An introduction to Four New

Possibilities

(1) Costs-only proceedings

(2) Default judgments and admissions

(3) Pleadings and statements of truth

(4) Sanctioned offers and payments

1. Costs-only proceedings


Costs only proceedings may be brought (s.52A) for the assessment of costs if:

all issues (including liability but not quantum for costs) have been agreed;

the agreement has been made or confirmed in writing; and

no related proceedings have been commenced.


Costs-only proceedings be commenced by Originating Summons in Form 10 (O.62, r.11A) to be accompanied by:

an affidavit exhibiting the agreement; and

the Plaintiff’s bill of costs

the affidavit should set out a brief

background of the dispute to enable the court to

assess or tax the costs


Acknowledgement of Service be made by way

of Form 15A.

General provisions as to costs offers and payments into court under the new O.62A are

applicable (instead of but not dissimilar to the revised O.22 – see below), as in taxation proceedings.

2. Default judgments and admissions


The new O.13A (modeled after Part 14 of the CPR) aims at facilitating settlement and saving court time and costs in relation to claims for liquidated or unliquidated sums of money by enabling defendants to propose payment terms (as to time and instalments) in submitting to entry of judgment by default.

The writ (revised Form 1) issued by a Plaintiff will need to include a statement (as required by O.6, r.2(1)) that the Defendant may make an admission in accordance with O.13A by completing an appropriate form enclosed together with the accompanying Acknowledgement of Service (revised Form 14).


For liquidated claim:A Defendant may within time stipulated (see O.13A,

r.3) make admissions by way of Form 16 as to:

(a) the whole of the claim for a liquidated amount of money (new O.13A, r.4) and the Plaintiff may request for judgment for the whole claim by way of Form 16A ; or

(b) part of the claim for a liquidated amount of money (new O.13A, r.5) and the Plaintiff

shall respond by way of Form 16B to state whether he accepts the amount in

satisfaction of the whole claim.


For liquidated claim:Final judgment without hearing may be entered

against the Defendant for the whole or accepted part of the liquidated amount as the case may be.

Fixed costs be awarded as per revised Part II of the Second Schedule to O.62:

(a) $10,000 if the Plaintiff is legally represented;

(b) $600 if the Plaintiff is not legally represented.

2. Default judgments and admissionsFor unliqiudated claim:

A Defendant may within the time stipulated (new O.13A, r.3) make admissions by way of Form 16C as to:

(a) liability but not quantum (new O.13A, r.6) and Plaintiff may obtain judgment “for an amount to be decided by the court and costs” by way of Form 16D; or

(b) liability and offer an amount in satisfaction of the claim (new O.13A, r.7) and the Plaintiff

shall respond by way of Form 16E to state whether he accepts the amount in satisfacti

on of the whole claim.Judgment without hearing may be entered against the

Defendant for (a) or (b) as the case may be.

2. Default judgments and admissions In filing a Form 16 or Form 16C, the Defendant may also make a

request for time to pay in whole or by instalments (O.13A. r.9):

the Plaintiff may(a) accept the Defendant’s request; or(b) refuse and give reasons for non-acceptanc

e and may counter propose as to the time to pay.

the court shall enter judgment for the amount admitted to be paid and may determine without a hearing date or the times and rate of payment (new O.13A, r.10), but shall consider the information set out in the defendant’s admission filed with the Registry, the reasons why the plaintiff does not accept the defendant’s proposal for payment, and any other relevant factors.

either party may ask for a re-determination when the court’s decision is made without a hearing (new O.13A, r.11)

2. Default judgments and admissions If the Plaintiff does not respond within 14 days to an admission under O.13A, claim will be stayed. Interests will be provided for under O.13A, r.12. Execution is stayed pending payment (O.13A, r.9(7)). In case of default, the stay will cease and the Plaintiff may enforce payment of the whole unpaid balance (O.13A, r.9(8)). Admission may only be allowed to be amended

or withdrawn if the court considers it just to do so

(O.13A, r.2(3)). O.13A not to be used as a substitute for “without prejudice” negotiations.

3. Pleadings and statements

of truth

3. Pleadings and statements of truth

Substantive defence should be pleaded by stating the reasons for denial and state the different versions of events intended to be put forward (O.18, r.13(5)).

Pleading by way of alternatives is permitted (O.18, r.12A).

A Defendant who has adequately set out the nature of his case in relation to which the untraversed allegation is relevant is deemed not to admit and to put the Plaintiff to proof of such allegation (O.18, r.13(6)).

The time to file defence is extended to 28 days (O.18. r.2).


A statement of truth (O.41A, r.2(1)) should, unless otherwise directed, be filed at the same time or separately to verify:

(a) pleadings (including amendments and further and better particulars);

(b) witness statements; and

(c) expert reports,

otherwise, the same may be liable to be struck out or ruled inadmissible (O.41A, r.6).


The form of a statement of truth (O.41A, r.5) shall be:

“I believe that the facts stated in this [name of document being verified] are true and (if applicable) the opinion expressed in it is honestly held.” – for witness statement or expert report

“[I believe] [the (plaintiff or as may be) believes] that the facts stated in this [name of document being verified] are true.” – for a document other than above.

3. Pleadings and statements of truthA statement of truth shall be signed by

(a) a party as defined under O.41A, r.3 (including a “person holding a senior position” or a partner, insurer etc.);

(b) a next friend or guardian ad item (O.41A, r.4(2)); or

(c) a legal representative [or an insurer] on behalf of the party which will be treated

as a statement by the person so signing that (i) the party has authorized him to do so, (ii) he has explained that this would be confirming the party’s belief that the facts stated in the document were true, and (iii) he has informed the party of the possible

consequences (O.41A, r.4(3)).

3. Pleadings and statements of truthA person who makes, or causes to be made, a

false statement in a document verified by a statement of truth without an honest belief in its truth is liable to contempt proceedings

by the Secretary for Justice or a person aggrieved; and

with the leave of the court which should not be granted unless satisfied that the punishment for contempt is appropriate and proportionate (O.41A, r.9(2) and (3)).

4. Sanctioned offers and

payments

4. Sanctioned offers and paymentsSanctioned offers may be made by either the Plaintiff

or the Defendant for the whole or part of the claim or an issue arising from a claim in order to save court time or costs.

There is no prescribed form but must be in writing and served on the other party (O.22, r.5).

If served less than 28 days before commencement of trial, the offer can only be accepted with the court’s leave unless parties agree on the liability of costs (O.22, rr.5(8), 15(2), and 16(2)).

A sanctioned offer may not be withdrawn or diminished before the expiry of 28 days from the date it is made unless with the leave of the court (O.22, r.7(1)).

There is no prescribed form for acceptance of a sanctioned offer.

4. Sanctioned offers and payments A Defendant may also make a sanctioned payment under For

m 23 and must state, among other things, the amount of payment and whether the payment relates to the whole claim or to part of it or to an issue arising from it and if so, to which part or issue (O.22, r.8(2)).

Form 23 has to be served on the Plaintiff (O.22, r.9). A notice (no prescribed form) made to appropriate the whole or part of money already paid to court under order is deemed to be a sanctioned payment notice (O.22, r.27)

A certificate of service has to be filed with court (O.22, r.9).A sanctioned payment may not be withdrawn or diminishe

d before the expiry of 28 days from the date it is made unless with the leave of the court (O.22, r.10(1)).

A sanctioned payment may be accepted by Form 24 (O.22, r.15). Plaintiff may obtain payment out by way of Form 25 (O.22, r.17), which has to be signed by both parties.

4. Sanctioned offers and payments

If there is a subsisting application to withdraw or diminish a sanctioned offer or payment, it may not be accepted without the leave of the court (O.22, r.7(3) & r.10(2)).

Where there are multiple parties, directions may be applied for to deal with any potential Sanderson or Bullock order (O.22, r.13).

4. Sanctioned offers and payments

Consequences of acceptance of part or the whole of a sanctioned offer or payment are dealt with under O.22, rr.20-22.

In relation to(a) the whole claim, the

same is stayed subject to enforcement without the need to commence new proceedings; and

(b) part of the claim or an issue arising, proceedings to that extent stayed subject to enforcement without need to commence new proceedings.

4. Sanctioned offers and payments As to costs,

(a) the offeree gets the costs of the proceedings up to the date of the acceptance if accepted without requiring leave to settle the whole claim (O.22, r.20(1) & r.21(1));

(b) the Plaintiff gets costs of the proceedings up to the date of acceptance if he abandons the remaining parts of the claim or other issues arising upon a sanctioned offer made or notice of payment served in relation to a part of the claim or an issue arising (O.22, r.20(2)); or

(c) it may otherwise be decided by the court (O.22, r.22(3)(c).

4. Sanctioned offers and payments A party who fails to obtain a judgment more

advantageous than an offer which has not been accepted may have the following consequences:

For a Plaintiff who fails to do better:

(a) has all or part of interests on the claim under s.48 disallowed for some or part of the period (O.22, r.23(2)); and

(b) has to pay (on an indemnity basis or otherwise) the costs of the Defendant incurred (O.22, r.23(3) and (4)(a)),

after the latest date on which the offer could havebeen accepted without the leave of the court; and

(c) has the interest on costs (whether or not on an indemnity basis) enhanced, up to 10% above judgment rate, (O.22, r.23(4)(b)).

4. Sanctioned offers and payments For a Defendant who fails to do better:

(a)has the interests on the whole or part of the award (excluding interest) enhanced, up to

10% above judgment rate, for some or part of the period (O.22, r.24(2));

(b)has to pay on an indemnity basis the costs of the Plaintiff incurred (O.22. r.24(3)(a)); and

after the latest date on which the offer could have been accepted without the leave of the court; and

(c) has the interest on costs enhanced, up to 10% above judgment rate, (O.22, r.24(3)(b)).

References

Final Report by the Chief Justice’s Working Party on Civil Justice Reform (available at <http://www.civiljustice.gov.hk>)

Hong Kong Civil Jurisdiction Handbook – Thomson, Sweet and Maxwell Asia

W.W.C.WongW.W.C.WongDepartment of JusticeDepartment of Justice

Documents

Civil Justice Reform: An introduction to Four New Possibilities 27 June 2008 [WARNING: This presentation does not necessarily represent the views of the