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Print articleCivil Justice Reform - An Overview
September, 2008 - Karen Dicks, Professional Support Lawyer
The Civil Justice Reforms will come into effect on 2 April 2009. The new court rules aim to improve cost-effectiveness and reduce complexity and delays in court proceedings. The purpose of this bulletin is to briefly highlight some of the major
changes to the High Court and District Court Rules, which will come into effect on 2 April 2009. Subsequent bulletins will deal with these topics in more detail.
1. The Underlying Objectives
The new court rules will contain a list of factors, called “underlying objectives”, which the court must consider and give effect to whenever exercising its powers or interpreting the court rules or a practice direction. The new rules also place an obligation on the parties and their legal representatives to assist the court to further the underlying objectives.
The underlying objectives are factors that will be considered by the court when making any decision. Parties will therefore have to bear them in mind when taking any step in the proceedings and, in particular, when deciding whether to make any interlocutory application.
2. Active Case Management by the Court
The new court rules place a specific duty on the court to further the underlying objectives by actively managing cases. A new rule will give the court general management powers. These powers will enable the court to intervene in a case and make orders of its own motion, rather than sitting back and letting the parties run the case as they think fit. The court will also have greater control over evidence, for example by being able to limit the number of witnesses and order the appointment of a single joint expert for both parties.
The existing Summons for Directions procedure will be replaced by a Case Management Summons and Conference under which parties will be required to complete, file and serve a questionnaire giving detailed information about their case.
After considering the parties’ questionnaires and the needs of the particular case, the court will fix a strict timetable for steps in the action and “Milestone Dates”, which once fixed, will be extremely difficult to change.
3. Pleadings and Statements of Truth
Defences
Bare denials will no longer be possible under the new court rules. A party who denies any allegation in the statement of claim or counterclaim will have to (a) state the reasons for the denial; and (b) state any version of events that he wishes to put forward.
Statements of Truth
Under the new court rules, all pleadings, witness statements and expert reports must
be verified by a statement of truth made by the person putting that document forward.
By making a statement of truth, a person verifies that he believes the contents of the
document to be true.
The potential consequences of signing a statement of truth, without an honest belief
that the contents of the document in question are true, are serious, namely
contempt proceedings, which may result in a fine or imprisonment.
4. Sanctioned Offers and Payments
Under the new court rules, “sanctioned offers and payments” will replace the existing “payments into court” procedure. Under the new rules, Plaintiffs will be able to make sanctioned offers in respect of monetary and non-monetary claims.
Defendants will still be able to make payments into court (to be re-named
“sanctioned payments”) in respect of monetary claims, as under the existing
rules, but will also be able to make “sanctioned offers” in respect of nonmonetary
claims.
Severe financial penalties may be imposed on a party failing to do better at trial than
the other party’s sanctioned offer/payment.
5. Mediation
Under its case management powers, the court, where appropriate, is to encourage
and facilitate the use of Alternative Dispute Resolution procedures such as mediation. It is anticipated that under new practice directions (not yet issued), the court may
make adverse costs orders against a party who unreasonably refuses to mediate,
where mediation has been suggested by the court or the other party.
6. Mareva Injunctions
Under the new rules, where parties are involved in proceedings outside Hong Kong, but have assets in Hong Kong, those assets may be frozen by a mareva injunction in order to assist those foreign proceedings. Such injunctions will only be made where judgments or arbitral awards in those overseas countries are capable of being enforced in Hong Kong.
7. Costs
Costs only proceedings
Under the new court rules, parties who have reached a settlement before any court
proceedings have been commenced and have agreed who is to pay costs, but have
not agreed the amount of those costs, will be able to bring “costs only proceedings”.
These are proceedings in which the only issue for determination by the court is the
amount of costs to be paid. Such proceedings are not possible under the existing court rules.
Wasted costs order
The new rules will enable the court to disallow costs or order a party’s legal representative (their solicitor and/or counsel) to pay any wasted costs, i.e. costs
incurred as a result of improper or unnecessary acts or omissions or any delay
or misconduct in the proceedings.
The new rules are aimed at discouraging unmeritorious/unnecessary applications
and encouraging parties to act reasonably and co-operatively throughout the
proceedings.
Costs against non-parties
Under the new rules, the court will be able to make costs orders against non-parties
such as insurers.
8. Impact on litigation
The new court rules are likely to lead to fundamental changes in the conduct of
litigation and in litigation culture. The rules will encourage parties to be more cooperative and adopt a “cards on the table” approach. As a consequence, there are likely to be fewer interlocutory applications and more settlements.
Greater costs are likely to be incurred at the beginning of proceedings (and before
proceeding are commenced) due to parties having to identify issues and prepare at an earlier stage in order to be able to complete the questionnaire and comply with the
court’s strict timetable.
Between now and April 2009, we shall be publishing further bulletins dealing with
some of the above topics in more detail and with other changes to be brought about by the new court rules and practice directions.
Karen Dicks, Professional Support Lawyer
Litigation Department, Deacons
September 2008
changes to the High Court and District Court Rules, which will come into effect on 2 April 2009. Subsequent bulletins will deal with these topics in more detail.
1. The Underlying Objectives
The new court rules will contain a list of factors, called “underlying objectives”, which the court must consider and give effect to whenever exercising its powers or interpreting the court rules or a practice direction. The new rules also place an obligation on the parties and their legal representatives to assist the court to further the underlying objectives.
The underlying objectives are factors that will be considered by the court when making any decision. Parties will therefore have to bear them in mind when taking any step in the proceedings and, in particular, when deciding whether to make any interlocutory application.
2. Active Case Management by the Court
The new court rules place a specific duty on the court to further the underlying objectives by actively managing cases. A new rule will give the court general management powers. These powers will enable the court to intervene in a case and make orders of its own motion, rather than sitting back and letting the parties run the case as they think fit. The court will also have greater control over evidence, for example by being able to limit the number of witnesses and order the appointment of a single joint expert for both parties.
The existing Summons for Directions procedure will be replaced by a Case Management Summons and Conference under which parties will be required to complete, file and serve a questionnaire giving detailed information about their case.
After considering the parties’ questionnaires and the needs of the particular case, the court will fix a strict timetable for steps in the action and “Milestone Dates”, which once fixed, will be extremely difficult to change.
3. Pleadings and Statements of Truth
Defences
Bare denials will no longer be possible under the new court rules. A party who denies any allegation in the statement of claim or counterclaim will have to (a) state the reasons for the denial; and (b) state any version of events that he wishes to put forward.
Statements of Truth
Under the new court rules, all pleadings, witness statements and expert reports must
be verified by a statement of truth made by the person putting that document forward.
By making a statement of truth, a person verifies that he believes the contents of the
document to be true.
The potential consequences of signing a statement of truth, without an honest belief
that the contents of the document in question are true, are serious, namely
contempt proceedings, which may result in a fine or imprisonment.
4. Sanctioned Offers and Payments
Under the new court rules, “sanctioned offers and payments” will replace the existing “payments into court” procedure. Under the new rules, Plaintiffs will be able to make sanctioned offers in respect of monetary and non-monetary claims.
Defendants will still be able to make payments into court (to be re-named
“sanctioned payments”) in respect of monetary claims, as under the existing
rules, but will also be able to make “sanctioned offers” in respect of nonmonetary
claims.
Severe financial penalties may be imposed on a party failing to do better at trial than
the other party’s sanctioned offer/payment.
5. Mediation
Under its case management powers, the court, where appropriate, is to encourage
and facilitate the use of Alternative Dispute Resolution procedures such as mediation. It is anticipated that under new practice directions (not yet issued), the court may
make adverse costs orders against a party who unreasonably refuses to mediate,
where mediation has been suggested by the court or the other party.
6. Mareva Injunctions
Under the new rules, where parties are involved in proceedings outside Hong Kong, but have assets in Hong Kong, those assets may be frozen by a mareva injunction in order to assist those foreign proceedings. Such injunctions will only be made where judgments or arbitral awards in those overseas countries are capable of being enforced in Hong Kong.
7. Costs
Costs only proceedings
Under the new court rules, parties who have reached a settlement before any court
proceedings have been commenced and have agreed who is to pay costs, but have
not agreed the amount of those costs, will be able to bring “costs only proceedings”.
These are proceedings in which the only issue for determination by the court is the
amount of costs to be paid. Such proceedings are not possible under the existing court rules.
Wasted costs order
The new rules will enable the court to disallow costs or order a party’s legal representative (their solicitor and/or counsel) to pay any wasted costs, i.e. costs
incurred as a result of improper or unnecessary acts or omissions or any delay
or misconduct in the proceedings.
The new rules are aimed at discouraging unmeritorious/unnecessary applications
and encouraging parties to act reasonably and co-operatively throughout the
proceedings.
Costs against non-parties
Under the new rules, the court will be able to make costs orders against non-parties
such as insurers.
8. Impact on litigation
The new court rules are likely to lead to fundamental changes in the conduct of
litigation and in litigation culture. The rules will encourage parties to be more cooperative and adopt a “cards on the table” approach. As a consequence, there are likely to be fewer interlocutory applications and more settlements.
Greater costs are likely to be incurred at the beginning of proceedings (and before
proceeding are commenced) due to parties having to identify issues and prepare at an earlier stage in order to be able to complete the questionnaire and comply with the
court’s strict timetable.
Between now and April 2009, we shall be publishing further bulletins dealing with
some of the above topics in more detail and with other changes to be brought about by the new court rules and practice directions.
Karen Dicks, Professional Support Lawyer
Litigation Department, Deacons
September 2008
