Strike out of stale claims for want of prosecution

Date published




Since the Civil Justice Reform (“CJR”), the courts have been highly critical of “stale” claims which have been inactive for years. In furthering the underlying objectives of CJR, in particular ensuring that the action is dealt with as expeditiously as reasonably practicable,  the attitude of “letting the sleep dogs lie” (i.e. allowing inactive proceedings to remain dormant) is also no longer acceptable. 

In the recent case of Hanly International Limited v Maurice Choy & Anor [2020] HKCFI 590, the Hong Kong Court of First Instance (“CFI”) dismissed two actions issued by the Plaintiff (“P”) which have been inactive for more than nine years.  In doing so, the CFI revisited the principles of strike out for want of prosecution laid down by the Court of Final Appeal (“CFA”) in its landmark judgment in Wing Fai Construction Co. Ltd (in liquidation) [2012] 1 HKLRD 589 (“Wing Fai”).


The background of the case is complicated involving various companies and agreements. For the present purposes, it suffices to say that the dispute arose from two separate but virtually the same agreements entered into between the P and the Defendants (“Ds”) (the “SPAs”).

Under the SPAs, it was agreed that P would purchase Ds’ respective 25% shareholding in a company (the “Company”). While the P had discharged its obligations and paid the considerations in full, the Ds did not transfer the shareholding to P. 

As a result, P issued a writ against D1 and D2 on 30 June 2005 (“1st Action”) and 7 October 2005 (“2nd Action”) respectively. After that, the following procedural events took place:

  • On 12 August 2005, P obtained an interlocutory injunction against D1 restraining him from disposing of his 25% shares in the Company. A similar injunction was granted on 14 October 2005 against D2.
  • On 12 August 2005, the court ordered speedy trial for the 1st Action.
  • On 17 August 2005, the director of P paid a sum of USD 154,281.31 into court pursuant to P’s undertaking in the injunction order granted against D1.
  • On 9 December 2005, the court ordered the 1st and 2nd Actions to be consolidated.
  • On 30 March 2006, the court ordered speedy trial for the 2nd Action.
  • On 2 October 2008, the 3rd checklist review hearing was held.
  • On 7 January 2009, Ds sent to P a further witness statement.
  • On 1 April 2009, the P filed its 4th supplemental list of documents.

Thereafter, the matter came to a standstill.

In around August 2018, the High Court was carrying out a review of pending cases to check whether moneys left in court for a long time should be transferred to the General Revenue. As there was a sum of USD 154,281.31 paid into court by the P’s director, the Registrar sent a letter to the parties on 1 August 2018 requesting the parties to, amongst others, make written submissions to show cause why the actions should not be dismissed for want of prosecution (the “Registrar’s Letter”).

On 2 October 2018, the P filed a Notice of Intention to Proceed.  On 1 November 2018, Ds issued Summonses to dismiss the actions for want of prosecution.

Legal Principles

The principles guiding the exercise of court’s discretion to strike out actions for delay have been set out in Wing Fai, which are summarised as follows:

  1. Striking out was a remedy of last resort and only where it would be plain and obvious to do so. Greater use should be made of other powers of the court, thus avoiding an “all or nothing” approach to dismissal.
  2. Abuse of the process of the court was the foundation for the exercise of the jurisdiction to strike out for delay.
  3. Abuse could take many forms. Mere delay would not suffice.  When considering the aspect of the delay it was important that it should be both inordinate and inexcusable, and that abuse was shown.  It had never been the law that mere delay would be sufficient to justify an order to strike out.  Abuse included inordinate and inexcusable delay causing prejudice to a defendant or contumelious conduct.  It might also take many other forms such as inexcusable non-compliance with or wholesale disregard of an order of the court or the rules of court, litigation anxiety and the existence of an interim injunction pending trial which aggravates the prejudice.
  4. Where abuse was clearly demonstrated, for example where there was contumelious conduct on the part of the plaintiff, proceedings could be struck out even where prejudice to the defendant could not be shown. However, in the majority of applications, the aspect of prejudice would often be extremely relevant.  Prejudice might well be relevant to the overall justice of the case.
  5. The conduct of the parties remained a relevant consideration. It was relevant both to the critical question of abuse as well as to the overall justice of the case.  Post-CJR where all parties to the proceedings had the obligation to prosecute the proceedings and assist the court in furthering the underlying objectives, it would be highly relevant to consider any failure on the part of the parties.  There was no place anymore for defendants to adopt the attitude of “letting sleeping dogs lie”.  If it was sought to be argued that time had dimmed the memories of witnesses, the court will usually want to know what steps had been taken by the defendant to take instructions, or proof or locate witnesses.
  6. Post-CJR, the underlying objective of ensuring that the court’s resources were distributed fairly (Order 1A rule 1(f) RHC) was referable to the administration of justice.

CFI Decision

In considering whether or not to exercise its discretionary power to strike out P’s actions, the CFI carefully examined all the circumstances and found the following:

  • None of the explanations offered by the P’s directors for P’s delay are credible or satisfactory. There have been unexplained inconsistencies in the P’s case and evidence;
  • The delay in the actions for some nine and a half years is plainly inordinate and inexcusable, in particular when there had been orders for a speedy trial;
  • P’s director should have been aware of the development of the case before the matter came to a standstill. At the time, it appeared that the P made a decision not to proceed with setting the actions for trial;
  • P did not appear to have an intention to bring the actions to a speedy conclusion. The P was only trying to use the actions to demand a settlement sum which was not supported by evidence. This amounts to abuse of process;
  • Due to the inaction, there has been real prejudice to Ds in that the witnesses’ recollection of what happened in 2004 must have been affected by the long delay;
  • P did not decide to revive the actions of its own accord. It only filed a Notice of Intention to Proceed 2 months after the Registrar’s Letter.

In its decision making process, the CFI also took into account D’s attitude and conduct, including the  Ds’ non-compliance with the injunction orders and that they have adopted the attitude of “letting sleeping dogs lie”. Notwithstanding that, in the overall administration of justice and bearing in mind the principles in Wing Fai, the CFI ultimately formed the view that it is plain and obvious, and just, to strike out the P’s actions.


Strike out is a remedy of last resort and the court will approach a strike out application on a case by case basis taking into account the facts of the case. This case serves a useful reminder that the court will not refrain from striking out a “stale” claim in the right set of circumstances where it is plain, obvious, and just to do so.

The courts exist to assist parties to resolve disputes and they should not be used by litigants for other purposes.  When an action is commenced, the court expects both the plaintiff and the defendant to proactively make progress towards resolving the dispute. As said by the Chief Justice in Wing Fai, litigation was not to be treated as a game, but as a serious legal contest.