ORDER 21 Withdrawal and Discontinuance

Contentspara.

21/0/1

1.Withdrawal of acknowledgment of service (O.21, r.1) 21/1

2.Discontinuance of action, etc., without leave (O.21, r.2) 21/2

3.Discontinuance of action, etc., with leave (O.21, r.3) 21/3

4.Effect of discontinuance (O.21, r.4) 21/4

5.Stay of subsequent action until costs paid (O.21, r.5) 21/5

6.Withdrawal of summons (O.21, r.6) 21/6

Editorial Introduction

21/0/2

Order 21 contains six rules (their terms may be contrasted with District Court Civil
Procedure (General) Rules, r.44). Rule 1 deals with the withdrawal of an acknowledgment
of service, rr.2 and 3 with the discontinuance of an action or the withdrawal of a claim
made in an action and indicate the circumstances in which the leave of the court is required,
and r.6 with the withdrawal of a summons in a pending cause or matter. The remaining
rules deal with the effect of withdrawal or discontinuance under r.3 (r.4) and with the
staying of proceedings in a subsequent action until costs are paid (r.5). The Order does not
apply to probate actions (O.76, r.11).

Rules 2 to 5 constitute a complete code on the subject of withdrawal and discontinuance of

the whole or part of an action, defence and counterclaim. They should be read together.
Notes on these rules are placed after r.5 (see paras 21/5/1 et seq.). Rules 1 and 6 deal with
two quite identifiably separate matters and are treated in notes following each rule.

Related Sources

21/0/3

•RHC, O.12 (Acknowledgment of service of writ or originating summons)

•RHC, O.20, r.2 (Amendment of acknowledgment of service)

•RHC, O.29, r.11 (Withdrawal or discontinuance by party in whose favour order for interim payment
has been made)
•RHC, O.62, r.3(7), r.10(1) (Costs regarding withdrawal or discontinuance and signing judgment for
defendant's costs on discontinuance)

•RHC, O.76, r.11 (Discontinuance and dismissal in probate actions)

•District Court Civil Procedure (General) Rules r.44(1)-(3)

Forms

21/0/4

The following Prescribed Form in Appendix A is relevant to O.21:

•No. 50--Judgment for defendant's costs on discontinuance (O.62, r.10(1))

Withdrawal of acknowledgment of service (O.21, r.1)

21/1
1. A party who has acknowledged service in an action may withdraw the acknowledgment at any time
with the leave of the Court.

21/1/1

Effect of rule

This rule provides for the withdrawal of an acknowledgment of service with the leave of the
court.

The application for leave to withdraw an acknowledgment of service is made ex parte to the
practice master on production of the consent of the plaintiff or his solicitor; the master will
indorse his leave on the sealed copy of the acknowledgment of service. If the consent of the
plaintiff is refused or cannot be obtained, the application for leave to withdraw an
acknowledgment of service is made by summons before the master.

The court has a complete discretion to grant a party leave to withdraw an acknowledgment
of service even though it contains a statement of intention to contest the proceedings where
such acknowledgment was returned by accident, e.g. a solicitor acting without proper
authority or instructions or the facts show that there has been what can properly be called a
mistake (Firth v. John Mowlem & Co. Ltd [1978] 1 W.L.R. 1184; [1978] 3 All E.R. 331,
CA). Indeed, the discretion of the court is unfettered, and is not limited to a case where the
defendant acted under a mistake, though the discretion will be exercised with caution, and
the court will have regard to all the circumstances of the case, and will weigh the balance
between the faults of the parties and the prejudice which will or may be occasioned to each
of them arising from the grant or refusal of such leave (per Mustill J. in Rothmans of Pall
Mall (Overseas) Ltd v. Saudi Arabia Airlines Corp. [1981] Q.B. 368; [1980] 3 All E.R.
359).

On the other hand, where the acknowledgment of service or notice of intention to defend
 has been returned or given deliberately by solicitors acting on proper advice and doing
what they intended to do, leave to withdraw such acknowledgment or notice will be refused
(Somportex Ltd v. Philadelphia Chewing Gum Corp. [1968] 3 All E.R. 26, CA).

This rule should be read in conjunction with O.20, r.2 "Amendment of acknowledgment of
service."

Discontinuance of action, etc., without leave (O.21, r.2)

21/2
2.--(1) Subject to paragraph (2A) the plaintiff in an action begun by writ may, without the leave of the
Court, discontinue the action, or withdraw any particular claim made by him therein, as against any or
all of the defendants at any time not later than 14 days after service of the defence on him or, if there
are two or more defendants, of the defence last served, by serving a notice to that effect on the
defendant concerned.

(2) Subject to paragraph (2A) a defendant to an action begun by writ may, without the leave of the
Court--

(a)withdraw his defence or any part of it at any time,

(b)discontinue a counterclaim, or withdraw any particular claim made by him therein, as against any or
all of the parties against whom it is made, at any time not later than 14 days after service on him of a
defence to counterclaim or, if the counterclaim is made against two or more parties, of the defence to
counterclaim last served,

by serving a notice to that effect on the plaintiff or other party concerned.

(2A) A party in whose favour an interim payment has been ordered, in accordance with Order 29, may
not discontinue any action or counterclaim, or withdraw any particular claim therein, except with the
leave of the Court or the consent of all the other parties.

(3) Where there are two or more defendants to an action begun by writ not all of whom serve a defence
on the plaintiff and the period fixed by or under these rules for service by any of those defendants of his
defence expires after the latest date on which any other defendant serves his defence, paragraph (1)
shall have effect as if the reference therein to the service of the defence last served were a reference to
the expiration of that period.

This paragraph shall apply in relation to a counterclaim as it applies in relation to an action begun by
writ with the substitution for references to a defence, to the plaintiff and to paragraph (1), of references
to a defence to counterclaim, to the defendant and to paragraph (2) respectively.

(3A) The plaintiff in an action begun by originating summons may, without the leave of the Court,
discontinue the action or withdraw any particular question or claim in the originating summons, as
against any or all of the defendants at any time not later than 14 days after service on him of the
defendant's affidavit evidence filed pursuant to Order 28, rule 1A(4) or, if there are two or more
defendants, of such evidence last served, by serving a notice to that effect on the defendant concerned.
(3B) When there are two or more defendants to an action begun by originating summons not all of
whom serve affidavit evidence on the plaintiff, and the period fixed by or under these rules for service
by any of those defendants of his affidavit evidence expires after the latest date on which any other
defendant serves his affidavit evidence, paragraph (3A) shall have effect as if the reference therein to
the service of the affidavit evidence last served were a reference to the expiration of that period.

(4) If all the parties to an action consent, the action may be withdrawn without the leave of the Court at
any time before trial by producing to the Registrar a written consent to the action being withdrawn
signed by all the parties.

Discontinuance of action, etc., with leave (O.21, r.3)

21/3
3.--(1) Except as provided by rule 2, a party may not discontinue an action (whether begun by writ or
otherwise) or counterclaim, or withdraw any particular claim made by him therein, without the leave of
the Court, and the Court hearing an application for the grant of such leave may order the action or
counterclaim to be discontinued, or any particular claim made therein to be struck out, as against any
or all of the parties against whom it is brought or made on such terms as to costs, the bringing of a
subsequent action or otherwise as it thinks just.

(2) An application for the grant of leave under this rule may be made by summons or motion or by
notice under Order 25, rule 7.

Effect of discontinuance (O.21, r.4)

21/4
4. Subject to any terms imposed by the Court in granting leave under rule 3, the fact that a party has
discontinued an action or counterclaim or withdrawn a particular claim made by him therein shall not
be a defence to a subsequent action for the same, or substantially the same, cause of action.

Stay of subsequent action until costs paid (O.21, r.5)

21/5
5.--(1) Where a party has discontinued an action or counterclaim or withdrawn any particular claim
made by him therein and he is liable to pay any other party's costs of the action or counterclaim or the
costs occasioned to any other party by the claim withdrawn, then, if, before payment of those costs, he
subsequently brings an action for the same, or substantially the same, cause of action, the Court may
order the proceedings in that action to be stayed until those costs are paid.

(2) An application for an order under this rule may be made by summons or motion or by notice under
Order 25, rule 7.

21/5/1

Effect of rules 2-5 (rr.2-5)

 These rules constitute a complete code on the subject of withdrawal and discontinuance of
the whole or part of an action, defence and counterclaim. They provide for a certain time
before which discontinuance of a claim or counterclaim may be made without leave, and
after which discontinuance requires the leave of the court. See "Time for service of notice
of discontinuance of withdrawal", para. 21/5/3.

These rules draw a clear distinction, which may not be a matter of mere terminology, since
it may affect the question of costs or the institution of a new action or the making of a new
claim, between a "discontinuance" and a "withdrawal", The term "discontinuance" appears
to be directed to the final termination of the whole action or counterclaim, so that no part of
it survives an effective discontinuance; whereas the term "withdrawal" appears to be
directed to the termination of part only of an action, namely in an action begun by writ, of a
particular claim made in the action or counterclaim; and in an action begun by originating
summons, of a particular question or claim raised in the summons. This distinction applies
whether the discontinuance or withdrawal is effected without leave or pursuant to leave,
and therefore when serving the relevant notice or applying for the requisite leave, care
should be taken to employ the appropriate term.

Rules 2-5 of this Order apply only if the action was begun by writ or by originating
summons, so that the right to discontinue without leave is not available in proceedings
begun by an originating notice of motion (Re Dyson's Trade Mark (1891) 65 L.T. 488) nor,
it would seem, to any case in which a defence is not required by any rule to be served (ibid.)
e.g. third party proceedings. Order 21, r.2 has no application to judicial review proceedings
(Peter Po Fun Chan v. Winnie C. W. Cheung [2006] W.L. 7995 L; [2006] H.K.E.C. 226).

21/5/2

Discontinuance or withdrawal by plaintiff without leave (r.2)

The right of a plaintiff to discontinue the action or withdraw part thereof without the leave
of the court may be exercised only if the following conditions are fulfilled:

(A) Where the action is begun by writ

(i)that a notice of discontinuance or a notice of withdrawal of a particular claim, as the case

may be, is served on the defendant, or if there are two or more defendants, on the defendant
concerned;

(ii)that service of the notice of discontinuance or withdrawal is duly effected within, and
not later than, the time specified in rr.2(1) and (3); and

(iii)that an order for an interim payment under O.29 has not been made in his favour. It
should be noted that the Hong Kong rule applies to an interim payment ordered pursuant to
O.29 (rather than O.29, r.11 in the English rule). Therefore, the Hong Kong rule covers
both interim payments made pursuant to O.29, r.11 and r.12.

(B) Where the action is begun by originating summons

(i)that a notice of discontinuance or a notice of withdrawal of any particular question or
claim, as the case may be, is served on the defendant, or if there are two or more defendants,
on the defendant concerned; and

(ii)that service of the notice of discontinuance or withdrawal is duly effected within, or not
later than, the time specified in rr.2(3A) and (3B).

In either case the notice of discontinuance or withdrawal must be in writing, and must be
clear and unequivocal, stating whether the action is wholly discontinued or specifying the
particular claim or question which is being withdrawn. No particular form is necessary
(The Pomerania (1879) 4 P.D. 195; M'Ilwraith v. Green (1884) 14 Q.B.D. 766, CA;
Spencer v. Watts (1889) 23 Q.B.D. 353, CA); cf. Moon v. Dickinson (1890) 63 L.T. 371.

The word "claim" in r.2(1) is used to indicate a cause of action rather than a form of relief
and, accordingly, the plaintiff may abandon any head of relief at any time without leave and
without notice to the defendant, e.g. withdrawing the prayer for specific performance and
electing to claim damages only, and thereby becoming entitled to enter judgment in default
of defence under O.19, r.3. (Morley London Developments v. Rightside Properties (1973)
117 S.J. 876, CA).

Where a defendant pays money into court in satisfaction of only one or more causes of
action, the plaintiff is entitled to serve notice of acceptance of such payment in and at the
same time abandon all the other causes of action in respect of which the defendant has
denied liability and made no payment in and in such event, the plaintiff is entitled to tax his
costs of his entire action including the costs of his abandoned claims (Hudson v. Elmbridge
B. C. [1991] 1 W.L.R. 880; [1991] 4 All E.R. 55, CA and see note at para. 22/3/1).

Where a plaintiff's claims against two co-defendants were several and not joint, and a
payment into court was made by one co-defendant and subsequently accepted by the
plaintiff, the plaintiff could proceed to trial against that other defendant. If the plaintiff
wished to discontinue the other several claim against the defendant who had not made a
payment in, he must make an application for an order for costs in respect of that defendant
and the court is endowed with the jurisdiction to award such costs under O.21, r.3 and
s.52A of the High Court Ordinance (General Accident Insurance Asia Ltd v. Hampton
Winter & Glynn & Others [1999] 2 H.K.L.R.D. 109).

Although the plaintiff has the unqualified right under r.2(1) to discontinue his action
without the leave of the court before the service of the defence on him and indeed within 14
days after such service, yet if he abuses such right by serving a notice of discontinuance
after obtaining substantial advantages in the action to the prejudice of the defendant, e.g. by
securing substantial interim payments and an admission of liability or otherwise, he will be
guilty of an abuse of the process of the court, and the court will then have power to set aside
his notice of discontinuance, but nevertheless, the court in its discretion may grant him
leave to discontinue on terms and will not grant an injunction against him to restrain him
from bringing or continuing an action based on the same cause of action in a foreign court,
e.g. in Texas, USA where he is advised that he can obtain substantially higher damages for
 personal injuries than he can in England, where he can show that he will gain a legitimate
personal or juridical advantage by doing so and that on the critical question between
advantage to him and disadvantage to the defendant, the balance is in his favour (Castanho
v. Brown & Root (U.K.) Ltd [1981] A.C. 557; [1980] 1 All E.R. 143, HL, affirming on
different grounds [1980] 1 W.L.R. 833; [1980] 3 All E.R. 72, CA). See also Fakih Brothers
v. Moller (Copenhagen) [1994] 1 Lloyd's Rep. 103 where Casthano v. Brown & Root (U.K.)
Ltd (above) was applied and a notice of discontinuance served before defence (but after an
injunction had been granted to the defendant) was set aside and see Ernst & Young v. Butte
Mining Plc, The Times, March 22, 1996.

The principle underlying r.2(2A) is that if a party has an order for an interim payment under
O.29, r.11 or r.12 made in his favour, he is to be treated as if, as it were, he elected to
continue his action or counterclaim and therefore should not be allowed to discontinue the
action or counterclaim without the leave of the court or the consent of all the other parties.
It should be noted, however, that this rule does not apply if an interim payment is made
voluntarily and not pursuant to an order of the court but nevertheless in such a case the
principle of Castanho v. Brown & Root Ltd (above) may still apply.

Where an application for urgent interlocutory relief is made prior to the filing of originating
process, the applicant should undertake to file the appropriate originating process as soon
as reasonably practicable. That applies even if it is decided not to continue with the
proceedings. Once the originating process has been issued, it can then be assigned an action
or micellaneous proceedings number. The proceedings can then be discontinued, either
without leave under RHC, O.21, r.2 if the originating process was a writ, or with leave
under O.21, r.3 if other form of originating process was used (Dragon Capital Partners L.P.
v. Merrill Lynch Capital Services Inc., unreported, HCA No. 10161 of 1994, November 14,
1996, [1996] H.K.L.Y. 1074).

21/5/3

Time for service of notice of discontinuance or withdrawal (r.2)

Rule 2 sets out a fixed and certain time for the service of a notice of discontinuance or
withdrawal without leave. The rule has the distinct advantage of saving costs and avoiding
controversy, but the time limit fixed by it is rigid and must be strictly adhered to.

In relation to an action begun by writ, under the combined effect of r.2(1) and 2(3) a
plaintiff may serve a notice of discontinuance or withdrawal of any particular claim at any
time, but the last date on which he can effectively serve such a notice is as follows:

(a)where there is only one defendant, not later than 14 days from the service of his defence;

(b)where there are two or more defendants, either not later than 14 days from the service of
the defence last served or, if any defendant does not serve a defence, not later than the date
fixed for the service of such defendant's defence expires, whichever is the later. The action
may be discontinued without leave before the write is served: Toto Toys Ltd & Another v.
King Fung Vacuum Ltd & Others, unreported, DCCJ 3338 of 2004, [2005] H.K.E.C. 1303.
 In relation to an action begun by originating summons, under the combined effect of r.2(3A)
and (3B), a plaintiff may serve a notice of discontinuance or withdrawal of any particular
question or claim at any time not later than 14 days after service on him of the defendant's
affidavit evidence filed pursuant to O.28, r.1A(4); or if there are two or more defendants, of
such evidence last served, but where one of several defendants does not serve his affidavit
evidence, the last date on which the plaintiff can effectively serve his notice is not later than
the date fixed for the service of such defendant's evidence or the date when the period under
these rules expires, whichever is the later.

It must also be noted that the time for service of such notice on any one of several
defendants is not fixed by reference to the date when the defence or the affidavit evidence
of that defendant has been served but by reference to the date of the defence or the affidavit
evidence last served or the date by which the defence or the affidavit evidence of any other
defendant ought to have been served.

The pendency of an order staying proceedings until something is done by plaintiff (e.g.
security for costs given) does not prevent the plaintiff from giving notice of discontinuance.

21/5/4

Discontinuance or withdrawal by co-plaintiffs (r.2)

One of two or more co-plaintiffs cannot withdraw without the consent of the others if he is
a necessary party to the claim by them: if one plaintiff declines to proceed the usual order is
to strike him out as plaintiff and add him as defendant upon the terms of security being
given for the costs of the original defendants (Re Matthews [1905] 2 Ch. 460) but a
co-plaintiff suing in respect of a separate cause of action may withdraw without leave; for
his withdrawal will not affect the right of his co-plaintiffs to continue the action but he
remains a party to the action and may be ordered to pay costs up to the time of his
withdrawal (King v. Sunday Pictorial Newspapers Ltd (1924) 41 T.L.R. 229). The same is
the case where two plaintiffs claim in the alternative: either can withdraw his claim without
leave (per Lush J. ibid.).

One or more of several plaintiffs, short of the total number thereof, cannot discontinue the
action, since however many plaintiffs there are, there is only one action, which remains in
being so long as there is one plaintiff, but any individual plaintiff having a separate
individual claim or claims can withdraw the same (see King v. Sunday Pictorial
Newspapers Ltd (above)).

21/5/5

Withdrawal of defence by defendant without leave (r.2)

Under r.2(2), a defendant may at any time or at any stage of the proceedings withdraw the
defence or any part of it without leave. He can only do so effectively, however, if he serves
a notice in writing, in clear and unequivocal terms, stating that he withdraws the whole of
 his defence or specifying the part which he withdraws. The notice must be served on the
plaintiff or other party concerned. Upon such a withdrawal the plaintiff will be at liberty to
proceed either on the basis of a default of defence under O.19 (Cooper-Dean v. Badham
[1908] W.N. 100) or on the basis of admissions in the defence under O.27, r.3.

21/5/6

Discontinuance or withdrawal of counterclaim by defendant without leave (r.2)

Under r.2(2), the position of the defendant with a counterclaim is assimilated in all respects
with the position of a plaintiff, as to which, see the notes above.

21/5/7

Discontinuance by consent without leave (r.2)

Rule 2(4) allows an action to be withdrawn, with the consent of all parties, at any time
before trial. All the parties must give their written consent, signed by each of them, and
such consent must be produced to the Registrar. The court will give effect to a contract to
withdraw a claim as it operates as an irrevocable abandonment of the claims by the plaintiff
(Macedonia Maritime Co. v. Austin & Pickergill; The Fayrouz I-IV [1989] 2 Lloyd's Rep.
73).

If by the terms of a compromise an action is discontinued, a motion cannot afterwards be

made to make the compromise a rule of court, for there is nothing upon which the court can
lay its hand to enforce the compromise (Graves v. Graves (1893) 69 L.T. 420, probate
action); but the compromise can be enforced. See Green v. Rozen [1955] 1 W.L.R. 741;
[1955] 2 All E.R. 797.

21/5/8

Costs on discontinuance without leave (r.2)

Where a plaintiff discontinues his action or withdraws any particular claim or question
without leave, the defendant is entitled under O.62, r.10, without an order to tax his costs of
the action or his costs occasioned by the matter withdrawn where the plaintiff by notice in
writing and without leave either wholly discontinues his action or withdraws any particular
claim or question, and if the costs are not paid within four days after taxation, to sign
judgment for them. Such costs of action include the costs of and occasioned by a strike out
application (Re Miller Peart (unrep., CFI 2111 of 2005) [2007] H.K.E.C. 96). But that is
not an absolute rule. The rules recognise that there may be circumstances in which a
plaintiff should be permitted to discontinue an action without having to pay the defendant's
costs. Thus, if the plaintiff wishes to discontinue the action without being liable for the
defendant's costs, he must obtain the leave of the court under O.21, r.3(1) (Trend
Publishing (H.K.) Ltd v. Vivien Chan & Co. (a firm) [1996] 2 H.K.L.R. 227; [1996] 3
H.K.C. 433).
 See "Discontinuance without leave" under O.62, r.10.

Where only a particular claim or question is withdrawn, the costs may be taxed and
judgment entered; but it is not the practice to allow execution to issue for these costs until
the rest of the action has been disposed of, and in ordinary circumstances a stay of
execution may be granted.

Where a defendant discontinues his counterclaim or withdraws part thereof without leave,
the plaintiff becomes entitled under O.62, r.3(7) to his costs of the counterclaim or his costs
occasioned by the claim withdrawn, as the case may be, including up to the time of receipt
of the notice of discontinuance or withdrawal unless the court otherwise orders.

21/5/9

Discontinuance or withdrawal with leave (r.3)

Leave of the court is required for the discontinuance of an action or counterclaim or the
withdrawal of any particular claim or question in the following cases:

(1)where the action was begun otherwise than by writ or originating summons; or

(2)where a notice of discontinuance or withdrawal has not been served or not effectively
served in due time;

(3)where the plaintiff has had an order for an interim payment made in his favour under
O.29 except where all the other parties consent.

In doubtful cases the plaintiff or the defendant, as the case may be, may apply for a
determination of the question whether discontinuance without leave was effective (per
Maugham J. in Munday v. Butterley Co. [1932] 2 Ch. 227) or alternatively for leave to
discontinue or withdraw a particular claim or question.

It is open to a plaintiff to apply for and obtain leave to discontinue, even when he could do
so without leave, in order to avoid the necessity of paying costs which discontinuance
without leave involves, and in a proper case leave may be given to discontinue without
paying costs.

The order should give leave to discontinue the action, not to "stay" it (Anon. [1876] W.N.
40). Where part of a case is withdrawn, the defendant is entitled to an order directing actual
withdrawal or discontinuance of the part in question (Emma Silver Mining Co. v. Grant
(1878) 11 Ch.D. 918). A defendant is not entitled as of right to discontinue or withdraw a
third party notice or a contribution notice without leave and, on his application for such
leave, the court has a discretion to grant it on terms, including a term requiring an
undertaking not to commence proceedings (Chapman v. Chief Constable of South
Yorkshire (1990) 134 S.J. 726; The Times, March 20, 1990).

21/5/10
 Application for leave (r.3)

By summons or by notice under the summons for directions (O.25, r.7) or by motion (see
r.3(2)).

If the terms offered in the application for leave are reasonable, the other party may have to
pay the costs of resisting the application (see Real and Personal Advance Co. v. McCarthy
(1880) 14 Ch.D. 188; (1881) 18 Ch.D. 362, CA).

In Musman v. Boret (1892) 40 W.R. 352, the summons was, in form, for a stay of
proceedings, but the court treated it as an application for leave to discontinue. See judgment
of Cave J. Consider Re Alpha Co. [1903] 1 Ch. 203, staying debenture-holders' action after
judgment.

The principle underlying the requirement for leave is that after proceedings have reached a
certain stage the plaintiff, who has brought his adversary into court, should not be able to
escape by a side door and avoid the contest, since he is no longer dominus litis and it is for
the court to say whether the action should be discontinued and upon what terms (per Chitty
L.J. in Fox v. Star Newspaper Co. [1898] 1 Q.B. 636 at 639).

Nevertheless it is not desirable that a plaintiff should be compelled to litigate against his
will; the court will normally grant him leave to discontinue if he wants to, provided no
injustice will be caused to the defendant nor will he be deprived of any advantage which he
has already gained in the litigation, which so far as possible should be preserved, but the
order of the court must take effect from the date on which such leave is granted, since the
court has no power under the rules or under its relevant jurisdiction to back-date such an
order (Covell Matthews & Partners v. French Wools Ltd [1978] 1 W.L.R. 1477; [1978] 2
All E.R. 800, CA, affirming [1977] 1 W.L.R. 876; [1977] 2 All E.R. 591).

21/5/11

Terms for grant of leave (r.3)

The court has a wide discretion as to the terms upon which it may grant leave to a plaintiff
or defendant, as the case may be, to discontinue or withdraw the whole or part of the action
or counterclaim. It may impose terms as to costs, as to the bringing of a subsequent action
or otherwise as it thinks just.

(1) As to costs--the order should provide for the payment of the costs of the action. The
general rule that a defendant is entitled to costs when an action is discontinued may be
departed from in a case where the discontinuance of the proceedings is due to the matter
having become academic, rather than to any acknowledgment by the plaintiff of likely
defeat (Barretts & Baird (Wholesale) Ltd v. Institution of Professional Civil Servants (1988)
138 N.L.J. 357 (considered and distinguished in Inchroy Credit Corp. Ltd v. Cheung
Man-Cheung [1992] 1 H.K.L.R. 120; Trend Publishing (H.K.) Ltd v. Vivien Chan & Co. (a
firm) [1996] 2 H.K.L.R. 227; [1996] 3 H.K.C. 433; and in Ta Tung China & Arts Ltd v.
Fontana Restaurant Ltd [1999] 1 H.K.L.R.D. 404, the Court of Appeal suggested that it
would be very unusual for an order for the payment of the costs by the party against whom
the party was discontinuing to be made. It was further suggested that the parties could go to
trial and have the costs dealt with after the trial. In such a case, the issues would be
extremely limited. In Ho Yuen Ki v. Stanley Ho (unrep., HCA 2798 of 2002) [2006]
H.K.E.C. 2077, the plaintiff sought discontinuance with no order as to costs on the ground
that the action had become academic. The Court of First Instance agreed that the action had
become academic but it ordered costs against the plaintiff, taking into account the plaintiff's
unreasonable conduct in the parties' attempt on settlement. In Re Ken Tak Investment Co.
Ltd (unrep., HCMP 3156 of 2004) [2006] H.K.E.C. 2252, the Court of First Instance held
that the costs incurred by each party with respect to a part of the proceedings were not
justifiable and therefore the Court made no order as to costs with respect of that part of the
proceedings: Standard Chartered Bank Hong Kong Trustee Ltd v. Brogan & Others [1990]
2 H.K.C. 560; Liverpool City Council, ex p. Newman (1993) 5 Admin. L.R. 669; Leung
Yuet Ching & Another v. Leung Yuet Kuen & Another [2001] 4 H.K.C. 562; Lee Tak Yan
and Others v. The Prudential Enterprise, Ltd and Other [2005] 646 H.K.C.U. 1). Where the
defendant has made the action academic by its own conduct in amending the defence, the
court will not be inclined to order cost against the plaintiff (Hachette Filipacchi Presse v.
Kador Ltd [1995] 1 H.K.C. 352). In the exercise of its discretion, the court may order costs
against the defendant on an application for discontinuance by the plaintiff if it considers it
just to do so in the light of the defendant's conduct: Alan Soh v. The Owners of the Vessel
Columbus Caravelle [2003] 1156 H.K.C.U. 1. In particular, the court may order costs in
favour of an applicant in exceptional circumstances where the application is doomed to
failure by an act of the respondent which is within the respondent's control, is out of the
hands of the applicant and which could have been taken either before the application was
made or at an earlier stage in the application so as either to obviate the possibility of the
application being made, or to minimise the costs associated with it: Re Peaktop
Technologies (USA) Hong Kong Ltd (unrep., HCMP 2456 of 2006) [2007] H.K.E.C. 992. If
the order gives leave to discontinue on the payment of the costs, the action survives until
the costs are paid.

(2) As to any other action--A plaintiff who without leave discontinues, or withdraws part of,
his action is not prevented from bringing another action for the same subject matter. But
where leave is required, the court will consider all the circumstances, and, if it seems just,
will impose a term that no other action shall be brought (Trend Publishing (H.K.) Ltd v.
Vivien Chan & Co. (A Firm) [1996] H.K.C. 433; Li Zhuo Ming v. Huayao Bio-Technology
Holding Group Ltd [2006] 2 H.K.L.R.D. E1; Hess v. Labouchere (1898) 14 T.L.R. 350).
Or leave to discontinue may be refused and judgment given for the defendant (Fox v. Star
Newspaper Co. [1898] 1 Q.B. 636; [1900] A.C. 19, where the application was made at the
trial). In an action for infringement of a patent the plaintiff shortly before trial discovered
that his specification needed correction, and at the hearing applied for leave to discontinue.
Leave was given upon the terms that no fresh action should be brought for the particular
infringements complained of in that action (Robertson v. Purdey [1906] 2 Ch. 615). See
also American International Group Inc. v. London American International Corp. [1982]
F.S.R. 441 (not in the future to bring similar action in passing off).

When a counterclaim is by leave discontinued, the same considerations would arise as with
 a plaintiff who discontinues by leave.

21/5/12

Effect of discontinuance and withdrawal (r.4)

The plaintiff who discontinues the action or withdraws part of his claim without leave must
pay the costs of the defendant (O.62, r.10(1)) and a defendant who discontinues his
counterclaim or withdraws part thereof is liable for the costs incurred thereby (O.62, r.3(7)).
See also para. 21/5/8, costs on discontinuance without leave.

The discontinuance of an action or the withdrawal of part of a claim without leave is no bar
to a subsequent action for the same cause of action (The Kronprinz (1887) 12 App.Cas. 256
at 262, where the distinction between discontinuance and dismissal is pointed out at 259).
The effect is the same where the discontinuance is with leave, unless the order giving the
leave expressly prohibits the commencement of a fresh action (ibid., at 262).

The plaintiff may therefore commence a new action for the same cause, to which such
discontinuance will be no defence; but unless he does so in good time, his laches may be a
bar (Reid v. London and Staffordshire Fire Insurance Co. (1883) 49 L.T. 468). The new
action need not refer to the discontinued action, nor should it be claimed that it be treated as
supplemental thereto (United Telephone Co. v. Tasker (1888) 59 L.T. 852). But when the
plaintiff has to obtain leave, it is only by the discretion of the court that he can discontinue
with the right of bringing another action (Fox v. Star Newspaper Co. [1898] 1 Q.B. 636;
[1900] A.C. 19; Hess v. Labouchere (1898) 14 T.L.R. 350).

Discontinuance may, however, be a bar to a further action where it amounts to an election

to adopt a voidable contract (Reid v. London and Staffordshire Fire Insurance Co. (1883)
49 L.T. 468). Thus a discontinuance pursuant to an agreement of an action to rescind a
contract to take shares was held to amount to an election to remain a shareholder and so to
be a bar to a second action to rescind (ibid.).

After discontinuance by the plaintiff, the court will make such further order as may be
requisite for giving effect to rights acquired by the defendant in the course of the
proceedings. Thus, where a plaintiff has given an undertaking in damages on obtaining an
interlocutory injunction, an inquiry as to damages will be ordered after discontinuance
(Newcomen v. Coulson (1878) 7 Ch.D. 764); so where the hearing of a summons has been
adjourned, the defendant may restore the summons to enable a certificate for counsel to be
given on dismissal of the summons with costs. In such cases application should be prompt:
if leave to discontinue is required, the necessary relief should be claimed by defendant on
the hearing of the plaintiff's summons.

Discontinuance does not prevent a person whose name has been added as a party without
authority from moving to strike it out with an order for payment of costs by the solicitors
(Gold Reefs Co. v. Dawson [1897] 1 Ch. 115).

21/5/13
 Effect of discontinuance on counterclaim (r.4)

A counterclaim is not affected by the discontinuance of an action by the plaintiff: O.15,

r.2(3). But it cannot be set up after discontinuance (The Salybia [1910] P. 25). Under s.40
of the District Court Ordinance, it can be transferred for trial to the district court.

21/5/14

Effect of discontinuance on appeal (r.4)

When an action is discontinued, an appeal in that action becomes ipso facto vacated. Notice
of discontinuance is sufficient, and no further notice need be given as to the appeal
(Conybeare v. Lewis (1880) 13 Ch.D. 469).

21/5/15

Revival after discontinuance (r.4)

An order for discontinuance made by consent may be set aside by a subsequent order also
made by consent; and the claim in the action may then be proceeded with (The Kronprinz
(1887) 12 App.Cas. 256).

21/5/16

Refusal of leave to discontinue(r.4)--Before judgment

Leave may be refused to a plaintiff to discontinue the action if the plaintiff is not wholly
dominus litis or if the defendant has by the proceedings obtained an advantage of which it
does not seem just to deprive him.

21/5/17

After judgment

Generally, discontinuance is not permitted after judgment, especially where the plaintiff is
not wholly dominus litis; and similarly, after verdict (see Stahlschmidt v. Walford (1879) 4
Q.B.D. 217).

21/5/18

Creditor's action

In a creditor's action for administration there can be no discontinuance after judgment; the
court having taken upon itself the administration of the estate for the benefit of all creditors
(see judgment of Kekewich J. in Re Alpha Co. [1903] 1 Ch. 203).
21/5/19

Debenture-holder's action

A plaintiff may be allowed to discontinue the action after judgment if no other

debenture-holder has claimed the benefit of the judgment (Re Alpha Co. [1903] 1 Ch. 203).

21/5/20

Foreclosure and redemption actions

Judgment nisi in these actions confers rights on the defendants, and plaintiffs will not after
such judgments be allowed to discontinue without consent of the defendants and to sell to a
third party because he might prejudice the rights of the defendants. However, failure to
obtain the consent of the defendants does not deprive the court of the power to give leave to
discontinue under O.21, r.3 (Hang Seng Bank Ltd v. Yeung Sau Min, unreported, MP No.
1170 of 1983, July 15, 1985, [1985] H.K.L.Y. 737).

21/5/21

Test action

In an action by shareholder against promoters for misrepresentation, which was made by

order a test action, a summons by plaintiff to stay all proceedings on payment of costs was
refused, plaintiff, having regard to the order, not being dominus litis. At the trial the
plaintiff, on the ground of ill health, asked for a postponement, or discontinuance, but the
court dismissed the action with costs (Robinson v. Chadwick (1878) 7 Ch.D. 878; cf.
Twycross v. Grant (1878) 2 C.P.D. 469).

21/5/22

Special case--Finding by arbitrator

An action was referred to an arbitrator, who in a special case found the facts against the
plaintiff, who then applied to discontinue. Held, that the finding was equivalent to a verdict
for the defendant, who was entitled to judgment; and leave to discontinue was refused
(Stahlschmidt v. Walford (1879) 4 Q.B.D. 217).

21/5/23

Staying subsequent action until costs paid (r.5)

Rule 5 applies to discontinued actions or counterclaims the principle on which the court
under its inherent jurisdiction stays actions in cases where a previous action brought for
substantially the same cause of action has been dismissed or stayed, and the plaintiff has
not paid to the defendant costs of such previous action ordered to be paid by him. See Re
Payne (1883) 23 Ch.D. 288, CA; Martin v. Earl Beauchamp (1883) 25 Ch.D. 12, CA;
 M'Cabe v. Governor & Company of Bank of Ireland (1889) 14 A.C. 413. The position is
different in the case of a minor, see, per Cotton L.J. in Re Payne (above).

Where an action--e.g. for calls--was discontinued by a liquidator, the defendant was held
not entitled to a stay of a summons by the liquidator for the same relief, but was allowed to
set off the costs against a sum recovered on the summons (Re United Service Association
[1901] 1 Ch. 97).

21/5/24

Stay subsequent application until costs paid (r.5)

Where a second application is made for the same relief as in a previous application
dismissed with costs, the application would be stayed unless and until those costs were paid
or, if not quantified, a reasonable sum to cover those costs is paid into court (Thames
Investment and Securities v. Benjamin [1984] 1 W.L.R. 1381; [1984] 3 All E.R. 393).

21/5/25

Application for stay of subsequent action (r.5)

By summons, or notice under the summons for directions (O.25, r.7) or by motion.

Withdrawal of summons (O.21, r.6)

21/6
6. A party who has taken out a summons in a cause or matter may not withdraw it without the leave of
the Court.

21/6/1

Effect of rule

If the summons has not been served, leave to withdraw it may be obtained ex parte from the
practice master who will indorse his leave on the summons. If the summons has been
served, and the other party consents, leave to withdraw may also be obtained ex parte from
the practice master; but if the consent of the other party is not obtained or is refused, leave
to withdraw may be sought only at the hearing of the summons, when the master will deal
with the costs occasioned thereby.