Chief Executive of the Hong Kong Special Administrative Region and Another v. President of the Legislative Council

HCAL 185/2016

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST

NO 185 OF 2016

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AND

HCMP 2819/2016

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 2819 OF 2016

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(Heard together)

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DECISION ON COSTS

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1.This is the President of the Legislative Counsel’s application by way of summons[1] to vary the costs order nisi I made against him in the judgment dated 15 November 2016 (“the Judgment”).  The court by its order dated 1 December 2016 directed that this application be disposed of by way of written submissions.

2.For convenience, I would adopt the abbreviations used in the Judgment.

3.In the Judgment, I allowed the applicants’ judicial review application against the President in relation to the President’s Decision, and made, among others, the following reliefs:

(1)    A declaration that the President has no power to re-administer or allow for re-administration of any further oath(s) to be taken by Mr Leung and Ms Yau under section 9 of the ODO on the basis that Mr Leung and Ms Yau have already vacated the office as a member of the LegCo, and are not entitled to act as a member of the LegCo.

(2)    An order of certiorari to quash the President’s Decision.

(3)    An injunction that the President be restrained from administering or allowing to be administered the making of oaths of Mr Leung and Ms Yau under section 19 of the ODO.

4.I also made an order nisi at paragraph 131 of the Judgment that, given the limited scope of the opposition raised by the President in these proceedings, the President shall bear one-fifth of the CE and SJ’s costs.

5.The President now seeks to vary this costs order nisi to the extent that there should be no order as to costs between him and the applicants.  In support of this application, the President essentially relies on the “public interest exception” as established in Chu Hoi Dick v Secretary for Home Affairs (No 2) [2007] 4 HKC 428 at paragraphs 29 - 30, per Lam J (as Lam VP then was) and Chan Noi Heung v Chief Executive in Council [2009] 3 HKLRD 362 at paragraphs 8 - 12, per Ma CJHC (as the learned CJ then was).  These principles were endorsed by the Court of Final Appeal in Leung Kwok Hung v President of Legislative Council (No 2) (2014) 17 HKCFAR 841.

6.Mr Anthony Chan for the President argues that the President’s participation in and opposition to these proceedings fall within public interest exception because:

(1)    The subject matter of the proceedings is of public interest and the President had no personal interest: President’s summons paragraphs 7 - 9, 11.

(2)    The court is the final arbiter.  Before Mr Leung and Ms Yau were declared by this court to have been disqualified, they were still properly elected members and the President did not have the power to disqualify them: President’s summons paragraph 10.

(3)    The Judgment (and the Court of Appeal’s judgment dated 30 November 2016) significantly contributed to the better understanding of the law: President’s summons paragraphs 12 - 13.

(4)    The President took a very narrow point, ie, it was unnecessary for the President to be joined as a respondent.  None of the relief sought and granted against the President was necessary, and it was proper and legitimate for the President to question why he should be joined: President’s summons paragraphs 14 - 30.

7.With respect, I am not persuaded by these submissions.

8.As a starting point, the general rule even in public law cases is that costs should follow the event.  This has been rightly accepted by the President.  This general rule is based on fairness and policy.  As explained by the CFA in Leung Kwok Hung at paragraph 14:

“… the principle that a successful party in litigation is entitled to an award of costs in his favour is one grounded in reasons of fairness and policy. When a party is put to the expense of responding to a claim in a court of law and prevails, it is only fair that he should be compensated for his expenditure. Equally, compensatory costs orders have long been part of our legal system and they serve to give claimants pause for thought before embarking on ill-conceived or unmeritorious litigation.”

9.However, the courts have since developed the public interest exception (“the Exception”), recognising that “public interest challenge… can be a powerful factor in displacing this general rule” on costs: Chan Noi Heung, paragraphs 8, 12(1) - (2), per Ma CJHC (as the learned CJ then was).

10.The relevant question to be asked in a “public interest challenge” is “whether the applicant or the general public should bear the costs consequence for this action”.  See: Re Ho Chun Yan Albert (FAMV 21/2012, 10 January 2013, per Ma CJ, Ribeiro and Tang PJJ) at paragraph 4.

11.Given that the consideration of a public interest challenge rests upon whether the court should depart from the usual costs follow the event rule as it would be in the interest of the public for the matters to be brought and litigated, all the cases concerning the Exception relate to the applicant, having brought but failed the challenge, seeking an exemption on costs.  Hence, the courts have also emphasised that, for the Exception to be engaged, not only that the matter brought to be challenged is one that concerns public interest, but it should also be one that bears a “real prospect of success” on merits.  It is only then that it would be in the public interest for the costs to be borne by public funds.  As held in Leung Kwok Hung at paragraph 7(10):

“… For [the public interest litigation factor] to apply, it will be necessary for the applicant to show that he brought proceedings to seek guidance on a point of general public importance for the benefit of the community as a whole and that he stood to obtain no personal private gain from the outcome. The applicant’s case must also have had a real prospect of success. Even then, the ultimate order of costs remains in the discretion of the Court of Appeal, which will also need to take into account other relevant factors such as the conduct of the parties.” (emphasis added)

12.In the present case, however, it is the respondent (the President) who seeks to rely on the Exception where he has unsuccessfully defended the President’s Decision under challenge.

13.In this respect, I agree with Mr Yu SC that the above considerations do not apply in the present case:

(1)    The respondent is a public authority who ex hypothesi would have made a decision which, as it has been eventually be shown, was erroneous or unlawful.  As such, it is difficult to say the erroneous or unlawful decision which gave rise to the litigation in the first place can be said to be made to “seek guidance on a point of general public importance for the benefit of the community as a whole”.

(2)    In any event, and in particular, in the present case, the President’s opposition to the judicial review was not based on any submissions on the law on oath taking.  His limited ground of opposition was only on the contention that he should not be joined as a party for the reasons I have set out in the Judgment at paragraphs 15 and 110.  In particular, he argued, among others, that the President’s Decision was not a substantive decision which was amenable to judicial review (which has been rejected by this court).  In the premises, I cannot see how the President’s said participation in the opposition of the judicial review could be regarded as seeking “guidance on a point of general public importance of the benefit of the community as a whole”.

14.For these reasons alone, I do not accept that the President’s participation and opposition to these applications can be regarded as falling within the Exception.  His costs varying application should be refused on this basis alone.

15.Further, insofar as necessary, for the following reasons, I would also reject the above other bases advanced by Mr Chan for the President (whether in support of the Exception arguments or as standalone grounds) to say that there should be no costs order made against the President:

(1)    The fact that both parties are litigating out of public funds cannot in my view be a relevant factor as contended.  Otherwise, the court would have to take into account the factor that an applicant or respondent is legally-aided as a good reason why costs should not be ordered against the unsuccessful party in all cases involving a publicly funded body, which is against the general position that the fact that a party is legally aided is not a relevant factor in considering costs.  Cf: R (Boxall) v Waltham Forest LBC [2000] ALL ER (D) 2445 at paragraph 22(ii) (referred to in GPB v William Lam (HCAL 130/2013, 17 August 2015, per Au J) at paragraph 31).

(2)    The fact that both litigating parties are public bodies also cannot by itself without more justify a departure from the general rule on costs.  If a public authority who is a party to judicial review proceedings wants to avoid an order of costs in the event of an adverse judgment, the usual course that it should adopt is to remain neutral to the proceedings and to abide by the result thereof.  When a public body respondent however adopts a positive and active position to oppose the application (as in the present case), it is difficult to see why it should not bear the costs like any other litigant simply on the basis that it is a public body.  Cf: Orrico Philippe v Municipal Services Appeals Boards [2015] 4 HKLRD 111 (CA) at paragraphs 12 - 18, per Lam VP.

(3)    Further, in the present case, not only is that the President took an active step to oppose the judicial review, albeit on limited grounds, it was, as this court has concluded in the Judgment, also necessary for the applicants to commence the judicial review against the President since he had in the President’s Decision decided that he would re-administer the LegCo Oath to Mr Leung and Ms Yau, and that decision was a substantive one.  See: paragraphs 7, 8, 112, 113 and 115 of the Judgment.  When this is viewed against the President’s active opposition to the judicial review, there is no reason why he should not bear the costs of the applicants to the extent of his opposition.

16.In the premises, I would refuse the President’s application to vary the costs order nisi.  That costs order shall hereby become absolute.  Further, the costs of this application shall also be to the applicants, to be taxed if not agreed, with certificate for two counsel.

Mr Benjamin Yu SC, Mr Johnny Mok SC, Mr Jimmy Ma and Mr Jenkin Suen, instructed by Department of Justice, for the 1^st and 2^nd applicants in HCAL 185/2016 and the 1^st and 2^nd plaintiffs in HCMP 2819/2016

Mr Anthony Chan, instructed by Lo and Lo, for the respondent in HCAL 185/2016 and the 3^rd defendant in HCMP 2819/2016