Pak Sai Ming v. J V Fitness Ltd

DCEC 494/2014

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO 494 OF 2014

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RULING

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INTRODUCTION

1.On 10 February 2017, I granted leave to the Respondent (“R”) for extension of time to seek variation of the costs order nisi and ordered that the Applicant’s award for the costs of trial (with certificate of counsel) be reduced by 30%, to be taxed if not agreed. I also ordered that the question about the costs of the applications for extension of time and variation be dealt with on paper.  The parties have since filed their written submissions on the costs of the applications. 

2.I note that it is the position of Mr Clough, counsel for A, that there should be no order as to costs, as each party was only partly successful in the aforesaid applications.  Mr Clough emphasizes, among other things, the fact that R had asked for a specific reduction of 50% of A’s award for costs but was only able to get a 30% reduction.  On the other hand, Mr Ho, counsel for R, submits that (1) A should have the costs of R’s application for leave to seek extension of time; and (2) R should have the costs for the application to vary the costs order nisi as well as the hearing on 13 January 2017 and all subsequent written submissions.

CONSIDERATION

As regards (1)

3.R was granted an indulgence by the court to entertain their application: Man Fong Hang v Man Ping Nam [2002] 4 HKC 538.  As such, there can be no dispute that A should have the costs of R’s application for leave to seek extension of time.

As regards (2)

4.The main issue before the court at the hearing on 13 January 2017 was whether A’s awards for costs could and should be reduced notwithstanding that the expiry of the time limit and that A was able to do better than R’s sanctioned payments.  Written and oral submissions from both sides were received by the court on that issue.  However, during the hearing an issue arose as to whether the Court had already become functus officio. It became obvious that only when the answer to the latter question was in the negative that the court should go on to decide whether extension of time should be granted; and if so, whether reduction should be made on the ground of A having exaggerated his claim; and if so, by what extent the reduction should be.  In that context that the court invited the parties to file further written submissions after the hearing dealing specifically on the issue of functus officio.

5.The position of Mr Clough as stated in his written submissions so filed was that the court did not have jurisdiction to allow the issue of costs to be re-opened.  Further, even if the court had such jurisdiction, R had failed to give any reasons for the court to exercise the discretion.  Mr Chan (the then lead counsel of R) held the opposite position.  In the event, for the reasons given in the Ruling handed down on 10 February 2017 the court ruled in R’s favour.  The upshot of the above was that R was successful in obtaining the extension of time sought in spite of the objection from A.

6.In relation to the application for variation, although R had sought a 50% reduction of A’s award for costs, the fact that R did not get everything it asked for does not mean that it should automatically be deprived of any part of its costs: see Yiu Hon Lam v Chan Yu Chun, CACV 383/2007, citing Waddington Ltd v Chan Chun Hoo Thomas and Ors, FACV 15/2007 (14 November 2008).   In the present case, despite A’s objection, R was successful in persuading the court that the former’s awards for costs of the trial should be reduced on the basis of A’s exaggeration in his claim and evidence.   As such, I consider that R was the real winner in this regard, even though that the reduction ordered by this court was only to the extent of 30%.  I do not think that the fact that R had not sought to safeguard their position by a Calderbank letter impacts significantly on the issue of costs in the present case.  The fact that A had done better than the sanctioned payments made by R had already been taken into account when the court ordered the 30% reduction. 

CONCLUSION

7.Having considered everything in the round, I make the following order:

(a)   A has the costs (with certificate of counsel) of the application for leave to seek extension of time to seek a variation of the costs order nisi; and

(b)   R has the costs (with certificate of counsel[1]) of:-

(i)   the application to vary the costs order nisi;

(ii)   the hearing on 13 January 2017 and all subsequent written submissions.[2]

Mr Neal Clough, instructed by B Mak & Co, for the applicant

Mr Leon Ho, instructed by Au & Associates, for the respondent