Wing Hong Construction Ltd (in Compulsory Liquidation) v. Hui Chi Yung and Others

HCA 1423/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1423 OF 2015

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DECISION ON COSTS

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1.Further to my written judgment dated 18 August 2017, parties made further submissions through correspondences on the proper orders to be made and on the issue of costs. I have treated the correspondences as applications to vary the order nisi.

2.The defendants also drew my attention to the fact that pursuant to the Order of Master S Kwang dated 12 April 2017, the defendant had (on 26 April 2017) paid a total sum of HK$100,000.00 to the plaintiff in full and final settlement of the plaintiff’s entitlement to costs under the Order of Master S Kwang dated 22 March 2017.

3.The defendants invite me to make the following orders:

(1) the defendants’ appeal for security for costs be allowed and the Order of Master S Kwang dated 22 March 2017 and 12 April 2017 be set aside;

(2) the plaintiff do within 14 days from the date of this Order return the total sum of HK$100,000 to the defendants;

(3) the plaintiff do within 28 days from the date of this Order give security for the defendants’ costs in the sum of HK$2,000,000.00 by paying the said sum into the court (with such sum to be placed in an interest bearing account and the interest accruing thereon be accrued to the credit as a security for the defendants’ costs in this action);

(4) until the security mentioned in paragraph (3) above is given, all further proceedings in this action be stayed;

(5) the plaintiff do pay to the defendants costs in relation to their summons dated 3 November 2016 and the hearing before Master S Kwang on 22 March 2017 with certificate for counsel, to be summarily assessed by me if not agreed;

(6) the plaintiff do pay to the defendants costs in relation to their Notice of Appeal dated 5 April 2017 and the hearing before me on 10 July 2017 with certificate for two counsel, to be summarily assessed by me if not agreed; and

(7) there be liberty to apply.

4.The plaintiff’s position is as follows:

(1) the Orders of Master S Kwang should be set aside, including the costs order of HK$100,000.00 in favour of the plaintiff;

(2) there should be no order for the costs of the Summons for security for costs or hearing of the said Summons before Master S Kwang on 22 March 2017;

(3) the costs of the Notice of Appeal filed on 5 April 2017 be paid by the plaintiff on a party‑and‑party basis;

(4) the plaintiff takes a neutral position on the defendants’ application for costs to be assessed summarily by me and if that be the case, the summary assessment should be postponed for 56 days so that parties can attempt to agree on the costs; and

(5) the plaintiff opposes the defendants’ application for a certificate for two counsel for the hearing on 10 July 2017.

5.The real disagreements between the parties are thus on two points only:

(1) whether costs should follow the event in respect of the Summons heard by Master S Kwang; and

(2) whether there should be certificate for two counsel in respect of the appeal.

6.On point (1), the plaintiff argues that the defendants did not refer Master S Kwang to the authorities which they eventually relied on at the appeal before me which I accepted in allowing the appeal.  I do not accept this argument.  First of all, the points argued at the appeal were essentially the same as those ran before Master S Kwang albeit with better articulations.  I do not agree with the plaintiff’s argument that the defendants ran their case “very differently” at the appeal.  Secondly, although some of the authorities relied on at the appeal had not been cited to the learned Master, the plaintiff had maintained its strenuous opposition despite having received and considered these additional authorities quoted extensively in the defendants’ Skeleton Arguments filed for the appeal.  I do not find any reason to depart from the usual rule that costs should follow the event.

7.On point (2), I agree however with the plaintiff’s opposition.  The appeal is not particularly complicated and not a lot of papers were involved.  I do not think it justifies the involvement of two counsel.  I will however grant a certificate for one counsel in respect of the hearing before Master S Kwang on 22 March 2017 and the hearing before me on 10 July 2017.  The issues are sufficiently complex to justify the engagement of counsel.

8.I decline the invitation to summarily assess the costs in respect of the defendants’ Summons and their appeal.  There is no saving in time and costs and I should leave the matter to the normal route of taxation if parties cannot agree on costs.  These costs should be taxable forthwith and the basis for taxation should be “party‑and‑party”.

9.In the circumstances, I shall make the following orders:

(1) the defendants’ appeal under their Notice of Appeal filed on 5 April 2017 be allowed and the Orders of Master S Kwang dated 22 March 2017 and 12 April 2017 be set aside;

(2) the plaintiff do within 14 days from the date of this Order return the total sum of HK$100,000 to the defendants;

(3) the plaintiff do within 28 days from the date of this Order give security for the defendants’ costs in the sum of HK$2,000,000.00 by paying the said sum into court (with such sum to be placed in an interest bearing account and the interest accruing thereon be accrued to the credit as a security for the defendants’ costs in this action);

(4) until the security mentioned in paragraph (3) above is given, all further proceedings in this action be stayed;

(5) the plaintiff do pay to the defendants costs of and occasioned by their Summons dated 3 November 2016 and there shall be a certificate for counsel for the hearing before Master S Kwang on 22 March 2017.  Such costs shall be taxed and paid forthwith (if not agreed) on party‑and‑party basis;

(6) the plaintiff do pay to the defendants costs of and occasioned by their Notice of Appeal dated 5 April 2017 and there shall be a certificate for counsel for the hearing before Recorder Pow SC on 10 July 2017.  Such costs shall be taxed and paid forthwith (if not agreed) on party‑and‑party basis; and

(7) there be liberty to apply.

Written Submissions from Mr James Wood and Ms Pooja Shahani, of Lipman Karas, for the plaintiff

Written Submissions from Mr Paul T K Lam SC, Mr Vincent Lung, instructed by ONC Lawyers, for the 1^st - 4^th defendants