Healthy Wharf Ltd v. The Official Receiver and Trustee of the Property of Leung Yat Tung, A Bankrupt

HCB 2019/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

BANKRUPTCY PROCEEDINGS NO 2019 OF 2000

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RE: LEUNG YAT TUNG

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D E C I S I O N

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1.On 29 August 2017, this Court handed down its Decision on the application made by the Creditor. The definitions contained in the Decision are adopted.

2.On 15 September 2017, the Creditor by summons applied, out of time, for extension of the period of 14 days specified under O 42 r 5B (6) to apply to vary the costs order nisi made in the Decision.

3.I agree with the OR, that the costs order in the Decision is an order nisi by virtue of the provisions of O 42 r 5B, without the need for express specification.  Notwithstanding the lack of a good reason furnished by the Creditor (the only one offered being its misunderstanding of the nature of the costs order) to justify the Creditor’s delay in making this application, the delay in question of 3 days is nevertheless short, and I can see no prejudice suffered by the OR as a result.  Hence, I am prepared to grant the extension sought by the Creditor to make the application for variation.  The question of the Court’s jurisdiction to grant the extension of time is dealt with in Man Wan Farming Ltd v Chief Executive in Council & Anor (No 2) [1998] 2 HKLRD 314, and in my decision in Elite Dragon Limited v Bel Global Resources Holdings Limited HCCL 8/2014, 14 July 2017.

4.Having considered the submissions made on behalf of the Creditor and the OR, I am not prepared to vary the costs order nisi made.

5.The Creditor argued that it should be entitled to part if not all of the costs relating to the Interim Order Costs and the Appeal Costs, which were accepted by the OR on 7 August 2017 as provable debts. However, as the OR pointed out, the OR had asked for apportionment of the total costs sought by the Creditor since 1 December 2016, for possible agreement.  No steps were taken by the Creditor to apportion these costs until 28 July 2017, when the Creditor provided the separate amounts of the Interim Order Costs and the Appeal Costs. The hearing of the Creditor’s application took place shortly thereafter, on 10 August 2017.  If the Creditor had taken steps promptly, after 1 December 2016, to provide the separate breakdowns of the Interim Order Costs, the Appeal Costs and the Petition Costs, agreement could have been made in good time before the hearing on 10 August 2017, saving the costs incurred up to 7 August 2017.

6.The hearing on 10 August 2017 and the Decision only dealt with the parties’ remaining dispute on the Petition Costs, with the OR succeeding in the result.

7.Overall, the fair order as to costs to be made is that the Creditor should bear the OR’s costs of the application for variation of the OR’s decision, including the application for variation of the order nisi.

Miss Elaine Liu, instructed by Ho & Ip, for the applicant

Ms Lok Pui Man Ophelia, Acting Assistant Official Receiver, for the Official Receiver and Trustee in Bankruptcy