Case Document

100%Judiciary

DCPI 1665/2011

[2019] HKDC 377

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

PERSONAL INJURIES ACTION NO 1665 OF 2011

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BETWEEN
	LEE CHUI YING	1^st Plaintiff
		(Discontinued)
	CHEUNG MAN KOK	2^nd Plaintiff
and
	CHAN YEE LING ELAINE（陳綺玲）	Defendant

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Before:

Deputy District Judge Kam K L Cheung in Chambers (Open to Public)

Date of Hearing:	19 October 2016
Date of Decision:	20 March 2019

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DECISION

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1.In dismissing both the 2^nd plaintiff’s claim and the defendant’s counterclaim, I made an order nisi that there be no order as to costs. Both the 2^nd plaintiff and the defendant now seek to vary the costs order nisi.

The applications

2.By her summons dated 29 August 2016, the 2^nd plaintiff seeks indemnity costs and enhanced interest against the defendant. Specifically, the 2^nd plaintiff seeks an order that all the costs incurred by her after 24 September 2013 be paid by the defendant on an indemnity basis. The 2^nd plaintiff also asks for certificate for two counsel. By another summons dated 31 August 2016, the defendant seeks to vary the costs order nisi to the effect that the 2^nd plaintiff “do pay the defendant costs or a certain percentage of the proceedings.”

The rules

3.The rules governing the exercise of the court’s discretion are to be found in Order 62 of the Rules of the District Court (“RDC”). Rule 5 provides as follows:-

“(1) The Court in exercising its discretion as to costs shall, to such extent, if any, as may be appropriate in the circumstances, take into account—

(aa) the underlying objectives set out in Order 1A, rule 1;

(a) …

(b) any payment of money into court and the amount of such payment;

(c) …

(d) any written offer which is expressed to be “without prejudice save as to costs” and which relates to any issue in the proceedings, but the Court may not take the offer into account if, at the time it is made, the party making it could have protected his position as to costs by means of a sanctioned payment or a sanctioned offer under Order 22;

(e) the conduct of all the parties;

(f) …

(g) any admissible offer to settle made by a party, which is drawn to the Court’s attention.

(2) For the purpose of paragraph (1)(e), the conduct of the parties includes—

(a) whether it was reasonable for a party to raise, pursue or contest a particular allegation or issue;

(b) the manner in which a party has pursued or defended his case or a particular allegation or issue;

(c) whether a claimant who has succeeded in his claim, in whole or in part, exaggerated his claim; and

(d) conduct before, as well as during, the proceedings.”

4.Order 22, Rule 5 of the RDC provides for the form and content of a sanctioned offer.

The 2^nd plaintiff’s summons

5.The 2^nd plaintiff had been attempting to settle with the defendant since 2013.

6.By a letter dated 27 August 2013, which is said to be a sanctioned offer and referred to as “August 2013 Offer” in this hearing, the 2^nd plaintiff through her solicitors offered to settle on the following terms:-

(a)   The defendant discontinue her Counterclaim in the action here.

(b)   The 2^nd plaintiff discontinues her Claim in the action here.

(c)   There be no order as to costs.

7.By a letter dated 4 February 2014, marked “Calderbank Offer”, the 2^nd plaintiff made another attempt to settle on the same terms (“the February 2014 Offer”).

8.About a month later, by another letter dated 7 March 2014 which is marked “Sanctioned Offer”, the 2^nd plaintiff offered to pay $48,000 to the defendant and proposed that the parties discontinued their respective claim against each other (“the March 2014 Sanctioned Offer”). Unlike the August 2013 Offer, the March 2014 Sanctioned Offer made no reference to costs.

9.By yet another letter to the defendant dated 7 April 2014, which is marked “Calderbank Offer”, the 2^nd plaintiff improved her last offer by agreeing to pay costs of the defendant in defending the 2^nd plaintiff’s claim up to the date of the Amended Defence and Counterclaim (“the April 2014 Offer”).

10.By a letter dated 2 September 2014 and marked “Without Prejudice”, the 2^nd plaintiff offered to pay a global sum of $200,000 to settle all the disputes between the parties (“the September 2014 Offer”).

11.On 29 October 2014, the plaintiff made a sanctioned payment in the sum of $50,000 (“October 2014 Sanctioned Payment”).

12.I shall now deal with the various settlement offers.

13.In so far as the August 2013 Offer is concerned, although it is said to be a sanctioned offer, there being a specific provision as to costs, it cannot be a valid sanctioned offer: Wong Yim Man Anthea v Wong Ho Ming Felix [2016] 3 HKLRD 249. Thus, the defendant cannot be said to be wrong in ignoring it.

14.As for the February 2014 Offer, Ms Lau, counsel for the defendant, argues that the offer is subject to the exclusionary rule under O 62, r 5(1)(d) because the 2^nd plaintiff could have protected her position by means of a sanctioned payment or sanctioned offer.

15.On this issue, I agree with Ms Lau. Although the letter in question is not marked “without prejudice save as to costs”, unlike the offer in Ming An Insurance Co (HK) Ltd v Ritz Carlton Ltd ((2009) 12 HKCFAR 745), it is not an open offer. The letter is ended with the remark “This letter will be produced to the Court when the matter of costs and interest are adjudicated.” Clearly, the 2^nd plaintiff made the offer on a without prejudice basis. Given that the offer was intended to work and treated as a without prejudice offer, it is in my view subject to the exclusionary rule.

16.As for the March 2014 Sanctioned Offer, Ms Lau argues that the offer is also subject to the exclusionary rule under O 62, r 5(1)(d) because the 2^nd plaintiff ought to have made a sanctioned payment rather than a sanctioned offer. I am not aware of any rule against a sanctioned offer as such but can understand the rationale behind Ms Lau’s argument. In this case, the 2^nd plaintiff did make a sanctioned payment in October 2014. I agree with Ms Lau that there was nothing to prevent the 2^nd plaintiff from making a sanctioned payment back in March 2014. Applying the same rationale that prefers payment into court to a calderbank offer when the party is in a position to make a payment into court, I take the view that the 2^nd plaintiff cannot rely on the March 2014 Sanctioned Offer.

17.The April 2014 Offer is not marked “without prejudice save as to costs”. However, like the February 2014 Offer, the offer was made on a without prejudice basis. It is in my view also subject to the exclusionary rule.

18.The September 2014 Offer, which was marked “without prejudice”, is clearly subject to the exclusionary rule.

19.As for the October 2014 Sanctioned Payment, there is no serious dispute that it was validly made. The defendant had 28 days to decide whether she should accept the sanctioned payment. The adverse costs consequences from her refusing the sanctioned payment arose on 26 November 2014.

20.Ms Lau further argues that any costs awarded against her client should be assessed as if the action were commenced in the Small Claims Tribunal. Reference is made to my assessment that damages for pain, suffering and loss of amenities should be $15,000 (in case the defendant won). Given the defendant’s counterclaim, which is for a sum vastly in excess of the jurisdiction of the Small Claims Tribunal, I have no sympathy for such argument.

21.Ms Chong, counsel for the 2^nd plaintiff argues that there should be certificate for two counsel. Whilst I fully appreciate that the parties have their names to protect, this is not a complicated case. I will give certificate for one counsel.

The defendant’s summons

22.The defendant has filed a lengthy affirmation in support of her summons that she be paid a certain percentage of the costs of the proceedings. Ms Lau has made no attempt to clarify how much costs should be awarded to her client. In any event, most if not all of the matters stated in the defendant’s affirmation, including the allegation of fraud, illegal funding of litigation, the 2^nd plaintiff pressurizing the police into arresting the defendant and trying to make profit costs out of these proceedings and so forth, are pure speculations and not supported by any evidence of substance. I have no hesitation in dismissing the defendant’s summons.

Orders

23.The costs order nisi be varied that:-

(a)   The costs of these proceedings, including any reserved costs, incurred by the 2^nd plaintiff from 26 November 2014 be paid by the defendant to the 2^nd plaintiff, to be taxed on an indemnity basis if not agreed with certificate for one counsel;

(b)   Interest on those costs above to be at 2% above judgment rate;

(c)   Costs of the 2^nd plaintiff’s summons and the defendant’s summons (including costs of the hearing) be to the 2^nd plaintiff with certificate for counsel.

24.I thank both counsel for their assistance.