Professor Chan Yan Cheong v. The Research Grants Council of the University Grants Committee

HCAL 603/2017

[2020] HKCFI 2180

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST

NO 603 OF 2017

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D E C I S I O N

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Background

1.By a Judgment dated 18 March 2020, Professor Chan lost after a rolled up hearing in a judicial review.  He was ordered to pay costs of RGC, summarily assessed in the amount of $1,060,000 (“costs order”).

2.Professor Chan filed a notice of appeal out of time, with leave of the Court of Appeal.  He now applies for a stay of execution of the costs order pending appeal on the grounds that he has strong grounds in the appeal. He is a self-funded litigant using his own savings to litigate in the hope of clearing his name through the court process.  He has to realize his assets to meet the costs order.  Due to current market conditions, refusal of a stay would cause him substantial loss and hardship.

3.Balancing the financial hardship to be faced by him in having to meet the costs order before the appeal against the lack of prejudice to RGC, Professor Chan invites the Court to grant an order to stay the costs order.

Legal principles governing stay of execution

4.The principles are well established.  The starting point is that the successful party is not to be deprived of the fruits of its success.  It is for the applicant to show good reasons for a stay.  The court must form a preliminary view of the merits and strength of the appeal.  If the appeal is not arguable, no stay will be granted, however exceptional the justifications for a stay may otherwise be.  If the appeal is only arguable, the applicant has to provide additional reasons to justify a stay.  The applicant needs evidence to demonstrate that the refusal of a stay would render the appeal nugatory and for that he must at least show that the refusal of a stay would have a serious deleterious effect.  It is always relevant to consider the prejudice to the successful party if a stay is granted.  See Star Play Development Ltd v Bess Fashion Management Co Ltd [2007] 5 HKC 84, §§7, 9-10, Ma J (as he then was).

Application of the legal principles

5.The 6 grounds of appeal largely mirror the arguments before this Court.  Mr Ng, counsel for the Applicant, has not demonstrated how this Court erred in law on any of those grounds.  Save for a bare assertion, Mr Ng has not demonstrated why there is a strong prospect of success on appeal.

6.Mr Ng further raised 2 issues:

(1) In the amended notice of appeal, that this Court had wrongly exercised the discretion because (a) she had considered whether the New Penalty Guidelines had a causative effect on the Appeal Decision, rather than whether they had a material or substantial impact on it; and/or (b) she should have inferred that the New Penalty Guidelines had been materially considered.

(2) In the written submission for stay, Mr Ng submits that an order quashing the sanction imposed by RGC could have given rise to a tort claim in Professor Chan’s favour for loss of funding.

7.With regard to (1), this Court has found RGC to have erred in law in applying the New Penalty Guidelines (§77 of the Judgment) and went on to explain why the penalty was not quashed.  At best, the appeal against the refusal to quash the penalty was arguable.  However, Mr Ng has not demonstrated strong prospects of success on appeal.

8.With regard to (2), the argument was not advanced before the Judgment was given.

9.The application for stay should be rejected without more.

10.As for the argument that refusal of stay would result in serious deleterious effect or financial ruin, this requires good evidence in support. A bare assertion is not sufficient: Star Play, §9(3).

11.Professor Chan has not produced eg his bank statements to show his liquidity position.  He has no evidence as to the value of his assets and what loss he might suffer by selling them now.  In the reply submission there is a reference to “limited resources” but there is no explanation as to its meaning.  There is nothing to support a submission that he would suffer a seriously deleterious effect if there be a refusal of stay.

Conclusion

12.In the premises, I dismiss the summons with costs to RGC to be summarily assessed on the papers on 3 September 2020 without attendance.  RGC shall file and serve its statement of costs by 31 August 2020.  The Applicant shall file and serve his grounds in opposition by 2 September 2020.

Mr Felix Ng, instructed by Pang, Wan & Choi, for the Applicant

Mr Harrison Miao, instructed by Lo & Lo, for the Putative Respondent