Chan Man Shun v. Sze Ching Lok

CACV 47/2019

[2020] HKCA 921

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 47 OF 2019

(ON APPEAL FROM HCA NO. 1170 OF 2014)

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Before: Hon Cheung, Chu and Barma JJA in Court

Date of written submissions: 4 September 2020 and 9 October 2020

Date of judgment: 18 November 2020

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JUDGMENT

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Hon Chu JA giving the judgment of the Court:

1.On 11 June 2020, this Court (Cheung and Chu JJA) handed down our judgment ordering the defendant to provide security for the plaintiff’s costs in this appeal in the sum of $150,000 by making payment into court within 30 days, in default of which the appeal shall stand dismissed with costs.[1]   

2.On 3 July 2020, the defendant filed a notice of motion applying for leave to appeal to the Court of Final Appeal against this Court’s judgment.  The application is opposed by the plaintiff.

3.The defendant lodged a written submission on 4 September 2020 to support his application.  The plaintiff lodged his written submission on 9 October 2020.   Despite an extension of time given by the Registrar of Civil Appeals, the defendant has not put in a reply submission.

4.Having considered the notice of motion and the parties’ written submissions, we see no reason to depart from the usual practice of determining applications for leave to appeal to the Court of Final Appeal on paper without an oral hearing.  We have therefore proceeded to determine the defendant’s application on the basis of the materials before us.

5.Since the filing of the notice of motion, upon the defendant’s failure to provide the security for costs as ordered, this appeal was dismissed on 13 July 2020.  The plaintiff’s costs of this appeal was also summarily assessed on 2 September 2020[2].

6.Section 22(1)(b) of the Hong Kong Court of Final Appeal Ordinance, Cap. 484, provides that leave to appeal to the Court of Final Appeal may be granted if the question involved in the appeal is one which, by reason of its great general or public importance, or otherwise, ought to be submitted to the Court of Final Appeal for decision.

7.In the notice of motion, the defendant put forward the following as matters to be considered in the intended appeal:

(1)  There are strong and cogent evidence showing the debt had been settled in the presence of witness(es).  The decision of the trial judge[3] (“the Judge”) was unreasonable, being based on speculations and preconceived views on credibility. 

(2)  The defendant was born and grew up in Hong Kong.  He is not a foreigner.  It is unreasonable to order security for costs when the defence is supported by reasons.

8.The defendant advanced the following arguments in his written submission^[4]:

(1)  There are “merits and extreme injustice” in the following aspects of the case:

(a)  The Judge ignored material evidence given by the defendant’s witnesses, Mr Kwan and Mr Hung, with regard to the payment by the defendant to the plaintiff of $1 million cash in November 2013 as settlement of the whole matter.

(b)  The Judge was not even-handed in his assessment of the evidence.  He found fault with the defendant’s witnesses over trivial inconsistencies and ignored serious inconsistencies in the plaintiff’s evidence.

(c)  The Judge was biased in favour of the plaintiff and he failed to question the many suspicious conduct of the plaintiff.  On the other hand, he held a prejudice against the defendant because he felt that the defendant was well educated and had some legal knowledge.

(d)  The Judge was biased against the defendant in that: (i) he considered Mr Hung’s evidence to be of no particular help to the defendant’s case, despite his evidence about making available $1 million cash on the day of the settlement; (ii) he had no basis to query how the defendant managed to get out of the financial difficulty and the credit crunch within a short period of time; (iii) he disregarded the issue of the plaintiff’s signature on the settlement agreement; and (iv) he seemed to be concerned about the authenticity of the copy settlement agreement, but after the trial finished and before judgment was handed down, the defendant had written to inform the court that the original of the settlement agreement had been found, to which the Judge did not reply.

(2)  Public interest is engaged in that the Judge and the judicial system only focus on procedures and technicality, but fail to heed serious injustice, matters of logic, truth and facts.

(3)   The plaintiff’s solicitors acted unfairly to deprive the defendant of his legitimate rights.  The defendant was born and grew up in Hong Kong, is a responsible professional individual (not a company), has never been bankrupted, and an executive committee member of a reputable organization.  The appeal has strong and cogent grounds and more than 50% chance of success.  The plaintiff’s solicitor did not provide a breakdown of the amount of security sought in his first affirmation in support of the application.  The assertion that the defendant was impecunious was based on speculations and baseless.

(4)   Even though a trial judge has the advantage of seeing and listening to witnesses giving evidence, the appellate court is not prevented from overturning his decision if the inferences of fact he made are wrong or inherently improbable.

9.The plaintiff’s principal arguments in opposing the application are that the defendant’s arguments are irrelevant to the application and that the intended appeal does not involve any question of great general importance.

10.Evidently, the arguments raised by the defendant all relate to the circumstances of his case and the application for security for costs.  In a nutshell, the defendant contended that, by reason of his personal circumstances and the merits of his defence and/or his appeal against the Judge’s judgment, he should not have been ordered to provide security for the plaintiff’s costs in this appeal, and the order made by this Court has deprived him of his right to appeal.

11.These arguments do not constitute proper grounds for an appeal to the Court of Final Appeal.  Importantly, no question of great general importance as required by section 22(1)(b) of the Hong Kong Court of Final Appeal Ordinance has been identified.    Nor is there any such question apparent to us from the matters raised in the notice of motion and the defendant’s written submission.

12.Further, for the reasons given in our judgment, the arguments that it is unreasonable or improper to order the defendant to provide security are unarguable.  In an application for security for costs of the appeal, it is immaterial that the appealing party is an individual and not a corporation.  Neither is it relevant that the appealing party is resident in Hong Kong and not a foreigner.  It is settled law that impecuniosity of the appealing party amounts to special circumstances whereby the Court may order security be given for the costs of an appeal.  In this regard, we note that the defendant now seeks to dispute the plaintiff’s case that he is impecunious.  However, he has not put forward any substantial ground or an indication of his financial position, whether in opposing the application for security for costs or in this application for leave to appeal.   Regarding the merits of the appeal, notwithstanding the various points made by the defendant, they do not demonstrate that the appeal has such high chance of success that security should not be ordered.

13.As to the defendant’s complaint that he has been deprived of the right to appeal, it has to be borne in mind that the defendant has already had the issues concerned determined in the court below, and it is prima facie an injustice to the other party to allow the appeal to the Court of Appeal to proceed without security for costs being furnished in circumstances where he will be unable to enforce against the defendant any order for costs that may be made by the Court of Appeal: see Hong Kong Civil Procedure 2020 Vol. 1 para. 59/10/25. 

14.There is also no basis for granting leave on the “or otherwise” limb under section 22(1)(b).

15.As the statutory threshold for granting leave to appeal has not been met, we refuse the application and dismiss the notice of motion.  Applying the normal rule of costs follow event, the defendant having failed in the application should pay the plaintiff the costs of the application, with the amount to be summarily assessed.

16.In conclusion, we make the following orders:

(1)  The notice of motion is dismissed

(2)  The defendant pays the plaintiff the costs of the notice of motion to be summarily assessed.

(3)  The plaintiff to lodge and serve within 14 days from the date of this judgment a statement of costs for summary assessment.

(4)  The defendant to lodge and serve within 14 days thereafter a statement in opposition, if any.

Kelvin Cheung & Co for the plaintiff.

The defendant, unrepresented, acted in person.