Lam Wai Lik Eric and Others v. Tam Suet Mui

CACV 10/2021

[2021] HKCA 1388

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 10 OF 2021

(ON APPEAL FROM HCAP 5/2015)

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BETWEEN

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Before:  Hon Au and Chow JJA in Court

Dates of Written Submissions:  20 August 2021, 25 August 2021 and 3 September 2021

Date of Decision on Costs:  29 September 2021

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DECISION ON COSTS

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Hon Chow JA (giving the Decision on Costs of the Court):

1.On 30 July 2021, this Court gave its decision (“the Decision”)  allowing the Plaintiffs’ application by summons dated 1 April 2021 for security for costs of the appeal, but in a form that was offered or substantially offered by the Defendant. The Plaintiff’s application was for the Defendant to pay into court the amount of $1,200,000, while the Defendant’s offer was to provide security by means of a surety’s guarantee to be given by her solicitors (Ivan Tang & Co)  for an amount in the region of between $700,000 and $800,000. For reasons given in the Decision which it is not necessary to repeat in this decision, the Court was of the view that the surety’s guarantee offered by the Defendant, up to the amount of $800,000, was sufficient to provide reasonable protection to the Plaintiffs in respect of their costs of the appeal.

2.At §19 of the Decision, the Court made an order nisi that the costs of the application for security for costs be in the cause of the appeal.  The Court considered, provisionally, that an order that costs be in the cause of the appeal would reflect the justice of the case taking into account the fact that although the Plaintiffs were successful in obtaining an order for security for costs, the Defendant was successful in relation to the form of the security to be provided.  In addition, the Court considered that the amount of the security sought was excessive, and the amount of security eventually ordered by the Court was substantially reduced to $800,000 (from $1,200,000).  Nevertheless, the Court made the costs order on a nisi basis, because the Court was aware that there was some “without prejudice save as to costs” correspondence passing between the parties which might have a bearing on the issue of costs which the Court had not had an opportunity to consider.  Accordingly, at §18 of the Decision, the Court directed that any application to vary the costs order nisi “may only be made on the basis of matters disclosed in the ‘without prejudice correspondence’” [underlining original].

3.On 11 August 2021, the Plaintiffs applied by summons to vary the costs order nisi.  The Court decided to deal with the application on paper, and gave directions for the filing and service of submissions.

4.It is apparent from the Plaintiffs’ Submissions dated 20 August 2021 and Reply Submissions dated 3 September 2021 that the application to vary is principally based, not on matters disclosed in the “without prejudice save as to costs” correspondence, but on matters which this Court was aware of when it made the Decision and on matters of principle which this Court was familiar with.  While the Plaintiffs’ Submissions did refer to, inter alia, two letters marked “without prejudice save as to costs”, one from the Plaintiffs’ solicitors dated 5 February 2021 and the other from the Defendant’s solicitors dated 9 March 2021, those letters have little significance on the issue of the costs of the application for security for costs.  In particular, they do not alter the fact that the Defendant had, in the Affirmation of Lau Wing Chi Gigi filed on 3 May 2021, offered to provide the security sought by the Plaintiffs by means of a surety’s guarantee to be given by her solicitors, and the amount of the security ordered by the Court was substantially less than the amount sought by the Plaintiffs.  Had the Plaintiffs acted sensibly and reasonably to accept the Defendant’s offer at that stage, the subsequent costs incurred in relation to the application, and the court’s time in dealing with the application, would probably have been saved.

5.Under Order 1A, r 3 of the Rules of the High Court, Cap 4A, parties and their legal representatives are both under a positive duty to assist the court to further the underlying objectives of the rules, including: (i)  ensuring that a case is dealt with as expeditiously as is reasonably practicable, (ii)  promoting a sense of reasonable proportion and procedural economy in the conduct of proceedings, and (iii)  ensuring that the resources of the court are distributed fairly.  These objectives are not promoted or furthered by an overly aggressive litigation attitude on the part of any party to a litigation or his/her legal representatives.  As events have turned out, the Plaintiffs’ insistence, presumably upon the advice of their legal representatives, to pursue the application for security in an amount which the Court finds to be excessive and in a form which the Court does not consider to be reasonably necessary for the protection of the Plaintiffs’ costs position, has not produced any material benefit to the Plaintiffs in so far as the application is concerned.

6.Overall, this Court does not find any good or sufficient reason to vary the costs order nisi, which shall therefore be made absolute.  The Plaintiffs’ application to vary the costs order nisi is without merit and is dismissed with costs to the Defendant, which this Court summarily assesses at HK$35,000.

Mr K M Chong, Mr Alvin Chong and Mr Tyrone Tang, instructed by T K Tsui & Co, for the 1^st to 3^rd Plaintiffs

Mr Albert Yau and Mr Bache Sit, instructed by Ivan Tang & Co, for the Defendant