Samuel v. Secretary for Justice Sued for and on behalf of Director of Immigration

DCCJ 5724/2017

[2021] HKDC 1606

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 5724 OF 2017

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Before:  His Honour Judge Andrew Li (Paper Disposal)

Date of Written Submissions by the defendant: 2 November 2021

Date of Decision:  21 December 2021

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DECISION

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INTRODUCTION

1.On 12 October 2021, I dismissed the plaintiff’s claim as he did not appear at the trial.  I ordered the dismissal of the plaintiff’s claim with a costs order nisi in favour of the defendant, such costs to be taxed if not agreed at the District Court scale on a party and party basis, with certificate for 2 counsel: See §37 of my Reasons for Decision dated 22 October 2021 (“the Reasons for Decision”).

2.By the defendant’s summons dated 1 November 2021, the defendant applies for the variation of the nisi costs order set out at §37 of the Reasons for Decision, and seeks the following order:

“Costs of this action be to the Defendant, such costs to be taxed if not agreed at the District Court scale on a party and party basis up to 15 April 2020, and thereafter on indemnity basis. Further, the Defendant is entitled to interest on all costs incurred since 16 April 2020 at a rate of 5% per annum calculated for the whole period between 16 April 2020 and 12 October 2021.”

DISCUSSION

Basis for indemnity costs and enhanced interest

3.The defendant submits that the plaintiff is liable to pay costs on indemnity basis incurred after 15 April 2020 because he had failed to accept the defendant’s sanctioned payment in the sum of HK$12,000 (“the Sanctioned Payment”), the notice of which was served on him on 18 March 2020.  For the same reason, the defendant says that she is entitled to enhanced interest on the costs incurred after that date.

Material facts relevant to the application

4.The plaintiff initiated this action by writ on 21 December 2017.  He was represented by a firm of solicitors at the time.

5.The case was defended by the Department of Justice on behalf of the defendant.

6.Up until the pre-trial review (“PTR”), the plaintiff was represented by the same firm of solicitors.

7.The defendant made the Sanctioned Payment on 16 March 2020.  The notice of the sanctioned payment was served on the plaintiff on 18 March 2020.  However, the plaintiff had never accepted the Sanctioned Payment.

8.The PTR of this action was first scheduled on 27 November 2020.

9.Surprisingly, the plaintiff filed a notice to act in person on 12 November 2020 (ie 2 weeks before the original date fixed for the PTR) but the plaintiff never gave any explanation as to why his former firm of solicitors had ceased to act for him.

10.The plaintiff applied for legal aid on 19 November 2020. As a result, the PTR was re-fixed to 15 January 2021 because of the automatic stay under section 15 of the Legal Aid Ordinance, Cap 91[1].

11.At the PTR on 15 January 2021, the plaintiff indicated to the court that he would like to pursue the case himself even without the help of any lawyers[2].

12.The PTR was further adjourned to 29 January 2021 to arrange for a Punjabi interpreter for the plaintiff.  

13.At the hearing on 29 January 2021, the plaintiff still evinced an intention to prosecute the claim at trial[3].

14.However, on 11 October 2021, the day before the trial began, when the court’s clerk made telephone enquiries with him as to the whereabouts of his opening submissions which he was required to file by 14 September 2021, the plaintiff informed the court’s clerk for the first time that he wanted to withdraw his claim.  He also indicated that he would not file his opening submissions nor any formal document to withdraw or discontinue his case.  He further indicated that he was not going to attend the trial on 12 October 2021[4].

15.As said, the plaintiff did not appear at the trial on 12 October 2021[5]. I  therefore dismissed the plaintiff’s claim.

Order 22 Rules 23(4) of the Rules of District Court, Cap 336H (“RDC”)

16.As the plaintiff’s claim was dismissed, he failed to do better than the Sanctioned Payment. Under Order 22 rule 23(4)(a) of the RDC, the court may order, costs on indemnity basis in favour of the defendant after the latest date on which the plaintiff could have accepted the payment without requiring the leave of the court (the latest date being 15 April 2020, as the notice of sanctioned payment was served on the plaintiff on 18 March 2020 and the plaintiff had 28 days to accept the Sanctioned Payment).

17.Further, under Order 22 rule 23(4)(b) of the RDC, the defendant is entitled to interest on the costs incurred after the latest date on which the Sanctioned Payment could have been accepted without requiring the leave of the court (being 15 April 2020) at a rate of not exceeding 10% above the judgment rate.

The defendant’s submissions

18.Under the RDC, the court “shall” make the orders of indemnity costs and enhanced interest unless it considers it unjust to do so: (See Order 22 rule 23(5) of the RDC).  The court shall take into account all circumstances of the case including, firstly, the terms of any sanctioned payment; secondly, the stage in the proceedings at which any sanctioned payment or sanctioned offer was made; thirdly, the information available to the parties at the time when the sanctioned payment or sanctioned offer was made; and fourthly, the conduct of the parties with regard to the giving or refusing to give information for the purposes of enabling the payment or offer to be made or evaluated: (See Order 22 rule 23(6) of the RDC).

19.In this case, the Sanctioned Payment was made to the plaintiff after the exchange of witness statements, preceded by extensive document discovery. All the relevant documents and information had been disclosed to the plaintiff.  Hence, the plaintiff was in a position to evaluate the merits of his claim when the Sanctioned Payment was made.  Thus, the plaintiff could have chosen to accept the Sanctioned Payment within the time specified if he so wished. But he did not do so. 

20.In the circumstances, I accept the defendant’s submission that it is not unjust to order indemnity costs incurred against the plaintiff since 16 April 2020 with enhanced interest in this case.

21.As to the enhanced interest, it is trite that the same can be awarded at a rate which is greater than purely compensatory to mark the court's disapproval of a party’s unreasonable or improper conduct.  The factors include (a) the length of time that elapsed between the deadline for accepting the offer and judgment; (b) whether the party took entirely bad points or whether it had behaved reasonably in continuing the litigation, despite the offer, to pursue the claim or the defence, and (c) what general level of disruption can be seen, without a detailed inquiry, to have been caused to the party as a result of the refusal to negotiate or to accept the sanctioned payment or sanctioned offer.  See §7 of Angbuhhang Netra Jang v Laing O’Rourke Construction Hong Kong Ltd and Another [2021] HKCFI 232, per Hon. Lisa Wong J.

22.The maximum level of enhanced interest, namely 10% per annum on top of the judgment rate, had been allowed in different nature of cases, see Angbuhhang Netra Jang (supra), §§8-14.

23.In this case, I find the conduct of the plaintiff amounts to an abuse of the court’s process.  I therefore consider the maximum 10% per annum on top of the judgment rate should be ordered in order to mark the court’s disapproval of such appalling conduct:-

(a)  The plaintiff suddenly withdrew his claim on the eve of the trial;

(b)  The plaintiff did not accept the Sanctioned Payment by 15 April 2020, and only withdrew his claim one and a half year thereafter;

(c)  The plaintiff never explained why he wanted to act in person.  No genuine reason has ever been given to explain why he withdrew the claim only on the eve of the trial;

(d)  Although the plaintiff asserted that he intended to bring the claim to conclusion, he did not prosecute his claim at trial and he did not even try to seek adjournment of the trial to engage a new team of legal representatives;

(e)  The plaintiff ought to have known that his claim did not have merits and he could have chosen to accept the Sanctioned Payment;

(f)  By not having chosen to accept the Sanctioned Payment but only chosen to drop the case only on the eve of the trial, the plaintiff has unreasonably delayed the disposal of his claim for a long period of time;

(g)  After April 2020, further costs (from the public fund) were incurred to bring this case to trial in anticipation that the case would be adjudicated at trial; and

(h)  This is a waste of time and resources of the court and the government caused solely by the plaintiff.  A strong message should be sent to the asylum seeker community and their legal advisers to deter any such further abuse in future.

24.To determine the quantum of interest, the traditional approach was to make a detailed calculation of the full enhanced pre-judgment interest on each payment of costs from the actual date of payment to the date of judgment.  However, the court could also adopt a simplified approach to reduce the enhanced interest by half and award the half rate for the whole period from the last day on which the plaintiff could have accepted the Sanctioned Payment without leave (ie from 16 April 2020) to the date of judgment (ie on 12 October 2021): See §18 of Yeung Ho Man v Shum Kin Leung & Another [2020] HKCFI 2781.

25.In this case, the defendant elects to have the enhanced interest sum calculated in half rate (ie 5%) for the whole period between 16 April 2020 and 12 October 2021. 

26.I have no problem in ordering the same.  I so make the aforesaid order.

27.In terms of costs for this application, I am of the view that the present variation application made by the defendant was necessitated by reason of dismissal of the plaintiff’s claim.  For this reason, the defendant seeks and I shall grant a costs order that costs of this variation application be to the defendant, to be taxed if not agreed, on indemnity basis, with certificate for 2 counsel.

28.Lastly, I would like to thank the defendant’s counsel for preparing the very helpful written submissions.

The plaintiff acts in person and did not lodge any written submissions

Mr Eric Kwok SC leading Mr Herbert Leung, instructed by Department of Justice for the defendant