Success Lane Development Limited v. Fergurson Hong Kong Limited Trading As New World Millennium Hong Kong Hotel

DCCJ 2191/2023

[2024] HKDC 1220

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 2191 OF 2023

---------------------------------------

BETWEEN

---------------------------------------

---------------------------

DECISION

---------------------------

APPLICATION

1.This is an application of the Plaintiff (“P”) for variation of the costs order nisi (“Leave Decision Costs Order Nisi”) made in §89 of the Decision (“Leave Decision”) given by this Court on 1 March 2024, [2024] HKDC 336.

2.For ease of reference, this Decision adopts herein the abbreviations used in the Leave Decision unless otherwise stated. The background of the present application has been set out in the Leave Decision which should not be repeated in details here. I will just briefly summarize the relevant procedural history as follows.

3.By the Injunction Decision[1], this court dismissed P’s Injunction Application for continuation of the Ex-parte Injunction Order[2] with a costs order nisi made in favour of the Defendant (“D”).

4.Subsequently, P took out two Summonses (“Two Summonses”), the Leave Summons and the Evidence Summons[3], respectively applied for leave to appeal against the Injunction Decision and to adduce new evidence for the purpose of appeal.

5.By the Leave Decision, this Court dismissed the Two Summonses and made the Leave Decision Costs Order Nisi.

6.Dissatisfied with the Leave Decision Costs Order Nisi, P made the present application by filing the present summons on 15 March 2024 (“Present Summons”).

VARIATION SOUGHT

7.The Leave Decision Costs Order Nisi provides that:-

(1) The costs of the Evidence Summons shall be paid by P to D, including all costs reserved, with Certificate for Counsel, summarily assessed at HK$18,000 (inclusive of Counsel fees in the sum of HK$10,000), payable forthwith.

(2) The costs of the Leave Summons shall be paid by P to D, including all costs reserved, with Certificate for Counsel, to be assessed summarily on party and party basis.

(3) For the summary assessment of the costs of the Leave Summons, D shall lodge and serve its statements of costs of the Leave Summons within 7 days from the date hereof. P shall lodge and serve its succinct statements of objection within 7 days thereafter. The summary assessment of costs shall be conducted on papers thereafter no matter whether P has lodged any statement of objection. The assessed costs shall be paid by P forthwith after the summary assessment.

(4) The above two costs order nisi shall become absolute in the absence of application to vary by Summons within 14 days from the date hereof.

8.By the Present Summons, P seeks to vary the Leave Decision Costs Order Nisi to the extent that:-

“costs of the Leave Summons and the Evidence Summons be paid by P to D to be taxed on a Party-to-Party Basis.”

Besides, P also asks for the costs of the Present Summons to be paid by D within 7 days after summary assessment.

9.In essence, the Present Summons does not seek to disturb the decision on liability on costs. It seeks to avoid immediate quantification and immediate payment of costs as well as counsel fees.

LEGAL PRINCIPLES

10.It is trite that costs are a matter of discretion of the court. Pursuant to Practice Direction 14.3, the Court will give preference to summary assessment of costs where an interlocutory application is concerned, unless there is good reason not to do so, eg where the paying party shows substantial grounds for disputing the sum claimed for costs that cannot be dealt with summarily.

11.Following the Civil Justice Reform, immediate payment of costs of interlocutory proceedings by way of summary assessment is encouraged. The objective is to discourage unnecessary and disproportionate interlocutory applications and the court should be more astute to the impact of costs on legal proceedings: Midland Business Management Ltd v Lo Man Kui (No 2) [2011] 2 HKLRD 667, §§9 and 12.

12.With these principles in mind, I now turn to consider P’s grounds of application.

GROUNDS OF APPLICATION

13.It is noteworthy that P, acting in person shortly after the issuance of the Present Summons, mentioned various matters, which are not relevant to the present application in its skeleton submissions. In this Decision, this Court should only focus on P’s grounds of application as set out in §§7-14 of P’s submissions dated 6 May 2024 (“P’s First Submissions”).

14.In §7 of P’s First Submissions, P refers to Asia-Pac Infrastructure Development Limited vs Ing Yim Leung Alexander and Others[4] to contend that this court has failed to give consideration to the fact that P was a litigant in person and it had not conducted the case in “bad faith and dishonesty”.

15.Such contentions are misconceived. Asia-Pac did not make a ruling that “bad faith and dishonesty” are prerequisites for an order of summary assessment and immediate payment of costs. Nor did it prohibit such order to be made against a losing litigant in person. It indeed indicated that the court would make such order to show disapproval of “bad faith and dishonesty” of a party. The rationale of the ruling of Asia-Pac should not be taken out of context.

16.Plainly, the status of being a litigant in person will not attract absolute privilege of protecting it from an order of immediate assessment and immediate payment of costs. There is neither statutory provision nor legal principle which exempts litigant in person as a class from summary assessment.

17.Nor can I find any special circumstances of this case which render summary assessment and immediate payment of costs inappropriate. The procedural history indicates that P was not unfamiliar with civil procedures. P has, since the commencement of the present proceedings, through its director, Ms Yung Mei Chun Jessie (“Ms Yung”)[5], managed to initiate and prosecute a number of applications with a considerable amount of affirmations, submissions and legal authorities in support.

18.Further, not only that P had not asserted any actual financial hardship, let alone any solid proof, Ms Yung had, at one of the hearings of the Injunction Application, emphasized that P was financially sound (notwithstanding its share capital was insignificant) and was capable of meeting any financial liabilities or consequences if the situation warrants.

19.Absent any solid proof of special circumstances, P’s complaint that this Court was erred in taking into account the unfairness of keeping the costs from D is unconvincing. There has been no justification to keep D out of pocket for the costs for a prolonged period pending trial, bearing in mind that those applications had already determined and concluded at or around the amendments of pleading stage. It is necessary for the Court to ensure the fairness to the parties in exercising the discretion as to costs and to keep a successful party from its costs may amount to prejudice: §§16 & 21 Seridom Servicios Integrados Idom SAU v Heng Wen Trade Co, Ltd [2019] HKCFI 761.

20.In §§8 and 11 of P’s First Submissions, P complained this Court to have failed in giving consideration to the merits of P’s position in connection with the Two Summonses and to the fact that D’s Stay Application was unwarranted. It is difficult to see how such complaints will advance P’s present application bearing in mind that the present application does not touch on the issue of liability on costs.

21.In any event, such complaints are unjustified. They were made in ignorance of the reasons given in the Leave Decision and the Injunction Decision, which I should not repeat here.

22.Likewise, P’s repetition of its disagreement to the Injunction Decision[6] and another decision (“Injunction VOC Decision”)[7] will not take P’s position in the present application any further. Suffice it to say that its arguments have been rejected in the Leave Decision and another decision dealing with P’s application for leave to appeal from the Injunction VOC Decision, I should not burden this Decision by repeating my reasons for decision therein.

23.In §§9-10 of P’s First Submissions, P argues that the Injunction Application[8], the Stay Application[9] and the Two Summonses were not severable and self-contained from the rest of the action, and accordingly, their costs could only be taxed together with other costs of the whole proceedings at the end.

24.Such arguments are without merit. All those applications were indeed originated from and premised on P’s Second Ex-parte Application for the Ex-parte Injunction Order. They were interlocutory applications which have already been determined and concluded. No matter what the outcome of the subsequent inspection, loss assessment or final trial, if any, will be in future, it will not change the fact that the P’s Second Ex-parte Application and the Injunction Application were procedurally and legally defective and the Two Summonses were unmeritorious.

25.All those interlocutory applications and the costs incurred therein would not have otherwise took place in the ordinary course of legal proceedings but solely for P’s deliberate applications. Upon their determination, those applications were wholly disposed of. Their costs could be ascertained and assessed separately and independently by referring to the relevant summonses. Each of the summonses are clearly severable and self-contained from the rest of the action.

26.In §§12-14 of P’s First Submissions, P essentially contended that it had been deprived of the rights to challenge the items and amount of the costs claimed by D. Such contentions are unsubstantiated. For the Evidence Summons, D’s costs statement was provided to P together with D’s Skeleton Submission in Opposition on 16 February 2024. P had not shown any substantial grounds to dispute the applicability of summary assessment.

27.For the Leave Summons, P was unable to actually elaborate what aspects of D’s costs and to what extent those aspects fell outside the scope of summary assessment. It still could not justify, even after D’s submission of the Statement of Costs on 7 March 2024, which items and what amounts of D’s costs could not be summarily assessed.

28.General criticisms that the costs sought by D was excessive and that there existed a possibility of overlapping of costs among multiple related applications did not render summary assessment inapplicable. Such concerns have been properly addressed during the assessment exercises, in that P was offered the chance to raise its objections by lodging its List of Objections. The costs were assessed after taking into account of P’s objections.

29.It should be borne in mind that this Court, having the conduct of the Injunction Application, the Stay Application, the Injunction VOC Application and the Two Summonses, has been familiar with the procedural history and the development of this case as well as the disputes between the parties, and, accordingly, has been in a better position to properly assess the costs of all the applications dealt with by this Court than the taxing master and to guard against double claim of costs.

30.Thus considered, P’s complaint that this Court did not give independent consideration to the suitability of summary assessment and immediate payment is unfounded. In any event, P has already taken out another summons seeking leave to appeal against the quantum of all the costs order assessed by this Court, which will be dealt with in another decision.

31.P’s objection to the grant of counsel certificate is unjustified. Given a number of legal and factual issues were raised and hotly contested in the Injunction Application as well as the Two Summonses, I take the view that the matters were of sufficient difficulty and technicality to warrant the instruction of counsel in opposing the Two Summonses.

32.For completeness sake, I should note in passing that P has also mentioned various procedural matters in its skeleton submissions[10]. Those matters are not relevant to the present application and are illusory. Suffice it to say that the true facts regarding P’s conduct of the present proceedings are well documented in the original documents of these proceedings as well as the transcripts of the hearings. It leaves no room for any attempt to suggest otherwise.

33.Indeed, this Court has repeatedly acceded to P’s requests for extension of time for lodging skeleton submissions in various applications and for transcripts of all the hearings before this Court so as to ensure that P would have reasonable time to prepare its case.

DISPOSITION

34.Having considered all the submissions of the parties, P has not put forward any good reasons to show why an order for summary assessment and immediate payment should not be made. Indeed, the Leave Decision Costs Order Nisi is in line with the legal principles. It serves to discourage the unmeritorious applications of the Two Summonses and promote a sense of procedural economy and costs saving.

35.The parties should not waste further time, efforts and costs in embarking on a separate costly and time-consuming taxation proceedings. Judicial resources could also be saved. P plainly failed to show substantial grounds for disputing D’s claim for costs could not be dealt with summarily. It’s application to vary the summary assessment to a more time-consuming and costly taxation is unjustified. The Present Summons is unmeritorious and is hereby dismissed.

36.There is no reason why costs should not follow the event in this application. I order P to pay D’s costs of this application, including all costs reserved, summarily assessed at HK$21,000, payable forthwith.

The Plaintiff acting in person

Messrs Y T Chan & Co, for the Defendant