Mohammad-riasat v. Wanton Business Services Ltd
Read the full judgment text of HCPI 312/2021 on BabelCite. This High Court CFI judgment was delivered on 23 January 2026.
1. On 19 September 2025, this court handed down the judgment after trial (“the Judgment”) in favour of the plaintiff with a nisi costs order (“the Nisi Costs Order”). The defendant now applies to vary the Nisi Costs Order.
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HCPI 312/2021 [2026] HKCFI 567 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE PERSONAL INJURIES ACTION NO 312 OF 2021 ________________________ BETWEEN
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________________________ DECISION ON COSTS ________________________ 1.On 19 September 2025, this court handed down the judgment after trial (“the Judgment”) in favour of the plaintiff with a nisi costs order (“the Nisi Costs Order”). The defendant now applies to vary the Nisi Costs Order. BACKGROUND 2.The background, dispute and findings were set out in the Judgment, which will not be repeated. The same definitions and abbreviations are adopted for the present purpose. 3.By the Judgment, this court awarded the plaintiff (“MR”) damages in the sum of HK$952,477.44, net of contributory negligence and employees’ compensation received. By the Nisi Costs Order, the defendant (“WBS”) shall pay MR’s costs of the action, including any costs reserved, to be taxed on the District Court scale, while MR’s own costs up to discharge of his legal aid shall be taxed in accordance with legal aid regulations. 4.On 2 October 2025, WBS filed its summons to vary the Nisi Costs Order (the “Summons”) in the following terms:
5.MR’s legal aid lasted from 4 November 2020 until 6 July 2023 (the “Legal Aid Period”). Legal Aid Counsel appeared at the hearing of the Summons on behalf of the Director of Legal Aid (“DLA”), and made submission insofar as DLA’s interest in relation to the Legal Aid Period is concerned. THE PRINCIPLES 6.O22, r23 of the Rules of the High Court, Cap 4A (“RHC”) provides:
7.Pursuant to O22A, r1(2) RHC, upon the satisfaction of the cause or causes of action or to the extent to which the sanctioned payment may be withdrawn or diminished pursuant to O22, and where money in court is a sanctioned payment made in accordance with O22, an order may be made for the money to be paid out. This is the court’s discretion: see MGA Entertainment Inc formerly known as ABC International Traders, Inc doing business as MGA Entertainment v Toy and Trends (Hong Kong) Ltd & Ors [2014] HKCU 1645 at §§15-17. THE SANCTIONED PAYMENTS 8.In 2020, MR filed his employees’ compensation claim against WBS. This was settled in January 2021 at the sum of HK$380,000. 9.On 29 September 2021, MR commenced the present action, claiming against WBS damages in the sum of HK$4,400,000. 10.On 18 May 2022, WBS made its first sanctioned payment in the sum of HK$1,000,000 (the “1st Sanctioned Payment”). On 25 May 2022, MR’s then solicitors rejected the settlement offer, and demanded a sum of HK$5,050,000. Even higher than the pleaded claim, that was. 11.On 15 July 2022, WBS increased its sanctioned payment by a sum of HK$300,000. On 22 July and 3 August 2022, MR’s solicitors rejected the settlement offer, and demanded a sum of HK$5,030,000. Negligibly less than the sum demanded previously, that was. 12.On 15 December 2022 and 2 February 2023, WBS further increased its sanctioned payment by a sum of HK$100,000 respectively. There was no response from MR’s solicitors. 13.On 6 July 2023, MR’s legal aid certificate was discharged. 14.On 4 October 2023, WBS further increased its sanctioned payment by a sum of HK$900,000 (the “Final Sanctioned Payment”), bringing the sanctioned payments to a total sum of HK$2,400,000. There was no response from MR. 15.On 21 October 2024, which was 5 days after the pre-trial review (“PTR”) hearing, WBS reiterated the sanctioned payments to MR and that that would be the ultimate, final and non-negotiable offer. On 17 December 2024, MR rejected and counter-offered to settle at the sum of HK$3,200,000, inclusive of the employees’ compensation received. WBS rejected that. DISCUSSION 16.Undoubtedly, MR failed to obtain a better result than the sanctioned payments made by WBS, probably not even the 1st Sanctioned Payment as at the time when it was made back in May 2022. The present case falls within the rule so that this court shall make the orders pursuant to §§(2), (3) and (4) of O22, r23 unless it would be unjust to do so. It is the burden of MR to satisfy this court that this would be unjust, considering the circumstances including those set out in §(6) of the rule. 17.By letters dated 4 October and 20 October 2025, MR made his representations. So did he at the hearing. 18.In view of the history set out above and the period during which MR was acting on legal advice, I can only consider his repeated rejections of the settlement offers of WBS were conscious and informed decisions on his part. For the purpose of O22, r23(6), it is not about subjective good faith on his part to negotiate for settlement as MR suggests in his submission. His counter-offers through his then solicitors reflect inadequate readiness to compromise, which is the foundation of any settlement. 19.Contrary to MR’s submission, I do not agree that it was unfair for WBS to reiterate the Final Sanctioned Payment with a view to settlement when MR was acting in person. I see no reason for suspecting that the maintenance of his stance in rejecting such settlement offer, while acting in person, was adopted out of any insufficient understanding, as he did consciously make his counter-offer in reply. It is also unfair for MR to suggest now that WBS’ negotiation for settlement was mere tactic. The fact of the repeated sanctioned payments, so that MR could have put an end to the litigation by walking away with HK$2.4 million with costs, speaks for itself. MR’s argument that making the order would “dismiss the true meaning of justice” lacks substance for the purpose of r23(6), and defies understanding in the circumstances discussed above. 20.Therefore, the variation of the Nisi Costs Order in terms of §4(1), (2), (3) and (5) above in my view is justified. So is §4(8) above whereby the balance of the sanctioned payments in court after deducting the Judgment Sum should be paid out to WBS. 21.The following terms of variation sought may deserve further consideration in view of the DLA’s submission:
22.Regarding the above issues, DLA made the following submission:
23.DLA also asks that MR’s own costs during the Legal Aid Period to be taxed in accordance with Legal Aid Regulations. On this, this court actually included such order in the Nisi Costs Order, which WBS does not seek to vary by the Summons. In other words, this part of the Nisi Costs Order simply stands. ENHANCED INTEREST RATE 24.The enhanced interest and its rate under O22, r23 are matters of the court’s discretion. In Imran v Intrafor Hong Kong Ltd [2024] HKCFI 100, this court had this to say:
25.DLA also refers to this court’s judgment in So Sin Ying v JV Fitness Ltd [2023] HKCFI 3352 as well as the judgments in Yeung Kiu Ying v Fairwood Fast Food Ltd t/a Fairwood [2020] HKDC 293 and Hui Pui Man v Intercontinental Limousine Company Ltd [2025] HKDC 1721 in support of his submission that the rate should be no more than 5%. 26.In Cheung Hon Kin v Chubb Life Insurance Company Ltd (formerly known as New York Life Insurance Worldwide Ltd v Ace Life Insurance Company Ltd. respectively) [2024] HKCFI 3623, the Court explained (at §§19-21) the two approaches in determining the enhanced interest rate. The traditional approach is to calculate the interest on each item of expenditure from the actual date of payment. The modified approach, on the other hand, is to order interest at half the rate which the court would otherwise order for the whole of the relevant period. Both WBS and the DLA left that to this court. 27.Considering the findings in the Judgment as well as the history and conduct of litigation summarised above, I am not inclined to think this as one of the extreme cases warranting the maximum enhanced interest rate of 10%. WBS has provided the receipts of disbursements made by the insurers of WBS since 15 June 2022, but they have yet to settle its solicitors’ bills. I accede to the variation sought in terms of the traditional approach, and set the rate of the enhanced interest at 3% per annum above judgment rate in respect of the costs and disbursements of WBS from their actual payment. THE SET-OFF AND PAYMENT OUT 28.Counsel for WBS acknowledges that it is not the usual practice of the court to allow the judgment sum to remain in court to enable the requesting party to enjoy effective security for his costs, unless he manages to demonstrate good reasons: see Darcy Grant Dmetrichuk v Tung Wah Group of Hospitals Wong Fut Nam College [2006] HKCU 1362 at §18; Ng Chi Kwan, Danny Summer & Anor v Yeung Yiu Kwai & Anor HCPI 633/2011 (28 November 2014) at §§31-34; Sandhu Jatinder Singh v Ma Shiu Ming & Anor DCPI 2647/2022 (11 December 2024) at §66. 29.In the present case, counsel asks this court to take into account the circumstances of the present case as found, namely that MR has admittedly not worked at all since the accident but been depending on comprehensive social security assistance. It is therefore unlikely that MR would have the means to discharge his liability to pay WBS’ costs. WBS may only look to the prospect of recovering its costs from the Judgment Sum to which he is adjudged to be entitled. 30.WBS’ application that MR should be entitled to no interest on the Judgment Damages after 15 June 2022 caused this court to raise the concern whether this would be unfair if the Judgment Sum is to be further retained in court pending the set-off. Counsel submits that the root cause of MR’s predicament, notwithstanding judgment in his favour, is the consequence he must bear which triggers the operation of O22, r23 against him. Further, while the Judgment Sum remains in court pending set off and payment out, such sum should still attract interest in the suitors’ funds accounts. Hence no substantial unfairness. 31.As for the DLA, section 18A(4) of the Legal Aid Ordinance, Cap 91 (“the LAO”) provides that the legal aid first charge on any damages or costs (awarded to the aided person) shall not prevent a court allowing them to be set off against other damages or costs in any case where a solicitor’s lien for costs would not prevent it. The set-off sought under §4(7) above refers to WBS’ costs incurred after the discharge of legal aid on 6 July 2023. DLA observes that other than that, the costs are really those between the DLA and WBS during the Legal Aid Period. This brings about DLA’s following submission. 32.DLA submits that instead of allowing the balance of the Judgment Sum to be withheld by the court pending set-off of the parties’ respective costs during the Legal Aid Period, such balance should be paid out to the DLA pursuant to section 19A of the LAO. DLA is concerned about the delay due to the uncertain and probably different timing of any agreement or, even more so, the taxation of the parties’ respective costs. This, the DLA argues, is unnecessary and avoidable as the position of DLA to pay WBS’ costs during the Legal Aid Period ought not to be doubted. Hence no real concern referred to above which may otherwise justify the proposed stalling of the payment out. Disposal of the matter this way, it is also submitted, would become relatively neater, and further involvement of this court would be saved as well. 33.I see the sense in the DLA’s submission. So did counsel for WBS so that she also proposed to revise the terms of the variation to accommodate the DLA. ORDER 34.Hence the following order:
COSTS OF THE SUMMONS 35.The terms of §4(10) above are appropriate. Therefore the costs of and occasioned by the Summons be paid by MR to WBS with certificate for counsel, on an indemnity basis to be taxed on High Court scale if not agreed.
The plaintiff appeared in person Ms Christina Lee, instructed by Chu & Lau, for the defendant Ms Cynthia Chan, Legal Aid Counsel, appearing on behalf of the Director of Legal Aid | |||||||||||||||||||||
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