O’reilly Mark v. Mandatory Provident Fund Schemes Authority

HCAL 1543/2024

[2026] HKCFI 341

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST NO 1543 OF 2024

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COSTS RULING

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A.  Introduction

1.By my Decision dated 4 February 2025, [2025] HKCFI 382, I dismissed the Applicant’s application for leave to apply for judicial review.

2.I adopt in this Ruling on Costs any relevant abbreviations or definitions as found in my previous Decision. I also note that there has been no appeal from the Decision.

3.The full reasoning for that Decision is contained within the Decision itself, and need not be rehearsed here.

4.Suffice it to say for present purposes that I held that the point that judicial review is a remedy of last resort was inextricably wrapped up in the main aspects of the intended challenge. In that regard, I held the application to have been misguided. The true nature of the Applicant’s underlying complaint or challenge was directed against DCP, and not the MPFA. His misgivings arose from DCP’s handling of matters under the Scheme, which are matters between them both as trustees such that the dispute is a civil private law matter and not a public law matter. I further held that it is difficult to see how the judicial review application would have resolved that dispute, and the Applicant still had open to him civil proceedings against DCP and/or Deloitte China in the BVI.

5.On the other hand, I think it is relevant to take into account – and I do so below – that I did not dismiss the judicial review application on other points advanced by the MPFA, namely either (1) on the basis that there was no “decision” made or “action” taken amenable to judicial review, or (2) on the basis that the application was or had become academic.

6.I directed that the consequential matter of costs would be dealt with on two rounds of paper submissions. Therefore, I directed that (1) both parties may file any costs submissions (which must be limited to no more than five pages), and (2) both parties may file any reply costs submissions (which must be limited to no more than three pages). Thereafter, I would make my costs ruling.

7.Now having considered the various submissions filed, this is my Ruling on Costs.

B.  Applicable Principles

8.I do not think there is any significant dispute about the applicable principles; they are well-settled.

9.Since applications for leave to apply for judicial review are ordinarily meant to proceed on an ex parte basis, the general rule should be that an unsuccessful applicant will not be ordered to pay the costs of a putative respondent, unless there are special or unusual circumstances which justify such an award.

10.The discretion to make such an award of costs should be sparingly exercised, such that good reason will be required before the Court would make an order for costs against the applicant. However, this does not mean that costs will only be awarded when the application for leave is frivolous, vexatious or motivated by bad faith.

11.Amongst the matters to be taken into account will be: (1) what has led the opposing party to attend the hearing or participate in the proceedings; (2) if the opposing party has attended or participated at the invitation of the Court, why the Court considered the attendance or participation relevant; (3) whether that party’s attendance or participation has been of material benefit to the Court in determining the application; (4) the underlying lack of merits of the application; (5) whether the matter has proceeded with full argument and documentary evidence so that the applicant has, in effect, had a full substantive hearing of the judicial review challenge; and (6) whether the public interest litigation exception might have been triggered, where there is a point of law raised and considered for the benefit of the community.

12.As to summary assessment of costs, it is well-settled that the Court will adopt a relatively broad brush approach to the assessment. That will entail looking at the individual costs elements claimed, and the overall total claimed, by reference to reasonableness and proportionality in light of the volume of documentation, apparent complexity, and relative importance of the points in dispute.

13.I adopt these various principles in my consideration below.

C.  Submissions – Incidence of Costs

14.In my summary of them, the Applicant made the following submissions:

(1)  Interpretation of ORSO is vital because it will govern any future beneficiaries’ suit.

(2)  Though not a ‘policeman’, the MPFA has accountability for the public good, holding trustees to section 25(5)(e).

(3)  Despite that section’s introduction in June 2020, its operation remains unclear, and the case serves many ORSO schemes.

(4)  Indeed, private issues often lead to a deeper review of law/regulation.

(5)  Section 33A obliged the Applicant to report activities he believed to be non-compliant, and Scheme members should know how the MPFA will respond to trust breaches.

(6)  The application did not state, nor suggest, that the ‘joint tenancy’ of two trustees was a consequence of the common law. Rather references were made to statutory provisions, reflecting common law.

(7)  When the Applicant was appointed as trustee, the assets of the trust vested in the two trustees as joint tenants.

(8)  When section 25 of ORSO was drafted, the drafters likely had in mind joint tenancy.

(9)  Though there are disputes with the co-trustee, the application was strictly confined to ORSO interpretation and the MPFA’s lack of knowledge of trust law.

(10)  It is necessary to decide what section 21(1)(a) of ORSO means when there are two trustees.

(11)  Because it is a breach of trust by the Applicant passively to allow his co-trustee exclusive possession, his application was an essential public protest.

(12)  The Court’s dismissal of the application follows the MPFA’s letter, but the application was simply to raise questions and was not intended to be “against” the MPFA.

(13)  The Applicant has no personal gain, merely rights and duties as an (unpaid) trustee.

(14)  The engagement of an external law firm and Senior Counsel to oppose the application was unnecessary.

(15)  Judicial review is not a matter on which the Applicant was expected to have expertise as trustee, and so any culpability if its criteria were misjudged.

(16)  The MPFA should obtain costs from the assets held by the co-trustee.

(17)  The Applicant could not imagine paying the MPFA’s costs to contest his right to clarify the law.

(18)  The Decision leaves unsatisfied various questions.

(19)  The Decision requires the Applicant either to spend his own money on lawsuits in the BVI, for no personal gain, or simply to give up his rights, and both are too harsh for an unpaid trustee.

(20)  However, the Applicant should be protected by the history of “Beddoe orders”, because he followed the advice in that case suggesting a trustee is provided by the law with an inexpensive method of solving his doubts in the interests of the trust.

(21)  Nevertheless, the Applicant accepts the Court’s view that judicial review should be avoided in this case.

(22)  The Applicant suggests withdrawing the application and closing the matter.

15.In my summary of them, the MPFA made the following submissions:

(1)  On the application of the settled principles, there are good reasons to award costs in favour of the MPFA, on a full indemnity basis.

(2)  The application was completely devoid of merit, where (a) the Court has accepted that the proceedings were wholly inappropriate since the disputes are private in nature, (b) the application was described as “misguided” and “unnecessary”, and (c) no public interest is involved.

(3)  An award of costs in this case would not deter any future genuine public law claims.

(4)  Irrespective of the public/private nature of the dispute, neither the language nor the structure of the ORSO lend any suggestion to the Applicant’s case.

(5)  The Applicant knowingly chose not to pursue ordinary civil litigation, despite being so advised by the MPFA.

(6)  The suggestion is that the Applicant commenced judicial review proceedings so as to avoid potential costs orders which may be made in ordinary civil litigation.

(7)  In any event, judicial review should not have been deployed as a substitute for what has all along been a private dispute between trustees.

(8)  Contrary to well-established principles, the Applicant inappropriately invited the Court to rule on a hypothetical case and to give general advice on the law, which invitation the Court declined.

(9)  The MPFA lodged its Initial Response and made factual and legal submissions at the invitation of the Court, and has thus meaningfully participated in the proceedings.

(10)  The Applicant effectively had a substantive hearing (even though on paper).

(11)  The Applicant’s costs submissions seek to reargue matters which have already been decided and addressed in the Decision.

(12)  The MPFA’s Letter is different from the MPFA’s response to the judicial review proceedings; the former responded to the Applicant’s complaint to the MPFA, and the latter responded to the judicial review application as directed by the Court.

(13)  Any alleged impecuniosity on the part of the Applicant is not a valid reason for not ordering costs, if it should otherwise be ordered.

(14)  The Applicant made no prior application for any protective costs order (which has an established procedure for dealing with costs concerns).

(15)  It is simply too late to seek to withdraw the judicial review application, but in any event the usual costs order made on withdrawal is that the applicant would be required to pay the putative respondent’s costs.

16.I note that at various parts of the Applicant’s first-round submissions, the Applicant criticised Mr Yuen – Leading Counsel for the MPFA – and suggested that he “misled the Court”, “made an untrue statement”, “building at least half his case on this error, prejudicing the issues”. However, I also note that the Applicant has sought to clarify in subsequent correspondence that no allegations of impropriety by any persons were made, implied or intended. In any event, whilst I reject the suggestion Mr Yuen misled the Court, I do not think I need to address this point further.

D.  Decision – Incidence of Costs

17.I agree that a substantial part of the Applicant’s costs submissions in effect seek to re-argue matters which were decided by me in the Decision – which, as I have noted, was not the subject of any appeal and which Decision was expressly accepted by the Applicant. I therefore decline to engage with the submissions which amount to that attempted re-argument.

18.Further, where I have determined the application for leave to apply for judicial review, it is obviously too late to seek to withdraw the application in the hope of avoiding any adverse costs consequences.

19.But I otherwise take into account the submissions which I have set out above. I place perhaps particular weight on the following:

(1)  The general position is that an unsuccessful applicant will not be ordered to pay the costs of a putative respondent, unless there are special or unusual circumstances which justify such an award.

(2)  Interpretation of ORSO is of some real and practical importance to trustees and beneficiaries alike.

(3)  Though not a ‘policeman’, the MPFA has accountability for the public good.

(4)  Section 33A obliged the Applicant to report activities he believed to be non-compliant, and it might be helpful to test the integrity of the decision-making process relating to any response to such a report.

(5)  Such reports are presumably to be made for the overall good of public administration.

(6)  Though there are disputes with the co-trustee, the application focused on the correct statutory interpretation of ORSO under which the MPFA has a significant role to play.

(7)  The Applicant has no personal gain, merely rights and duties as an (unpaid) trustee.

(8)  However, the Applicant knowingly chose not to pursue ordinary civil litigation, despite previously being so advised by the MPFA.

(9)  The Applicant has stated he has accepted the Court’s view that judicial review should be avoided in this case.

(10)  But it was inappropriate for the Applicant to have invited the Court to rule on a hypothetical case and to give general advice on the law.

(11)  The MPFA lodged its Initial Response and made factual and legal submissions at the invitation of the Court, and meaningfully participated in the proceedings.

(12)  As intended, those submissions were of assistance to the Court.

(13)  The Applicant effectively had a substantive hearing (even though on paper).

(14)  I dismissed the application primarily because the real underlying dispute raised by the Applicant is a civil private law matter and not a public law matter.

(15)  However, I did not dismiss the judicial review application on other points advanced by the MPFA, namely either (1) that there was no “decision” or “action” made by a public authority which might be amenable to judicial review, or (2) that the application was or had become academic.

20.In the circumstances, where there is some merit on both sides of the argument, it seems to me that the broad exercise of my discretion as to costs should lead to an order that the Applicant should pay 50% of the MPFA’s costs, to be summarily assessed. In short, it seems to me that there are some special or unusual circumstances which justify such an award of costs in favour of the putative respondent, but that they do not justify an order requiring the Applicant to bear all of those costs.

E.  Summary Assessment of Costs

21.By its Revised Statement of Costs for Summary Assessment, the MPFA seeks to recover HK$537,529 (on a 100% recovery basis).

22.It seems to me that that overall figure is disproportionate to the issues in dispute, and there is specific force in the Applicant’s criticism that the engagement of both Senior Counsel and Junior Counsel to oppose the application was unnecessary. Of the total claimed, HK$438,375 is attributable to Counsel’s fees – and (even acknowledging Counsel’s involvement in the preparation of the Initial Response) there is obviously something of a mismatch between that high level of fees and the argument that there was obviously no merit in the judicial review application. However, I disagree with the Applicant that there was no proper reason for the engagement of external solicitors, whose fees in general seem to me to be reasonable and proportionate. I have, in the exercise of my discretion, excluded the claimed costs of preparing the Statement of Costs and its revision. I also take into account the divided spoils on the argument as to the incidence of costs.

23.Taking the approach on principles identified above, it seems to me that the appropriate summary assessment would lead to the figure of HK$280,000 (on a 100% basis). Therefore, the summary assessment of 50% is at the figure of HK$140,000.

The applicant, acting in person

Mr Rimsky Yuen SC and Mr Ian Yu, instructed by Clyde & Co, for the putative respondent