Re Li Tat Kong
Read the full judgment text of HCB 741/1995 on BabelCite. This HCB judgment was delivered on 25 April 2003.
1. This is an application by Mr Li Tat Kong ("Mr Li") seeking leave to appeal against two costs orders which I made against him on 28 March 2003, on the Official Receiver's application to vary a cost order nisi which I had made against the Official Receiver in my judgment of 23 December 2002 by which I dismissed the Official Receiver's application to commit Mr Li for contempt of court on the basis of alleged breaches by Mr Li of duties imposed on him under the Bankruptcy Ordinance (Cap. 6). The
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HCB000741C/1995 HCB 741/1995 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE BANKRUPCTY PROCEEDINGS NO. 741 OF 1995 ____________
____________ Coram: Deputy High Court Judge Barma, S.C. in Chambers Date of Hearing: 25 April 2003 Date of Decision: 25 April 2003 _____________ D E C I S I O N _____________ 1.This is an application by Mr Li Tat Kong ("Mr Li") seeking leave to appeal against two costs orders which I made against him on 28 March 2003, on the Official Receiver's application to vary a cost order nisi which I had made against the Official Receiver in my judgment of 23 December 2002 by which I dismissed the Official Receiver's application to commit Mr Li for contempt of court on the basis of alleged breaches by Mr Li of duties imposed on him under the Bankruptcy Ordinance (Cap. 6). The Official Receiver has appealed against that dismissal. 2.Mr Li's appeal on the question of costs would, if leave were granted, be made by way of Respondent's notice in the Official Receiver's appeal. Mr Smith, appearing for Mr Li, accepted that leave to appeal is required because of the provisions of s. 14(3)(e) of the High Court Ordinance which imposes a requirement for leave to be obtained before an appeal can be brought solely on the question of costs, as it would be in the case of Mr Li. 3.Before I turn to the merits of the application, I should deal first with a preliminary objection which Miss Chan, appearing for the Official Receiver, raised to my hearing the application at all. Miss Chan drew my attention to s. 98(2) of the Bankruptcy Ordinance which provides that any appeal in relation to bankruptcy proceedings must be brought within 21 days of the date when the decision sought to be appealed against is pronounced. 4.As my decision on the question of costs was given on 28 March 2003, the time for appealing against that decision would have expired on 18 April 2003, one week ago. However, as that day was a public holiday, the time would not in fact expire until the first working day thereafter which was 22 April 2003, this Tuesday. Mr Li's application was, in fact, made by summons dated 23 April 2003, one day after the expiry of the time limit. In these circumstances, Miss Chan submitted that the correct course for Mr Li to have taken would have been to make a composite application for extension of time for appealing and for leave to appeal, to the Court of Appeal, and not to make the application presently made (which is simply an application for leave to appeal), to me. 5.I was told by Mr Smith on instructions that Mr Li's summons was, in fact, ready for issuing on 22 April 2003 and that an attempt was made to issue it on that date, but that it was not possible to have it issued then because the Registry felt unable to do this without having a date available for the hearing of the summons to be inserted in the summons, which could not be done until the next day, when my availability for hearing the summons could be confirmed. As I understood Miss Chan's submission, she did not suggest that I do not have jurisdiction to grant leave to appeal, but she submitted that there would be no point in my doing so since it would still be necessary for Mr Li to obtain an extension of time for appealing, in view of the fact that the summons was, for whatever reason, issued outside the time limit for appealing against my decision of 28 March 2003. 6.The practice is that applications for leave, where they can be made to the court below, should in the first instance be made to that court, and should only be made directly to the Court of Appeal where there is good reason for so doing. It appears from the commentary to RHC Order 59 rule 14 at paragraph 59/14/4, p. 839 of the Hong Kong Civil Procedure 2002 that the position is this:
7.It therefore appears that notwithstanding that the application for leave to appeal has been made after the apparent expiry of the time limit for appealing, I have jurisdiction to entertain the application. It would therefore seem to me that it is a matter for my discretion whether or not I should entertain the application and go on to deal with it on its merits. 8.In my view, it would be appropriate, in the exercise of my discretion, to consider the merits of the application. I say this for the following reasons. It seems to me that the practice that is described in the passage from the Hong Kong Civil Procedure which I have cited is aimed at a situation in which an application is made to the Court of Appeal, notwithstanding that the application could have been made to the court below because the court below has jurisdiction to deal with it, it is nonetheless taken by the Court of Appeal to be desirable in the interests of saving costs to have all matters dealt with by a single composite application. 9.Where as here, for whatever reason (and in this case the reason appears to have been perhaps due to in part at least the procedural aspects of the procuring of the issue of the summons in question), an application has in fact been made to the court at first instance, it seems to me that for me to simply refuse to hear the matter on the basis that this is something that could be dealt with by the Court of Appeal, and that it may be necessary in any event to seek an extension of time for appealing from that court if in fact it was insisted on by the Official Receiver, is not something which makes it a waste of costs or waste of time for me to deal with the matter, particularly as I have already heard argument on it and given also that, as I think Mr Smith rightly suggested, the ordinary course is for applications for leave to be dealt with by the court below since that court is, in general, in a better position to take a view as to whether or not leave ought to be granted. 10.For those reasons, I propose to go on to deal with Mr Smith's application on behalf of Mr Li on its merits. Mr Li sought leave to appeal in relation to both aspects of my cost order, which dealt with two separate aspects of the litigation in relation to Mr Li's bankruptcy. 11.In my order of 28 March 2003, I made order against Mr Li in relation to, first, the costs of the public examination before Master Ho, and, second, the costs of the application for committal before me. I shall deal first with the costs of the application for committal before me. 12.Following the hearing on 28 March 2003, I varied my original costs order to an order that there be no order as to costs in relation to that hearing. I did so for the reasons which I gave in my ruling on costs, the principal reason on which I relied being that where the Official Receiver was performing a function of a public nature, there was a principle that costs should not be ordered against the Official Receiver (or some other public officer in a similar position) unless such costs could be said to have been incurred by reason of unreasonable or improper conduct on his part. 13.Today, Mr Smith drew my attention to an English Court of Appeal decision which was not available to me at the time of the hearing of the application to vary the costs of order nisi - Re Southbourne Sheet Metal Co. Ltd (No. 2) [1993] BCLC 135. That decision concerned disqualification proceedings against a director of a company and it was held by the English Court of Appeal that there was no principle in such cases that simply because there was a public interest in the bringing of proceedings, the ordinary rule that costs should follow the event should be displaced. 14.Mr Smith suggested that in the light of that decision it would be arguable that the line of the authority relied upon by Miss Chan (and upon which I made my decision) on 28 March 2003 should not be followed in Hong Kong and that the matter should be considered by the Court of Appeal. 15.Miss Chan responded that none of the authorities which were relied upon at the hearing of the application to vary the costs of order nisi appeared to have been referred to in the Re Southbourne Sheet Metal case, so that that decision was given per incuriam. In my view, given the existence of the Re Southbourne Sheet Metal case, it seems to me that there is at least an argument for saying that the principle which I relied upon may not be one which should apply in the circumstances of this case. In so saying, I am not suggesting that that is the case, but accepting that there is an argument to that effect, and that such an argument is not one which has no prospect of success. 16.In the circumstances, I think that there is an arguable point to be put to the Court of Appeal in relation to the question of the costs of the committal proceedings, and I would therefore grant leave to appeal on that point. 17.So far as the costs of the public examination are concerned, Mr Smith's initial submission was that it had been my ruling that the costs of the public examination could be awarded against Mr Li on the basis that he was no longer a bankrupt. However, Mr Smith accepted on being reminded of the terms of my ruling that that was not in fact the basis on my decision, which was that there had been an element of wasted costs in relation to the public examination which had taken place prior to the committal hearing and that it was appropriate that, because of that, the costs of that examination should be borne by Mr Li, notwithstanding that he was, at the time of his examination, a bankrupt and notwithstanding that the general approach to costs in relation to public examinations was that such costs should be borne by the estate. 18.Mr Smith submitted then that since that order for costs involved a departure from the general principle, that was in itself a reason for granting leave to appeal, since it would be appropriate for the Court of Appeal to consider the circumstances in which the general principle should be departed from. Mr Smith also suggested that the terms of my judgment in the committal application involve an acceptance that, whatever blemishes there may have been in Mr Li's evidence during the course of the public examination, whatever doubts they may have engendered might turn out to be unfounded at the end of the day. 19.In my view, I do not consider that the latter point is a particularly strong one, in that it seems to me that the basis on which I ordered Mr Li to pay the costs of the public examination would not be founded on what might turn out to be the case at the end of the day, but on the nature of the answers that he had given in the public examination so far. However, I would accept that in ordering Mr Li to pay the costs, there was a departure from the general practice, and it seems to me that in the circumstances of this case, particularly since there is in any event going to be an appeal of the committal proceedings to the Court of Appeal in the course of which there is likely to be an examination of the answers that Mr Li gave in the course of the public examination, it would be a case in which the Court of Appeal should be given the opportunity to deal with the question of the costs of the public examination, and in particular the circumstances in which it would be appropriate for the costs of such an exercise to be borne not by the estate but by some other party, in this case the bankrupt. 20.For these reasons, I give leave to appeal in relation to that part of my costs order also. In so doing, I remain conscious of the fact that it may be that an extension of time is still be required by Mr Li in order to bring this appeal, whether by way of Respondent's notice or otherwise. However that is not a matter that I have jurisdiction to deal with and it will be for Mr Li to take whatever steps may need to be taken in this regard.
Representation: Miss Linda Chan, for the Official Receiver Mr Clifford Smith, SC, instructed by Messrs Finley & Co., for the Bankrupt |
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