Tang Lap Man v. Yeung Peter and Others

Headnote

Order 59 rule 10(5) : An example of circumstances which justified an order for security for costs even though it was not shown that the appellant would be unable to meet the costs of the appeal if unsuccessful.

BETWEEN

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Coram: Hon. Cons, Fuad, JJ.A. & Kempster, J.

Date of Judgment: 3rd April, 1984.

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JUDGMENT

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Cons, J.A.:

1. The proceedings with which we are concerned today initially originated in 1977. In that year the plaintiff sold his Letters B to the 4th defendant. Subsequently he came to the conclusion that the consideration which had been paid to him was vastly inadequate. Therefore in 1982 he took out a writ in the High Court asking that the sale be rescinded or that damages be paid to him based on either misrepresentation or on failure to fulfil a verbal guarantee that if the price of the Letters B should rise he would be given an option to buy back at the price sold.

2. The action came on for trial in 1983. All told it took twelve days and at the end of the hearing on the 26th of January this year the plaintiff's action was dismissed. The judge was very emphatic in the view that he took of the plaintiff's evidence and that of his witnesses. He thought that the whole of the plaintiff's claim was based on fraud and forged evidence.

3. Two days later the plaintiff served his Notice of Appeal. Rules of Court provide that once Notice of Appeal has been served the appeal itself shall be set down within seven days. The plaintiff did not comply with that rule but eventually filed an application to extend the time. The application came before a Master on the 27th of last month who came to no definite conclusion upon the application.   However, with the agreement of the plaintiff and of the Defendant's Counsel we have dealt with that matter earlier today, making an order extending the time for setting down until the 16th of this month.

4. In view of that agreement Defence Counsel naturally has not pursued his application to strike out the plaintiff's appeal for failure to set down within time, but he has pressed on with an alternative application for security for the costs of the appeal. That is an order this court is empowered to make if it should feel that it is justified by special circumstances. In that case Counsel has proposed $50,000 as a reasonable figure. This is consistent with the usual practice of ordering something less than the reasonably expected costs of the appeal. It bears no resemblance to the extravagant figure that had originally been put forward.

5. Annexed to the plaintiff's Notice of Appeal is a document entitled "Statement of Appeal". It is a long document comprising 19 pages of typescript. It is not always too easy to follow, and much of it is repetitive. In substance it sets out the plaintiff's version of the events both before and after the sale together with comments on the evidence and the testimony of both the plaintiff's and the defendant's witnesses.

6. In addition the plaintiff has addressed us today. In some instances he has gone into greater detail as to what he suggests are the true facts. But in effect he has done no more than repeat what he had already set,out in his Statement of Appeal. The general burden of his submissions is that the plaintiff's claim is honest and genuine and that those who deny it are untruthful.

7. The question of who is telling the truth or not is a matter our law leaves to the judge who sits at first instance, that is the judge who hears and sees those who give evidence before him. It is thought that he is the best person to decide where the truth does in fact lie and this court will not, as a general rule, interfere with question of that nature. For myself I find nothing in what has been written in the Statement of Appeal or in what has been said today which inclines me even to consider departing from that general rule. To that extent, in my view, the plaintiff's appeal stands very little chance of success.

8. However the matter does not end there. There are two further considerations which I think are of importance. Firstly, whatever view the plaintiff may himself take of the morality of his conduct, he has shown himself to be a man quite prepared deliberately to mislead the court. On his own admission he falsified tapes which he put in evidence as truthful recordingsof conversations he had with other parties. Secondly, there are the plaintiff's witnesses. The judge found that they were telling lies. But not only was he satisfied that they were telling lies, he found that they were putting forward a deliberately rehearsed story. On the face of matters as they stand at this stage the judge's conclusion in this respect would appear to be well merited. It is an indication of yet further interference by the plaintiff.

9. Taking these three matters into account they amount, in my opinion, to sufficient speciality of circumstance to warrant our saying that the defendant should not be called upon to meet this appeal unless the plaintiff is prepared to support his conduct by the deposit of security against costs. I would therefore make an order that he should pay into court within ten days the sum of $50,000 as security for the costs of his appeal and that in the meantime all proceedings in the appeal should be stayed. If payment is duly made the appeal should continue in accordance with our order as to the time for setting down and in that instance, lest the plaintiff should feel the court start with an unfair prejudice against him, I would further order that the appeal be placed before some other division of this court.

Fuad, J.A. :

10. I agree and with the order proposed by my Lord.

Kempster, J. :

11. I too agree with all that has fallen from my Lord Mr. Justice Cons including the terms of the order and of the direction proposed. I think it, however, helpful to point out that as a rule it is not appropriate for this court to form even a preliminary opinion about the merits of subsisting appeals at an interlocutory stage or to order an appellant to give security. None the less Order 59 r. 10(5) provides :-

"The Court of Appeal may, in special circumstances, order that such security shall be given for the costs of an appeal as may be just. "

An illustration of what may be described as "special circumstances" was given by the Court of Appeal in England in Weldon v. Maples, Teesdale & Co., and Others⁽¹⁾. At page 333 Bowen L.J. said :

"The cases in which security may be ordered are therefore not limited to cases of the poverty of the appellant alone. If there are special circumstances which, in the opinion of the Court, render it just to order security to be given, the order should be made without reference to the appellant's poverty."

In that case an order for security was made; on the ground that the respondent had made out a prima facie case of an abuse of the process of the court.

12. Mr. Yam, who appears for the defendants, has submitted to us that it is an abuse of the process to prosecute a hopeless appeal when the costs below have not yet been paid. But the defendants are not required to establish a prima facie case of abuse of the process. They are required to show special circumstances in which it would be just for this court to make the order for security sought. Here we know that the plaintiff has been held by the trial judge, whose function has explicitly been described by my Lord Mr. Justice Cons, to have acted fraudulently; to have called false witnesses; to have forged tapes put before the trial judge as genuine and - this may be critical to my own decision - that the plaintiff, by what he called his Notice of Appeal, has himself admitted the alteration of three out of four of such tapes. These considerations, in my view, constitute special circumstances.

(1) (1887) 20 Q.B.D. 331

Representation:

TANG Lap Man, Plaintiff in person.

David YAM (Messrs. Woo, Kwan, Lee & Lo) for Defendant.