Read the full judgment text of CACV 382/2002 on BabelCite. This Court of Appeal judgment was delivered on 20 January 2005 before Li CJ, Bokhary PJ, Chan PJ, Ribeiro PJ, Sir Ivor Richardson NPJ.
Civil procedure – wasted costs – O 62 r 8 – solicitor knowingly commenced action on false basis – vendor respondents incurred costs defending Writ Action – judge at first instance ordered solicitor to indemnify respondents for entire costs of Writ Action on solicitor and own client basis – Court of Appeal varied order to exclude 'failed costs' (costs of steps taken by respondents that were held to fail, including the costs of a failed application for security for the costs of the purchaser's appeal) – appellant appealed to Court of Final Appeal – Court of Final Appeal dismissed appeal but judgment was ambiguous as to whether orders upheld were those of the judge or as varied by the Court of Appeal – parties given leave to address the issue in written submissions – whether causal link between appellant's misconduct and all costs incurred by respondents in the Writ Action existed – held that the knowing commencement of a false claim has causal potency extending to all costs reasonably incurred by the opposing party in defending the action – the application for security for the costs of the appeal was a reasonable step taken by respondents to protect themselves against a predicament caused by the appellant's misconduct, and the fact that the application failed did not sever the causal connection – Court of Appeal's variation excluding 'failed costs' set aside – Court of Appeal's consequential costs order (apportioning costs on the basis of partial success) could not stand once the variation was set aside, and was substituted with an order that the respondents have all their costs in the Court of Appeal on a party-and-party basis – costs of the O 62 r 8 proceedings varied from an indemnity basis to a party-and-party basis – appellant ordered to pay respondents' costs of the appeal and of the present ruling – respondents required to procure written confirmation from Messrs Lo and Lo of an extended undertaking to cover additional sums payable by virtue of the ruling – liberty to apply in writing on implementation.
Legal issues: Whether Court of Appeal's variation excluding 'failed costs' from wasted costs order should be set aside · Whether the consequential Court of Appeal costs order should stand
Outcome: Appeal dismissed; the Court of Appeal's variation of the wasted costs order is set aside; the Court of Appeal's consequential costs order is varied so that the respondents have all their costs in that court on a party-and-party basis; the costs of the O 62 r 8 proceedings to be paid on a party-and-party basis; the appellant to pay the respondents' costs of the appeal including those incurred in relation to the present ruling.
Cited by 27 cases