Tripole Trading Ltd and Others v. Prosperfield Ventures Ltd

FACV No. 5 of 2005

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

FINAL APPEAL NO. 5 OF 2005 (CIVIL)

(ON APPEAL FROM CACV NO. 43 OF 2004)

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Between:

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FACV No. 6 of 2005

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

FINAL APPEAL NO. 6 OF 2005 (CIVIL)

(ON APPEAL FROM CACV NO. 35 OF 2004)

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Between:

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Court: Mr Justice Bokhary PJ, Mr Justice Chan PJ, Mr Justice Ribeiro PJ, Mr Justice Litton NPJ and Lord Hoffmann NPJ

Date of Decision: 15 March 2006

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DECISION  ON  COSTS

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Mr Justice Bokhary PJ:

1.This is the Court's decision on costs.  It is to be read together with the judgment handed down on 5 January 2006.  By that judgment (i) the defendants' appeals were allowed; (ii) the orders of the Court of Appeal were discharged; (iii) the defendants were relieved of the undertakings given in the courts below; and (iv) the trial judge's orders other than as to costs were replaced by declarations to the effect that the two agreements are void.

2.As to costs, we made an order nisi that the trial judge's award of costs to the plaintiffs stand, but that all costs incurred in the proceedings after 27 January 2004 (the date of the trial judge's judgment), including the costs before us, be awarded to the defendants.  We directed that the order nisi becomeabsolute after 28 days unless a party wishing to contend for a different costs order were to lodge written submissions (copied to the opposite party), in which event the opposing party do have 28 days to lodge its written submissions reply.  And we indicated that we would then adjudicate on the matter of costs without hearing the parties further. 

3.We have since received written submissions from the parties.  By their written submissions the defendants ask us to vary so much of the order nisi as deals with the costs up to 27 January 2004.  Primarily they ask for all or a substantial part of those costs.  Alternatively they ask that there be no order as to those costs.  By their written submissions in reply, the plaintiffs ask that the order nisi be made absolute in its entirety.

4.The defendants cite the statement of the Court of Appeal in Elpe International (Far East) Ltd v. Hewlett Packard Hong Kong Ltd, Civil Appeal No. 58 of 1993, 30 July 1993, at p.10 that courts dealing with costs begin by looking at the realities and asking themselves “who really won? ”.  And the defendants say that they are the real winners.  They say so on the basis that the actions amounted in essence to a claim by Mr Peng to the shares in SCIC, later re-named SFC, and such claim failed. 

5.There is a problem with the defendants' approach.  The costs now in question are those at first instance.  And the defendants' approach asks the question “who really won? ” out of the context of the case as it was actually fought out between the parties at first instance.  At first instance the main if not sole issue was whether, as the defendants alleged while the plaintiffs denied, there had been an oral agreement whereby Mr Peng agreed to transfer his shares in SCIC to Madam Ding and Mr Zheng.  That issue was resolved by the trial judge in Mr Peng's favour, and that finding stands.  So the costs now in question pertain to the part of the proceedings in which the plaintiffs won on the main if not sole issue then actually fought out between the parties.  And, if anything, the defendants' difficulties in regard to those costs are increased by the fact that it was they who raised that issue. 

6.All things considered, we are of the view that the plaintiffs should have the costs up to 27 January 2004 even though the defendants should have the costs thereafter.  Accordingly the order nisi is now made absolute in its entirety.  Additionally, we consider it appropriate in all the circumstances to award - and do award - the plaintiffs the costs of the written submissions. 

Written submissions on costs by Mr Godfrey Lam (instructed by Messrs Wong Poon Chan Law & Co.) for the defendants/appellants

Written submissions on costs by Mr Anderson Chow SC (instructed by Messrs Clifford Chance) for the plaintiffs/respondents