Chin So Hang v. Lee Chee Kin

DCCJ 3371/2003

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 3371 OF 2003

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BETWEEN

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Coram: Deputy District Judge M. Chow

Date of Hearing: 23rd October, 2006

Date of Handing Down Decision:  27th October, 2006

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DECISION

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1.This is an application by the Plaintiff to vary the costs order to the effect that the Defendant do pay the Plaintiff’s costs in respect of the time spent for the argument of the preliminary issue.

2.There were two grounds for awarding costs against the Plaintiff.  A total of 3 hours 15 minutes were spent for the following matters: -

(i) Time was spent for sending the Sales and Purchase Agreement to the Stamp Duty Office for adjudication by the Plaintiff on the first day of the trial.  ( about 2 hours 15 minutes)

(ii) Defence Counsel was provided with a copy of the skeleton argument and a list of authorities just at 9:30 am and the Defence Counsel requested one hour to read the papers.

3.The Plaintiff’s Counsel does not pursue the second ground for variation of the costs nisi order.

4.The argument was mainly whether costs should be awarded against the Plaintiff on the first ground.  The argument advanced by the Plaintiff’s Counsel was that the Plaintiff was under no statutory obligation/ duty to send the Sales and Purchase Agreement to the Stamp Duty Office for adjudication.  It was all done as a gesture of goodwill.

5.The Sales and Purchase Agreement was an essential piece of document for the purpose of this trial hearing.  The preliminary issue was whether or not the Sales and Purchase Agreement was admissible as evidence by virtue of S.15 of the Stamp Duty Ordinance on the basis that it had not been duly stamped.

6.This issue was raised by the Defence about a week before the trial date.  In fact, there were correspondences between the parties’ solicitors as to their respective points of view. 

a) The Plaintiff’s solicitor held the view that the Sales and Purchase Agreement was not an instrument chargeable with stamp duty as it fell within the exception of S.29C (5A) of the Stamp Duty Ordinance.

b) The Defendant’s solicitor disagreed and contended that S.15 of the Stamp Duty Ordinance applied.

23-6-2006 Friday

7.By the time that the Defence provided the list of authorities to the Plaintiff on 23^rd June, 2006 (Friday), the position of the Defence could not be clearer as their stance was to raise objection as to the admissibility of the Sales and Purchase Agreement under S.15 of the Stamp Duty Ordinance. 

24-6-2006 Saturay

8.The Plaintiff gathered their momentum to send a certified copy of the Sales and Purchase Agreement to the Stamp Duty Office for adjudication.

9.This urgent request was not entertained by the Stamp Duty Office as they required to stamp on the original copy.

26-6-2006 Monday

10.The Stamp Duty Office is located in the Revenue Tower which is just next to the District Court.  The Plaintiff’s solicitor firm is situated at no.5 Queen’s Road, Central.  (as stated in the letterhead).

11.The distance between the Stamp Duty Office and the Plaintiff’s solicitor office is no more than a few minutes by taxi, for unknown reason, the Plaintiff solicitor chose to wait until Monday morning 26^th June, 2006 (the 1^st trial date) to send the original copy to the Stamp Duty Office for adjudication rather than to pursue the matter immediately (a week ago) or as soon as possible on Friday, (23-6-2006) or Saturday, (24-6-2006).

12.Miss Lam, Counsel for the Plaintiff presented her argument until 10:30 a.m..  At that point of  time, the Defence Counsel referred to the case of  Chan Woon Cheung v Chan Yuk Ching and Others HCA 1377/2001 that if the Plaintiff’s solicitor would give a personal undertaking to this Court to seek leave for the instrument  to be received in evidence, the case could be proceeded without further argument. 

13.The Plaintiff’s solicitor refused to provide such an undertaking. 

14.What the Plaintiff is seeking from the Court is to vary the costs order on the ground that the Plaintiff’s conduct in bringing the original Sales and Purchase Agreement to the Stamp Duty Office for adjudication was in fact as a gesture of goodwill.  The Plaintiff was under no statutory duty/ obligation to do so.

15.At the end of the day, the Plaintiff was proved to be right that the Sales and Purchase Agreement was a “not chargeable instrument” and therefore was not required to pay Stamp Duty.

16.Therefore, the Plaintiff should not be penalized in costs.

Ruling

17.In the present case, it was not up to the Plaintiff to decide that the Sales and Purchase Agreement was a non-chargeable instrument until the Court made such a ruling or determination on the preliminary issue or alternatively with the adjudication from the Stamp Duty Office that the instrument was not chargeable.

18.In fact, this Court had not been informed that the Plaintiff had sent the original copy to the Stamp Duty Office for adjudication while the Plaintiff’s Counsel was presenting her submission on S.29C (5A) of the Stamp Duty Ordinance.

19.The Defence withdrew their objection when they knew that the Sales and Purchase Agreement was not chargeable instrument and “shall be admissible in evidence …… not standing any objection relating to stamp duty.” S.13 (6) Stamp Duty Ordinance.

20.After hearing submission from both parties, I am not persuaded to vary the costs order as determined previously.  As stated in the case of Chan Woon Cheung, Deputy High Court Judge To said that: -

“the party seeking to rely on the instrument would before the hearing have made good the instrument by having it stamped and paying penalty.”

Orders: -

21.Costs to the Defendant in respect of the time spent for the preliminary issue argument, if not agreed, to be taxed.

22.For the present summons, costs follow the event, I made an order nisi for costs to the Defendant, with Counsel ‘s certificate, if not agreed, to be taxed.  14 days to become absolute.

Ms. Lam, Catrina D.W., instructed by M/s J. Chan, Yip, So and Partners, for the Plaintiff.

Mr. Li, Albert K.C., instructed by Messrs Tam and Partners, for the Defendant.