Kowloon-canton Railway Corporation v. Cheung Yin Tung and Others

HCA 2222/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 2222 OF 2006

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BETWEEN

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Before: Deputy High Court Judge Gill in Chambers

Date of Hearing: 20 December 2006

Date of Delivery of Judgment: 21 December 2006

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J U D G M E N T

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1.On 1 October 2006 the plaintiff, the KCRC, having applied ex parte was granted orders injuncting the defendants from engaging in “protesting, demonstrating or congregating in a riotous, disorderly, offensive or unlawful manner in the plaintiff’s railway premises”.  The 6^th, 7^th and 8^th defendants together applied for a discharge.  That was adjourned for evidence and argument; meanwhile, the ex parte orders were extended pending hearing of the application for discharge. 

2.This is the application for discharge.

3.Prior to the hearing the matter concerning the 7^th defendant was resolved by agreement; the injunction concerning him has been discharged.  That concerning the 6^th and 8^th defendants remains extant, but not for long.

4.There has been recent correspondence between the solicitors.  In a letter of 14 December, Messrs Johnson Stokes and Master wrote:

“… we are instructed to inform you that our client [KCRC] is agreeable to discharging the injunctions as against the 6^th and 8^th defendants if they are willing to confirm by letter from your goodselves that they will not unlawfully or illegally enter upon our client’s Railway Premises, as defined in the KCRC Ordinance.  Our client is not asking for an admission of liability.

Further, on another note and in relation to the question of costs, our client is agreeable to putting an end to the entire action once and for all … without seeking costs against your clients, that is on the basis of no order as to costs.”

5.Messrs Au Yeung, Cheng, Ho and Tin, representing the 6^th and 8^th defendants, gave the assurance asked for on behalf of their clients, but stated they were not agreeable to there being no order for costs.

6.That said, Mr Chan representing KCRC before me confirmed at the outset of the hearing that KCRC did not oppose a discharge, the outstanding issue being that of costs.

7.Costs as everyone knows are at the discretion of the court.  There are certain ground rules or guidelines, but the exercise of that discretion falls generally to be determined by the facts and events of a given case.  With that in mind, although the issue of the continuation of the injunctions is no longer at large, it is necessary for me to rehearse the history leading to the granting of the ex parte orders and the aftermath.

8.KCRC had given public notice that it might combine two Light Rail routes in the Yuen Long area and called for public consultation.  Interested parties claiming they would be disadvantaged by the proposal protested by demonstration. 

9.The 6^th and 8^th defendants, Messrs Mak and Tse, came to be involved.  They are both District Councillors in Yuen Long and were opposed to the proposal, supporting the viewpoint of many of their constituents that this would be disruptive and inconvient to a significant number of commuters.  Both were known to Miss Ida Leung of the Public Affairs Department of the KCRC, one of two officers who filed affidavits in support of the application for the injunctions and in opposition to the discharge.  The other was Mr Simon Tang.  He is the manager of West Rail Operations for KCRC.

10.On 27 September KCRC announced that the routes would be combined, to take effect from 8 October. 

11.After the announcement there were two significant developments that took place on 28 and 29 September.  On 28 September a group of some 10 to 15 people sat in protest on the platform of the Tin Heng Station for about 24 hours from 4 p.m., under a banner of the Democratic Party.  Mr Tang had direct knowledge of the event.  He deposed that the demonstration (as he described it) was relatively small, relatively peaceful and did not cause too much disruption.  (Pausing here, there were photographs.  One would be hard pressed to establish from these that given the numbers involved there could have been any disruption at all.)

12.Messrs Mak and Tse are identified from the photographs to have been present.  Their evidence was that in fact they showed up at about 4:30 p.m. on 28 September and sat with the protesters for about half an hour.  Then they left.

13.On 29 September there was a significantly bigger, and noisier, demonstration.  This one is said to have been orchestrated by the Democratic Alliance for the Betterment and Progress of Hong Kong, known as the DAB.  200 or more met and marched to the Tin Yat Station, where they gathered without authority on the Light Rail tracks, shouting slogans.  There they stayed for about 20 minutes.  But before dispersing there was a general announcement broadcast, which urged those present to attend a protest scheduled for 1 October.  This was to be a march between one station and another, a distance of about 1 kilometre.  Mr Tang was there to witness the event.  He spotted Cheung Yin Tung, the 1^st defendant, as being the person who made the announcement, using a loudspeaker.

14.Miss Leung deposed that Mr Cheung told her that he would not rule out the possibility that the march between stations would be along the railway tracks.  This was apparently confirmed in a press release that was sent out shortly afterwards, declaring that there was to be a demonstration by walking and/or lying on railway tracks, a collaboration between the Democratic Party and the residents association of Tin Shui Wai.  The media were cordially invited to attend.

15.KCRC’s management was understandably concerned by this escalation, and risk to the safety of the protesters and others, and filed for the injunctions in order to try to nip the demonstration in the bud.

16.The named defendants were targeted; Mr Tang stated why in his affidavit: 

“31. I verily believe that the persons named as Defendants are ringleaders or organisers in tomorrow’s intended demonstrations.  I further verily believe as follows:

a. Cheung Yin Tang and Wong Wai Yin are the persons who released the press invitation mentioned in Ida Leung’s Affidavit;

b. The remaining Intended Defendants are all members of the Democratic Party who, to the best of my knowledge and belief, would attend the protests tomorrow.

32. The Intended Plaintiff has every wish to avoid any possible confrontation, and it is hoped that the injunctions sought herein will be sufficient to deter the organisers and ringleaders, which should also dissuade their followers from following suit.  The Intended Plaintiff has neither the manpower, experience nor resource to handle any turmoil, unrest or physical violence that might ensue.”

Cheung Yin Tung is as I have said the 1^st defendant, Wong Wai Yin is the 2^nd.

17.Messrs Mak and Tse filed affidavits in opposition to their having been joined and then injuncted.

18.Both denied they were members of either the Democratic Party or the DAB.  Both put in a brief attendance at the “sit-in” on 28 September and signed a petition to register their support.  Both said they had known Miss Leung for a number of years with whom they had a cordial relationship.

19.Neither had attended the meeting of 29 September where there had been trespass on the railway tracks.  Neither had given any indication that they would participate in any unlawful activity planned for 1 October.  Neither was an organiser or a ringleader.  Neither knew of the press release.  Neither was proposing to trespass on the Light Rail tracks on 1 October or on any other day; nor had they done so.

20.KCRC filed further affidavits opposing the discharge of the injunctions effectively denouncing their protestations of innocence.  The stance taken by Messrs Mak and Tse opposing the merger of two routes was seen as implicating them; (per Mr Tang):

“The 6^th to 8^th Defendants alleged in their respective Affirmations that the Plaintiff’s proposal of merging the Light Rail route nos. 761 and 761P with effect from 8^th October 2006 would cause great inconvenience and hardship to the residents of Yuen Long and Tin Shui Wai.  Therefore, as District Councillors, the 6^th to 8^th Defendants have been actively voicing the complaints and concerns to the relevant authorities, including the Plaintiff.

…

The 6^th to 8^th Defendants were known and identified protestors and demonstrators, and there had clearly been repeated active participation by the 6^th to 8^th Defendants in the very same chain or series of protests organised and masterminded by the very same group of persons and ringleaders, finally culminating and leading up to the demonstrations on the 1^st October 2006 that aroused the concern of the Plaintiff, in particular the public invitation to walk on the tracks on 1^st October 2006 and the threat which it might pose to the public’s safety, which prompted the Plaintiff to apply for the injunction against all the Defendants, including the 6^th to 8^th Defendants.”

21.Yet the only matter actually implicating Messrs Mak and Tse was their attendance (for half an hour) at the sit-in of 28 September.  That was the position leading up to the exchange of correspondence and confirmation from counsel that what was left to be determined was the issue of costs.

22.Which leads me to this the remaining matter.

23.The starting point, as is often the case, is the White Book.

24.At paragraph 29/1/44, the editors deal with what is said to be the usual order for the costs of an interlocutory injunction and discharge:

“Costs on an application for an interlocutory injunction — It has for many years, been the normal practice for a successful plaintiff granted an interlocutory injunction to be granted his costs in the cause and for a successful defendant to be granted his costs in the cause.  But the rationale of that practice is perhaps not clear and the courts are showing a greater willingness to depart from it, see, e.g. the discussions as to costs reported in [1976] F.S.R. 3 in the cases of Steepleglade Ltd v Stratford Investments Ltd and the other case there mentioned.  In Bushbury Land Rover Ltd v Bushbury Ltd (1997) F.S.R. 709, CA, the court, in refusing leave to appeal, said the judge had not erred in principle in awarding a defendant his costs in any event.  Where a plaintiff seeks an interlocutory injunction but decides, after seeing the defendant’s evidence, not to proceed with the application for interlocutory relief, it may be a proper exercise of the court’s discretion to award the defendant his costs of the application in any event and, in appropriate circumstances, to order taxation of the costs forthwith (Kickers International SA v. Paul Kettle Agencies Ltd [1990] F.S.R. 436).  For non-disclosure but regranted on terms see Liu Xian Feng & Another v. Liu Bo & Others [2005] H.K.E.C. 1196, for costs on an injunction discharged.”

25.Hoffman J (as he then was) dealt with the point in Kickers International at page 438:

“An order for a party’s costs to be ‘in the cause’ is made because the court has not investigated the merits and considers that it would not be fair for him to recover those costs unless he succeeded at the trial.  But the fact that the merits have not been investigated, or not fully investigated, does not necessarily mean that the court cannot dispose finally of interlocutory costs.  The question cannot be settled simply by reference to practice: it must be answered on the facts of the individual case.”

26.In Bushbury Land Rover Ltd, the English Court of Appeal considered that a limited chance of success at the interlocutory stage was a significant factor in determining how the costs should be dealt with.  Auld LJ said at p.712, alluding to Hoffman J’s judgment in Kickers International and that of Knox J in Silicon Graphics Inc. v Indigo Graphics System (UK) Ltd [1994] FSR 403:

“In my view, there is no difference of substance in the respective formulations of Hoffmann J and Knox J.  They both express a simple enough (though imprecise) notion, namely that, where a judge on an interlocutory application considers, in applying the American Cyanamid test, that it falls so far short of satisfying the criteria for the grant of interlocutory relief that the plaintiff should never have sought it, he may, in his discretion, penalise him in costs.”

27.In this case Mr Li for Messrs Mak and Tse holds out for an order for the costs in favour of his clients upon the basis that in persuading the Duty Judge to grant the ex parte order in the first place KCRC had been guilty of material non-disclosure.

28.It is not challenged that where following the granting ex parte of an injunction subsequently it is found that there has been material non-disclosure, the usual order is to discharge the ex parte order and award costs against the applicant.

29.Mr Chan for KCRC disputes there was material non-disclosure.  He submits KCRC was justified in pursuing the injunctions against all the defendants including Messrs Mak and Tse. 

30.He submitted that the practical reality is that some two months on the protests and demonstrations against the merger of lines have died down.  The two defendants having promised through their solicitors not to offend, KCRC is content with that.  The ‘usual order’ of costs in the cause, or alternatively costs of the defendants in the cause, is the appropriate order.  Another acceptable option would be to reserve the costs to the trial judge.

31.Having considered all factors and in particular the known circumstances of this case I regard KCRC not guilty of material non-disclosure, but rather that those having conduct of the case allowed themselves to over-emphasize the roles played by Messrs Mak and Tse in the lead up.  There was of course nothing adverse in their voicing support for those of their constituents who were anticipating disruption in their community by the proposed change.  Their attendance at the sit-in, brief as it was, was peripheral involvement only in a peaceful, non-disruptive challenge.  Thereafter they played no part in events; in particular, that which alarmed KCRC’s management and with justification — the trespass on the tracks of 29 September.

32.And having allowed themselves to cast Messrs Mak and Tse as ringleaders and organizers, yet they persisted in doing so, notwithstanding the reasoned protestations of innocence made by Messrs Mak and Tse in their affidavits.

33.This was not warranted, not justified, and points to a costs order favouring the innocents with costs to be paid now.

34.But there is a further matter.  The letter from those representing KCRC indicated their client was “agreeable to putting an end to the entire action once and for all …”.  And Mr Chan at my invitation, fairly told me that the matter will probably not go to trial.  As Hoffman J said in Kickers International at p.438:

“One solution sometimes adopted is to reserve the costs of the motion to the trial judge.  There is a superficial attraction about this course because the trial judge will have all the facts and be in the best position to decide whether a party should have interlocutory costs despite the fact that he has lost at the trial.  But in practice it has serious disadvantages.  One is the difficulty of reconstructing for the trial judge how things looked at the time of the interlocutory application, particularly when it involved questions of balance of convenience which were irrelevant at the trial.  But the more important reason is that very often there is no trial.  In such a case, an order that costs be in the cause or reserved to the trial judge is in practice a decision that there should be no order as to costs.  Not many defendants, even with the encouragement of success at the interlocutory stage, are willing to insist on a trial for the purpose of recovering their interlocutory costs.  But unless they do, the costs are left in limbo, as in Stratford v. Lindley (No. 2) [1969] 1 W.L.R. 1547.  This gives the unsuccessful plaintiff a powerful bargaining weapon.  He can face the defendant with the alternative to accepting a substantial discount on the interlocutory costs or having to incur the trouble, expense and risk of a trial.  Furthermore, the existence of an order for substantial costs contingent upon the outcome of the trial, or reserved to the trial judge, may push the parties into a trial of an action which would otherwise have settled.”

35.In conclusion, whatever the merits for going after the remaining defendants, which is of course something I can only speculate on, KCRC had insufficient grounds to join Messrs Mak and Tse both before and after the evidence they filed.  And an interlocutory injunction pursued ex parte is not a remedy that should be looked for lightly or on speculative information.  It can have grave and drastic consequences.

36.In the circumstances, Messrs Mak and Tse are as I found entitled not only to a discharge of the order of 1 October 2006 but costs, including those reserved, to be taxed if not agreed and paid forthwith.

37.Mr Tse being on legal aid, his own costs are to be taxed under Legal Aid Regulations.

38.There will be these orders accordingly.

Mr J Chan, instructed by Messrs Johnson Stokes & Master, for the Plaintiff

Mr C Y Li, instructed by Messrs Au-Yeung, Cheng, Ho & Tin, for the 6^th and 8^th Defendants