Cogi Enterprises Ltd and Other v. The Incorporated Owners of Malahon Apartments

HCA 816/2004

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 816 OF 2004

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Before : Hon Sakhrani J in Chambers

Date of Hearing : 19 August 2010

Date of Judgment : 19 August 2010  

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J U D G M E N T

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1.There are two summonses before me.  I shall deal with them in the order that they were argued by Mr. Wright for the plaintiffs. 

2.The first is a summons dated 2 July 2010.  This is the application on the part of the 2^nd plaintiff that the order made on 5 May 2010 regarding the door opening as referred to in my judgment of that day be varied to the extent that the door opening is to be kept on the condition that the fire shutter installed behind the door at the door opening be modified to the satisfaction of the Fire Services Department.  Alternatively, there is an application for a stay of that order pending a disposal of the cross appeal against the same by the plaintiffs by way of the respondent’s notice filed on 10 June 2010.  In the further alternative, that there be an extension of time of 6 months until 5 January 2011. 

3.On 5 May 2010 I gave judgment after trial on the various matters in respect of which there were agreed issues between the parties.  In respect of the door opening I found in favour of the incorporated owners, the defendant.  I dismissed the plaintiffs’ claim for a declaration that the door opening is lawful.  I gave judgment to the defendant against the 2^nd plaintiff on its counterclaim in respect of the door opening for an order that the 2^nd plaintiff does by 5 July 2010 demolish and remove the door opening and reinstate a wall where the door opening has been made with liberty to the parties to apply in case there is difficulty in complying with this order.

4.In support of the application for variation the 2^nd plaintiff relies on the affirmation of Ching Wing Kai filed on 2 July 2010.  He exhibits a copy of an expert report prepared by Mr John Cock dated 30 June 2010.

5.I would observe that by the variation sought the 2^nd plaintiff would not be required to remove the door opening and reinstate the wall where the door opening was made.  This in effect seems to me to be a reversal of my order.  As there is an appeal and a cross appeal against my findings and orders made, this is a matter that should be determined by the Court of Appeal.  I do not think I have jurisdiction to reverse my order at this stage after the order has been drawn up, sealed and entered.

6.I would also observe that in respect of the respondent’s notice of cross appeal at paragraph (10) of the grounds, the point is made that I should have taken into account the fact that the door opening provides the only access to the toilets and the removal of the door opening would have an adverse environmental impact which would affect the entire building.  No doubt the evidence of Mr John Cock is designed to support that proposition.  That was not a matter within the List of the Agreed Issues between the parties at the trial.  I do not recall that there was any evidence as to this matter before me nor were there any arguments by counsel in respect of this matter.  No doubt this is a matter that will have to be determined by the Court of Appeal. 

7.I reject the application for the variation sought. 

8.As regards the application for a stay of the order pending the disposal of the appeal the relevant principles are well established and are set out in the submissions of Mr Wright.  There is no issue on the principles involved. 

9.Despite the submissions of Mr Wright I am not persuaded that the 2^nd plaintiff has demonstrated reasonably arguable grounds of appeal in its cross appeal and the order made in respect of the door opening.  That being so I decline to order a stay of the order in relation to the door opening pending the disposal of the cross appeal by the Court of Appeal.

10.Mr. Wright also asked for an extension but in effect it is an application for a stay as he has frankly conceded that he wants an extension as long as the time taken for the appeal to be heard.  It appears that nothing has been done to comply with the order apart from obtaining the expert report of Mr Cock for the purpose of this application.

11.I am prepared to grant a short extension of time for the 2^nd plaintiff to comply with the order. 

12.In relation to the pipeworks I have given the defendant time to comply with that order by 5 November 2010.  It would be reasonable, in my view, to give the same time to the 2^nd plaintiff to comply with the order in relation to the door opening and I extend time to 5 November 2010.

13.The other summons before me is an application to vary the costs order nisi that I made.  The order nisi that I made was that

(1)     the 1^st plaintiff does pay the defendant its costs of the claim for injunctive belief and damages for libel, such costs to be taxed;

(2)     save for the costs order made in (1) the costs of the action be costs to the plaintiffs to be paid by the defendant, such costs to be taxed; and

(3)     the costs of the counterclaim be costs to the defendant to be paid by the plaintiffs, such costs to be taxed. 

14.For the guidance of the taxing master I observed that roughly about 70% of the total time at trial was taken up with the matter of the pipeworks in respect of which the 1^st plaintiff succeeded and that each of the other matters (the pipeducts, the passage and the door opening) took roughly about 10% of the total time at trial.  My observations as to the time taken at trial does not appear to be challenged by either counsel. 

15.As regards the costs that the 1^st plaintiff does pay in respect of the claim for libel, Mr Wright submitted that the 1^st plaintiff should not be required to pay those costs in view of the findings that I made at trial.  With respect, I disagree.  The claim for libel was abandoned well before the trial.  It was abandoned at the pre-trial review on 21 December 2009.  The party who makes a claim and abandons it must bear the consequences of that course.  It seems to me that there is no reason to depart from the usual rule that costs should follow the event.

16.As regards the other matters sought in the summons, the plaintiffs ask for an order that the defendant do bear 80% of the plaintiffs’ costs of the action and that the plaintiffs do bear 20% of the costs of the defendant’s counterclaim and they further argue that the plaintiffs’ costs should be taxed on an indemnity basis whereas the defendant’s costs should be taxed on a party and party basis.

17.For a court to order the successful party’s costs to be taxed on an indemnity basis there has to be some special or unusual feature to justify such an award.  That is clear from the decision of Sung Koo Kee Ltd v. Pak Lik Co (a firm) [1996] 3 HKC 570.  It has further been held that the discretion to award indemnity costs is not to be fettered or circumscribed beyond the requirement that taxation on an indemnity basis must be appropriate.

18.Despite the arguments of Mr Wright I am not persuaded that there is some special or unusual feature to justify an award of indemnity costs against the defendant.  The parties held different views on the legal and factual issues between the parties and they presented their respective case in accordance with their views.  That is commonplace in civil litigation. 

19.I was also reminded by Mr Chan, for the defendant, that in this case the plaintiffs did apply for summary judgment but that was unsuccessful before Yam J.  

20.I am not persuaded that I should order indemnity costs against the defendant in this case. 

21.It seems to me that the order nisi that I made for the costs of the action to be costs to the plaintiff and for the costs of the counterclaim to be costs to the defendant is an appropriate order to make in this case.  It will be up to the taxing master to tax those costs and I have already indicated for his assistance that about 70% of the time was taken up with the matter of the pipeworks in respect of which the 1^st plaintiff has succeeded and that each of the other matters (the pipeducts, the passage and the door opening) took roughly about 10% of the total time at trial.  So in respect of the total time at trial the plaintiffs as a whole have succeeded in respect of 80% of the total time. 

22.In the circumstances I am not prepared to vary the costs order nisi and that summons is dismissed.

Mr Colin Wright, instructed by Messrs Orrick, Herrington & Sutcliffe, for the 1^st Plaintiff to the 3^rd Plaintiff

Mr Kenneth C. L. Chan, instructed by Messrs Tung, Ng, Tse & Heung, for the Defendant