China Chance Corporation Ltd v. Rockefeller Group International, Inc
Read the full judgment text of HCA 2165/2009 on BabelCite. This High Court CFI judgment was delivered on 2 February 2011.
1. This is an application by the defendant seeking to vary the costs order nisi given in a written Decision herein handed down on 3 August 2010.
Cited by 2 cases
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HCA2165/2009 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE ACTION NO. 2165 OF 2009 ------------------------ BETWEEN
------------------------ Before : Hon Suffiad J in Chambers Dates of Written Submissions on Costs : 17 and 21 December 2010 Date of Ruling on Costs : 2 February 2011 ----------------------------------------- RULING ON COSTS ----------------------------------------- 1.This is an application by the defendant seeking to vary the costs order nisi given in a written Decision herein handed down on 3 August 2010. 2.In that written Decision, I had acceded to the defendant’s application by Summons dated 31 December 2009 and had made the order to :
3.In that written Decision, I had also made a costs order nisi that the costs of that application and the hearing be to the defendant, to be taxed if not agreed. This is the costs order nisi which the defendant now seeks to vary. 4.The costs order now sought by the defendant is that “the costs of the application and of the hearing be to the defendant on an indemnity basis, to be taxed if not agreed with certificate for two counsel.” Indemnity costs 5.The basis upon which the defendant seek for indemnity costs is the plaintiff’s failure to make a full and frank disclosure of the FCPA issue in the ex parte application before the Master as was found by me to be the case in my written Decision when the ex parte application was made before the Master. 6.The defendant further submits that in the present case there is evidence which would support the conclusion that there had been an element of deliberation about the plaintiff’s failure to disclose material facts. 7.In this respect, the defendant relies on the admission of Mr Hall-Jones contained in the 2nd Affirmation of David Gerald Hall-Jones that Mr Hall-Jones had turned his mind as to whether the FCPA issue should be brought to the attention of the Master, but stated, in paragraph 78 thereof that the reason for the non-disclosure was that he did not think there was a “genuine” FCPA issue. 8.The defendant further submits that in the light of that admission by Mr Hall-Jones, it is clear that the material non-disclosure was not an innocent oversight by the plaintiff, but a deliberate decision on the part on the plaintiff or its legal advisers to withhold the FCPA issue from the court on the basis that there was no “genuine” FCPA issue. 9.The question as to when an order for indemnity costs is justified where there has been a failure to disclose material facts on an ex parte application was dealt with by Keith JA in the case of New Asia Energy Ltd v Concord Oil (Hong Kong) Ltd [2000] 2 HKC 681 where the learned judge said at page 691 :
10.From those words of Keith JA cited above, it can at once be seen that the criteria is not whether the withholding of material facts was deliberate or not deliberate. It has to go further than being simply a deliberate withholding. 11.Where it is a deliberate withholding AND those facts withheld are believed to be material that is said to be more serious than where the withholding was deliberate but that the facts withheld was erroneously believed not to be material. 12.Coming back to the present case, whilst the admission by Mr Hall-Jones may show that it was not an oversight, and therefore in that sense a deliberate withholding, at the same time his explanation for that withholding, albeit an erroneously belief on his part, was that he did not think the FCPA issue was a “genuine” issue. 13.In this respect I make two observations. Firstly, there is no other evidence which could show that Mr Hall-Jones did not believe that which he stated to be his belief in his affidavit, albeit that such belief was erroneous. Secondly, at the substantive hearing, the case of the plaintiff was argued (rightly or wrongly) on the footing that the FCPA issue was not a genuine issue in the absence of any evidence of an actual bribe such that the defence of “illegality” does not even arise. 14.If, therefore, Mr Hall-Jones did not truly belief that the FCPA issue was a “genuine” issue, it would follow from that he did not believe the FCPA issue to be material to the ex parte application, albeit erroneously. 15.Ultimately, whether or not indemnity costs is awarded is largely a matter of discretion for the court. 16.Generally speaking, that discretion may be exercised where there has been deception or underhanded conduct or where the case has been brought with an ulterior motive or for an improper purpose or where litigants conduct their case in bad faith, or in an improper or oppressive manner or where costs has been incurred irrationally and out of all proportions to what is at stake. However it must also be recognized that these are not the only situations where that discretion of the court may be exercised nor should such discretion be fettered or circumscribed. The power to award of indemnity costs should only be made where “appropriate”. 17.Stepping back and looking at the entire picture including the non-disclosure of material facts, I am of the view that this is not such a case where indemnity costs ought to be awarded against the plaintiff. Although the defendant’s application for stay was acceded to in the substantive application, it can hardly be said that the submissions put forward by the plaintiff was so unarguable, or improper or made in bad faith. 18.In the circumstances, I am not persuaded that there is here a proper basis for me to exercise my discretion to order indemnity costs against the plaintiff. Certificate for two counsel 19.Certificate for two counsel is opposed by the plaintiff. 20.At the substantive hearing of the application, the plaintiff appeared by senior counsel alone (Mr Coleman SC) while the defendant was represented by a senior counsel (Mr Whitehead SC) leading a junior counsel (Mr Robert Pang). 21.The documentation used in the hearing of the application was voluminous, in particular the great amount of experts opinion involved. 22.Having dealt with the submissions of counsel in the application, I can also safely say that the legal issued involved were far more complex than what would normally be expected in applications of this nature, not to mention the involvement of New York law, and in particular U.S. law relating to the FCPA issue. 23.Given the above, it comes as no surprise that the defendant had instructed both a senior counsel as well as a junior counsel to deal with the application. 24.The fact that Mr Coleman SC alone appeared for the plaintiff at the hearing does not detract from the fact that the application itself and the legal issues and arguments involved were highly complex. 25.In the circumstances, there will be granted certificate for two counsel. 26.Finally, the costs of the written submissions relating to the variation of the costs order nisi is to be covered by the costs order made herein. The costs order 27.The costs order to be as follows. 28.The costs of the application (by the defendant’s Summons dated 31 December 2009 as amended on 29 April 2010) and of the hearing on 3 May 2010 be to the defendant to be taxed if not agreed with certificate for two counsel.
Messrs Luk & Co., for the Plaintiff Messrs Gall, for the Defendant | |||||||||||
Other judgments that cite this case
Further hearings and rulings under HCA 2165/2009