Lung Po Kwan and Another v. Tang Kam Sheung and Another
Read the full judgment text of CACV 164/2010 on BabelCite. This Court of Appeal judgment was delivered on 5 May 2011 before Tang Acting CJHC, Le Pichon JA, Saunders J.
Civil procedure – costs – indemnity basis – 'without prejudice save as to costs' offer – appeal from Lands Tribunal – building management dispute – where the Presiding Officer's judgment was clearly wrong and no difficult or unsettled law was involved – the 1st and 2nd Applicants' claim against the 1st Respondent (Ms Tang) was dismissed in the Lands Tribunal with costs to Ms Tang – on appeal, the Court of Appeal allowed the appeal, set aside the order below, and granted the Applicants an injunction and damages with an order nisi for costs below and of the appeal with a certificate for two counsel – the Applicants had, before applying for leave to appeal, made a generous 'without prejudice save as to costs' offer to abandon the appeal on condition that Ms Tang waive the order of costs made in her favour, and that there be no order as to costs of the appeal – Ms Tang did not accept the offer – the Applicants applied for costs of the appeal to be taxed on an indemnity basis – whether the offer and its rejection warranted an indemnity costs order – held: the discretion to award indemnity costs is not fettered beyond the requirement that such taxation must be 'appropriate' (Choy Yee Chun (The Representative of the estate of Chan Pui Yiu) v. Bond Star Development Ltd [1997] H.K.L.R.D. 1327 cited) – Order 62 rule 5(1) requires the court to take into account the underlying objectives, any written 'without prejudice save as to costs' offer, and the conduct of the parties – although no sanctioned offer could have been made under Order 22, the offer was generous, Ms Tang was substantially worse off following the appeal, and the rejection of the offer was unreasonable – order made: Ms Tang to pay the 1st and 2nd Applicants' costs of the appeal to be taxed on an indemnity basis unless agreed.
Legal issues: Whether costs of the appeal should be taxed on an indemnity basis following rejection of a generous without-prejudice-save-as-to-costs offer
Outcome: The Applicants' application for indemnity costs of the appeal is granted
Cited by 10 cases
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CACV 164/2010 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF APPEAL CIVIL APPEAL NO. 164 OF 2010 (ON APPEAL FROM LANDS TRIBUNAL BUILDING ________________________ BETWEEN
________________________ Before: Hon Tang Acting CJHC, Le Pichon JA and Saunders J in Court Date of Submissions: 14 and 18 April 2011 Date of Decision on costs: 5 May 2011 ________________________
________________________ Hon Tang Acting CJHC: 1.In the Lands Tribunal, the 1st and 2nd Applicants’ claim against the 1st Respondent (Ms Tang) was dismissed by Judge M Wong (Presiding Officer of the Lands Tribunal) with costs. 2.On appeal, we allowed the 1st and 2nd Applicants’ appeal, set aside the order of the learned Presiding Officer, and made an order nisi that Ms Tang do pay the 1st and 2nd Applicants their costs below and of the appeal with certificate of two counsel to be taxed if not agreed. 3.This is the 1st and 2nd Applicants’ application for costs of the appeal to be taxed on an indemnity basis. 4.This application is made because the 1st and 2nd Applicants had, through their solicitors, made a “without prejudice offer save as to costs” offer by a letter dated 18 May 2010 (“the offer”) (prior to their application for leave to appeal) to the 1st Respondent, whereby the Applicants had offered to abandon their appeal on condition that Ms Tang waived the order of costs made in her favour by the Lands Tribunal; and that there be no order as to costs of the appeal. 5.That offer was not accepted. 6.As noted, the 1st and 2nd Applicants have succeeded in their appeals. They have been granted an injunction and awarded damages. 7.As the following summary in the Supreme Court Practice at 62/App/12 shows the discretion to award indemnity costs:
8.Mr Shum, for the 1st and 2nd Applicants, submitted that this is an appropriate case for an indemnity award. He described the offer as generous. He submitted that, in the context of costs, Order 62 rules 5(1) mandates the Court to take into account the following:
9.Under Order 22, a party could make a sanctioned payment or offer, in which event, where the other party fails to do better than the sanctioned offer or payment,
10.Even so, it does not follow that costs on an indemnity basis will follow a sanctioned offer or payment, but such an order may be made when the circumstances are right. 11.Here, we are not concerned with a sanctioned offer, none could have been made, but the offer was indeed generous. Ms Tang is substantially worse off as a result of our decision. Also, this is not a case where difficult or unsettled law as involved. With respect to the learned Presiding Officer, his judgment was clearly wrong. So, I believe the rejection of the offer was unreasonable. 12.In the circumstance, this is an appropriate case for costs on an indemnity basis and I would so order. Hon Le Pichon JA: 13.I agree and have nothing to add. Hon Saunders J: 14.I agree. Hon Tang Acting CJHC: 15.We order that Ms Tang do pay the 1st and 2nd Applicants’ costs of the appeal to be taxed on an indemnity basis unless agreed.
Mr Erik Shum, instructed by Messrs Yip, Tse & Tang, for the 1st & 2nd Applicants Mr Jackson Poon, instructed by Messrs William Sin & So, for the 1st Respondent |
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Further hearings and rulings under CACV 164/2010