Romag Fasteners Inc and Another v. Kim Sang Jo

HCMP 1275/2010

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1275 OF 2010

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DECISION ON PENALTY

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1.By a Judgment dated 5 February 2013, I found the Defendant guilty of civil contempt for Inter Core’s failure to comply with the disclosure obligations within the time imposed by paragraph (5) of Mr Justice A Cheung’s Order dated 21 April 2009.

2.In the Judgment, I expressed the view that a fine will be the appropriate penalty in the circumstances of the case.  I do not intend to repeat the reasons for my views.

3.Directions were given for written submissions on the level of the fine.  I have since received submissions from the Defendant on sanction.  I have further received written representations from both sides on costs.

4.In Secretary for Justice v Ocean Technology Ltd [2010] 1 HKC 456, Hartmann JA said:

“26. In civil contempt, the prime consideration, in assessing an appropriate penalty, is the need to demonstrate to litigants that orders of court must be obeyed. …..

27 .......

28.    In my judgment the justice of the matter would be met by a fine imposed on each of the respondents.  But before considering the amount of any such fines, there is another issue which must be determined, that is, the issue of costs.”

5.I propose to follow Hartmann JA’s approach and begin with the question of costs.

6.The Plaintiffs invited the Court to make a gross sum assessment on an indemnity basis and submitted a Statement of Costs for that purpose. 

7.The Defendant contended that some of the items in the Statement would duplicate with the costs already provided for in previous orders in these proceedings.

8.The Plaintiffs have since clarified that the items of work set out in the Statement were all undertaken after the hearing on 1 December 2011 and there was no duplication with work dealt with in the previous orders.  I have no reason to doubt the Plaintiffs’ clarification.

9.I think it is appropriate to award costs on an indemnity basis.  I am prepared to allow the Plaintiffs’ costs in full, that is, $185,580.50.

10.In considering the appropriate penalty, I have taken into account this and the previous costs orders in these proceedings.  I also take into account the Defendant’s submissions on his financial circumstances.

11.Having considered all matters, I think the appropriate fine is $10,000.  The Defendant is allowed 14 days to pay. 

12.I would also make an order that the Defendant should pay the Plaintiffs’ costs of $185,580.50 as assessed.

Messrs Sit, Fung, Kwong & Shum, for the plaintiffs

Mr Eric Yao, instructed by H M Tsang & Co, for the defendant