Skillsoft Asia Pacific Pty Ltd v. Ambow Education Holding Ltd

HCCL 19/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMMERCIAL ACTION NO. 19 OF 2013

(Transferred from HCA 597 of 2012)

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D E C I S I O N   O N   C O S T S

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1.Pursuant to para 35 of the judgment dated 12 December 2013 (“Judgment”), the parties have filed written submissions on the issue of costs. This is the decision on that issue.

2.However, 3 points should be dealt with first. Firstly, the defendant’s submissions were not filed on time. It appears that its legal advisors have failed to familiarise themselves with the rules on how clear days are to be calculated (see O 3, r 2 and Hong Kong Civil Procedure 2014, vol 1, 3/2/8 and 3/2/9).  This is unsatisfactory.  In the future, similar failure may result in an issue being decided without the submissions of the defaulting party when there is no application, which has to be properly supported with an explanation for the default, for an extension of time.

3.Secondly, a summary judgment on the 1^st Payment has been granted with a stay of execution pursuant to para 33 of the Judgment. There is an omission to deal with interest entitlement.  I award interest on the 1^st Payment at prime rate plus 1% from 2 October 2012 until 12 December 2013 and thereafter at judgment rate(s) until payment. 

4.Thirdly, the plaintiff has raised a concern in respect of the concession referred to in para 25 of the Judgment that it may in the future be said to be a binding admission on its part that the Agreement was terminated upon the appointment of the JPLs.  Quite fairly, the defendant did not comment on such concern.  I do not believe that the concession in question can be construed to be a binding admission.  It was made for the purpose of the arguments ventilated before the court on 29 November 2013 (“Hearing”).  In particular, at the time Senior Counsel for the plaintiff was responding to an authority which was produced to the court without advance notice to him.

Costs

5.I have been referred by the defendant to some correspondence exchanged between the parties.  I do not believe that the defendant has made any sanctioned offer to settle the plaintiff’s claim or part thereof (see O 22, r 3 and r 5).  Indeed, it is not suggested that the defendant has made such an offer.  However, the defendant seeks to rely upon O 62, r 5(d) and ask to have its costs on indemnity basis from 24 October 2013 onwards.

6.I do not believe that the defendant can rely upon O 62, r 5(d) because I am not convinced that it could not have protected its position as to costs by means of a sanctioned offer.  Indeed, no proper reason has been advanced by the defendant as to why it could not have relied upon the provisions of O 22. 

7.I intend to adopt a broad brush approach on costs as suggested by the defendant.

8.There were 3 issues before the court at the Hearing – stay of proceedings and summary judgment on the 1^st and 2^nd Payments.  The plaintiff was successful in respect of the first two issues.

9.Further, I take into account two particular matters, namely (a) at the hearing on 3 October 2013, the plaintiff had already made clear its position that notwithstanding the insolvency of the defendant it was entitled to a summary judgment on any indisputable debt (relying upon Hong Kong Institute of Education v Aoki Corp (No 2) [2004] 2 HKC 397) and (b) in a letter issued well before these proceedings were instituted and dated 23 September 2011, the defendant had made clear its contention that there is “no support in the Agreement that the License Fees applies to non-exclusivity” [bundle 1, tab 29].

10.Taking a broad brush approach, I am inclined to apportion the costs to the effect of 2/3 and 1/3 in favour of the plaintiff and defendant respectively.

11.However, there are merits in the defendant’s criticisms of the plaintiff’s evidence in terms of both prolixity and admissibility (see paras 31 and 32 of the Judgment and paras 5 and 8 of the defendant’s submissions filed on 17 December 2013).  I shall therefore make a downward adjustment of the plaintiff’s costs entitlement.  I order that: (i) the plaintiff is to have its costs of the Summons dated 7 June 2013, including 55% of the costs of the Hearing and (ii) the defendant is to have its costs of the Summons dated 3 October 2013, including 35% of the costs of the Hearing.

12.The plaintiff succeeded in bringing forward the hearing of its Summons dated 7 June 2013 and should have its costs of and occasioned by the Summons dated 17 September 2013.

13.By reason of the complexity of the costs order as a whole, I decline the defendant’s invitation to assess its costs summarily.

Mr Clifford Smith SC, instructed by Timothy Loh Solicitors, for the plaintiff

Mr Edward Alder, instructed by Tanner De Witt, for the defendant