Basab Inc and Another v. Superb Glory Holdings Ltd and Others

HCA 6/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 6 OF 2014

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DECISION

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1.On 4 December 2014, this court ordered that the Statement of Claim against the 1^st and 2^nd defendants be struck out and the action against them be dismissed.  The plaintiffs have also been ordered to bear the 1^st and 2^nd defendants’ costs of their summons and their costs of the action.

2.On 17 December 2014, the plaintiffs lodged an appeal to the Court of Appeal and notice of setting down the appeal was filed on 19 December 2014.

3.By Summons dated 8 April 2015, the plaintiffs apply to stay the execution of the costs order granted by this court until the appeal has been finally disposed of.

4.For the purpose of this application, I am satisfied that the plaintiffs’ appeal is arguable, that is, one with reasonable prospects of success.  In this regard, I bear in mind the case of International Leisure Ltd v First National Trustee Co UK Ltd [2013] Ch 346, brought to my attention by the plaintiffs for today’s hearing, which brings into question whether it is the plaintiffs or the company who are “primarily entitled” to recover the loss allegedly caused by the defendants in question. 

5.As to the disposal of the plaintiffs’ application, I intend to follow the approach adopted by Bharwaney J in 廈門新景地集團有限公司 v Eaton Properties Limited, HCCL 13/2011 (Decision dated 2.12.13).  At paragraphs 4, 9 and 10 of that Decision, Bharwaney J stated as follows:

“4. ... If the plaintiff succeeds in the appeal, the costs incurred on the taxation,...would be wasted. Moreover the court’s resources deployed for the taxation of costs would also be wasted.”

“9. However, I am also satisfied that should the appeal be dismissed, the grant of the stay that has been sought will delay the defendants from receiving the costs that they are entitled to...”

“10. ... In my judgment, a proper balance between these competing needs can be achieved if I were to make a condition of the stay that I propose to grant that the plaintiff pays into court an amount which could counter balance the delay that is being faced by the defendants. In this way, the delay to the defendants is ameliorated by the certainty that there is a sum of money in court that they can look to, to satisfy the costs, or a substantial part thereof, that would be awarded to them on the subsequent taxation of those costs.”

6.In the premises, Bharwaney J ordered the appellant/plaintiff to pay an amount equivalent to 65% of the claimed costs into court as a condition of the stay.

7.In the present case, the amount of costs claimed by the 1^st and 2^nd defendants in their Bill of Costs is HK$1,613,124.  In the plaintiffs’ List of Objections, the plaintiffs have proposed reductions to the tune of HK$966,624.

8.Taking a necessarily broad-brush approach and striving to maintain a proper balance between the competing needs of the parties, I would order a stay on condition that the plaintiffs pay into court a sum of HK$1,000,000. Indeed, Mr Patrick Siu for the plaintiffs accepts that HK$1,000,000 would be an appropriate figure if I see fit to order a payment in.

9.Accordingly, I order that there be a stay of execution of the taxation of the costs awarded by me by the order dated 4 December 2014 until the appeal in CACV 256/2014 (on appeal from HCA 6/2014) has been finally disposed of, on condition that the plaintiffs pay into court the sum of HK$1,000,000.

Submissions on time needed for payment in and costs

10.I order that the costs of the plaintiffs’ application be costs in the cause of the appeal.

11.I order that the plaintiffs are required to make the payment into court within 28 days from today.

Mr Patrick Siu, instructed by Henry Wai & Co, for the 1^st and 2^nd plaintiffs

Mr Alan Kwong, instructed by Anthony Siu & Co, for the 1^st and 2^nd defendants