ZFY v. SCHC

FCMP 97/2020

[2022] HKFC 143

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 97 OF 2020

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D E C I S I O N

(Costs of Expunge Summons)

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Background

1.  In this Decision, I will conveniently refer to the Applicant Mother as “M” and the Respondent Father as “F”.

2.  On 30/7/2020, M filed her 1^st Affirmation in support of her Originating Summons seeking, inter alia, permanent removal of their 6-year old child “D” to Chengdu, Mainland China. Attached to M’s 1^st Affirmation are a number of exhibits amongst which there was an audio clip of a conversation between M and D which was produced and marked as Exhibit “ZFY-18”.

3.  On 23/11/2020, F issued a Summons seeking leave to expunge Exhibit “ZFY-18” (the “Expunge Summons”) on the basis that such exhibit was scandalous and/or oppressive. F filed his supporting affirmation setting out his grounds for the application.

4.  On 5/3/2021, this Court granted an Order in terms in respect of a Consent Summons where F shall have leave to withdraw the Expunge Summons and M shall have leave to withdraw Exhibit “ZFY-18.

5.  The only outstanding matter is the question of costs which this Court decided to be dealt with on paper with directions for parties to exchange their submissions and authorities.

Applicant’s Submissions

6.  M’s Counsel Miss Lily Yu submitted that in applications to do with children, the usual order should be no order as to costs (see TPL v. WYY, CACV 47/2014 & CACV 61/2014). Such practice applied in interlocutory matters as it does upon substantive hearings (see C v. FC (Children Proceedings: Costs) [2004] 1 FLR 326.

7.  Reference was also made to the case of S v. S (HCMP No.5547/1999) where Deputy Judge Gill (as he then was) set out the principles on costs in a case involving children as follows :-

(a) In general circumstances there should be no order for costs. Parties who have a reasonable case to put forward going to a child’s welfare should not be dissuaded from doing so by threat of an adverse costs order if they do not succeed. And in a child related case there should be no perceived winner or loser, save that it is the child who is the winner.

(b) If a party has by virtue of improper conduct attracted the proceedings which but for that may have been avoided then that might well warrant ad adverse costs order;

(c) If in the course of proceedings one party behaves unreasonably in his or her conduct of the litigation then that might be recognised in an adverse costs order;

(d) The financial circumstances of the parties and how an order for costs will impact on the parties is a factor for consideration;

(e) The general rule of not ordering costs should not deter a court from exercising its discretion to do so in circumstances it finds to be exceptional not necessarily limited to a particular category of cases.

8.  The last case of TWC and LKL (FCMC No.8460/2012) in Miss

Yu’s submission was also referred to by F’s Counsel Miss Alison Choy in her submissions. Miss Yu referred to the words of the learned Deputy Judge KK Pang (as he then was) regarding the use of covert evidence by the father in that case where it was said :-

“104. ….. the use of covert surveillance evidence in proceedings in relation to children is permissible in appropriate cases. As to whether it is appropriate to use covert surveillance evidence in any case, in my view it depends on a consideration of the special circumstance of individual case with the best interest of the child as the guiding principle……

109. ….. I have seriously considered whether I should make an adverse costs order….. I accept that the Father’s use of covert surveillance evidence is not designed to manipulate and harass the Mother. I do not regard the conduct had come within the category of unreasonable litigation conduct……”

9.  M’s Counsel Miss Yu drew the Court’s attention to the fact that there was a transcript prepared in respect of the audio in Exhibit “ZFY-18” which was later produced by M under her 4^th Affirmation as Exhibit “ZFY-34”. This was filed by M and uncontested by F. The fact that only Exhibit “ZFY-18” was withdrawn by consent but Exhibit “ZFY-34” remained in the Court file indicates that F did not obtain the reliefs sought in the Expunge Summons and thus there was no basis for seeking costs as if he was the successful party in the Expunge Summons.

Respondent’s Submissions

10.  The first case which F’s Counsel Miss Choy referred to was the case Famous Marvel Company Limited & Ors v. Conversant Group Limited & Ors (unreported HCA No.2153/2009 where Hon Au-Yeung J said :-

“The principles for determining costs

22. There is no dispute that even if a case is settled except as to costs, the Court still has the power to determine which party should be liable for costs. There is no tradition for there to be “no order as to costs” in such a scenario. I am guided by the following principles in deciding costs :

(i) The Court is to decide if the party seeking costs has substantially obtained the reliefs sought in the litigation: Re Chinese United Establishment Ltd, HCCW 291/1994, 5 October 1995, Roger J (as he then was), approved in CACV 214/1995; Lai Yuet Chun v. Super Deluxe International Limited & Ors, HCCW 186/2001, 3 June 2003 Kwan J (As she then was).

(ii) At each end of the spectrum there will be cases where it is obvious which side would have won had the substantive issues been fought to a conclusion. In between, the position will, in differing degrees, be less clear. How far the Court will be prepared to look into the previously unresolved substantive issues will depend on the circumstances of the particular case, not least the amount of costs at stake and the conduct of the parties. Brawley v. Marcynski (No.1) [2003] 1 WLR 813.

(iii) The Court will first consider if it is in a position to say what the likely outcome after trial would have been. If it is not in a position to do so, the order may well be no order as to costs: Brawley v. Marcynski (No.1), at para 18, Longmore LJ; followed in BCCT Software Solutions Ltd v. C Brewer & Sons Ltd [2004] FSR 150.

(iv) The Court may permit parties to adduce evidence on the question of costs: Ta Tung China & Arts Ltd v. Fontana Restaurant Ltd [1999] 1 HKLRD 404; Lai Yuet Chun v. Super Delux International Limited & Ors, at para 12. However, to say that the parties must go to trial in order to resolve any outstanding questions of costs would be contrary to the underlying objectives enshrined in RHC Order 1A rules 1 and 2: Graham M Morley v. Kwan Wo Wan & others, HCA 4366/2003, 30 December 2009, Recorder Jat SC.

(v) A broad brush can be taken by referring to all matters already laid before the Court, eg pleadings, correspondence, witness statements, transcripts of evidence and the terms of the settlement order: c.f. BCT Software Solutions Ltd v. C Brewer & Sons Ltd, at para 9; Graham M Morley v. Kwan Wo Wan & others.

(vi) The objective is to do justice between the parties without incurring unnecessary Court time and consequently additional costs: Brawley v. Marcynski (No.1).” (emphasis added).

11.  For the case of TWC and LKL (FCMC No.8460/2012), reference was made to the entire paragraph 104 in the Judgment which I took the effort of reproducing the entirety of it :

“104. Having regard to all the above matters, I accept that the use of covert surveillance evidence in proceedings in relation to children is permissible in appropriate cases. As to whether it is appropriate to use covert surveillance evidence in any case, in my view it depends on a consideration of the special circumstance of individual case with the best interests of the child as the guiding principle. Where there is clear evidence showing that the spouse is a danger to the child in question, presumably the use of covert surveillance evidence can be justified. In other cases, for my part, probably it is wise to exercise caution. It is because to spy on the other party’s private life is intrusive and is often frown upon and taken as prying and underhand by the other party when he or she finally finds out that his or her privacy has been under covert surveillance. It is going to do a lot to undermine trust between the parties. It increases the costs and expenses of the litigation. It curtails the communication between the parties. It harms their continuing relationship as parents. It increases the tension, bitterness and conflict that the parties may encounter in an adversarial litigation system. The parties may be discouraged from co-operatively working together as parents in the long run, and eventually the best interest of the child will be inevitably threatened.”

Legal principles on determining costs in interlocutory proceedings

12.  It is somehow odd that neither party provided any assistance to me as to the practice and procedural rules governing costs of interlocutory proceedings in civil cases which undoubtedly includes family cases.

13.  Given the provisions of Rule 3 of the Matrimonial Causes Rules Cap.179A, the Rules of the High Court Cap.4A shall apply with necessary modifications to matrimonial proceedings in the Family Court. The Rules of the District Court Cap.336H, insofar as costs are concerned, largely resembled the Rules in the High Court. There is no dispute that the Family Court is part of the District Court with specialised jurisdiction in both matrimonial and some other non-matrimonial but family related matters.

14.  It is trite that costs are in the court’s discretion, to be exercised judicially: see section 53(1) of the District Court Ordinance, Cap 336 and Order 62 rule 2(4) of the Rules of the District Court, Cap 336H.

15.  Following the Civil Justice Reform (“CJR”) which came into effect on 2 April 2009, the often cited general rule of “costs follow the event” no longer applies to interlocutory proceedings. They are now governed by Order 62 rule 3(2A), which provides :-

“If the Court in the exercise of its discretion sees fit to make any order as to the costs of or incidental to any interlocutory proceedings, it may, subject to this Order, order the costs to follow the event or make such other order as it sees fit.”

16.  The relevant legal principles have been usefully summarised by Hon To J in the case of Melvin Waxman v Li Fei Yu (unrep, HCA 1972/2012, 11 September 2013), at paragraph 19 :-

“19. Summing up on the post-CJR position, I think the court has much wider discretion as to costs in interlocutory proceedings. Unlike other proceedings, the general rule of costs following the events do not apply. The court is entitled to take into account all the circumstances of the case, including those set out in rule 5, to make such order as it thinks fit. In the exercise of its discretion, the court may take the issue-based approach or may take into account merit of the parties’ case or the possible outcome of the action. The circumstances of interlocutory proceedings are so numerous that it is impossible to make any general rule. Costs to follow the event and costs be to the successful party’s costs in the cause are obvious options.”

17.  In the later case of Tin Foo Investment Company Limited v. Previgor Development Limited & Ors [2018] HKCFI 2870 where Hon Lisa Wong J referred to her earlier decision in Daimler AG v Leiduck (re expert evidence) (No 3) [2018] 1 HKLRD 1188[1] where she cited and accepted the decision of Hon To J in Melvin Waxman (supra). See also Hong Kong Civil Procedure 2022, Vol 1, at paragraph 62/3/3B at 1310.

18.  Besides, Order 62 rule 5(1) sets out matters which the court shall take into account in exercising its discretion as to costs which includes :-

(aa) the underlying objectives set out in Order 1A, rule 1;

(a) any offer of contribution made under Order 16, rule 10;

(b) any payment of money into court and the amount of such payment;

(c) any written offer made under Order 33, rule 4A)(2);

(d) any written offer which is expressed to be “without prejudice save as to costs” and which relates to any issue in the proceedings;

(e) the conduct of all the parties;

(f) whether a party has succeeded on part of his case, even if he has not been wholly successful; and

(g) any admissible offer to settle made by a party, which is drawn to the Court’s attention.

19.  Further, Order 62 rule 5(2) provides :-

“(2) For the purpose of paragraph (1)(e), the conduct of the

parties includes :-

(a) whether it was reasonable for a party to raise, pursue or contest a particular allegation or issue;

(b) the manner in which a party has pursued or defended his case or a particular allegation or issue;

(c) whether a claimant who has succeeded in his claim, in whole or in part, exaggerated his claim; and

(d) conduct before, as well as during, the proceedings.”

The Chronology

20.  It may be useful to go through some of the background leading to the filing of F’s Expunge Summons.

21.  On 30/7/2020, M filed her 1^st Affirmation in support of her　Originating Summons seeking relocation of the child D. Exhibit “ZFY-18” was included in this Affirmation. M’s Originating Summons was scheduled to be heard on 21/9/2020.

22.  On 15/9/2020, F filed his 1^st Affirmation in support of his Inter Partes Summons seeking sole custody, care and control of the child D which was scheduled to be heard at the same time as the 1^st call over hearing of M’s Originating Summons on 21/9/2020.

23.  At the hearing on 21/9/2020, F’s Counsel opposed to the production of Exhibit “ZFY-18” and this Court also noted that there was no transcript filed in respect of the audio evidence under Exhibit “ZFY-18”. M’s solicitors confirmed to the Court that a transcript of the audio for Exhibit “ZFY-18” would be produced after that hearing.

24.  On 16/11/2020, M filed her 4^th Affirmation to produce the transcript of the audio marked as Exhibit “ZFY-34”.

25.  On 23/11/2020, which was a week after M filed the transcript of the audio, F issued the Expunge Summons in the following terms :-

“1. The exhibit marked “ZFY-18” from the Applicant’s Affirmation affirmed on the 29^th day of July 2020 be struck out on the basis that it is scandalous and/or oppressive;

2. For the purposes of carrying out paragraph 1, the said Affirmation be expunged from the court and the Applicant do file a revised affirmation within 7 days; and

3. Costs of this application be to the Respondent.”

26.  For reasons unknown, both the Expunge Summons and F’s 2^nd Affirmation in support of it was dated 12/11/2020 but was only filed on 23/11/2020, which was well after M’s 4^th Affirmation and Exhibit “ZFY-34” was filed on 16/11/2020. Thus, it was not surprising for F’s Expunge Summons not to refer to Exhibit “ZFY-34” which came in after the Expunge Summons was prepared and yet to be filed. In any event, F’s Counsel Miss Choy offered no explanation in her written submissions for the “time gap” between 12/11/2020 and 23/11/2020 whilst M’s Counsel Miss Yu, in her written submissions, took upon the issue of Exhibit “ZFY-34” had never been objected by F or sought to be expunged in F’s Expunge Summons.

27.  The Expunge Summons, with leave of the Court, was listed for call over hearing at the same time as the Pre-Trial Review of M’s relocation application on 8/12/2020.

28.  Given the Covid-19 pandemic and the need to enhance social distancing for public health concern, the hearing originally scheduled for 8/12/2020 was adjourned to 5/1/2021.

29.  At the hearing on 5/1/2021, leave was granted for M to file and serve her Affirmation in opposition to F’s Expunge Summons on or before 2/2/2021 with consequential leave for F to file and serve his Affirmation in reply (if any) on or before 2/3/2021. It turned out that neither party had filed any affirmation as per the directions granted but chose to dispose of the matter by way of a Consent Summons for leave to respectively withdraw F’s Expunge Summons and M’s Exhibit “ZFY-18”.

Discussion

30.  Upon careful consideration of the case of TWC and LKL (FCMC No.8460/2012), it is clear that the learned Judge did not rule against the use of covert evidence in proceedings relating to children. The use of covert surveillance must be justified by consideration of the circumstances of the case with the best interest of the child to be the guiding principle.

31.  The question then came along was whether the audio clip was covertly obtained by M without the knowledge or consent of the child D. M in her Affirmation filed in support of the Originating Summons did not set out in any great detail of the circumstances when the audio was recorded save to say that the child D very much want to stay with her and that the idea of being apart made D very sad[2]. F in his 2^nd Affirmation filed in support of his Expunge Summons set out his “views” or “perception” as to the circumstances surrounding D when the audio clip was recorded[3].

32.  Given the fact that it was F who challenged the audio clip in that it was obtained covertly and thus it was scandalous and/or oppressive and should be expunged, he bears the burden of proving the same to the requisite standard of balance of probabilities. It is, in my decision, insufficient for F to just rely upon his own “views” or “perception” through listening to the audio in order to discharge his burden of proof. As F himself had fairly said at paragraph 13 of his Affirmation, there could have been many reasons for D’s crying so heard in the audio clip. Since the Expunge Summons had never been tried and parties’ evidence not being tested, there is no finding of fact as to any covertness or secrecy surrounding the circumstances of the audio clip as F had so alleged. This is different from the TWC and LKL case where there was a full blown trial of 9 days.

33.  There is also an important factual distinction in the present case when compared with the TWC and LKL case which must not be overlooked. For M to arrange the audio clip in order to try and reveal the wishes of the child over relocation could not be taken as comparable conduct of the husband in the TWC and LKL case for collating evidence of the wife’s personal conduct and suitability to be the carer of the child in that case. Conduct undertaken to uncover and reveal material evidence for the Court’s consideration of the issue before it is different from conduct undertaken to manipulate and harass the opponent.

34.  As early as 16/11/2020 in M’s lawyers’ letter in response to F’s intended (emphasis added) application to expunge Exhibit “ZFY-18” sent to this Court and copied to F’s lawyers, it was said :

“The Applicant take the firm view that the aforesaid exhibit is both proper and relevant, particularly given that the Minor has, in fact, been informed by the Applicant that an audio recording will in fact be taken. We have refrained from further proving the transcript of the audio clip for the reason that the upcoming Social Investigation Report will in any event be sufficient to address the Minor’s views on the issue, and there is no necessity to rely on the audio clip and add further costs and time to the application.”

35.  Despite the aforesaid explanation provided on 16/11/2020, F could have refrained from issuing his Expunge Summons even though it had already been prepared on 12/11/2020 and ready for filing. The fact that F chose to issue the Expunge Summons rather than to wait and see whether the Minor’s views were reflected in the forthcoming Social Investigation Report would have to bear those costs which would have been saved rather than spent. To the contrary, W had been fair and reasonable for not seeking costs against F. The Social Investigation Report was actually submitted to the Court on 24/11/2020, that is to say, just the day after the F’s Expunge Summons was issued.

36.  Disposal of the Exhibit “ZFY-18” by way of a withdrawal of it simultaneously with a withdrawal of F’s Expunge Summons could be said to be a “no winner/no loser” scenario to trigger the exercise of the Court’s discretion on awarding costs on the likely outcome if the Expunge Summons was fully argued. There is also no issue on litigation conduct or unreasonable behaviour which the Court need to take into account of and to make any costs or adverse costs order for achieving fairness in the case.

37.  Given that this is a child related case where parents should not be dissuaded by any costs implications for asserting his or her rights to the best they could, it is conceptually wrong to submit that “but for the filing of Exhibit “ZFY-18” and refusal to withdraw it, the Expunge Summons need not be issued.” As set out above, there was no need or real urgency for F to issue the Expunge Summons whilst the Social Investigation Report was forthcoming the following day.

Decision

38.  Given full and careful consideration of all the above and applying the cited cases and authorities, I decided that it is fair and reasonable that there should be no Order as to costs of the Expunge Summons.

Costs

39.  However, as F had refused to accept M’s proposal of no costs for the Expunge Summons which ended up with further costs being spent in resolving the matter, I decided that F should pay to M the costs of resolving the costs of the Expunge Summons, to be taxed if not agreed.

40.  I also grant Certificate for Counsel.

41.  This is a costs order nisi which would become absolute if no application is made to vary the same within 14 days from the date of this Decision.