SIMPLY POWER LTD v. BILLY CHUA AND OTHERS

HCA 2452/2013

[2023] HKCFI 2353

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2452 OF 2013

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BETWEEN

(by Original Action)

AND BETWEEN

(by Counterclaim)

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JUDGMENT

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Introduction

1.  On 14 April 2023, this court handed down a Judgment after trial. The outcome of the trial is this.

2.  As between the Plaintiff and the 1st Defendant, the 4th Defendant and the 5th Defendant (collectively “Midland Parties”):

(i) All of the Plaintiff’s claims, including the claim of Fraudulent Misrepresentation, against Midland Parties were dismissed.

(ii) Judgment was entered in favour of the 4th Defendant against the Plaintiff in the sum of HK$6,030,000 by reason of the Plaintiff’s failure to complete the sale and purchase transaction under clause 13 of the PASP.

3.  As between the Plaintiff and the 3rd Defendant:

(i) Judgment was entered in favour of the Plaintiff against the 3rd Defendant in the sum of HK$120.6 million, being the return of the 20% Deposits forfeited by the 3rd Defendant in the transaction.

(ii) Judgment was entered in favour of the 3rd Defendant against the Plaintiff for nominal damages for breach of the FASP by reason of its failure to complete the sale and purchase transaction.

(iii) The Plaintiff’s claim of Fraudulent Misrepresentation against the 3rd Defendant, allegedly made by the Midland Parties with the 3rd Defendant’s authority, consent etc, was dismissed.

4.  By a Decision on Costs dated 30 June 2023 (“Decision on Costs”), upon considering the parties’ written submissions, this court ordered that:

(i) 25% of the Plaintiff’s costs of the Action be borne by the 3rd Defendant, to be taxed if not agreed and paid forthwith, certificate for 2 counsel.

(ii) 75% of the 3rd Defendant’s costs of the Action be borne by the Plaintiff, to be taxed if not agreed and paid forthwith, certificate for 2 counsel. (“Costs Order”)

5.  This is the Plaintiff’s application by summons dated 14 July 2023 (“Summons”) for leave to appeal against the aforesaid Costs Order made on 30 June 2023 as per the draft Notice of Appeal attached to the Summons (“Draft Notice”). According to the Draft Notice at para 2, the Plaintiff is seeking the following Order:

“As regards the claims and counterclaim between the Plaintiff and the 3rd Defendant, the Plaintiff shall be entitled to costs of the Action, (i) save and except for the portions of disputes in the Action between the Plaintiff and Midland Parties and (ii) including any costs reserved, to be taxed on a party and party basis with certificate for 2 counsel in relation to the pre-trial review and the trial.”

6.  As usual, this court has carefully considered Mr Tong SC’s submissions. At para 11, he says this:

“11. P relies on 4 grounds of appeal in the Draft Notice [p.6]. Wrong and unreasonable exercise of discretion in the Order (Ground 4) is the crux of P’s intended appeal. In particular, the learned Judge had overlooked and/or failed to pay sufficient attention to 2 relevant facts when assessing the matter of costs between P and D3:

(a) The main event in the Action as between P and D3 (Grounds 1 and 2) [p.6]; and

(b) The facts on the negotiation of the terms relating to the various drafts of PASP leading up to the FASP are plainly relevant and part and parcel of the issue relating to the Deposits (Ground 3) [p.6]. This is relevant in 2 ways: first, it shows the Fraudulent Misrepresentation Claim is not a discrete and distinct issue (Ground 1) [p.6]; second, the Fraudulent Misrepresentation Claim did not take up more than half of the time taken at the trial.” (emphasis added)

7.  Costs are in the discretion of the trial Judge. Reasons for making the Costs Order have been set out in the Decision on Costs and shall not be repeated. They are self-explanatory. Nothing in the grounds of appeal set out in the Draft Notice undermines those reasons. In particular, this court has not overlooked the main event of the Action between the Plaintiff and the 3rd Defendant. This Court has also not overlooked the fact that the Fraudulent Misrepresentation Claim was a distinct issue and that it had taken up more time than half of the trial.

8.  In short, this court does not consider the proposed appeal has any reasonable prospects of success. The Application is hereby dismissed.

9.  This court fully understands what the Plaintiff, having “won” the Action against the 3rd Defendant, so to speak, may feel for having ultimately to pay some of its costs, after settling the accounts. But the Plaintiff could have “won” the Action without making the wholly unmeritorious Fraudulent Misrepresentation Claim which had taken up a majority of the time for trial. The costs in relation to the Fraudulent Misrepresentation Claim, which the Plaintiff has lost, must be borne by the Plaintiff.

Disposition and costs order

10.  The Plaintiff’s Summons is hereby dismissed. The parties having already made submissions on costs at the hearing, costs of and occasioned by the Summons be to the 3rd Defendant, to be taxed if not agreed, and paid by the Plaintiff forthwith. Certificate for Senior Counsel.