3D-GOLD JEWELLERY HOLDINGS LTD AND ANOTHER v. PRICEWATERHOUSE COOPERS

HCCL 13/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMMERCIAL ACTION NO 13 OF 2015

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D E C I S I O N   O N   C O S T S

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Introduction

1.  By Judgment of this court dated 16 May 2016 (the “Judgment”), this court: –

(1) dismissed the defendant’s summons dated 5 February 2016 to strike out parts of the plaintiffs’ Reply (the “Strike Out Application”); and

(2) made a costs order nisi (at paragraph 49 of the Judgment) that the defendant do pay to the plaintiffs the costs of the Strike Out Application in any event, such costs to be taxed if not agreed (the “Costs Order Nisi”).

2.  The plaintiffs apply to vary the Costs Order Nisi and for an order to have the costs of the Strike Out Application summarily assessed at HK$732,307.50, to be paid by the defendant to the plaintiffs forthwith.

Variation of Costs Order Nisi

3.  In Midland Business Management Ltd v Lo Man Kui (No 2) [2011] 2 HKLRD 667, while Johnson Lam J (as Lam VP then was) stated, at paragraph 10, that under Civil Justice Reform an unwarranted interlocutory application should normally be sanctioned by an immediate costs order, at paragraph 11 his Lordship cautioned that: –

“11. In so saying, I must not be taken as saying that an immediate costs order should be made against every unsuccessful party in an interlocutory application. I can readily see that there are cases where such a party may have a proper justification for making an interlocutory application even though he fails at the end of the day. There could also be cases where the court considers that it would be more appropriate to make an order ‘in any event’ or ‘in the cause’ or to reserve costs.”

4.  Having regard to all the relevant circumstances of this case, I agree with the defendant that while the defendant lost the Strike Out Application, such application was not unwarranted or pursued without proper justification.

5.  I agree that although this court ultimately found that the defendant’s complaints in relation to the Reply were without merit, they were not spurious: –

(1) The plaintiffs sought the summary dismissal of the defendant’s Strike Out Application at the call over hearing before this court on 17 February 2016, at which this court, however, ruled that the application should be determined at a full hearing;

(2) The Consolidated Statement of Claim (291 pages) and the Defence and Counterclaim (273 pages) are, as this court have noted at paragraph 9 of the Judgment, very lengthy documents.  Given that the Reply and Defence to Counterclaim runs to a further 336 pages, making it the longest pleading in the action, I agree that its sheer length tends to show that the defendant’s complaints about the prolixity of the Reply were genuine, even if they were ultimately rejected;

(3) The substantive hearing of the Strike Out Application took a full day of the court’s time, and required proper consideration of each of the complaints which were raised by the defendant; and

(4) The Strike Out Application has not impeded the procedural progress of the plaintiffs’ claim, given the length of time which remains before trial, which has been fixed to commence in April 2018.

Disposition

6.  In view of the circumstances set out above, I make the following order: –

(1) the plaintiffs’ application to vary the Costs Order Nisi be dismissed, and the Costs Order Nisi is hereby made absolute; and

(2) the costs of this application be paid by the plaintiffs to the defendant in any event, such costs to be taxed if not agreed.