CLSA PREMIUM LTD (formerly known as KVB KUNLUN FINANCIAL GROUP LTD) AND OTHERS v. BANCLOGIX SYSTEM CO., LTD

HCA 1416/2019

[2021] HKCFI 1598

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1416 OF 2019

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DECISION ON COSTS

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1.  In my Decision handed down on 23 April 2021 ([2021] HKCFI 1102), I decided that the interlocutory injunction sought by the 1^st plaintiff should in principle be granted, but in lieu of an actual injunction, the undertakings offered by the defendant were to continue until trial. Pursuant to the directions given in that Decision, the parties have since entered into correspondence and made written submissions to this court on the remaining issues of costs that they have not been able to resolve by agreement.

2.  Two issues remain.  First, as regards the defendant’s summons to discharge or vary the undertakings and for fortification, there is no dispute that, as the summons has been dismissed, the defendant should pay costs.  The only question is whether it should pay costs forthwith or in any event.

3.  Secondly, as to the costs relating to the 1^st plaintiff’s summons for “continuation” of the ex parte injunction order, there is no issue that for the costs incurred up to and including the hearing on 9 August 2019, costs in the cause would be an appropriate order.  The disagreement concerns the costs incurred thereafter (including costs reserved under the orders of 12 and 13 August 2019).  The plaintiffs submit that they should be paid by the defendant.  The defendant submits that the proper order is costs in the cause or the 1^st plaintiff’s costs in the cause.

4.  Taking the second issue first, whilst the 1^st plaintiff can say that it has been successful in the outcome of its summons, I consider that having regard to the material non‑disclosure at the ex parte stage, it should not be awarded costs outright.  Although this court did not refuse injunctive relief on the ground of such non‑disclosure, it did find that the 1^st plaintiff failed to make proper inquiries and thereby failed to disclose material matters to the ex parte judge.  The duty of full and frank disclosure in an ex parte application and the concomitant duty on the applicant to make proper inquiries are taken very seriously by the courts.  Breaches thereof even if non‑deliberate may well be visited with consequences.  I accept the defendant’s submission that the costs should be in the cause.

5.  On this basis, given that a large part of the defendant’s summons is the obverse of the 1^st plaintiff’s summons, the costs of the former should also be left to the end, so that any apportionment and assessment may be dealt with at the same time.

6.  As to the 2^nd to 4^th plaintiffs’ costs, they have appeared in support of the 1^st plaintiff’s position but through the same solicitors and counsel and are in reality in the same camp as the 1^st plaintiff.  For present purposes, there should be one set of costs relating to the plaintiffs and no specific provision need be made in relation to each plaintiff separately.

7.  There will therefore be the following orders:

(1)  The costs of and relating to the 1^st plaintiff’s summons filed on 6 August 2019 (including costs reserved under the orders of 12 and 13 August 2019) shall be in the cause, to be taxed if not agreed, with a certificate for two counsel.

(2)  The defendant shall pay the plaintiffs’ costs of and relating to the defendant’s summons filed on 9 September 2020 in any event, to be taxed if not agreed.

8.  The defendant being successful on the costs issues remaining after the correspondence, it seems to me the plaintiffs should pay the defendant the costs of the written submissions on costs in any event, and I so order on a nisi basis.