ZELLER+GMELIN CORPORATION v. NEW L1NE LTD

HCMP 693/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 693 OF 2015

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RULING ON COSTS

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Introduction

1.  In the originating summons issued by the plaintiff, a Delaware company (“P”), P alleging a fraud scheme, sought against the defendant (“D”), a Hong Kong company, among others, a refund of the sum of US$ 177,500 which had remained in an account of HKBC held by D (“Account”), and which was transferred by P to D under the fraud scheme. 

2.  P obtained by way of an ex parte application on 26 March 2015 an injunction restraining D or any one from dealing with or in any way disposing of the monies in the Account up to the value of US $177,500 and any interest accrued on that basis (“Injunction”).

3.  The originating summons and accompanying documents, and also a sealed copy of the Injunction together with relevant court documents were served on D at its last registered address on 26 March 2015 and on 31 March 2015.

4.  The inter-partes summons to continue the Injunction was fixed before this court on 10 April 2015 and D being absent, and having been satisfied with service, this court continued the Injunction and ordered costs of both ex-parte and the inter-partes application for the Injunction including all reserved costs to be P’s in any event.

5.  The originating summons was then fixed for a first direction hearing before this court on 18 May 2015.  Before the hearing, P had issued a post-judgment injunction summons on 11 May 2015 to seek an order, among other things, that the Injunction was to continue until after completion of execution or enforcement of the judgment granted or further order.

6.  At the hearing on 18 May 2015, a Mr Strothenke claiming to be a director of D appeared with an affidavit of the same date but not properly filed.  He did not obtain any order /direction to represent D, but he indicated that he would agree to the order sought in P’s summons of 11 May 2015, and also the orders sought in the originating summons, and only opposed to costs of those summonses being paid by him.

7.  At the hearing, on 18 May 2015, Mr Strothenke had tried to explain that the sum of money was transferred to D’s account from an unknown source and he himself was trying to make enquiries from HSBC as to the source of the money but complained that HSBC was rude to him, and he received no information.  I allowed D time to file further affidavit evidence on the source of the sum of money and directed that the question of costs be dealt with on paper, with both P and D to lodge written submissions on costs only.

8.  P lodged written submissions on costs on 29 May 2015.

9.  There was, however, no further affidavit filed by Mr Strothenke, or anyone else on behalf of D, nor were any written submissions on costs lodged on behalf of D after the hearing on 18 May 2015.

10.  All documents had been duly served on D at its registered office.  However, D did not file any acknowledgment of service, nor did D turn up at the hearing on 10 April 2015, and only turned up on 18 May 2015.

11.  There was no explanation from Mr Strothenke why he could not concede to the reliefs sought by P in the originating summons and the post-judgment injunction summons earlier. 

12.  Having considered P’s submissions, I agree that there is no reason to depart from the usual rule that costs should follow the event.  I therefore order that D to pay the costs of the originating summons filed on 26 March 2015 and the summons filed on 11 May 2015 and of the hearing of 18 May 2015 and of P’s solicitors written submissions on costs be to P, to be taxed, if not agreed.