LCH v. JMC

HCMP 678/2019

[2019] HKCFI 2521

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 678 OF 2019

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D E C I S I O N
(On Costs)

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Introduction

1.  On 1 August 2019, this Court handed down a judgment (“Judgment”) in relation to the Mother’s application for stay of proceedings on forum non conveniens and Father’s application seeking a return order in respect of the parties’ child CJH from Toronto to Hong Kong.  I shall follow the definitions/abbreviations in the Judgment unless otherwise stated herein.

2.  Pursuant to the Judgment, this Court dismissed the Mother’s Stay Application and allowed the Father’s Return Application (“Order”). The question of costs was reserved and was directed to be dealt with on paper.

3.  The Mother and CJH returned to Hong Kong after the Order and at a direction hearing on 6 September 2019 in relation to the Father’s application for the Custody/Care Order, by consent, this Court ordered CJH to cease to be a ward of this Court forthwith and that the Father’s application for the Custody/Care Order was transferred down to be dealt with by the Family Court and there be no order as to costs in relation to that hearing.

4.  The only remaining question before this Court is the costs of Mother’s Stay Application and the Father’s Return Application.

5.  The Father seeks costs of both applications, while the Mother seeks no order as to costs for both applications.

General legal principles 

6.  The power of the Court to award costs orders is governed by Order 62 of the Rules of the High Court.  Costs are in the unfettered discretion of the Court.  Wide though the discretion is, it is a judicial discretion and must be exercised on fixed principles, that is according to rules of reason and justice, not according to private opinion and the exercise of discretion even by a judge sitting alone must be justifiable[1].

7.  Order 62 rules 3(1) – (2A), RHC provides:-

“3(1) Subject to the provision of this Order, no party shall be entitled to recover any costs of or incidental to any proceedings from any other party to the proceedings except under an order of the Court.

(2) If the Court in the exercise of its discretion sees fit to make any order as to the costs of or incidental to any proceedings (other than interlocutory proceedings), the Court shall, subject to this Order, order the costs to follow the event, except when it appears to the Court that in the circumstances of the case some other order should be made as to the whole or any part of the costs.

(2A) If the Court in the exercise of its discretion sees fit to make any order as to 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.” (emphasis added)

8.  As seen above, a distinction is drawn between costs of interlocutory proceedings and costs of proceedings other than interlocutory proceedings.  It is accepted by Mr Yim that both the Stay Application and the Return Application are interlocutory in nature.

9.  It has been set out in paragraph 62/3/3B, in interlocutory proceedings, the principle that costs normally follow the event is no longer the prescribed usual order but is instead just an option. Further, Order 62 rule 5 provides for special matters to be taken into account by the Court in exercising discretion.

10.  It has been long recognised that in children matters, the general practice is that there be no order as to costs.  In TPL and WYY, CACV 47/2014 and CACV 61/2014, unreported, 15.12.14, the Court of Appeal has set out the relevant principles that should be taken into account when considering if a cost order is appropriate in applications to do with children. As pointed out by the Court of Appeal, the approach that in applications to do with children, the usual order should be no order as to costs stems from the aspiration that in these applications, the court is seeking to find an arrangement which is best for the children, and that the rationale is that when a court considers custody and care and control of the children, the proceedings are inquisitorial rather than adversarial[2].

11.  Mr Yim had also referred this Court to a UK Supreme Court case In re S (A Child) (Access to Justice Foundation intervening) [2015] 1 WLR 1631, which concerned costs orders in care proceedings.  It was summarised in the headnote as follows:

“Orders for costs are not normally made, either at first instance or on appeal, in cases about children because the parties are generally acting in what they believe to be the best interests of the child and should not be deterred from helping the court to reach the right solution by the risk that they might have to pay the other side’s costs. A costs order will only be made where a party has acted reprehensibly in relation to the child or taken an unreasonable stance in the proceedings, where the child’s welfare might be put at risk if a costs order were not made, or where for some other reason it is appropriate and just. The same principle applies in cases involving local authorirties, which have statutory duties to protect children from harm[3].”

12.  In particular, Baroness Hale had said in the above case[4]:

“Whenever a court has to determine a question relation to the upbringing of a child, the welfare of the child is the court’s paramount consideration: section 1(1) of the Children Act 1989. This applies just as much to care proceedings brought to protect a child from harm as it does to dsiputes between parents or other family members about the child’s future. Although the proceedings are adversarial in form, they have many inquisitorial features. An application cannot be withdrawn without the court’s consent: FPR r 29.4. The court is not bound by the cases put forward by the parties, but may adopt an alternative solution of its ow. The court is not bound by the choice of evidence put forward by the parties, but can decide for itself what evidence it wishes to hear….”

13.  As pointed out by Mr Yim, the approach not to award costs in children matters is a practice rather than a principle of law.  He has further submitted that the practice is considered to be applicable only to situations where a court is asked to consider and determine the parties’ rights on custody, care and control of their children but the Stay Application and the Return Application were procedural/interlocutory in nature and did not determine the parties’ substantive rights on custody, care and control of CJH.

14.  Neither Counsel has referred this Court to any decisions on costs in relation to return applications.

15.  Insofar as a return application under the Hague Convention, Article 26 of the Convention provides that the court where appropriate may direct the person who removed or retained the child or who prevented the exercise of rights of access to pay necessary expenses incurred by or on behalf of the applicant for the return, including costs of legal representation of the applicant and those of returning the child. 

16.  Although there is no specific reference as to the power of the court to make orders against the applicant for the return in Article 26, this was considered by Ryder J, as he then was, in EC-L v DM (Child Abduction: costs) [2005] EWHC 588 (Fam).  In that case, the plaintiff mother issued and later withdrew an application for return under the Hague Convention.  The father sought costs against the plaintiff mother or the applicant who was publicly funded, and Ryder J, as he then was, made an order for costs against the mother who was found to have unreasonably conducted her case by reason for her persistent pursuit of uncorroborated false allegations against the father.

17.  Ryder J pointed out that Hague Convention proceedings are summary proceedings that are not governed by the principle that the welfare of the child concerned is paramount and the objects are to secure the prompt return to the jurisdiction of their habitual residence of children under 16 who have been wrongfully removed to or retained in any Contracting State[5].

18.  Ryder J then held, amongst other things, that the court is required to construe Article 26 so as to ensure that the parties are broadly on an equal footing and that it should be the expectation in child abduction cases that the usual orders would be no order as to costs, but where a party’s conduct had been unreasonable or where there was a disparity of means then the court could consider whether to exercise its discretion in accordance with the normal civil principles[6].

19.  A more recent case where costs were considered following a hearing to determine a child’s habitual residence under the Hague Convention Jurisdiction is SB v MB (Costs) [2014] EWHC 3271 where one of the parties’ common ground on the framework of the law relating to the determination of costs in the Hague Convention applications was there should be an inquiry into the merits, quoting the above passage in italics of what was held by Ryder J in EC-L v DM [7].

20.  In the present case, even though the Return Application is not made under the Hague Convention but in this Court’s inherent jurisdiction, in my view, what was held in EC-L v DM should be equally applicable.

21.  I now turn to the present case.

The Father’s grounds for seeking a costs order against the Mother 

22.  The Father’s grounds included the following:

(1)     The Court ruled in favour of the Father on almost all the issues arising from the two applications, with the only exception being the argument relating to “deemed submission to jurisdiction” under Order 12 rule 8, RHC; 

(2)     For that issue, the Mother was held to have filed the Stay Application late but the Court was nevertheless prepared to grant the Mother retrospective leave to issue her application out of time; 

(3)     In other words, for the only issue on which the Court ruled in favour of the Mother, the Mother was seeking the indulgence of the Court;

(4)     It is clear that the Father is the winner of both applications, and thus costs should follow the event;

(5)     In any event, it is undisputable that both the Stay Application and the Return Application were wholly necessitated by the highly unreasonable behaviour of the Mother.

Discussion

23.  The “unreasonable behaviour” of the Mother complained of by the Father was the surreptitious removal of CJH to Toronto from Hawaii by the Mother, after a trip which was agreed to by the Father.

24.  As seen in the Judgment, this Court considered the question of CJH’s habitual residence will have an impact on both the Stay Application and the Return Application.  It was only in connection with considering the issue of CJH’s habitual residence that this Court found that the Mother’s removal of CJH to Toronto was “surreptitious” and that following the decision in L v L, I accept Mr Yim’s submission that such surreptitious removal should not change CJH’s habitual residence.

25.  As Ryder J has held in EC-L v DM, the usual order in child abduction cases is no order as to costs.

26.  It was the Mother’s case that her actions were predicated on her genuine conviction that she was acting in CJH’s best interests when she returned with CJH to Canada due to her financial limbo. Further, her application in disputing the forum of Hong Kong was made bona fide and cannot be said to be unreasonable, and that the Mother genuinely believed that CJH’s habitual residence was established in Canada.

27.  As accepted by the Father, both the Return Application and the Stay Application were interlocutory applications, and they were both summary proceedings essentially to determine whether questions concerning CJH’s welfare including her custody and care and her financial provision should be dealt with by the court in Canada or in Hong Kong.  Such summary proceedings are being dealt with on affidavit.  There has been no oral evidence given by the parties and their respective written evidence has not been tested by cross examination.

28.  The conduct envisaged in Order 62 rule 5 is the parties’ conduct in the litigation.  As has been said, the court should not be too quick to label a parent’s conduct in the litigation as “unreasonable ”, and hopelessness and unreasonableness is not necessarily the same thing[8].  There is no sufficient evidence that the Mother’s litigation conduct has been unreasonable, nor is there sufficient evidence of disparity of means save that although the Mother had another landed property in her name apart from the family home, she had a lower earning capacity than the Father. 

29.  In short, there is no sufficient evidence before the Court that the Mother has acted reprehensibly or taken an unreasonable stance in the proceedings, or that CJH’s welfare might be put at risk if a costs order were not made or there are some other reasons that it is appropriate and just to make a costs order.

Conclusion

30.  Having considered the usual approach in children cases and EC-L v DM all the circumstances of this case, I have come to the view that there should be no order as to costs in relation to the two applications, including any costs reserved.