MIMI KAR KEE WONG HUNG v. SEVERN VILLA LTD AND OTHERS

HCMP 243/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 243 OF 2011

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HCMP 522/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 522 OF 2011

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R U L I N G

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Introduction

1.  On 24 October I delivered a Ruling which resulted in the adjournment of these matters to be tried, with sufficient time allowed, by another judge. In the course of the Ruling I had to decide a number of interlocutory summonses as a prelude to the start of the trial.  This Ruling is concerned with the costs of those interlocutory summonses and also with Mr Barlow SC’s application for leave to appeal to the Court of Appeal, my orders dismissing his client’s (the Plaintiff’s) interlocutory summonses.  Although he has no summons for leave for appeal I am content to have his undertaking that his solicitors will issue the summons no later than Friday this week.

Costs

(a) The 1st and 2nd Defendants’ summons to amend and for joinder of a 4th Defendant

2.  I dealt with it in this way.  I said that had the case not been adjourned I would have dismissed the part of the summons that sought amendments to the defence and counterclaim, but I would have allowed the joinder of APL, which required very little alteration to the present pleadings by the parties.  This therefore is the basis of my ruling on the costs of the summons.  In the event, because I was adjourning the case I ruled that the 1st and 2nd Defendants could also amend the defence and counterclaim as they had applied for.  The adjournment meant that the Plaintiff will have time to deal with these amendments in good time for the start of the trial when it is re-listed.

3.  Mr Bleach SC submits that where he has been partially successful in obtaining leave for the joinder of APL and, on his estimate, the argument over that took up half the time of the hearing of this summons, he should be awarded half of the costs of the hearing to be taxed on a party and party basis and that the Plaintiff should have all the costs of and occasioned by the addition of APL as the 4th Defendant.  These costs, mostly being the costs of any consequential amendments to the Plaintiff’s statement of claim and reply.

4.  Mr Barlow submits that I should not be rewarding the 1st and 2nd Defendants with any order for costs in their favour.  This was a very late application, which Mr Bleach, as he must, correctly accepts.  The failure to do this earlier was regrettably due to oversight.

5.  There is no principle in such cases that “he who is late pays” but, on this occasion, I consider this to be the correct order. Once Mr Barlow was faced, on day one of the trial, with this application it was entirely reasonable for him to have resisted it as strongly as he did.  In the event the hearing lasted the whole of the first day. The fact that Mr Bleach at the end achieved half-marks by getting his joinder is really overtaken by the lateness of the application and where, in my judgment it was reasonable for Mr Barlow to have resisted as he did then I am persuaded that the Plaintiff must have both sets of costs on this summons in any event to be taxed on a party and party basis.  In my judgment, lateness is decisive

(b) The Plaintiff’s three summonses all of which were dismissed

6.  These were firstly, a summons to rule inadmissible the third and fourth affirmations of Tess Ng because they amounted to the giving of expert opinion evidence where no prior leave had been obtained, alternatively and in the event that I refused to rule out these affirmations, for leave for the Plaintiff to call expert accounting evidence., Mr John Lees, a respected forensic accountant having already been engaged to assist the Plaintiff.  The second summons, in the order that they were argued, was for substantial further discovery to be made by the 1st and 2nd Defendants.  These summonses dated 19 October, that is to say on the second day of the hearing and served on the following morning.  Lastly, an earlier dated summons for leave to appeal my ruling dated 30 September which had provided for some further disclosure to be made by the 1st and 2nd Defendants but considered to be far too little by the Plaintiff.  This was also dismissed.

7.  Mr Barlow concedes the costs.  He submits these should be to the 1st and 2nd Defendants in any event to be taxed on a party and party basis.

8.  Mr Bleach, supported by Mr Yu, says that these costs should be taxed on an indemnity basis, alternatively on a common fund basis and, taxed and paid forthwith.

9.  Mr Bleach submits that these summonses were all without merit and in two cases issued that very last moment with a view to forcing an adjournment if they were to succeed by obtaining further disclosure and/or leave being given to call Mr Lees as an expert.

10.  Mr Bleach places reliance on RHC Ord.62 at para.62/App/12 [page 1162 HKCP 2011].  The passage relied on comes from Choy Yee Chui v Bond Star Development Ltd [1997] HKLRD 1327.  It is to this effect:  Costs can properly be ordered to be taxed on an indemnity basis where the proceedings were scandalous or vexatious, or had been initiated or prosecuted maliciously, or for an ulterior motive or in an oppressive manner.

11.  In such circumstances, Mr Bleach submits the timing, lack of merit and the oblique purpose of forcing the adjournment are all good and sufficient reason to condemn the Plaintiff with a taxation on an indemnity basis.

12.  As to an immediate taxation and payment, Mr Bleach submits that given the complete lack of merit and oblique purpose of the applications there is no reason why the Defendants should have to wait for their costs until after the end of the now adjourned trial.

13.  Mr Barlow loudly protests that such base motives have been imputed to the Plaintiff.  Whilst the Plaintiff will remain in Severn Road for the time being, there will be severe financial consequences for her if she fails at the trial and the possession order is made against her.  The possession proceedings come with a claim for mesne profits which will result in very severe financial consequences for her.  She is just as anxious as the other parties to have the trial proceed as soon as possible.  Mr Barlow submits that all of his summonses are motivated by a wish to obtain a fair trial and nothing else.

14.  From the start this has been very hostile litigation with nobody prepared to give any quarter.  Whilst the timing of the Plaintiff’s summonses inevitably raises the strongest suspicion of an ulterior motive, the fact remains that much of the preparation by the 1st and 2nd Defendants has the mark of the last minute about it.  The lateness of the “D” bundles is an example and Ng IV is of recent origin.  Added to which, many documents have been redacted, redactions which I have upheld, but in this climate were bound to fuel resentment and suspicion.  Whilst to be deprecated, these late summonses are not entirely unexpected although, Mr Barlow’s discovery summons on what would have been the third day of the trial does have the favour of a rise to Mr Bleach’s challenge to the Tess Ng III and IV summons when he said that the Plaintiff, at that stage, had no discovery summons before the court.  That summons appeared soon enough on 19th and served on 20^th October.  I am afraid this has all been part of the “argy bargy” which has characterised this case in more ways than one.

15.  Where I am unable to hold that there has been an oblique purpose in bringing these very late applications, all of which have failed on their merits, I do not consider that I ought to condemn the Plaintiff in the way that is urged upon me by Mr Bleach.  I will give all the Defendants their costs in any event which will be taxed on a party and party basis. 

16.  As to the costs of and occasioned by the adjournment, I agree with Mr Yu that these costs will need to be provided for one way or another in due course.  I will reserve these costs to the trial judge.

The Application for Leave to Appeal

17.  Mr Barlow needs to show that in respect of each summons he has a reasonable prospect of success in the appeal.  In each case, I have provided my reasons for dismissing his summonses.

18.  As to Tess Ng III and IV and its alternative to call Mr Lees, I say the following:  With respect to Mr Barlow, for the reasons that I have given, I am completely satisfied that her’s is not expert evidence nor that Mr Lees is required to be called as a witness.  I refuse Mr Barlow leave to appeal in respect of this summons.

19.  In respect of the summons for further discovery, what needs to be recollected here is the narrowness of the issue.  These issues do not require discovery on the scale that Mr Barlow contemplates.  Whilst the complaint as to redactions is more understandable in the sense that this complaint is not a fanciful one, that is not enough to justify leave being given.  In any event, I have taken the view that the fact that these accounts have been audited and the Plaintiff was Chairman and Director of the ADHL group when the accounts were approved this must provide the Plaintiff with sufficient protection and I am satisfied that in such circumstances a fair trial will be possible.  Accordingly, I am refusing leave on this summons as I am in respect of the application which relates to my order of 30 September.

20.  These refusals to give leave will come with orders for costs to the 1^st and 2^nd Defendants, in any event, to be taxed on a party and party basis.