XCHRX AGFA HONG KONG LTD. AND ANOTHER v. FAITH & SAFE TRANSPORTATION LTD.

HCAJ336/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ADMIRALTY ACTION NO.336 OF 2001

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J U D G M E N T

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1. I have before me an application where the parties have now reached agreement on everything. The terms of the order that they have agreed upon are as follows : set out in the letter dated 6 December 2001 from Messrs Richards Butler to the court and it is that :

(1) The defendant is to release container AWTU2010829 to the plaintiff upon the plaintiff's solicitors undertaking in writing to the defendant's solicitors, Messrs Ince & Co., that the security referred to in paragraph 2 will be paid into court upon a sealed order being received.

(2) HK$35,000.00 be paid into court by the plaintiff as security for the defendant's claim and/or the claim for indemnity for loss and/or damage which the defendant may suffer as a result of their complying with paragraph 1 above, but the security amount be reduced to HK$30,000.00 if the plaintiff has returned the container to the defendant prior to the court order being sealed.

(3) The matter be dealt with by the Small Claims Tribunal.

2. Basically, the solution that the parties have agreed upon is that the container with the goods, which are now held by the defendant, would be released to the plaintiff upon the said security being furnished and with the reduction of the security should the container be returned to the defendant prior to the court order being sealed, and the claim of the defendant against the plaintiff in relation to the handling of the container be dealt with in the Small Claims Tribunal presumably because that sum may not be very large.

3. This is an application basically in the form of an interlocutory injunction, seeking an order from the court, that upon terms as may be ordered by the court, that goods of special nature be released. In such an application, it is usual for undertaking in damages to be given by the plaintiff. I think much have been incorporated in the part of the order now agreed and it is usual, even if an order is so made upon an interlocutory injunction basis, that it will be costs in the cause. Mr Horton for the plaintiffs in what I may characterize, I hope not unfairly, as a typically aggressive manner, has asked for the whole of his costs incurred from the date the demand was first made by the plaintiff against the defendant, on 1 December until today to be paid forthwith, taxed on a full indemnity basis and with a gross sum assessment. I think that is much too aggressive. What seems to me that I have to look at is the total behaviour of both parties, especially the behaviour of the defendant and their solicitors, and to say whether that behaviour was so unreasonable that the costs which had been unnecessarily incurred in the circumstances by the plaintiff and that there ought to be compensation for costs as demanded by the plaintiff. I must say I cannot agree with Mr Horton as to the way he had characterized the misbehavior of the defendant and their solicitors. The defendant is entitled to have a little bit of time to reflect upon the matter, to discuss and be properly advised and perhaps even occasionally to make initial mistake in the wish they are entitled to take time to make a reasonable, considered and commercial decision, and this is what they have done eventually. Messrs Ince & Co. really had one working day, that is yesterday, to agree and flash out with Messrs Richards Butler, and agreed on a formula that is acceptable to both sides. I do not think Messrs Ince & Co. have behaved unreasonably. They are entitled to look at some of the documents to satisfy themselves that their clients are not being overly exposed. They have, for example, asked for the undertaking damages which, I think, Mr Horton has initially refused, but now he says he is willing to accept. These are all part and parcel of a necessary discussion kind. The only thing that had brought this urgency about is because of the special nature of the cargo. In all the circumstances, I must say I have to exercise my discretion not in favour of the costs order sought by Mr Horton.

4. It is difficult to say what should be the proper costs order. It can be on the basis of costs in the cause, but Mr Horton says that may not be wholly appropriate, having regard to the nature of the case now. I have not heard Mr Ng for the defendant disagreeing with it. In my view, in the unfortunate circumstances of this case, perhaps the proper order for costs is that no order as to costs should be made. I therefore decline to make any order of costs in relation to everything that led to the making of today's order.