XCHRX LANDPAC COMPACTION HONG KONG LTD. AND OTHERS v. SINOTRANS (HK) SHIPPING LTD. AND OTHERS

HCAJ204/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ADMIRALTY ACTION NO. 204 OF 2000

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J U D G M E N T

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1. The main question before me, on the application by the plaintiffs for costs incurred and wasted of Order 14 application issued by the plaintiffs against the 5th defendant by a summons dated 9 March 2001 (now been withdrawn by the plaintiffs) is whether the 5th defendant should pay the costs of that wasted Order 14 application.

2. In my view, having regard to the circumstances, in particular the affidavit materials and what I have been told at today's hearing, that the plaintiffs have been pressing the 5th defendant for disclosure of any defence for the plaintiffs' consideration of a proposed taking out of Order 14, that it was wholly unreasonable for the 5th defendant not to disclose a viable defence and, in fact, the plaintiffs' Order 14 costs would have been saved if the 5th defendant had disclosed that there is a defence, or possible defence, to the plaintiffs' claim. So, in my view, the costs incurred by the plaintiffs, i.e. the wasted costs incurred by the plaintiffs in relation to Order 14, should be borne by the 5th defendant.

3. I have not overlooked what Mr Ng, counsel for the 5th defendant, has repeated to me again and again in the course of his address that because there was negotiation or discussion between the parties in relation to this small claim that it was reasonable for the 5th defendant to behave in the way he did. I think the true fact of the matter is that there was no discussion or no active negotiation during the period. Instead, the plaintiffs' position was saying to the 5th defendant show me a defence or make me an offer. No offer was made during that relevant period and no viable defence was disclosed. So the plaintiffs, quite reasonably, therefore, issued Order 14 proceedings.

4. In the very special circumstances of this case, therefore, I accept the submission of the plaintiffs that the wasted costs of Order 14 should be borne by the 5th defendant.

5. I will now hear the parties as to whether I should be ordering costs to be quantified now by way of gross sum assessment or to be decided in the normal way.