FUNG MEI YEE v. SZETO SIX CHUN also known as司徒法正

HCA 311/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 311 OF 2015

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DECISION ON COSTS

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1. This is the plaintiff’s application by summons to strike out the defendant’s Amended Defence for non-compliance of an unless order for discovery and to enter judgment against the defendant for the plaintiff’s claims herein (the “Summons”).

2. A discovery order against the defendant was made by the court on 5 May 2016 (the “Discovery Order”) which consisted of three parts, i.e. (1) filing and serving of a further and better List of Documents (the “Better List”) with verifying affidavit; (2) production of documents specified in the Better List; and (3) filing and serving an affidavit for discovery of specific categories of documents.

3. The defendant failed to comply with the Discovery Order.  The court made an unless order on 15 July 2016 requiring the defendant to comply with the Discovery Order by 4:00 p.m. on 29 July 2016 (the “Unless Order”).  Non-compliance of the Unless Order would entitle the plaintiff to apply for judgment.  This is the plaintiff’s application for judgment relying on non-compliance of the Unless Order.

4. The defendant filed the Better List on 22 July 2016.  The Better List was verified by an affirmation of the defendant which was also filed on 22 July 2016.

5. Mr. Lau representing the plaintiff confirmed at the hearing on 15 May 2017 that parts 1 and 2 of the Discovery Order had been complied with and this application only concerned with part 3 of the Discovery Order on specific discovery.

6. Part 3 of the Discovery Order covered 9 categories of documents.  Category (1) documents were discovered in the Better List.  The hearing before me only concerned with categories (2) to (9).

7. After the plaintiff took out the Summons on 20 September 2016, the defendant filed an affirmation on 18 October 2016 disclosing further documents (the “October Affirmation”).  In an open letter dated 9 May 2017 from the defendant’s solicitors to the plaintiff’s solicitors (the “Open Letter”), the defendant conceded that he had received from the plaintiff the five sums of money concerning the category (3) documents.

8. At the hearing of 15 May 2017, I found that the defendant had dealt with discovery of the categories (2), (4), (6) and (7) documents as well as the categories 9(a), (d) and (e) documents by the October Affirmation. I made no further order in respect of these categories of documents.

9. I agreed that the Open Letter had dealt with the category (3) documents and I made no further order in respect of the category (3) documents.

10. I found that the defendant had not complied with the Unless Order in respect of the categories (5), (8), 9(b) and 9 (c) documents.  After considering all the circumstances of this case, including parts of the Unless Order had been complied with in time and some other parts of the Unless Order had been complied with out of time as well as the issue of proportionality, I allow a final opportunity for the defendant to comply with the remaining parts of the Unless Order by making a further unless order.

11. The remaining issue is costs for the Summons. The parties agreed to deal with this issue by written submissions.  Both parties lodged their written submissions on costs on 22 May 2017.

12. The plaintiff seeks costs for the Summons with certificate for 2 counsel.  The plaintiff further seeks indemnity costs up to the filing of the October Affirmation.

13. The defendant also seeks costs for the Summons, alternatively costs after the October Affirmation either in full or in part (i.e. at least 80%).

14. The defendant was in breach of the Discovery Order.  He was in further breach of part of the Unless Order.  The defendant simply totally disregarded part 3 of the Discovery Order save and except the category (1) documents which had been covered by the Better List.  The defendant did not file the October Affirmation until after the first hearing of the Summons.  The October Affirmation was filed almost one month after issuance of the Summons and more than two months after the deadline imposed in the Unless Order.  The Open Letter was not issued until 9 May 2017, i.e. just one week before the substantive hearing of the Summons on 15 May 2017 which was more than nine months after the deadline imposed in the Unless Order.  Yet the Defendant had not fully complied with the Unless Order as at 15 May 2017.

15. It was the non-compliance of the Unless Order leading to this application and the court found that as at the date of the substantive hearing of the Summons, the Unless Order had not been fully complied with.  I see no reason why the defendant shall not be ordered to pay the plaintiff’s costs for this application.

16. No explanation was given by the defendant for his failure to fully comply with the Unless Order.  Taken into account the aforesaid procedural history of this case, I agree with Mr. Lau that the defendant’s breach was intentional and contumelious.  (See Top One International (China) Property Group Ltd v Top One Property Group Ltd [2011] 1 HKLRD 606)

17. This is not the first time the court issued unless order against the defendant.  Another unless order on interrogatories was made (albeit by consent) against the defendant on 25 May 2016 just ten days after the Unless Order.

18. The defendant was in patent breach of the Unless Order when he did not file and serve affirmation to deal with specific discovery of the categories (2) to (9) documents.  Yet the defendant took no action to seek from the court relief from sanction.  Such attitude of total disregard of court order, not to say an unless order, will be disapproved by the court in the clearest terms without leaving any doubt on the parts of the parties and their legal representatives.

19. I take into account the various factors stipulated in Order 62, rule 5 of the Rules of the High Court, including the conduct of the defendant as aforesaid.  I agree with Mr. Lau that this is an appropriate case where indemnity costs up to the filing of the October Affirmation on 18 October 2016 should be awarded against the defendant. However, I do not consider that this application justifies engagement of two counsel although I note that both parties were represented by two counsel at the hearing on 15 May 2017.  I grant counsel certificate for one counsel only.

20. In the premise, I order the defendant to pay the plaintiff’s costs for the Summons on indemnity basis up to 18 October 2016 and thereafter on party-and-party basis with certificate for one counsel.  Such costs will be assessed by summary assessment by way of paper disposal and payable forthwith after the assessment.

21. The plaintiff has submitted her statement of costs.  I direct the defendant to send to the court his comments (if any) on the plaintiff’s statement of costs within seven days from the date of this order with copy to the plaintiff.  The assessment will be dealt with by the court by way of paper disposal.