THE INCORPORATED OWNERS OF KADOORIE AVENUE MANSION v. RISING DRAGON INTERNATIONAL LTD

HCMP 3201/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO 3201 OF 2013

(ON AN INTENDED APPEAL FROM LDBM 201/2013)

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JUDGMENT

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Hon Cheung CJHC (giving the judgment of the court):

1.  This is the application of Rising Dragon International Limited (“Rising Dragon”) for leave to appeal from the decision of HH Judge Ko dated 1 November 2013, refusing Rising Dragon’s application for a stay of LDBM 201/2013 pending the final determination of LDBM 202/2013.

2.  In the proceedings below (LDBM 201/2013), the Incorporated Owners of Kadoorie Avenue Mansion (“the Incorporated Owners”) sue Rising Dragon for breach of the relevant Deed of Mutual Covenants, the Conditions of Exchange for the grant of the Government Lease and section 34I of the Building Management Ordinance (“the Ordinance”), as well as nuisance, in respect of the erection of antennas and radio stations on the roof of the subject building – part of which is said to be common parts of the building.  The Incorporated Owners are represented by Chan & Tsu, solicitors.

3.  In LDBM 202/2013, Rising Dragon sues the Incorporated Owners for instructing Chan & Tsu to represent the Incorporated Owners in commencing and continuing LDBM 201/2013, in breach of section 20A(2) of the Ordinance for failing to procure the service of the solicitors by tender.  As mentioned, Rising Dragon therefore applied for a stay of LDBM 201/2013 pending the final determination of LDBM 202/2013.

4.  The learned judge treated the stay application as a matter of case management.  After considering various matters set out in his judgment, he declined to exercise his discretion to order a stay.  He dismissed the application with costs.

5.  In applying for leave to appeal, Mr Patrick Chong for Rising Dragon argued that the judge failed to take into account relevant considerations, and took into account irrelevant considerations.  He also argued that section 20A of the Ordinance has not received judicial clarification after its amendment in 2007, and this intended appeal will provide this court with an opportunity to examine the effect of the amendments.

6.  We do not agree that the judge has failed to take into account relevant considerations, or has taken into account irrelevant considerations.  The judge clearly dealt with the arguments made before him and referred to the evidence filed in relation to the stay application.  The fact that he did not refer to each and every piece of evidence placed before the court, or each and every argument run before him, does not mean that he, as a professional judge, has forgotten any of them, or has failed to take them into account where appropriate.

7.  As for those matters which are said to be irrelevant and should not have been taken into account by the judge, we do not agree that they are irrelevant matters.

8.  The question of weight was a matter for the judge to decide in conducting his balancing exercise.  This is particularly so when what was involved was clearly a case management decision.

9.  The judge was fully aware that under section 20A(7), the court has the power to declare that the contract for the procurement of service is void (as opposed to voidable) in appropriate circumstances.  He specifically referred to the judgment of HH Judge Simon Leung in The Incorporated Owners of Jet Foil Mansion v Ying Kong Company Limited, LDBM 371/2007, 22 January 2009, paras 24 and 25, which clearly pointed out this possibility.  We are satisfied that the judge has taken this possibility into account in deciding whether in all the circumstances of the case, fairness and justice would be better served by not ordering a stay of LDBM 201/2013.

10.  In any event, we wish to point out that even if, for the sake of argument only, the contract for the procurement of service between the Incorporated Owners and the solicitors is eventually declared by the court to be void, instead of voidable, it does not, in our view, necessarily follow that these solicitors have or had no authority from the Incorporated Owners to commence and prosecute LDBM 201/2013 on behalf of the Incorporated Owners against Rising Dragon.  Such a declaration by the court in LDBM 201/2013 would only mean that the retainer contract between the Incorporated Owners and the solicitors is void and of no effect in law between the two, so that, for instance, the solicitors cannot go after the Incorporated Owners under contract for remuneration of their services.  It does not necessarily follow that the Incorporated Owners have not authorised the solicitors to commence and prosecute LDBM 201/2013 on their behalf against Rising Dragon.

11.  For all these reasons, the application for leave to appeal is dismissed.  Pursuant to Order 59, rule 2A(8), we order that Rising Dragon may not request our determination to be reconsidered at an oral hearing inter partes.  We further order that Rising Dragon shall pay the Incorporated Owners their costs of this application.  As for the amount, we note that the arguments before us are substantially the same as those below.  Accordingly, the Incorporated Owners’ costs are summarily assessed at $25,000.