XCHRX CHANG WAI JING v. MULCHANDANI, DAYAL TILOCKCHAND t/a DANSON'S INCORPORATION

HCA 10828/1996

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 10828 OF 1996

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D E C I S I O N

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1. On 28 October 1999 I gave judgment in these proceedings for the plaintiff for the sum of $1,311,516.00 and made an order nisi for costs in her favour against the defendant. The defendant now applies for a variation of that order for costs.

2. Miss Sze Kin on behalf of the defendant accepts that the usual order is that costs follow the event, and that there should be an order in respect of the part of the action in which the plaintiff was successful. However, she points out that there were two matters in dispute in this case, albeit both arising out of the same tenancy agreement, namely the rent payable, and whether rates were to be borne by the tenant. In respect of the former I found for the plaintiff, that there had been no variation of the written tenancy agreement as far as the rent was concerned. As to the rates, I found that there had been no agreement that the defendant should pay them in addition to the rent and that the inclusion of such a provision in the written agreement was an error. That part of the plaintiff's case accordingly failed and Miss Sze contends that the defendant should have his costs in respect of that part.

3. There are two questions to be considered here: first, whether the matter of the rates was sufficiently separate from the other issue to be considered a discrete cause of action, which would stand or fall by itself and would thereby justify an order for costs to follow the event; and second, if it was not, whether the pursuit of that matter increased the costs to a degree which should be reflected in the order for costs.

4. It is not in dispute that the general rule is that the successful party to litigation is entitled to an order for costs. Difficulties arise where it is not clear who is the "winner" in any proceedings, or where one side is partly successful and partly unsuccessful. That is the situation here. The plaintiff has been successful in the major part of the claim, namely the rent, but not in the lesser part, the rates. I call the rent part the major as it is clearly so in monetary terms. Even if the plaintiff had properly quantified the rates claimed, which she was unable to do, not having kept evidence to date of the sums paid, they would have amounted to less than 40% of the rent claimed.

5. However, both these claims arise out of one contract, the tenancy agreement entered into by the parties in 1990, when the rent was fixed at $40,000.00 a month, and the provision as to rates included, wrongly in my judgment. The agreement continued after its date of termination under the provisions of section 122 of the Landlord and Tenant (Consolidation) Ordinance, Cap. 7. It was the defendant's case that it had been varied by oral agreement, but the tenancy agreement was still at the core of this action, and the matters before me concerned the terms thereof. I am not accordingly prepared to find that the two claims made here by the plaintiff were sufficiently separate to be considered different causes of action. They were merely two sums of money claimed under one agreement, and therefore do not, on this basis, attract separate orders for costs.

6. I move then to the second question, namely whether the pursuit of the rates claim added to the work involved and the length of the trial to an extent which should be reflected in the costs.

7. It is inevitable that an additional claim will increase the work necessary and the preparation for trial. It has to be dealt with in the pleadings and instructions have to be taken by the legal representatives. The extent of such extra work is difficult to estimate at this stage and I can only adopt a broad brush approach from what I have observed at trial. This leads me to conclude that it was the rent dispute which occupied by far the greater part of these proceedings, and would have taken up a similar amount of the preparatory work. The trial lasted three days, and it is clear to me that, had the rates matter not been part of it, only a modest amount of time would have been saved, and certainly not enough to avoid the third day's costs.

8. Taking an overall view of the matter, I consider it right that the order for costs should reflect the partial success of the defendant, and I consider that the appropriate method of so doing is by awarding the plaintiff a proportion of her costs only. The order for costs is accordingly varied to the extent that the plaintiff shall have her costs of the proceedings to the extent of 80%.