LAU KAM SING DICKIE v. ARCHITECTS REGISTRATION BOARD HKSAR INQUIRY COMMITTEE

CACV 108/2024, [2025] HKCA 76

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 108 OF 2024

(ON APPEAL FROM THE DISCIPLINARY ORDERS

OF THE INQUIRY COMMITTEE OF

THE ARCHITECTS REGISTRATION BOARD

DATED 18 DECEMBER 2023 NO. ARB 2020_01)

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D E C I S I O N

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Hon Cheung JA (giving the Decision of the Court) :

1.  This is the application by the Architects Registration Board (‘the Board’) for security for costs in respect of the appeal (‘the Appeal’) by Lau Kam Sing Dickie (‘Lau’)[1] against the disciplinary orders made by the Inquiry Committee (‘Committee’) of the Board, which was served on Lau on 18 December 2023. Lau opposes the application.

2.  We are of the view that it is appropriate to deal with this application based on written submissions only, without an oral hearing, pursuant to Order 59, rule 14A(1) of the Rules of the High Court (Cap. 4A) (‘RHC’).

I.  Background facts

3.  The Appeal arose from the decision made by the Committee dated 22 November 2023 (‘the Decision’). For the purpose of disposing of the present application, the following brief summary of the basic facts of this case, taken from the Decision, should suffice.

4.  On 31 July 2012, Wealthy Gate Architects & Associates Limited (‘the Company’), of which Lau was the managing director, was appointed by the Incorporated Owners of Kwok Wing House (‘the Complainant’) as its consultant for an architectural consultancy project for the repair works and fire services improvement works (‘the Project’) to No. 63, Tung Choi Street, Mongkok, Kowloon, Hong Kong (‘the Premises’).

5.  On 28 February 2020, the Complainant lodged a complaint against Lau who acted as the registered architect in the Project for his misconduct and neglect.

6.  The Committee was subsequently appointed to investigate whether Lau had engaged in any professional misconduct or negligence under the Architects Registration Ordinance (Cap. 408) (‘ARO’) and the Code of Professional Conduct of the Board (‘Code’). An oral hearing was conducted on 21 October 2022.

7.  By the Decision, the Committee found that Lau had committed a disciplinary offence under section 21(1)(a) of the ARO. The Committee found that :

1)  Lau had contravened section 21(1)(a) of the ARO for i) his inadequate supervision and monitoring of the fire services improvement works contract and failure to take proactive action as the administrator of the said contract; ii) his negligence in checking the certification to ensure the insurance premium payment was accurate; and iii) his failure to check the figures and monitor the calculation of the budget estimate.

2)  Lau had contravened Principle 2 of the Code for i) his inadequate supervision and awareness of outstanding works and progress on the Project resulting in part of the Urban Renewal Authority’s subsidy being withdrawn; and ii) his inadequate supervision on the financial implications on the owners of the Premises during tender stage.

3)  Lau had contravened Principle 3 of the Code for i) his failure to explain, advise and act on calling in the bond; ii) his inadequate supervision on registering outstanding works and defects during site works and at completion of the Project; iii) issuing a Certificate of Making Good without adhering to the agreed procedure for clearing outstanding works and defects; and iv) not communicating with the Complainant within a certain time frame.

8.  In light of the above findings, by the Decision, the Committee proposed the following disciplinary orders (‘Orders’) to be imposed on Lau that :

1)  The Chairman of the Board shall admonish Lau orally under section 24(1)(f) of the ARO;

2)  The Registrar of the Board shall remove the name of Lau from the register for six months under section 24(1)(b) of the ARO; and

3)  The order made under 2) above shall be suspended for one year, subject to the condition that Lau should not commit another disciplinary offence during the said suspended period under section 24(1)(d) of the ARO.

9.  By a notice of appeal dated 18 March 2024 (‘the Notice of Appeal’), Lau now appeals against the Orders to the Court of Appeal that there were ‘palpable and overriding errors of fact and errors of law in the Decision’. The following are the broad grounds raised by Lau in the Notice of Appeal :

1)  The Committee erred in law in proceeding with the complaint on the basis that the Company was appointed by the Complainant, represented by the Complainant’s Chairman, and acted as the architectural consultant in the Project.

2)  The Committee erred in law in proceeding with the complaint on the basis that Lau acted as the registered architect in the Project.

3)  The Committee erred in holding that Lau took up the roles in carrying out the survey, preparing proposals and tender documents, monitoring project progress, evaluating tenders, providing contract administration, and supervising the works.

4)  The Committee erred in law in imposing a duty on Lau regarding the supervision and monitoring of the Project, and in holding that Lau’s supervision was unsatisfactory.

5)  The Committee erred in law in holding that the serious delay in the fire services improvement works was caused by the fact that the supervision provided by the Company had fallen far below the standard expected.

6)  The Committee erred in law in holding that the Company omitted to call in the bond.

7)  The Committee erred in holding that the Company had not supervised the site work diligently which resulted in the Complainant being unable to claim the full subsidy as approved by the Urban Renewal Authority.

8)  The Committee erred in law in holding that the Company, while evaluating the tenders, had no proper regard to the interest of the owners of the Premises.

9)  The Committee erred in comprehending that miscalculation of wall area by the Company caused an increase in budget estimate from $2,800,000 to $4,760,000.

10)  The Committee erred in law in holding that consent from the Complainant was required before issuance of the Certificate of Making Good Defects and that the Company did not adhere to the agreed procedure for clearing outstanding works and defects.

11)  The Committee erred in holding that there was inadequate supervision on the part of the Company on registering outstanding works and defects during site works and at completion of the Project.

12)  The Committee erred in holding that there was miscommunication and missing communication between the Company and the Complainant.

13)  The Committee erred in law in ruling that the mistake of the Company in certifying the sum for insurance premium payment amounted to a misconduct.

14)  Lau was wrongly targeted in the complaint.

15)  The imposition of the sanction of removing Lau from the register for six months was improper.

II.  Security for costs of the appeal

10.  On 27 August 2024, the Board took out the present summons with an affirmation in support, applying for an order, inter alia, that Lau do, within 14 days from the date of the order to be made, provide security for the Board’s costs of the Appeal in the sum of $422,850.

11.  The Board submitted that the following grounds justify an order for security for costs of the Appeal being made against Lau :

1)  Lau is impecunious and will be unable to pay the costs of the Appeal to the Board, as he has been adjudged bankrupt on 24 June 2019 and is subject to a subsisting non-commencement order dated 20 January 2020.

2)  The Appeal is apparently without merit.

12.  Lau raised the following grounds in opposition :

1)  The application is an unreasonable and oppressive attempt to stifle the Appeal;

2)  There are strong merits in the Appeal;

3)  The Appeal is important to him as a practising professional; and

4)  The amount of security for costs sought is excessive.

III. Principles

13.  Under Order 59, rule 10(5) of RHC, the Court of Appeal may, in special circumstances, order the appellant to provide security for the costs of the appeal. For this purpose, ‘special circumstances’ include cases of insolvency or impecuniosity, and difficulty or expense in enforcing costs order (see Hong Kong Civil Procedure 2024, Vol 1, at [59/10/26] and [59/10/27]).

14.  The fact that the appellant is a bankrupt is in itself no bar to an order of security for costs of an appeal. The position is set out as follows in Hong Kong Civil Procedure 2024 at [59/10/26] :

‘ where an insolvent or impecunious appellant is not legally aided for the appeal, it is no bar to the award of security for costs by the Court of Appeal that he does not have the money and therefore the security order will have the effect of preventing him from pursuing his appeal; on the contrary that is inherent in most applications for security on the grounds of insolvency or impecuniosity.’

15.  The Court, however, retains a discretion not to order security if the appellant can demonstrate sufficient countervailing factors which would militate against such order being made (see Hong Kong Civil Procedure 2024, at [59/10/32]).

16.  Where an appellant contends that security should not be awarded because it would prevent him pursuing his appeal, he has to satisfy the Court not only that he is unable to furnish security for costs from his own resources, but also (and the onus of proof is on him on this issue) that he is unable to raise the money elsewhere (see Hong Kong Civil Procedure 2024, at [59/10/32]).

IV.  Our view

1)  Impecuniosity of Lau

17.  On the materials before us, particularly the undisputed facts that Lau has been adjudged bankrupt and he is still subject to the subsisting non-commencement order, we are satisfied that the Board has demonstrated that Lau is impecunious, and that the Board will encounter difficulties in recovering the costs of the Appeal from Lau if the Appeal were to be dismissed.

18.  In our view, we are satisfied that the Board has made out a case of special circumstances for requiring security for costs to be provided.

2)  Merits of the Appeal

19.  Although we find that Lau is impecunious, and that the Board will encounter difficulties in recovering the costs of the Appeal from Lau if the Appeal were to be dismissed, we have to now consider whether there are sufficient countervailing factors which would militate against an order for security for costs being made against Lau.

20.  It is generally up to the party resisting the application to demonstrate countervailing factors militating against an order being made (see Chung Kau v Hong Kong Housing Authority [2004] 2 HKLRD 650, at [14(2)]).

21.  In the present case, Lau submitted why an order for security should not be made, which can be summarised as follows :

1)  It is not just to order security; and

2)  There are merits in the Appeal.

22.  Having found that Lau is impecunious, we do not accept his contention that it is not just to order security. It is not necessary to go into the details of the contentions which have been canvassed in the Notice of Appeal in the present application. All that we need to say is that the Appeal is not so meritorious that it will cause us to exercise the discretion against the granting of security.

23.  We take the view that granting of security would not stifle the Appeal in the circumstances. We are not satisfied that Lau is unable to raise funds for the security. On the contrary, Lau in his skeleton (at [25]) asked for a longer time for him to raise funds to pay for the security.

24.  Overall, we consider that there are special circumstances which justify ordering Lau to give security for the Board’s costs of the Appeal. Considering the parties’ submissions, we are prepared to give Lau a longer time to pay for the security.

3)  Quantum

25.  As to the amount of security, according to the Board’s Skeleton Bill of Costs of the Appeal, the estimated costs (excluding the costs of the present application) are $422,285 (including $205,000 for counsel fee).

26.  According to the Board’s Statement of Costs for Summary Assessment dated 18 October 2024, the costs of the present application are at $48,567.

27.  We consider that the appropriate amount of security of the Appeal (excluding the costs of the present application) on a party to party basis is $300,000.

V. Conclusion

28.  Accordingly, we make the following orders :

1)  Lau is to pay into court within 42 days from the date of this order the sum of $300,000 as security for the costs of the Appeal;

2)  The Appeal is stayed until the sum is paid;

3)  In default of payment and upon the solicitors for the Board certifying such default to the Registrar of Civil Appeal, the Appeal will be dismissed without further order together with costs of the Appeal to the Board; and

4)  The Board is to have the costs of this application which are to be summarily assessed by this Court upon Lau filing a statement of objection (limited to two pages) to the Board’s Statement of Costs dated 18 October 2024 within 14 days.