KOO MING KOWN v. THE COMMISSIONER OF INLAND REVENUE

HCA 2025/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2025 OF 2011

____________________

_______________

D E C I S I O N

_______________

INTRODUCTION

1.  This is the application by the plaintiff for leave to appeal against my Decision on Costs (“the Decision”) handed down on 14 May 2014, whereby it was ordered that the costs of these proceedings be paid by the plaintiff to the defendant, such costs to be taxed on an indemnity basis if not agreed.

RELEVANT LEGAL PRINCIPLES

2.  The applicable legal principles in appeals against costs orders have been set out in Hi‑Tech Precision Products Limited v Soundwell Far East Limited, CACV 294/2003 (Judgment dated 25/5/2005):

“ 8. It is well-established that appellate courts are reluctant to interfere with costs orders made at the discretion of the judge. It matters not whether the appellate court would have made a different order had it been dealing with the matter at first instance. The appellate court would not interfere with the judge’s costs order unless it was shown that the judge had failed to exercise the court’s discretion, or exercised it upon a false principle, or did not exercise it judicially (Choy Yee Chun v Bond Star Development Ltd [1997] HKLRD 1327) or the exercise of discretion was demonstrably flawed (China Venture Techno International Co Ltd v New Century Chain Development Co Ltd [1996] 2 HKLR 18). Having carefully considered the submissions made on behalf of the Company, I do not think that those high thresholds have been crossed.”

PROPOSED GROUNDS OF APPEAL

Ground 1

3.  The plaintiff’s complaint here is that the court has failed to consider a relevant factor, namely, whether the defendant’s conduct had rendered the Action academic - and such a failure vitiated the court’s discretion.

4.  This court has clearly and demonstrably considered that factor in coming to the Decision.  At paragraph 16 of the Decision, it was expressly stated that: “The plaintiff therefore submitted that the present action has been rendered academic, but only as a result of the defendant’s agreement to give such written assurance.”  See also paragraph 4 of the Decision.  How much weight was placed on this factor is another matter.

5.  Importantly, what the plaintiff could have sought, as remarked by this court at paragraph 17 of the Decision, was a declaration that there was a binding settlement agreement in 2011 and a declaration of the legal effect of such an agreement.  Yet, not only had he not attempted to include a claim for such declarations before or during the trial, the plaintiff expressly sought and maintained in the prayer of his pleadings a declaration that the 2011 Settlement Agreement was unenforceable or void ab initio.  In the circumstances, the defendant cannot be blamed for not offering the assurance, because it was not a relief sought by the plaintiff in these proceedings.

Ground 2

6.  Here, the plaintiff seems to be suggesting that the court should look at his desires “holistically”, with a broad brush in hand, never mind what in fact was asked for in the pleadings.  Mr Maurellet, counsel for the plaintiff, went so far as suggesting that the fact that the plaintiff went about “it” in a different way did not mean he had failed; and that the plaintiff still got what he wanted by these proceedings and so he succeeded. 

7.  I agree with Mr Paul Leung, counsel for the defendant, that the court’s process and procedures simply cannot be used in such a way for an ulterior purpose.  From the cases cited in paragraphs 7 to 11 of the Decision, the relevant question is whether the plaintiff has obtained substantially what he sought in the litigation.  Put simply, a written assurance from the defendant is not something sought by the plaintiff in this litigation.

Ground 3

8.  Here, the plaintiff is complaining that indemnity costs should not be ordered against him even though some admittedly serious allegations were made in the Statement of Claim, and maintained on the records for years.  According to the plaintiff, it could not be said that because the plaintiff’s causes of action are not sustainable they were not pursued in good faith.  He submits further that given the Witness Statements were filed long ago and not much costs would have been incurred by the defendant in dealing with them, no indemnity costs should have been ordered.

9.  I do not agree.  I do not think that I can do any better than by repeating what I have stated in paragraphs 26 and 27 of the Decision. In short, if the plaintiff was not serious in maintaining and making good the grave and scandalous allegations against the defendant, he should not have made them in the first place, and he could have and should have abandoned them and have them removed from the court records at a much earlier stage of these proceedings.

CONCLUSION

10.  In my view, the plaintiff has not demonstrated any of his proposed grounds to have a reasonable prospect of success on appeal.  Accordingly, the plaintiff’s application by summons dated 27 May 2014 for leave to appeal is dismissed.