BEACON COLLEGE LTD. v. YIU MAN HAU, ALFRED AND OTHERS

HCA 4273/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 4273 OF 2001

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J U D G M E N T

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1. Three short points arise following my decision on 5 September 2002. The first is as to the interpretation of the order made by in me. The second is as to the order nisi made on costs. The third is a summons by the 1st defendant for an order for an inquiry as to damages.

2. It has apparently been suggested by the solicitors for the plaintiff that the order made is ambiguous. They say that it is open to argument that it is not clear that it was the intention of the court that the injunction should remain in force except in so far as it restrained the 1st defendant from teaching evening classes. They ask in that the order, instead of being an order in discharging the injunction as to its restraint upon teaching evening classes, be an order varying the injunction to permit the 1st defendant to teaching evening classes.

3. To suggest that there is any difference between the two formulations borders upon the farcical. Fortunately, counsel for the plaintiff accepted that the order was clear and did not require either explanation or amendment under the slip rule.

4. In the judgment an order in nisi for costs in favour of the 1st defendant was made. It was made in those terms primarily on the basis that he had succeeded in obtaining a discharge of at least part of the injunction. Now, two competing arguments arise.

5. First, the 1st defendant says that because the court found that there had been a breach of the undertaking given by the plaintiffs to support the injunction obtained there should be indemnity costs in favour of the 1st defendant. It is right that there is authority to say that where there has been a breach of an undertaking by a plaintiff where that undertaking has been given in support of an application for an injunction the defendant, on the succeeded in discharging the injunction should have indemnity costs. See: Leung Yee & Anor v Ng Yiu Ming & Anor [2001] 1 HKC 342 C.A.

6. On the other hand the plaintiff says first, that of the voluminous affidavits filed, and the time spent in court, 80% was relevant to issues upon which the 1st defendant failed in the application to discharge the injunction. It is also right that there is authority to say that where when one party succeeded in part, but fails in part, and the other party also both succeeds and fails in part, there should be an appropriate apportionment of costs. See: John Richardson Computers v Flanders (No. 2) [1994] 144.

7. The trial of the substantive issues between the parties is to take place soon, commencing 11 November 2002. Many of the issues that were relevant on my consideration of the application to discharge the interim injunction will be the subject of findings of fact in the course of the trial. In the circumstances therefore I consider it appropriate to vary the costs order made and substitute therefor an order reserving costs on the application to discharge the interim injunction in order that the questions of costs, and issues of in both indemnity and apportionment can be dealt with at the conclusion of the trial in the light of the findings of fact made at the trial. There will be an order accordingly. The order that the 1st defendant shall have his costs taxed upon Legal Aid Regulations remains.

8. Finally, he 1st defendant says that, having succeeded in part in discharging the interim injunction, upon the basis that the plaintiff has been a breach of its undertaking, he is entitled to damages. He asks for an inquiry as to damages. In the course of argument on the matter counsel for the 1st defendant sensibly accepted that the findings of fact to be made at trial will be integral to any conclusions upon damages and that consequently the issue of damages ought to be considered only after the trial. There will therefore be an order adjourning the 1st defendant's summons for an inquiry as to damages sine die, pending the conclusion of the trial, to be restored upon 7 days notice.

9. Costs on the applications before me to be reserved, the 1st defendant's costs to be taxed upon Legal Aid Regulations.