HO CHOR MING AND OTHERS v. HONG KONG CHIU CHOW PO HING BUDDHISM ASSOCIATION LTD

CACV 451 /2018

[2019] HKCA 495

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 451 OF 2018

(ON APPEAL FROM HCMP NO 506 OF 2013)

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J U D G M E N T

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Hon Kwan VP:

1.  This appeal was brought by the receiver and manager (“the Receiver”) of the Hong Kong Chiu Chow Po Hing Buddhism Association Limited (“the Association”) against the decision of G Lam J on 8 June 2018 (Re Hong Kong Chiu Chow Po Hing Buddhism Association Ltd (No 2) [2018] 3 HKLRD 270). By the decision, the judge ordered inter alia: (1) the Receiver do provide to the Association copies of the Receiver’s bills of costs and the bills of costs of the solicitors appointed by the Receivers (“the Solicitors”), which have all been assessed by a master, within 14 days thereof; (2) the Association do file and serve a statement of objections within 28 days thereafter; and (3) the assessment in relation to which objection is taken to be re‑opened and be referred to a master for assessment in which the Association do have leave to participate.

2.  The judge gave leave to appeal his decision as this would appear to be the first case in which a reasoned judgment was given holding that the assessment of a receiver’s and his solicitors’ bills of costs may be re‑opened on the application of the entity that has emerged from receivership[1].

Background

3.  The judge has set out in some detail the relevant background matters in §§2 to 21 of the decision.  I do not propose to set them out in full and would merely mention some salient matters.

4.  The Association was incorporated as a company limited by guarantee and has been recognised as a charitable institution since 1981.  In 2012, a dispute arose over its membership and directorship.  On 29 August 2013, Harris J appointed the Receiver to manage and preserve its assets and investigate its affairs, including the verification of the register of members, the preparation of a list of candidates for the election of directors, and convening an extraordinary general meeting to elect the 13^th board of directors.  It was provided in the order that the Receiver was authorised to exercise all of the corporate powers of the Association which are vested in its board of directors and that the powers of the Receiver in relation to the assets of the Association shall be vested in him to the exclusion of the powers of its board of directors and other officers of the Receiver.

5.  From the appointment of the Receiver up to the determination of questions of membership by G Lam J on 25 November 2015, various orders and directions have been made regarding the remuneration of the Receiver as follows:

“The remuneration of the Receiver be charged on a time-cost basis at the rate(s) as set out in Annexure B of the Receiver’s letter to the Registrar of the High Court dated 27 August 2013, and be paid out of [the Association’s] assets.”[2]

“Mr Justice Harris directs that [the Receiver’s] fees and disbursements should be assessed by a taxing master.”[3]

“(2) For the avoidance of doubt, the remuneration of the Receiver in relation to the Applications and the Further Application[4] shall also be charged on a time-cost basis at the rate(s) as set out in Annexure B of the Receiver’s letter to the Registrar of the High Court dated 27 August 2013, and be paid out of [the Association’s] assets;

(3) The remuneration and disbursements of the Receiver in relation to the Applications and the Further Applications (including the costs of retaining the independent advisers as mentioned in (1) above) be taxed by the court unless otherwise directed;”[5]

“Costs of the Receiver of [the Association] be borne and paid out of the assets of [the Association];”[6].

6.  In May 2016, the Receiver informed the court that there was insufficient cash in the assets to pay his outstanding fees and disbursements and sought directions from the court that a valuable property of the Association be sold to settle the fees.  On 29 June 2016, G Lam J gave directions for the Receiver to convene another extraordinary general meeting to elect directors, and that the management of the Association be handed over by the Receiver to the board of directors as soon as practicable after its election, save for the property proposed to be sold, with liberty to the Receiver to restore the application for directions for sale of the property.  As for the Receiver’s costs of that application, he ordered such costs be paid out of the assets of the Association.

7.  Pursuant to those directions, an extraordinary general meeting was held on 20 August 2016 and directors were duly elected.  The directors explored other ways to settle the Receiver’s fees and the Receiver did not immediately restore the application for directions for sale of the property.

8.  In January 2017, one of the directors requested the Receiver to provide all relevant documents relating to the assessment of the Receiver’s fees by the court[7]. The Receiver replied stating that the fees and expenses had been taxed and allowed and he failed to recognise why the director would need to review the approved bills of costs.  The Receiver declined to provide copies of his bills of costs and instead supplied copies of the letters from the court giving the results of the assessment and the invoices from the Receiver and the Solicitors which were settled.

9.  The dates and results of the assessment are set out in the tables in §19 of the decision:

Receiver’s bills

Item	Date of Registrar’s letter	Deduction	Amount allowed
Bill 1	25 Feb 2015	8%	$5,739,547.71
Bill 2	23 Oct 2015	5%	$2,015,952.44
Bill 3	2 Mar 2016	5%	$1,401,336.89
Bill 4	31 Aug 2016	0%	$1,743,914.93
Bill 5	10 Jan 2017	0%	$1,558,861.42
Bill 6	23 Mar 2017	0%	$325,819.06
Total			$12,785,432.45

Solicitors’ bills

Item	Date of Registrar’s letter	Deduction	Amount allowed
Bill 1	5 May 2015	16%	$1,315,539.96
Bill 2	8 Aug 2016	18%	$522,065.50
Bill 3	18 Jan 2017	18%	$464,156.90
Bill 4	12 Oct 2017	22%	$116,480.10
Total			$2,418,242.46

10.  Bills 1, 2 and 3 of the Receiver and Bills 1 and 2 of the Solicitors were assessed before the 13^th board of directors was elected and the Association was represented only by the Receiver.  Further, as the Association is a company limited by guarantee and a recognised charity, there was no shareholder with a stake in its assets who could scrutinise the bills and raise objections where appropriate.

11.  Bills 4, 5 and 6 of the Receiver and Bills 3 and 4 of the Solicitors were assessed after the management of the Association had reverted to the board.  But the directors were not notified of the assessment of these bills and, as mentioned earlier, were not provided with copies of the bills of costs they had requested.  They could not have taken part in the assessments.

12.  The total of the fees and disbursements came up to $15.2 million, of which $7.7 million of the Receiver’s bills and $1.3 million of the Solicitors’ bills had been paid by the time the Receiver’s application for directions for sale of the property was restored for hearing before G Lam J on 20 December 2017.  At that hearing, the Association gave an undertaking to the court to pay $4 million by the end of December 2017 and another $2 million within six months to the Receiver on account of his fees and expenses, subject to the Receiver’s undertaking to pay back any surplus if the assessments were re‑opened and the amount found payable was reduced.

The summons of the Association

13.  The Association issued a summons on 13 December 2017 returnable on the same date as the Receiver’s application for directions for sale of the property.  This summons was taken out under Order 32 rule 6 of the Rules of the High Court and the inherent jurisdiction of the court.  It sought an order to “set aside” the “taxation proceedings” in relation to the Receiver’s bills and the Solicitors’ bills, that the Receiver and the Solicitor do submit their bills with full particulars to the court for taxation before a master and provide the Association with copies, and that leave be given to the Association to participate in the taxation proceedings and to file and serve a statement of objection within 14 days of service of the bills.

14.  The judge approached this by posing three questions:

(1) Should the Association, in principle, be permitted, if it so desires, to take part in the assessment of the Receiver’s remuneration and disbursements?

(2) Does the court have the power to re‑open or set aside the “taxation” decisions of the master made in the absence of the Association as separately represented?

(3) If so, should that be done in the present case?

15.  The judge answered all three questions in the affirmative in favour of the Association.  He did not immediately set aside all the assessments made by the master as sought in the summons.  Instead, he first ordered the Receiver to provide copies of the bills of costs with full particulars to the Association, and gave leave to the Association to file and serve a list of objections thereafter.  His order went on to provide that it is only in respect of those items to which objection is taken that the assessment is to be re‑opened and be referred to a master for assessment, with leave to the Association to participate in that assessment.

This appeal

16.  Four grounds were raised in the notice of appeal.  In gist, these grounds are: (1) procedural irregularity in that the decision contains 16 cases not cited by either party and they were not given an opportunity to make submissions on those cases; (2) and (3) error of law in defining the parameters for exercise of the discretion, and thus no true exercise of the discretion; (4) error of law as to the nature of the application and jurisdictional basis.  The grounds were not argued in the sequence set out in the notice and the skeleton submissions of the Receiver.  Further, in response to questioning from the court, Mr Victor Joffe for the Receiver[8] narrowed down the width of and qualified some of the contentions in writing.

17.  Before discussing the points argued on appeal, I wish to point out one matter.  In the court below, it was submitted by Ms Rachel Lam for the Receiver that the assessment of a receiver’s remuneration is generally an exercise involving only the court and the receiver and there is no support for the proposition that the subject company of the receivership is entitled to participate in the process of assessment of the receiver’s remuneration[9].  This contention relating to the right of the Association to participate in the determination of the Receiver’s remuneration is the subject of the first question posed by the judge and he devoted a substantial part of his judgment to deal with this.

18.  On appeal, Mr Joffe did not adopt the position that a receiver’s remuneration is a question strictly between the court and the receiver.  He accepted that the subject company of the receivership has a right to participate in the assessment of a receiver’s remuneration but drew a distinction between a “forward looking” application (when an assessment has not yet been made) and an ex post facto application (for re‑opening an assessment and for re‑assessment).  His concession is to the extent that the subject company is entitled to participate if a “forward looking” application is made but not when an ex post facto application is made, his rationale being that once the process of assessment is completed, there is no basis to re‑open the assessment in the absence of valid grounds or special circumstances.

19.  I leave for the time being any possible implications arising from the distinction drawn by counsel.  I wish to stress that the judge is obviously right, for the reasons he gave, in rejecting the submission that the assessment of a receiver’s remuneration is strictly between the court and the receiver and that the subject company, whose assets would be used to pay such remuneration, would not be entitled to participate in the assessment.

20.  With this, I turn to the crux of this appeal which is the second question posed by the judge, namely, whether the court has jurisdiction to re‑open an assessment.

If there is jurisdiction to re‑open an assessment

21.  The judge mentioned two alternative bases as giving rise to jurisdiction to re‑open an assessment of a receiver’s remuneration.  One is Order 32 rule 6, the other is Order 30 rule 5.  Mr Joffe took issue with both of them.

(a) Order 32 rule 6

22.  Order 32 rule 6, as pointed out by the judge, is a provision of general application.  It simply provides as follows: “The Court may set aside an order made ex parte.”

23.  The judge held that the assessments by the master were orders made ex parte within the meaning of the rule, and were made in proceedings in which the Association was a party, who clearly therefore had standing to apply for an order under Order 32 rule 6[10].  He recognised it is possible to argue that the assessment of the Solicitors’ fees was not conducted ex parte, if in fact the Receiver had acted on behalf of the Association and taken on the role of raising objections. But the reality is that the scope of any objection that could be raised by the Receiver to the Solicitors’ charges was severely limited, as presumably the work done by the Solicitors was all done on the instructions of the Receiver[11].

24.  Mr Joffe submitted that Order 32 rule 6 is not applicable because, strictly speaking, the Association was a party to the assessment in that the Receiver represented them at the time when Bills 1 to 3 of the Receiver’s bills and Bills 1 and 2 of the Solicitors’ Bills were assessed, as, prior to 20 August 2016, there was no board of directors and the Receiver was authorised to exercise all the powers vested in the board.  In respect of Bills 4 to 6 of the Receiver’s bills and Bills 3 and 4 of the Solicitors’ Bills, the management had reverted to the board of directors when these bills were assessed but the directors did not participate in the assessment as they were not notified.  Mr Joffe submitted that in not notifying the board of directors, the Receiver was simply following the directions of the court of 19 May 2014 which merely directed that the Receiver’s fees and disbursements “should be assessed by a taxing master” and no mention was made of the need to give notice of the assessment to any interested party.

25.  I do not accept the above submissions.  In light of the inherent conflict of duty and interest on the part of the Receiver regarding the assessment of his own remuneration, the representation of the Association by the Receiver in this matter could hardly be regarded as meaningful or effective.  To treat the Receiver’s application for assessment of remuneration in the absence of separate representation for the Association as other than an ex parte matter is to elevate form over substance.

26.  As for the bills that were assessed after management had reverted to the board of directors, it is disingenuous to suggest that the Receiver was following directions of the court in not notifying the board.  The Receiver had refused requests of one of the directors to provide information and documents relating to the assessment, asserting that there was no need for the directors to review the approved bills.  If the Receiver was in any doubt as to whether the directors should be notified of the pending assessments, they should at least have sought directions from the court.  As the judge has stated, had the Association been informed at that point of the assessment and sought to take part, there is little doubt it would have been permitted to do so[12]. On the distinction drawn by Mr Joffe as to the entitlement of the subject company to participate in the assessment, the Association would have been entitled to participate as assessment of these bills had not been made when management reverted to the board.  On counsel’s analysis, the outcome of not notifying the board of pending assessments was to turn the “forward-looking” applications into ex post facto applications and effectively deprive the Association of its right to participate.  This cannot be right.

27.  Mr Joffe further submitted that Order 32 rule 6 makes no provision for the orders made by the judge, namely, the provision by the Receiver of copies of the bills and the service by the Association of objections.  This is not a point of substance.  Provision for such orders is made in Order 30 rules 5(1) and (3).  The fact that the marginal note of the summons only mentioned Order 32 rule 6 and inherent jurisdiction of the court but not Order 30 rule 5 is immaterial when one comes to examine the jurisdiction of the court.  If, as contended by Mr Joffe, the provisions in Order 30 rule 5 are inapplicable where the court exercises the power to set aside an ex parte order under Order 32 rule 6, the inherent jurisdiction of the court may be invoked to provide for steps to be taken incidental to the setting aside of the ex parte order to give effect to this order.  If, contrary to his contention, Order 30 rules 5(1) and (3) are applicable, there would be no need to rely on inherent jurisdiction.  Whichever route is taken, there would be power to make the orders as made by the judge.

(b) Order 30 rule 5

28.  The relevant provisions are Order 30 rules 3 and 5 and they read as follows:

“3. Remuneration of receiver

A person appointed receiver shall be allowed such proper remuneration, if any, as may be authorized by the Court and the Court may direct that such remuneration shall be fixed by reference to such scales or rates of professional charges as it thinks fit.”

“5. Receiver’s accounts

(1) A receiver shall submit such accounts to such parties at such intervals or on such dates as the Court may direct.

(2) Any party to whom a receiver is required to submit accounts may, on giving reasonable notice to the receiver, inspect, either personally or by an agent, the books and other papers relating to the accounts.

(3) Any party who is dissatisfied with the accounts of the receiver may give notice specifying the item or items to which objection is taken and requiring the receiver within not less than 14 days to lodge his accounts with the Court and a copy of such notice shall be lodged in the Registry.

(4) Following an examination by or on behalf of the Court of an item or items in an account to which objection is taken the result of such examination must be certified by the Registrar and an order may thereupon be made as to the incidence of any costs or expenses incurred.”

29.  The judge took the view that approaching this as a matter concerning the receiver’s accounts, the provisions in Order 30 rule 5 clearly provide for the orders that he could make and did make.  He also referred to several cases (Day v Croft (1840) 2 Beav 488; Harris v Sleep [1897] 2 Ch 80; and Re Kay and Lovell [1941] Ch 420) as examples to show that a master’s decision or certificate passing a receiver’s accounts, including the receiver’s remuneration and disbursements, could be opened up and varied if there was valid objection.  He therefore reasoned that in the present case, upon an objection raised in the manner as provided in Order 30 rule 5, the previous assessment cannot be an answer as it was not a ruling on any such objection raised by the Association[13].

30.  Mr Joffe submitted that Order 30 rule 3 provides for authorisation by the court of the receiver’s remuneration, whereas rule 5 provides for the submission of accounts by the receiver and the scheme under rule 5 is to keep the accounts away from the involvement of the court until an objection is taken.  He argued at first that Order 30 rules 3 and 5 are disjunctive, so if the assessment is completed under the procedure in rule 3, rule 5 may not be invoked to re‑open the assessment completed under another procedure.  He later retracted from this position and contended that even though rules 3 and 5 may not be disjunctive in operation in other circumstances, these provisions should be regarded as disjunctive in the present situation because the procedure under rule 3 had been completed.

31.  He further argued that once the assessment had been completed under rule 3, there should be a separate inquiry if the assessment should be re‑opened and this cannot be done under rule 5 which merely goes to the provision of accounts and does not provide for jurisdiction to re-open an assessment.  And the judge was wrong to order the assessment to be re‑opened without considering whether the objections raised by the Association of any particular items in the bills are valid objections.  It is not for the subject entity, rather than the court, to dictate the basis and threshold for any re‑opening and re‑assessment.  There should be a filtering process to ensure that the assessment would only be re‑opened if the objections are found to be valid and the assessment is shown to be wrong.

32.  As for the cases mentioned by the judge, Mr Joffe submitted that they supported his proposition that the right of an interested party to be heard is in itself insufficient for the assessment to be re‑opened, and there must be some factor affecting the accounts for the previous assessment to be set aside.

33.  I do not agree with Mr Joffe’s construction of Order 30 rules 3 and 5.

34.  It is incorrect to say that rules 3 and 5 provide for two distinct and disjunctive procedures, as Mr Joffe must have recognised when he made the limited concession as mentioned above.  Rule 3 is a general empowering provision, the detail workings of which are complemented by rule 5, which provides for a mechanism by which objection may be raised to any item in the accounts submitted by the receiver, including his remuneration and disbursements.

35.  In construing these provisions, it is instructive to have regard to the historical context of the general law of receivership, namely, that the procedure concerning a receiver’s disbursements and remuneration has been related to his duty to render accounts, as borne out by the authorities cited by the judge[14].  The practice has been that the receiver’s disbursements and remuneration are accounted for as part of his account for the assets in the receivership, upon which a charge is imposed to meet such disbursements and remuneration.

36.  One finds an example of this practice in Day v Croft, where a receiver appointed of a testator’s estate was directed to pass his accounts half‑yearly.  By the first half‑year’s account, the Master had allowed him remuneration at the rate of 5% of the full amount of all his receipts, which came up to a very substantial figure.  Two individuals brought a petition, the object of which was to have the matter referred back to the Master for a review of his report allowing the receiver’s remuneration.  Lord Langdale MR noted that at the time the matter was before the Master, an objection was made to the allowance awarded to the receiver, but the particular circumstances and the particular nature of the items were not brought to the Master’s attention.  As the Master did not have the opportunity of considering what ought to be allowed, Lord Langdale referred the matter back to him to review his report.

37.  Harris v Sleep and Re Kay and Lovell are further examples in which the receiver’s remuneration was included in the accounts rendered, was certified by a Master and was the subject of subsequent application to vary the same.

38.  Order 30 rule 5 clearly provides a juridical basis to set aside and re‑open the assessment of a receiver’s remuneration and disbursements.  As for Mr Joffe’s submission that the assessment should not be re‑opened without a valid objection (whether by a separate inquiry or other filtering process), this goes to the discretion whether to set aside and vary the assessment and not the jurisdiction.

If the discretion to re-open an assessment should be exercised

39.  This is the third question posed by the judge.

40.  In the exercise of his discretionary power, the judge took into account the fundamental rights of access to the court and to a fair hearing, that one instinctively recoils at the notion that a person may be financially encumbered without an opportunity of being heard (Boldwin Construction Co Ltd, §17; Lu Jun v Yu Qi & Ors, §8), and that Order 30 rule 5 also recognises that a party may be afforded an opportunity to raise objections to a receiver’s accounts[15]. He had regard to the fact that the Association was represented only by the Receiver when Bills 1, 2 and 3 of the Receiver and Bills 1 and 2 of the Solicitors were assessed, and the inherent conflict of duty and interest on the part of the Receiver in relation to his own remuneration is self‑evident.  As for Bills 4, 5 and 6 of the Receiver and Bills 3 and 4 of the Solicitors, the board of directors could not have taken part in the assessment because they were not informed.  He noted that the amounts of the bills are substantial, seen in the context of both the assets of the Association and the cost of a further assessment exercise.

41.  The judge weighed the matters urged upon him by the Receiver – that allowing the assessments to be re‑opened would inevitably lead to further expenses and time, and there was some delay before the Association made the present application[16]. As against the factors of expenses and delay, the judge noted that the Receiver and the Solicitors have received interim payment virtually in full.  No argument was raised of change in position, so there is little prejudice if the re‑opening of the assessments may result in certain amounts to be paid back.  There was no suggestion that the Receiver would be hampered by the lapse of time or loss of information if the assessment exercise has to be conducted again[17].

42.  For all the above reasons, the judge exercised his discretion to re-open the assessment.  He did not order a wholesale re‑opening and repetition of the taxation exercise as sought by the Association in the summons.  He decided that as a practical matter, there is no need to set aside everything and require the Receiver to go through the whole process again, unless there is an objection raised to the items in question[18].  As the information provided to the Association so far concerning the fees and expenses is sparse, it is difficult to see how the Association can consider its position and devise “legitimate and properly substantiated complaints” without further information. Further, Order 30 rule 5(2) envisages that a party to whom the receiver’s accounts are to be submitted should be able to inspect “the books and other papers” relating to the accounts and then raise objections[19].  He therefore made an order to allow the Association access to information and then to raise objections, and treat only those items to which objection is taken as being re‑opened.

43.  Mr Joffe contended that it would not have been necessary or proportionate in all the circumstances to order the Receiver to provide their bills of costs or the re‑opening of the assessments, and certainly not in one go.  He reiterated that the re‑opening and reassessment should be treated separately and “not conflated”.

44.  He submitted that there was no true exercise of discretion to speak of, as the judge placed “overwhelming weight” on the Association’s right to be heard, and the other factors canvassed would necessarily feature in most if not all cases (interim assessment of costs would have occurred; there will be difficulty in providing the subject entity with information; there is unlikely to be any allegation of wrongdoing or misfeasance of the receiver; there will be delay and expense in re‑opening and reassessment).  It was argued that the parameters set out in the decision are so wide that if the decision is upheld, re‑opening and reassessment will occur in virtually every receivership at the election of the subject entity, rendering the prior assessments futile and duplicating time and costs.

45.  It was further submitted for the Receiver that in having regard to the need for proportionality in all the circumstances, “due and proper weight” should be given to the following: that assessment had been properly carried out under Order 30 rule 3 and would normally amount to appropriate and adequate supervision of the Receiver’s costs (harking back to the submission that this is not a “forward looking” but an ex post facto application); that a court-appointed receiver is entitled to be indemnified in respect of his costs and expenses out of the assets in his hands reasonably promptly, and this is so even if the receivership was carried on unnecessarily (Capewell v Revenue and Customs Commissioners [2007] 1 WLR 386 at §§21, 27); that there was no suggestion of wrongdoing, bad faith, misfeasance on the part of the Receiver, and no new evidence or a material change of circumstances is shown, drawing an analogy with the variation or discharge of an order for appointment of interim receivers; and that there are other avenues for redress available to the subject entity, such as an action for misfeasance.

46.  In gist, the arguments advanced by Mr Joffe may be put under two broad categories.  The first relates to the question whether the re‑opening and reassessment should be treated separately.  The second relates to questions of weight to be given to various matters in the exercise of discretion.  I will address them in that order.

47.  I see nothing wrong with the pragmatic approach adopted by the judge.  I do not think it necessary to hold a separate inquiry or go through some other kind of filtering process separately to ascertain if there is a valid objection against any item in the bills of costs of the Receiver and the Solicitor.  In the interests of saving time and expenses, there is no good reason why the separate stages of re‑opening and reassessment should not be telescoped as one process and be dealt with together in a rolled‑up hearing.

48.  Nor do I think this is tantamount to allowing the subject entity to dictate the basis and threshold for any re‑opening and reassessment.  The present situation is akin to a review of taxation of costs under Order 62 rules 33 and 34, in which any party to any taxation proceedings may apply to the taxing master to review his decision in respect of any item before the signing of the taxing master’s final certificate.  The applicant is to deliver to the taxing master (with a copy to the other party, if any) the objections in writing specifying by a list the items or parts of the items he objected to, and stating concisely the nature and grounds of objection in each case.  The other party may deliver to the taxing master his answers in writing to the objections, stating concisely the grounds on which he will oppose the objections.  On a hearing of the review, the taxing master may exercise all the powers which he might exercise on an original taxation in respect of the item objected to.

49.  As in the situation of the review of a taxing master’s certificate, it is for the Master to rule on the validity of any objection against any item of costs.  If the objection is invalid, the assessment will stand.  It is only where the objection is ruled to be valid that the Master will make a reassessment of the item objected to.  And as in the case of a review of taxation, the Master will have power to award the costs of and incidental to the proceedings before him, to reflect the outcome and degree of success in the re‑opening and reassessment.  There is no question of the subject entity dictating the basis and threshold for any re‑opening and reassessment.

50.  There is no support in the authorities for the contention that a valid objection for this purpose must be some wrongdoing, bad faith or misfeasance on the part of the receiver.  Order 30 rule 7(1) cited by Mr Joffe deals with an entirely different situation[20] and does not provide support for this contention.  And if material change of circumstances is required to be shown for re‑opening the assessment, there is material change in this situation in that the Association was unable to take part in the assessment of all the bills, through no fault of its directors, who were unjustifiably denied copies of the bills of costs requested from the Receiver.

51.  Turning to the second broad point regarding the proper weight to be given to various matters, this seems to be an attempt to re‑package matters that had been urged before the judge.  It is entirely within the judge’s discretion to give such weight to the matters canvassed as he sees fit. There is no error in principle in giving considerable weight to the fact that the Association was financially encumbered with a substantial bill of costs without an opportunity of being heard.  It is an exaggeration to say that this factor and the other factors the judge took into consideration would necessarily feature in most cases so that re‑opening and reassessment will occur in virtually every receivership at the election of the subject entity.

52.  There is no basis to interfere with the manner in which the judge weighed up various factors in deciding how to exercise his discretionary power.

If there was procedural irregularity in the hearing

53.  The remaining ground of appeal is that the judge cited 16 cases and advanced Order 30 rule 5 as a juridical route for the orders made, none of which was mentioned by counsel on both sides, without inviting them to make further submissions.

54.  I propose to deal with this shortly.  Any opportunity that might have been denied to the Receiver was fully redressed on appeal.  I note also that the judge in fact gave leave to the parties to make further written submissions after the hearing, albeit that was in relation to some other issues he canvassed with counsel in the course of their oral submissions.

55.  I have little doubt that if Order 30 rule 5 was raised by the judge at the hearing, he would have given leave to the parties to address this in the further written submissions they were going to lodge if they should desire it.  As for the 16 cases, Mr Joffe did not have much to say about them in this appeal (he criticised the old receivership cases as giving no or limited reasoning and the cases relating to provisional liquidators as irrelevant) and it is fair to say that the focus of his submission was not on those cases.

Conclusion and costs

56.  For the above reasons, I would dismiss the Receiver’s appeal.  We have heard submissions on costs.  There is no dispute that costs should follow the event and there should be a certificate for two counsel.  I would so order.

Hon Yuen JA:

57.  I agree.