CHINA GLOBAL (ASIA) LTD v. SLATE GLOBAL LTD

LDPD 2890/2010

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

APPLICATIONNUMBER LDPD 2890 OF 2010

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BETWEEN

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DECISION ON COSTS

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1.  There are 2 applications of variation of costs order nisi before me.

2.  On 20 September 2011, I handed down a Judgment herein. By the Judgment, I ruled in favor of the Applicant against the Respondent.  I further dismissed the Third Party proceedings instituted by the latter.

3.  Briefly, I did not accept the case of the Respondent. I found that one of the directors of the Respondent Mr. Marshall had allowed and authorized the Third Party to enter into the subject tenancy agreement with the Applicant. When Mr. Marshall denied the same in the proceedings, he was not telling the truth. The Respondent was therefore liable to the Applicant in the capacity of its tenant. As to the Third Party Proceedings, I ruled that the Lands Tribunal did not have the necessary jurisdiction to deal with the matter and further refused to exercise my discretion to transfer the same to the District Court.        

4.  As to costs, I made the following order nisi.

(a)    The Respondent do pay costs of the Applicant, including Certificate for Counsel for the hearing on 4 July 2011, to be summarily assessed by me, failing agreement by the parties within 35 days.

(b)   There is no order as to costs between the Respondent and the Third Party in the Third Party proceedings.

5.  On 3 October 2011, the Respondent wrote to this Tribunal asking for a variation of the costs order nisi. It said, inter alia, that it had made an offer for a judgment for the Applicant with costs on 24 June 2011. It was not accepted and as such, the costs should be divided into 2 parts by 24 June 2011. When the Respondent should be paying the costs before the date, the Applicant was to be liable for those incurred after the date.

6.  The Applicant disagreed and said, among others, that the letter of 24 June 2011 was not clear. It further said that the judgment was to be made on the basis of apparent authority and not actual authority.

7.  On 6 October 2011, the Third Party also wrote to the Tribunal on the question of costs. It wanted to seek costs against the Respondent. The Third Party commented on the conduct of the Respondent, including that it had persuaded the Court to set aside the default judgment on a false basis, it also ran an untrue case at trial and unreasonably rejected an offer from the Third Party on 19 May 2011.

8.  Later, I directed both of these applications to be listed before me for a short hearing.

9.  Parties appeared before me this afternoon for the matter. Mr. T. Wong of Counsel and Mr. Hanusch continued to represent the Applicant and the Respondent respectively. Ms. Wong acted for the Third Party.

10.  Upon hearing from them, I have decided to refuse both of the applications. My reasons appear in below.

(a)  Costs are matters within the discretion of the Court to be exercised judicially. In so doing, I ask myself to bear in mind the factors listed in O. 65 r. 5 of the Rules of the High Court and the explanatory notes at p.1098 to 1106 of the White Book 2011.

(b)In the present case, no doubt the Applicant is the innocent party. It was and is the landlord. There was outstanding rent and it sued for the tenant under the Tenancy. However, a simple non-payment of rent case turned out to be complicated because of the conduct and disputes of both the Respondent and the Third Party.

(c)  Although the Respondent wanted to help the Third Party at the beginning to rent the premises in the name of the former, it went too far by denying the authorization in the present proceedings.

(d)At the same time, the Third Party should also be held responsible. She failed to pay rent as from time to time. She made quite some inaccurate and incorrect statements throughout the proceedings, adding complications to the parties’ arguments.

(e)  In relation to the application by the Respondent, I agree with the submissions by Mr. Wong. In short, there was no sanctioned offer or payment. The suggestion by the solicitors of the Applicant on 23 June 2011 is a constructive and actionable offer for settlement and the calderbank letter dated 24 June 2011 by the Respondent is unclear and ambiguous. The Respondent should therefore bear all costs of the Applicant. Mr. Hanusch has not been able to persuade me to rule otherwise.

(f)   As to the variation sought by the Third Party, I agree to allow it to be brought out of time as the delay is short and the Respondent suffers no real prejudice at all. However, as a matter of substance, I did and continue to see her conducts as abovementioned justifying an exception to be made although the proceedings against her were dismissed by me.

(Discussion on costs and other incidental matters)

11.  In the end, I made the following orders and directions.

(a)  The Respondent do pay costs of the Applicant, including the Certificate for Counsel for the hearing on 30 November 2011, to be summarily assessed by me (0.5 hour reserved), failing argument by the parties within 14 days from the date hereof.

(b)There is no order as to costs as between the Third Party and the Respondent.

(c)  The time stated in the costs order made herein on 20 September 2011 is extended for 14 days from today. In the event that the parties cannot agree on the quantum, 0.5 hour is also to be reserved for the lump sum assessment.