SUCCESS LANE DEVELOPMENT LTD v. FERGURSON HONG KONG LTD t/a NEW WORLD MILLENNIUM HONG KONG HOTEL

DCCJ 2191/2023

[2025] HKDC 336

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 2191 OF 2023

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DECISION

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I.  INTRODUCTION

1.  On 2 January 2025, I handed down my decision ([2025] HKDC 17) to dismiss the plaintiff’s stay application and joined its director Ms Yung Mei Chun Jessie (“Ms Yung”) to the present proceedings for the purpose of Order 62 rule 6. I made directions in §20(2) of the decision that Ms Yung shall file and serve affirmations on or before 7 February 2025, with the hearing fixed today on whether she should be ordered to pay costs personally. This is Ms Yung’s summons filed and served late afternoon yesterday for time for her to file and serve the affirmation and consequentially adjourn the present hearing.

II.  PROCEDURAL HISTORY

2.  On 7 February 2025, the last day for her to file and serve affirmations, Ms Yung wrote in and applied for time extension for her to file and serve affirmations on or before 18 February 2025 and refixing the hearing, on the ground that the plaintiff’s solicitors were granted an order to cease to act on the same day.

3.  Pausing here, I note that it was the plaintiff’s solicitors who ceased to act. It was not Ms Yung’s solicitors. As a matter of fact, there had never been any solicitors on record acting for Ms Yung.

4.  Normally, the Court does not entertain applications by way of letters. Summons should be taken out. However, to save time so as to ensure that the present hearing could still proceed, I allowed the time extension on paper until 18 February 2025 but refused to refix the hearing.

5.  On the last day of the extended time, namely, 18 February 2025, Ms Yung wrote in again to seek time extension until 17 March 2025 and refix the present hearing, this time on the ground that the plaintiff’s solicitors and her solicitors had ceased to act, although as I said, at least on record, Ms Yung never had any solicitors acting for her. In response, I directed that any applications should be made by way of summons.

6.  Yesterday, on 27 February 2025, Messrs HY Leung & Co LLP filed a Notice to act for Ms Yung, and as mentioned at the outset, filed and served the summons only in the late afternoon, supported with the affirmation of Ms Yung. Her counsel’s skeleton submissions were lodged and served today. In essence, the submissions, based on Ms Yung’s affirmation, are (1) that Ms Yung had difficulty in securing legal representation for her within a relatively short timeframe especially when the solicitors which she had consulted for the purpose of engaging them to act for her personally refused to act for her on 7 February 2025; and (2) that the present costs proceedings under Order 62 rule 6 is against her personally and the consequence could be serious.

7.  As regards (1), change of legal team or late engagement of legal team is not a good reason for time extension. Absence of legal representative for Ms Yung is also not a good reason here because: (a) Ms Yung has been able to prepare affirmations and submissions in detail with references to statutes, rules and cases in the past for and on behalf of the plaintiff; (b) the substance she has to do here is to file an affirmation to explain factually her role in the proceedings: see §20(2) of my decision on 2 January 2025; and (c) the legal principles are not controversial, as have been accurately and succinctly set out in Mr Cedric Yeung’s skeleton submissions filed for the defendant. Further, despite Ms Yung’s allegation that the intended solicitors refused to act for her as late as 7 February 2025, I think, because of (a) and (b) above, the extended time until 18 February 2025 given for Ms Yung to prepare for the affirmation and/or for her to secure legal representation for the preparation was still reasonably sufficient. In any event, Ms Yung had sufficient time to approach her current solicitors shortly after 7 February 2025, rather than “early this week” as alleged in her affirmation made on 27 February 2025, and there is no good explanation for not approaching her current solicitors earlier, especially when the current solicitors were not new to her, having been acting for the plaintiff in a winding-up proceedings.

8.  As regards (2), I agree that the consequence could be serious in the sense that she would have to bear the costs personally and so, she should be given a chance to seek legal advice.

9.  Mr Yeung, counsel for the defendant, opposes Ms Yung’s summons broadly on three grounds:-

(1)  The present summons was taken out at the eleventh hour without any good explanation. This itself is sufficient for me to dismiss the summons;

(2)  Ms Yung’s failure promptly to secure legal representation for herself was entirely due to her own fault; and

(3)  Prejudice would be caused to the defendant that cannot be compensated by costs.

10.  For ground (1), there is no doubt inordinate delay in taking out the summons, and given my analysis in §7 above, I also agree that there is no good reason for such inordinate delay.

11.  For ground (2), Mr Yeung’s submissions are that from the evidence, it seems that the plaintiff’s previous solicitors (ceasing to act on 7 February 2025 as mentioned above) Ms Yung would like to engage refused to act because of the conflict of interest which Ms Yung could release the solicitors from but she did not do so. I tend to agree.

12.  However, in my view, it is ground (3), that is, prejudice to the defendant, that should bear the most weight. Mr Yeung submits that from the plaintiff’s past record in the present action that the plaintiff has never made good any costs order in favour of the defendant, and the plaintiff’s record of applications for leave to appeal almost as a matter of course and that the plaintiff has now even commenced a fresh action in an attempt to set aside the costs orders in favour of the defendant, chances are that Ms Yung would simply not pay any costs wasted as a result of the adjournment she now seeks. In this sense, Mr Yeung submits, not only the defendant would not be compensated by costs but that the defendant would have to incur more costs for the adjourned hearing that in all likelihood would be irrecoverable. Mr Yeung submits that in the circumstances, while the consequence against Ms Yung may be personal and serious, given that Ms Yung has not provided any good reason for the delay, I should refuse the adjournment so as to avoid effectively befalling the costs on the defendant who has committed no fault.

13.  There is great force in Mr Yeung’s submissions. But the submissions are based on an assumption that Ms Yung would treat costs orders against herself as if the plaintiff would treat costs orders against it. I understand how tempting it would be to equate Ms Yung and the plaintiff here, especially in the light of the submissions made by Mr Eric Chim, counsel for Ms Yung, that Ms Yung well knows the likely costs consequence of the adjournment upon his advice but insists upon seeking costs reserved, suggesting that Ms Yung would not like to pay the costs wasted as a result of the adjournment. However, what a client would like to put forward as a stance is one matter; whether the client would comply with a Court order she seeks to oppose is another. While (without ruling) Ms Yung might be blamed for the plaintiff’s failure to comply with costs orders in the past, I take into account that one would still presumably appreciate the more serious consequence of not complying with a costs order made against a natural person rather than a corporate entity. Thus, howsoever tempting it is, I should not simply equate the plaintiff’s attitude towards costs orders with Ms Yung’s.

14.  Having considered the above, especially the serious consequence against Ms Yung, despite Mr Yeung’s eloquent submissions, I think Ms Yung should still be given a last chance and therefore I make an unless order that unless Ms Yung shall file and serve her affirmation by 4:00 pm on 17 March 2025, she shall be debarred from doing so. I also adjourn the present hearing for substantive argument before a Judge on 11 April 2025 at 10:00 am with 3 hours reserved.

15.  As regards costs, it is Ms Yung who seeks indulgence, and she has no good reasons for delay in making the application and for the application itself, save and except for the inherent nature of the costs proceedings against her personally. She should be liable to pay costs of her application and the costs of today’s hearing wasted as a result of her application.

16.  I should also say that there is no point in reserving costs because if at the end of the costs proceedings, Ms Yung would not be personally liable for costs, she would still have to be liable for wasted costs of today’s hearing which does not concern the plaintiff at all. If at the end of the hearing, she would be personally liable for costs, then there would all the more be reason for her to bear today’s wasted costs.

17.  Further, given the absence of good reason for her inordinate delay in taking out the summons, I think costs should be assessed on an indemnity basis. Mr Chim has no qualm about this.

18.  In the circumstances, I order Ms Yung personally to pay the costs of her application and the wasted costs of today’s hearing forthwith, summarily assessed at HK$58,000.