BEIJING SONGXIANGHU ARCHITECTURAL DECORATION ENGINEERING CO., LTD v. KITTY KAM also known as WANG YUZHI

HCA 1289/2022

[2024] HKCFI 3069

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1289 OF 2022

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DECISION

(on variation of costs orders)

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1.  There are 2 costs orders in respect of which the parties are seeking variation.

Costs of the Defendant’s summons dated 23 May 2024 seeking the Confidentiality Order (“the Confidentiality Summons”)

2.  On 30 May 2024, this Court dismissed the Confidentiality Summons at the conclusion of the hearing. The Reasons for Decision was handed down on 19 June 2024 ([2024] 4 HKLRD 274), and in §29 thereof I awarded costs to the Plaintiff (“P”). As I have not heard parties fully on costs at the end of that hearing and my Reasons were then not yet given, it was right to treat the said costs order as an order given on nisi basis though it has not been expressly stated as such.

3.  By summons dated 4 July 2024, P first seeks leave to file the summons out of time, and then to vary the costs order such that the costs be assessed summarily and paid forthwith and taxed on indemnity basis with certificate for 2 counsel.

4.  P lodged its written submissions in support dated 30 July 2024 and Kam hers in opposition dated 13 August 2024.

5.  Kam does not object to the summons being filed out of time on the basis that she be awarded the usual costs for seeking extension of time at HK$1,040. D objects to the costs being awarded on indemnity basis and does not agree to a certificate for 2 counsel.

6.  P raised two main points. First, Kam has pursued unarguable, weak or thin points, or points that are plainly wrong in law. Second, that Kam had raised the issue of arbitral confidentiality with Anthony Chan J when P applied for the Mareva Injunction herein and the HCCT Proprietary Injunction in the related proceedings, but was rejected then by the learned judge, it was therefore an abuse for Kam to raise the matter again by the Confidentiality Summons.

7.  I do not accept these 2 points.

8.  Regarding the first, as I said in the Reasons for Decision, while the principles of open justice is well established, the operation and ambit of section 18(2)(a)(i) of the AO was not. I do not regard Kam’s application as so weak that it ought not have been made or so weak as to warrant indemnity costs.

9.  Regarding the second, I do not view the issuance of the Confidentiality Summons as an abuse in that the matter has already been squarely decided by Anthony Chan J. From the judge’s notes, this Court understands that at the time the application for the Mareva Injunction and the HCCT Proprietary Injunction were heard together, the matter of arbitral confidentiality was raised by senior counsel for Kam but was not formally applied for or was fully argued before the learned Judge who considered that the arbitral confidentiality (as the matters stood at the time) would already been sufficiently protected by handing down two separate Decisions and the one concerning the HCCT Proprietary Injunction be not published. Indeed, though this abuse point was raised in P’s written submissions opposing the Confidentiality Summons, it was not seriously pursued at the oral hearing; and this Court did not refuse the application on the basis of an abuse of process but instead went on to hear the application substantively and decided it based on substantive merits.

10.  Therefore, I would not award the costs on indemnity basis.

11.  Though Kam argued against a certificate for 2 counsel, Kam herself engaged Mr Chain SC, and not his junior, to move and argue the application. I consider it appropriate to certify for the attendance of 2 counsel. Summary assessment and payment forthwith thereafter are evidently appropriate and not serious contested. I would so direct.

12.  Disposal :

(a)  The costs order is therefore varied to : Kam do pay P its costs of the Confidentiality Summons to be taxed on party and party basis with certificate for 2 counsel to be assessed summarily and payable forthwith.

(b)  Since the parties have already lodged their respective Statement of Costs and List of Objections, I direct that the summary assessment shall take place together with the summarily assessments of other sets of costs at the hearing at 2:30 pm on 16 December 2024.

(c)  Since each party wins some on this application to vary, the fair costs order for this variation application seems to me would be no order as to costs. I so order on nisi basis to be made absolute in the absence of any application to vary by letter within the next 7 days.

Costs of the Defendant’s summons dated 20 November 2023 for striking out and discharge of the Mareva Injunction (“the Striking Out Summons”)

13.  On 30 May 2024, this Court also dismissed the Striking Out Summons at the conclusion of the hearing. The Reasons for Decision was handed down also on 19 June 2024 ([2024] HKCFI 1658).

14.  At §80 of the Reasons for Decision, I gave my provisional view on the costs of the Striking Out Summons and made the costs order nisi, thus :

“My provisional view is that this application for striking out is clearly without basis and unmeritorious, that Kam 5^th was unreasonable in length and in seeking to present arguments rather than facts and arguing as if this were a trial over those issues, but which eventually were abandoned save but one point, that the resistance against allowing the Plaintiff to refer to the draft amendment is totally unreasonable and unmeritorious, and the application to seek to discharge the Mareva Injunction was based on or consequential upon similar arguments. In the round and provisionally, I consider it clearly appropriate to order Kam to pay the costs of her summons to be taxed on an indemnity basis. I also certify for 2 counsel. I so order on nisi basis which will become absolute in 21 days unless any party applies by summons to vary within that time.

15.  By P’s summons dated 4 July 2024, P seeks to vary the costs order nisi by (a) including in this order the costs reserved under the Order dated 8 December 2023, and (b) for the costs to be summarily assessed and paid forthwith.

16.  By Kam’s summons dated 5 July 2024, she seeks to vary by (a) having the costs be taxed on party and party basis, and (b) giving certificate for one counsel only.

17.  The parties have lodged their respective submissions both dated 30 July 2024, and their reply submissions both dated 13 August 2024.

18.  Kam’s submissions against taxing on indemnity basis are summarized thus :

“What appears to have occurred is that your Lordship simply did not agree that the case is a proper one for striking out. Numerous reasons were given.” (§8 of Kam’s submissions dated 30 July 2024)

19.  Kam also urged that though the late abandonment of the many points may form the basis for awarding indemnity costs as in China Shanshui Cement Group Limited & Others v TianRui (International) Holding Company Limited (HCA 548/2019, [2021] HKCFI 2745, unrep., 13 September 2021), she asked this Court to consider, as in that case, to apportion such that only part of the costs be taxed on indemnity basis and the remaining on party and party basis.

20.  As set out in the Reasons for Decision, this Court held that Kam’s case for striking out was much more unmeritorious than what Kam now contends, namely, that this Court just did not agree that it was a proper case for striking out. To name but 2 matters : (a) this Court at §4 already made reference to the fact that Anthony Chan J has already decided, after a contested hearing in January 2023, that the Plaintiff has a good arguable case, which logically means that it has been decided that the Plaintiff’s case would not be so weak as to bound to fail (which was the basis for Kam’s striking out) and (b) the very key matter of the so called “undisputed evidence” relied on by Kam for the striking out was far from “undisputed”, and was clearly and evidently disputed and disputable such that it evidently did not justify a striking out (§§40-49). In my view, the striking out application ought not have been taken out.

21.  Moreover, there were also the other conducts I set out in §80 of the Reasons (which I need not repeat or elaborate here) over which Kam has not sought to respond to here.

22.  In my view, this is a case that amply justify awarding costs on indemnity basis.

23.  I do not find at all appropriate the approach advocated by Kam to apportion part of the costs to be taxed on indemnity basis and part of the costs on party and party basis. Kam abandoned 7 out of the 8 points elaborately argued in Kam 5^th, and importantly, they were abandoned so late that the time and costs spent by P in preparing to deal with them at the hearing were already spent. There is thus little meaning or utility in awarding, say, only 7/8 of the costs to be taxed on indemnity basis. Moreover, there were the other conducts such that together they fully justify, in my view, the taxation of the entire costs on indemnity basis. So far as actual hearing time that were saved by the late abandonment, Kam would be entitled to the savings in costs even when taxed on indemnity basis.

24.  Next, I must reject the contention that the matter justified only certifying for one counsel. As Kam herself acknowledged, she engaged Mr Chain SC and his junior. The complexity of the matter and the amount involved clearly justified engaging 2 counsel. I do not think any more need to be said in this regard.

25.  Summary assessment and the costs payable forthwith are clearly justified and not seriously contested by Kam. I would so direct. Kam did not contest against including the costs reserved under the Order dated 8 December 2023.

26.  Disposal:

(a)  The costs order is therefore varied to : Kam do pay P its costs of the Striking Out Summons, including the costs reserved under the Order dated 8 December 2023, to be taxed on indemnity basis with certificate for 2 counsel to be assessed summarily and payable forthwith.

(b)  Likewise, the parties have already lodged their respective Statement of Costs and List of Objections, I direct that the summary assessment shall take place together with the summarily assessments of other sets of costs at the hearing at 2:30 pm on 16 December 2024.

(c)  P is clearly the winner and on nisi basis Kam do pay P its costs of the 2 variation summonses, which will become absolute in the absence of any application to vary by letter within the next 7 days. Such costs are also to be assessed summarily on 16 December 2024.

For that purpose, P do lodge and serve its Statements of Costs within 7 days after the costs order nisi becomes absolute and Kam to lodge her Lists of Objections 7 days after.