SECRETARY FOR JUSTICE v. CHENG KA YEE AND OTHERS

HCMA 466/2017

[2018] HKCFI 2594

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MAGISTRACY APPEAL NO 466 OF 2017

(ON APPEAL FROM KCCC 2932 OF 2015)

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DECISION ON COSTS

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1.  By a judgment dated 6 August 2018, I dismissed the appeal made by the Secretary for Justice by way of Case Stated under s.105 of the Magistrates Ordinance (“MO”).  The respondents (R1 – R4), originally the defendants who had been acquitted after trial, now make applications for costs.  The parties have filed their written submissions on the issue of costs, based on which I now dispose of the applications.

The respondents’ applications for costs

2.  R1 and R4 ask for “all and full costs for the appeal, review and trial below” [1]. Apparently R1 should not be asking for the costs of the review application before the Magistrate as he was already granted such costs[2]. R2 and R3 only seek for costs of the appeal.  The costs applications were made pursuant to s.120 of the MO.  Mr Boyton, counsel for R1 and R4, also prayed in aid the Rules of the High Court (“RHC”), in particular, Order 62, rule 3(2).

The appellant’s position

3.  Mr Leung SC, the Director of Public Prosecutions, for the appellant asks the court to defer the issue of costs for the consideration by the Court of Final Appeal (“CFA”). Alternatively, if the court is to deal with the costs issue, he submits that there should be no order as to costs for the trial and review hearing, and the respondents should only be awarded 50% of the costs of the appeal.

4.  In respect of the powers of this court to award costs, the appellant agrees that I have power under s.120(1) of the MO to award costs of the appeal.  However, the DPP submits that I have no power to award costs as to the proceedings before the Magistrate. 

Whether the issue of costs should be deferred

5.  Mr Leung SC invites the court to defer the issue of costs as the Appeal Committee of the CFA has granted leave to appeal on both limbs of point of law and substantial and grave injustice.  He submits that in the event the appellant succeeds in the appeal, it will dispose of the matter of costs.  Even if the appeal is to be dismissed, the CFA can still deal with the costs of the first instance trial and appeal as a consequential matter as it thinks fit by virtue of ss.17 and 43 of the Hong Kong Court of Final Appeal Ordinance.  To save time and costs, it is desirable to defer the issue of costs for the consideration of the CFA.

6.  All the respondents oppose the deferral of issue of costs and the deduction of their costs of appeal.  Counsel for the respondents submit that the respondents were all privately funded for the appeal, the delay in awarding their costs would cause financial hardship and prejudice to them in their preparation for the appeal to the CFA. 

7.  In my judgment, the overall resources might not be saved or significantly saved, by reserving the costs issue for the CFA.  Moreover, the successful party in a litigation in the normal course of event is entitled to a decision on costs upon the conclusion of the proceedings.  Although the CFA has granted leave to appeal, the appeal will take time to come to the final conclusion.  As the respondents are privately funded in the proceedings of this case, their financial constraint should not be neglected.  Having taken into account all the circumstances, I am of the view that it would be in the interest of justice that the issue of costs should not be deferred.

Costs of the proceedings before the Magistrate

8.  When the respondents were acquitted by the Magistrate, R1, R2 and R3 applied for costs of the trial but their applications were refused on the ground that they brought suspicion on themselves.  R4 did not apply to the Magistrate for costs of the trial.  R1 did not appeal against the Magistrate’s decision to refuse costs.

9.  Upon the Magistrate’s dismissal of the prosecution’s applicationfor review under s.104 of the MO, R1 – 3 applied for and were awarded the costs of the review hearing.  R4 did not apply to the Magistrate for costs of the review.

10.  Mr Leung SC submits that a judge of the Court of First Instance (“CFI”) is only empowered to make an order for costs incurred by a defendant in the proceedings before the magistrate when the defendant’s appeal is allowed.  On the other hand, Mr Boyton fails to elaborate the legal basis for his application for such costs.

11.  It is trite law that there is no inherent power in a court to award costs in criminal cases.  Such power is conferred by statute.  The power of granting costs in criminal cases is now generally contained in the Costs in Criminal Cases Ordinance, Cap 492 (“CCCO”).  Part II of CCCO deals with defence costs, s.8 in particular covers defence costs on appeal from magistrate.  It provides:

“ Where a judge—

(a) allows an appeal to which section 105 or 113 of the Magistrates Ordinance (Cap. 227) applies, in the exercise of his powers under section 120 of that Ordinance; or

(b) in any appeal against sentence imposed by a magistrate, quashes the sentence and in place of it imposes a less severe punishment than that so imposed,

the judge may order that costs be awarded to the defendant.”

(emphasis added)

12.  Another relevant statutory provision on costs in magistracy appeal is s.120 of the MO, which provides:

“ (1) On any appeal to which section 105 or 113 applies, the judge may make such orders as to costs, as he may think fit, and may—

(a) where he allows the appeal, direct that there shall be included in any costs to be paid by the respondent to the appellant the costs properly incurred by the appellant in the proceedings before the magistrate, or such fixed sum as the judge may consider reasonable in respect of the costs so incurred by him;

…” (emphasis added)

13.  I agree with the DPP that the power to award costs for the proceedings before the Magistrate can only be exercised by a CFI judge pursuant to s.120(1)(a) of the MO, where he allows the appeal made under s.105 or s.113 of the same ordinance.  In the present case, the appeal was made by the prosecution.  The respondents have not made application to appeal.  The appellant’s appeal has not been allowed.  This court therefore has no power under the CCCO or the MO to order costs for the proceedings before the Magistrate.

14.  Mr Boyton also says where the matter is silent, the court should refer to the RHC, specifically Order 62, rule 3(2) (“the rule”) which provides that costs should follow the event[3].

15.  The RHC, with certain exceptions, do not have effect in relation to any criminal proceedings: see Order 1, rule 2(3).  Order 62, though being one of the exceptions, must be read subject to the CCCO.  In my judgment, the rule does not apply in the present case[4]. In any event, the guiding principle expressed in the rule does not confer on me a general power to award costs of the proceedings before the Magistrate. 

16.  I therefore conclude that I have no power to award to the respondents their costs in the proceedings before the Magistrate.

17.  Even if I had the power, I would have exercised my discretion to refuse to award such costs to R1 and R4.

18.  R1’s application for costs of the trial had been refused by the Magistrate on the ground that R1 brought suspicion on herself.  R1 could appeal against that decision to refuse costs but she did not.

19.  R4, represented by counsel at trial (not Mr Boyton), chose not to apply for costs of the trial or the review hearing—probably wise decisions‌— at the conclusion of the hearings before the Magistrate.  Applications for these costs could have been made subsequently to the Magistrate out of time.  No such applications have been made.

20.  Having considered all the circumstances and the procedural history, R1’s application for costs of the trial, and R4’s application for costs of the trial and the review hearing before the Magistrate must be refused.

Costs of the appeal

21.  I would deal with the costs under this head on the basis as conceded by the appellant that the court has such power to award the costs.[5]

22.  Mr Leung SC accepts the general principle that costs should follow the event unless there is good reason to the contrary.  He submits that those reasons may include the conduct of the appellant or his legal representatives.  The DPP quoted the court’s comment in its judgment that what the respondents did was “wholly inappropriate and disgraceful which no doubt deserved to be condemned”.  Moreover, the appeal was dismissed mainly because the court found that the actus reus of the offence was not made out.  None of the respondents ever took issue with the appropriateness of the charges (the issue raised by this court) in the trial, the review and the appeal hearing.  And counsel for R1, R2 and R4 even agreed that the charges laid against the respondents were “appropriate” after the issue had been raised by the court.  The appellant submits that, in the special circumstances of this case, the respondents should only be awarded 50% of the costs of the appeal.

23.  I indeed commented in my judgment of the appeal that the conduct of the respondents was wholly inappropriate.  In my opinion, for their improper conduct, the respondents can be deprived of their costs of the proceedings before the Magistrate. 

24.  However, insofar as the appeal is concerned, the respondents being the successful parties should normally have their costs unless there is special reason not to follow the usual rule.  While counsel for the respondents rendered little assistance in the issue raised by the court, it cannot be said that the respondents or their legal representatives misconducted themselves in the appeal such that the respondents should be penalized by costs.  Indeed, the appeal would have been dismissed even if the issue raised by this court had not been raised.  In my judgment, it is only fair that the normal rule should apply and the respondents, as the successful parties, should not be deprived of the costs for the appeal.

The result

25.  The respondents are to have full costs of the appeal, to be taxedif not agreed.  R1’s application for costs of the trial, and R4’s application for costs of the trial and the review hearing before the Magistrate are dismissed.