XCHRX NEW TECHNOLOGY CABLE LTD. v. POPBRIDGE INDUSTRIAL LTD.

CACV 50/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 50 OF 2000

(ON APPEAL FROM HCA 7820/1999)

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J U D G M E N T

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Hon Godfrey VP :

1. This is an application by a respondent plaintiff for security for the costs of an appeal by an appellant defendant. The master refused to give judgment in favour of the plaintiff under Order 14, but on appeal to the judge that decision was set aside and the judge gave judgment in favour of the plaintiff for a sum in excess of $1,000,000.

2. The power of the court to direct security for costs to be given by an appellant is a power to be exercised only in special circumstances : see Order 59 rule 10(5) of the Rules of the High Court. One of those special circumstances is the impecuniosity of the appellant.

3. In the present case, it is said that the evidence establishes that the appellant would be unable, if unsuccessful, to pay the respondent's costs of the appeal. There is evidence that the defendant is strapped for cash and has had cash flow problems. But there is also evidence, which is uncontradicted, that it has a highly profitable business and that it has no problems paying its ordinary business expenses. And it has paid, although admittedly only when compelled to do so by presses of execution, the debt due to the plaintiff under the judgment.

4. The appellant has put in no evidence in the form of audited or even unaudited accounts which disclose its present financial position. But I do not consider that the respondent is entitled to demand that, and on the evidence before me, I see no ground for considering that the appellant will be unable to pay the respondent's costs of the appeal if the appellant is unsuccessful.

5. I will therefore dismiss this application, and order that the costs of the appellant be taxed (if not agreed) and paid by the respondent to the appellant.