CHINA CITY CONSTRUCTION (INTERNATIONAL) CO LTD (IN CREDITORS’ VOLUNTARY LIQUIDATION) AND ANOTHER v. CHINA CITY CONSTRUCTION & DEVELOPMENT CO (HK) LTD

HCMP 1883/2024

[2025] HKCFI 1685

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1883 OF 2024

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DECISION ON BASIS OF COSTS

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1.  On 14 February 2025, I handed down a judgment ([2025] HKCFI 710) on the plaintiffs’ application by Originating Summons (“OS”) for an anti-suit injunction. For reasons given in the judgment, I gave an order in terms of the plaintiffs’ application with an order nisi that costs follow the event. In the plaintiffs’ OS, they had requested an order that costs be assessed on an indemnity basis. Accordingly, in the judgment, I gave directions for written submissions on the question of the basis of costs, which have been duly lodged by the parties and which I have read.

2.  It is common ground that costs, including assessment on an indemnity basis (Order 62 rule 28(3) Rules of the High Court), are in the discretion of the court. It is also well-established that the circumstances in which the court may award indemnity costs should not be circumscribed. Having said that, in Overseas Trust Bank Ltd v Coopers & Lybrand (a firm) and Others [1991] 1 HKLR 177 quoted with approval by the Court of Appeal in Choy Yee Chun v Bond Star Development Ltd [1997] HKLRD 1327 at 1334, Godfrey J (as he then was) gave examples of situations where indemnity costs may properly be awarded, e.g. where the unsuccessful party’s proceedings are vexatious (the fact that the unsuccessful party is the defendant in the proceedings does not affect the court’s discretion to order indemnity costs against it: Choy Yee Chun, 1335J).

3.  In my view, this is an appropriate description of the defendant’s conduct in commencing the Beijing proceedings in the circumstances of this case. For reasons set out in the judgment as encapsulated at §77, “it is in my view, vexatious and oppressive for CCCDHK, after failing on the preliminary issue and well knowing the nature of the action from Cheng J’s Decision, to deliberately carve out one specific issue from those long-standing, multi-issue, multi-party Hong Kong proceedings for proceedings it has very recently commenced in Beijing based on a document (the Supplementary Agreement) of which it was or should reasonably have been aware a decade ago”.

4.  Finally, to avoid any misunderstanding in view of §7 of the defendant’s submissions, I should point out that §§59-60 of my judgment were assumptions, not findings, of the authenticity of the Supplementary Agreement and when it is said to have come to Ms Sze’s attention.

5.  I would give the following order and directions:

-  the costs of and occasioned by the Originating Summons filed on 30 September 2024 be summarily assessed on an indemnity basis and paid by the defendant forthwith;

-  the plaintiffs do file and serve their statement of costs within 7 days after the date of this Decision; and

-  the defendant to file and serve a list of objections (if any) within 14 days thereafter.

6.  A summary assessment would then be made on paper.