CENTALINE PROPERTY AGENCY LTD v. FUNG WAI YEE IRENE

DCCJ 673/2013

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 673 OF 2013

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DECISION

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1.  In this Decision, I shall adopt the abbreviations used in my Judgment in this action dated 30 June 2014. I shall refer to the background facts set out in the Judgment and I shall not make any repetition here.

2.  Centaline is the winning party in the Judgment and I accordingly make a cost order nisi that Fung do pay Centaline its costs of this action including the counterclaim and all costs previously reserved. I do not, however, allow certificate for counsel. Centaline now applies to vary the costs order nisi to include certificate for counsel. Fung opposes this application.

3.  In the last paragraph of the Judgment, I set out my reasons for not allowing certificate for counsel. To recap, I gave two reasons. First, I opine that the dispute is factual and straightforward and a competent solicitor could well handle the trial as he did in the Inquiry. Second, both the claim (HK$105,600) and the counterclaim (HK$186,200) involve modest sums only.

4.  This morning, Mr Hung accepts that Centaline’s claim is straightforward but he submits the Counterclaim is complicated due to Fung’s allegations of Centaline’s breach of implied terms and misrepresentations.

5.  This court is aware of the nature of the Counterclaim and has dealt with it in the Judgment. This court is not convinced that it is complicated at all. The parties agreed to the existence of the Implied Terms at trial and whether Centaline made the alleged misrepresentations is a question of fact. I have read the transcript of the Inquiry thoroughly and what transpired between KK and Fung on the material day was actually fully investigated and Mr Hung conducted the proceedings competently. There is no reason why a competent solicitor cannot handle the trial essentially involving the same factual dispute.

6.  The additional allegation of Ngo’s misrepresentation on the pleading, in my view, does not complicate the trial. It was still an issue of fact. Centaline did not adduce any evidence from Ngo despite leave was granted to file a witness statement of Ngo. Further, the parties did not include the factual issue relating to the alleged misrepresentations by Ngo in their agreed list of issues. Eventually, Fung’s counsel at the outset of the trial confirmed that no reliance would be placed on the alleged misrepresentation of Ngo.

7.  Mr Hung further relies on the late application of Fung to file voluntary particulars. The application was only made on the first day of the trial. The application was in any event simple and did not justify engagement of counsel.

8.  Mr Hung highlights to me the assistance of Mr Pun, Centaline’s trial counsel, rendered to this court. However, the question as to whether certificate for counsel is appropriate is not really performance based.

9.  Mr Hung refers to the costs order I made at the pre-trial review hearing under which certificate for counsel (“the Order”) was granted. I was aware of this when I made the costs order nisi. The Order was made with the consent of counsel on the both sides and without a fair assessment of the overall complexity of the matter. I have a different view of the dispute after trial and I believe that I am entitled to disallow certificate for counsel in light of my changed view.

10.  Mr Hung then makes a clever point that the actual amount involved in the present action should be HK$291,800 being the total amount of Centaline’s claim and Fung’s counterclaim. Therefore, the stake was not so modest. Mathematically, Mr Hung is correct but I disagree that it would materially affect my exercise of the discretion. As Mr Hung accepts, if Centaline succeeds in resisting the Counterclaim, it must follow that Centaline’s claim would be allowed. On the other hand, if Fung’s counterclaim is allowed, Centaline’s claim would be dismissed accordingly. This court was essentially tasked with the adjudication of Fung’s counterclaim only.

11.  Mr Hung lastly refers to me two decisions of the District Court. They are Centaline Property Agency Limited v Yip Yuk Fai, unreported, DCCJ 5321/2009, 18.8.2011 and Jungle Holdings Limited v Fenton Associates Limited, unreported, DCCJ 1099/2004, 22.3.2006. There, on both occasions, apparently lesser amounts were involved but certificate for counsel was nevertheless allowed in the costs orders nisi. There was no explanation given for the grant of certificate for counsel. I derive little assistance from these two cases.

12.  In any event, being the trial judge, I am in the best position to assess the complexity of the matter and to decide on the issue of costs including the appropriateness of certificate for counsel. Whether certificate for counsel should be granted involves an exercise of my discretion to be made judiciously on the particular circumstances of this action. I am not convinced that my discretion would be exercised erroneously if I disallow certificate for counsel in light of my view of the dispute. 

13.  Accordingly, for the reasons given above, I dismiss Centaline’s application to vary the costs order nisi despite the able submission of Mr Hung.

14.  Lastly, I should point out that this application was first made by way of Centaline’s letter to this court dated 11 July 2014. Upon receipt of the letter, this court immediately alerted Centaline to the need to issue a summons to make such an application. Centaline managed to take out the summons on the following business day, which was the last day of the 14-day time limit.

15.  It is high time that practitioners be reminded of the observation of Ma CJHC (as the Chief Justice then was) in PCCW-HKT Telephone Ltd v Telecommunications Authority, unreported, CACV 274/2003, 7.9.2004 that an application to vary the costs nisi should be made by summons or motion, as the requirement was intended to enable the other side to adequately prepare: see also Hong Kong Civil Procedure 2014 Vol.1 §32/3/1. Without complying with the procedural requirements properly, such applications may not be able to be made timeously within the 14-day time limit.

16.  Costs should follow the event. Mr Hung submits that it was the first time Centaline argued on costs and so it should not pay any costs of Fung even its arguments were rejected. I cannot agree. It begs the question why Centaline decided to argue against the costs order nisi without good reasons in the first place. I order that that Centaline do pay Fung costs of this application in the sum of HK$4,200 summarily assessed.