LAU KING TING KATIE v. CHENG MIU HAR STELLA AND OTHERS

CACV 100/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 100 OF 2009

(ON APPEAL FROM HCA NO. 1049 OF 2007)

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BETWEEN

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D E C I S I O N

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1.  This is an application for security for costs on the appeal. It is the second time this has come before me. On the first occasion, the hearing took place within about two days of the application being made and the Appellant on this appeal asked for an adjournment; that was given.

2.  Briefly, this is a case of a hard-fought dispute between two solicitors who were formerly husband and wife. They had a lot of assets between the two of them. Some of them are investment properties, some of them are properties that they lived in and so on and so forth and they had a number of companies.

3.  The judge came to the clear conclusion that a very important document which the Appellant was relying on was forged. It was forged because the relevant page was taken from another document, which is now missing, and used as the signature page for what has been called a trust deed. That is a most serious finding and I am quite certain that the judge would not have made that finding had he not been clear as to it.

4.  On the last occasion, Mr Sussex SC, who appeared on behalf of the Respondents to this appeal, namely the wife, painted a picture that really, the case on appeal was unlikely to succeed to say the least. Really nothing more has been said about that and I take that to be the situation.

5.  The Appellant is clearly impecunious at the moment, although he has offered to provide a bank guarantee of $400,000.

6.  The real issue in this case, therefore, is as to the amount, because there is no real dispute that the Appellant is in an impecunious situation and that it may well be difficult for the Respondents to obtain their costs should they be successful. The Respondents clearly have a very strong case on this appeal.

7.  The question is the amount. Significant as to that is the fact that counsel who appeared below is seeking a brief fee of $1.3 million. I am not going to use any excessive language in respect of that. I am simply going to say that that is not a fee which this court can come anywhere near contemplating as reasonable. If a lay client who happens to have been a solicitor is prepared to pay that amount on a case like this, that is a matter for them. But as far as I am concerned and, I hope, as far as any taxing master is concerned, a figure like that for this case is simply something which the court would not be prepared to sanction. A great deal of effort has been taken in recent years in trying to reduce the costs of litigation and the Civil Justice Reform is primarily directed to that. But brief fees such as that on a case like this are something which it is impossible, in my view, to justify.

8.  That said, on the last occasion I did indicate that having read the papers, I thought that being generous on a case like this where the Respondent has indicated that the Appellant has basically no hope on the appeal, that a total security for costs in the sum of $500,000 was at the high end of anything I was prepared to contemplate. That remains so today.

9.  The Respondent has offered to provide a bank guarantee and I have been asked that instead of that, the money should be paid into court. Bank guarantees are standard. They have to be approved by the Registrar. There is no reason at the moment to suppose that any bank that might provide that guarantee is in any difficulties or that there would be any difficulty in enforcing that guarantee.

10.  I propose to make the order in the standard form that the Appellant do, on or before 28 August 2009, give security to answer costs in case any shall be awarded to be paid by the Appellant to the Respondents by making a lodgement in court of the sum of $500,000 by cash or banker’s draft or by the provision of a bank guarantee of the like amount which guarantee shall have been approved by the Registrar and until such lodgement be made and notice thereof given to the Registrar and to the solicitors for the Respondents, such notice to be given on the same day as the lodgement is made, all proceedings in the said appeal are to be stayed.

11.  In default of the Appellant making such lodgement as aforesaid within the time specified above or within such further time as the court may, for special reasons, allow, the said appeal do, upon the solicitors for the Respondents certifying such default to the Registrar, stand dismissed out of this court without further order.

12.  In the event that the appeal is dismissed in the circumstances provided for above, the Appellant do pay to the Respondent their costs occasioned by the said appeal, such costs to be taxed, and the costs of this application be costs in the appeal.