LAW SIU YIN ADA v. LO HUNG KWAN

CACV 1034/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 1034 OF 2000

(ON APPEAL FROM HCAP NO. 11 OF 1999)

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J U D G M E N T

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1. On 30 September 2000, Deputy Judge Muttrie dismissed the Plaintiff's appeal from the order of Master Ho striking out her Amended Statement of Claim. The Plaintiff is appealing to the Court of Appeal. The Defendant now applies for security for his costs of the appeal. He seeks security in the sum of $200,000.00.

2. Before the merits of the application are considered, two procedural matters need to be addressed. First, the Plaintiff's summons asserted that security was being sought pursuant to Ord. 23 r. 1 of the Rules of the High Court on the ground that the Plaintiff was ordinarily resident out of the jurisdiction. The reference to Ord. 23 was wrong. Ord. 23 relates to applications for security for costs in respect of proceedings in the Court of First Instance. Applications for security for costs in respect of proceedings in the Court of Appeal are governed by Ord. 59 r. 10(5). That mistake was not unimportant. The fact that a plaintiff is ordinarily resident out of the jurisdiction triggers the court's discretionary power to award security for a defendant's costs under Ord. 23. However, the technical question whether an appellant is ordinarily resident out of the jurisdiction is not relevant to an application for security for costs under Ord. 59 r. 10(5). The court's discretionary power to award security for costs under Ord. 59 r. 10(5) arises simply when special circumstances exist. Thus, residence overseas is capable of amounting to a special circumstance where the appellant's residence overseas would make the enforcement of any order for the respondent's costs of the appeal more difficult, and thus the attempt to enforce it would cause undue delay and expense. The Plaintiff is not represented by a lawyer, and thus her affidavit in opposition to the Defendant's summons addressed the technical question of her ordinary residence rather than the substantive question of whether the fact that she has lived in Australia for some time would in all the circumstances make it more difficult for the Defendant to enforce any order for his costs of the appeal.

3. Secondly, the appeal has been fixed for hearing on 24 April, i.e. less than three weeks' time. If security were to be ordered now, I would either have to order the security to be provided very soon, e.g. within 7 days, or I would have to vacate the hearing of the appeal to enable the Plaintiff to have sufficient time to provide the security. I would be very reluctant to take either of those courses since this application is being heard so soon before the date fixed for the hearing of the appeal (a) because of the lapse of time between the date when the appeal was set down (9 December 2000) and the date when the Defendant's summons for security for costs was filed (31 January 2001), and (b) because the Defendant's summons gave a time estimate for the hearing of the application of 2 hrs., thereby preventing it from being listed much earlier before a Justice of Appeal at, say, 9.30 a.m. one morning. Mr Andrew Cheung for the Defendant pointed out that the Plaintiff has known since 31 January that there has been at least a possibility that the court would order her to provide security, and therefore she has had plenty of time to raise the money in case security was ordered. I see the force of that, but I do not think that an appellant can really be expected to make full provision for security prior to the hearing of the application for security.

4. Against that background, I turn to the merits of the application. The Plaintiff does not deny that she has Australian citizenship and that she has spent much time in Australia. However, the evidence is that in the last 15 years or so she has spent more time in Hong Kong than in Australia. That is especially so over the past few years. Against that, it has to be said that she does not assert that she has any assets of her own in Hong Kong, and I accept that if she is ordered to pay the Defendant's costs of the appeal, it may take the Defendant longer to enforce that order and at greater expense than might otherwise be the case, especially as her Australian address is unknown to the Defendant. I therefore accept that special circumstances exist in the present case which trigger the court's discretionary power to order security for costs under Ord. 59 r. 10(5).

5. However, I have to balance such difficulties as the Defendant may encounter in the enforcement of an order for costs against the consequence to the Plaintiff of this application being made so soon before the hearing of the appeal. As I have said, I would have had to consider either ordering the Plaintiff to provide the security within a very short time or order that the date fixed for the hearing of the appeal should be vacated. In the balancing exercise which I have to conduct, I have concluded that the balance favours not making an order for security for costs. In reaching that conclusion, I have not overlooked Mr Cheung's point that the merits of the appeal are such that the appeal itself is close to being an abuse of process. After all, having pocketed the Australian equivalent of HK$8m. in 1996, the Plaintiff now seeks to escape the consequences of the Deed of Settlement under which that sum was paid. However, I do not think that I can sensibly form a judgment as to the merits of the appeal - even though the Defendant has already twice won below - without this hearing degenerating into a mini-hearing of the appeal.

6. For all these reasons, therefore, the Defendant's application for security for his costs of the appeal must be dismissed.