WONG KWOK SUN ERNEST v. TONG YING YUNG JAMES AND OTHERS

CACV 1564/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 1564 OF 2001

(ON APPEAL FROM HCMP NO. 1538 OF 2000)

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J U D G M E N T

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1. On 24 April Yuen J ordered the 1st and 2nd Respondents to purchase the Petitioner's shares in the 3rd Respondent. The 1st and 2nd Respondents are appealing against that order to the Court of Appeal. The Petitioner now applies for security for his costs of the appeal. The basis of the application is that the 1st and 2nd Respondents will not be able to pay the Petitioner's costs of the appeal if an award of costs is made in his favour. That is based on an assertion in para. 7 of the Notice of Appeal that the 1st and 2nd Respondents "are genuinely short of the resources" to buy the Petitioner's shares. The Petitioner's estimate of the value of the shares is $367,876.00, and his skeleton bill of the costs of the appeal prepared on the standard basis, but not taking into account the incidence of taxation, puts his costs at $241,402.00.

2. The assertion in para. 7 of the Notice of Appeal was that the judge's order ordering the 1st and 2nd Respondents to purchase the Petitioner's shares in the 3rd Respondent was flawed because the judge failed to take into account that the 1st and 2nd Respondents would be in contempt of court if they failed to do so, even when they were genuinely short of the resources to do so. Mr Gary Fung for the 1st and 2nd Respondents, who drafted the Notice of Appeal, tells me that it was not intended to assert that the 1st and 2nd Respondents did not have the resources to buy the shares but that para. 7 of the Notice of Appeal was merely an assertion that the judge had failed to take into account a potentially relevant factor. There is no reason why I should not take what Mr Fung tells me at face value. True, it was not deposed to on affidavit, but prior to today's hearing Mr Fung did not know that the Petitioner was relying on this paragraph in the Notice of Appeal to establish the impecuniosity of the 1st and 2nd Respondents.

3. There being, therefore, no evidence which raises a prima facie case of impecuniosity on the part of the 1st and 2nd Respondents, this application for security for costs must be dismissed.