RE TAM MEI KAM

CACV 39/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 39 OF 2014

(ON APPEAL FROM HCB NO. 3777 OF 2011)

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Hon Chu JA giving the Judgment of the Court:

Introduction

1.  By judgment handed down on 11 August 2014 (“the Judgment”), this court (Chu JA and Barnes J): (1) dismissed Madam Tam’s appeal against the decision of Kwan JA given on 4 July 2014 ordering her to provide $307,000 as security for the costs of her appeal against the decision of L Chan J; (b) ordered that she provides by 15 September 2014 further security in the sum of $50,000 on account of the costs of the appeal against Kwan JA’s decision; and (c) extended the time for providing the security ordered by Kwan JA to 15 September 2014.

2.  By an Application filed on 19 August 2014, Madam Tam applies for leave to appeal to the Court of Final Appeal against the Judgment. By a summons filed on 11 September 2014, Madam Tam further applies to extend the time for complying with Kwan JA’s order as varied to after the final disposal of her application for leave to appeal to the Court of Final Appeal. Both applications are opposed by Madam Tam’s trustees in bankruptcy (“the Trustees”).     

3.  The parties have no objection to the application for leave being disposed of on paper. Following the Court’s directions, they had lodged and served their written submissions on the application and also on the application to extend time, which is to be considered together with the application for leave to appeal.

Application for leave to appeal

4.  Although it has not been clearly specified in the Application, it will appear that Madam Tam makes her application for leave to appeal under section 22(1)(b) of Hong Kong Court of Final Appeal Ordinance Cap. 484,which provides:

“(1) An appeal shall lie to the Court –

…

(b) at the discretion of the Court of Appeal or the Court, from any other judgment of the Court of Appeal in any civil cause or matter, whether final or interlocutory, if, in the opinion of the Court of Appeal or the Court, as the case may be, the question involved in the appeal is one which, by reason of its great general or public importance, or otherwise, ought to be submitted to the Court for decision”.

5.  Madam Tam raises three grounds in support of her intended appeal to the Court of Final Appeal:

(1) The appeal involves questions of great general or public importance, namely,

“(a)  Whether the Court of Appeal in an application for Security for Costs when faced with a necessity to form a view on the true statutory construction of a particular piece of statue, which uses plain, unambiguous and unequivocal language, is obliged to form a definite view, or merely a purported preliminary view, of the true statutory construction of the piece of statue, when due administration of justice and the interest of justice is at stake?” (“Question 1”)

“(b) Whether the Court of Appeal in determining a particular conduct of a holder of public office is abusive or not, should only look at whether such conduct ought to be committed at all, rather than to conclude no abuse only on the wrong basis that such conduct be lawfully carried out, the Court would share the same conclusion, i.e. the sole basis to determine abuse or not ought to be any lawful basis to do the act complained?” (“Question 2”)   

(2) Leave to appeal ought to be granted under the “or otherwise” limb because there has been miscarriage of justice and that substantial and grave injustice has been done to her in that:

“(a) There is a sum of HK$2M odd at stake, determinative merely and solely on the true statutory construction of s.43(1) of Cap. 6. To shut out an appeal purely on a straightforward point of law on the basis of unjustified Security for Costs would be grossly unjust.

(b) The conduct of the Trustee in Bankruptcy is plainly and clearly prima facie questionable. To shut out an appeal against such questionable conduct on the basis of Security for Costs would be grossly unjust.”

(3) Having regard to the overall circumstances of the case, justice requires that leave to appeal be granted.  

6.  Dealing with the first ground of appeal, we do not accept that either Question 1 or Question 2 carries any great and general public importance. With regard to Question 1, the principles governing application for security for costs of appeal are well settled. In Chung Kau v. Hong Kong Housing Authority & Ors [2004] 2 HKLRD 650, 656D-G, Ma CJHC (as The Chief Justice then was) set out the relevant principles and said, inter alia,:

“(3) On a consideration of the merits of the appeal, while a detailed examination is not required (or desirable, even if possible on the materials before the court at this stage), the court should form some sort of preliminary, even instinctive, view. Where the merits appear to go strongly one way or the other, this may by itself be a decisive factor. Thus, an appeal which is very strong would often be a very good reason not to order security. The converse of course also applies. A hopeless appeal may even by itself justify an order for security. However, if the court takes the view that the appeal could really go either way, then generally it will look to the existence of any other factors to tilt the balance, in the absence of which security will be ordered. This is of course on the assumption that a factor such as impecuniosity has already been demonstrated.” (emphasis added)

7.  We are further of the view that Question 1 is not reasonably arguable. Firstly, given that security for costs application is an interlocutory application, it is not the occasion for the parties to rehearse their arguments on the appeal in great details. Accordingly, it is only appropriate that the Court should refrain from engaging in detailed assessment of the merits of the appeal.  It also follows that the Court needs not and should not express a conclusive view on the merits of the appeal.

8.  Secondly, as pointed out in the Trustees’ written submission, the approach advocated by Question 1 is incompatible with the underlying objectives of the Civil Justice Reform as set out in Order 1A rule 1 of The Rules of the High Court, Cap. 4A, in particular, the emphasis on costs effectiveness, proportionality and procedural economy.

9.  Thirdly, insofar as Question 1 seeks to suggest that different consideration or approach should apply to an appeal involving statutory construction, the written submission of Madam Tam has not set out the reason or basis for it. There is only a bare statement that the true construction of section 43E(1) of Cap.6 is a very straightforward matter and the Court ought to form a definite view on it.  In any event, this Court has indicated in the Judgment that in our preliminary view, the judge’s construction of the section is right and we do not find any strong merits in Madam Tam’s challenge to it.

10.  As for Question 2, this is based on a misreading of the Judgment: see paragraphs 33 to 35. We did not accept there are merits in Madam Tam’s complaint that the Trustees’ behaved abusively in making a new assessment of Madam Tam’s reasonable needs after the Official Receiver had already done an assessment. This is because the Trustees are under an obligation to maximise the estate in bankruptcy for the benefit of the creditors and they are not bound by the Official Receiver’s assessment of Madam Tam’s reasonable needs or proposal on the amount of monthly payment to be made to her. Although in the Judgment we had observed that the Trustees’ re-assessment proved to be justified in light of the judge’s decision, this does not form the legal reasoning underlying our view that the complaint of abusive conduct has no merits.

11.  Turning to the second ground of appeal, it is trite that the granting of leave to appeal under the “or otherwise” limb is an exceptional course, and the threshold requirement for invoking the Court’s discretion under this limb is a high one: Chao Keh Lung v. Don Xia (2004) 7 HKCFAR 260, 263 at para. 9.

12.  The particulars in support of this ground of appeal are in essence repetitions of Madam Tam’s arguments on the construction of section 43E(1) of Bankruptcy Ordinance and the Trustees’ conduct. It is argued that to shut out her appeal would be a miscarriage of justice and would cause grave and substantial injustice to her. As said in the Judgment, these arguments lack merits. There is no basis for granting leave under the “or otherwise” limb.   

13.  There is also no merit in the third ground of appeal, which is not an independent ground.

14.  For the above reasons, Madam Tam’s application does not come within section 22(1)(b) and ought to be dismissed.

Application for extension of time

15.  On the application for extension of time, the time for complying with Kwan JA’s order as varied and this Court’s order dated 11 August 2014 has lapsed on 15 September 2014. The Trustees do not appear to object to extending the time for Madam Tam to provide the security. We will therefore extend the time to 14 days from the date of this judgment.

16.  The Trustees are contented with an order that their costs of the Application and the summons be costs in the appeal. We so order.

Disposition

17.  Accordingly, we make the following orders:

(1) The Application filed on 19 August 2014 is dismissed.

(2) The summons filed on 11 September 2014 is dismissed.

(3) The Trustees’ costs of the Application and of the summons be costs in the appeal.

(4) The time for complying with: (a) paragraph 1 of the order dated 4 July 2014 (as varied by the order dated 11 August 2014); and (b) paragraph 4 of the order dated 11 August 2014 is extended to 14 days from the date of this judgment.