LAM MABLE v. WORLD PEACE LTD. AND OTHERS

HCA 4699/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 4699 OF 2001

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J U D G M E N T

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1. This is an appeal against a costs order made by Master D Brock on 25 November 2002. I need not recite the material events here; they have been set out succinctly in an amended chronology of events prepared by Mr Wong appearing for the Plaintiff in this appeal.

2. The principles governing a judge in chambers hearing an appeal from a master's costs order are well-known. Unless the order is unreasonable, unless the master erred in law or unless he failed to take into account proper matters or took into account matters that should not have been taken into account, the judge should not disturb the master's exercise of discretion on the question of costs. See for example, The Bank of East Asia Limited v. Yeung Lam Wilson, HCMP 4077 of 1998, Chung J, 27 October 1999.

3. In the present case, I am not persuaded by Mr Wong that the case falls within any one of those exceptions. I see no reason to disturb the Master's exercise of discretion. If I had been hearing the question of costs at first instance, I would most probably have made the same order myself.

4. I agree that so far as the costs of taking out the two time summonses by the 1st and 2nd Defendants are concerned, they should be paid, as a matter of general principle, by the two Defendants to the Plaintiff. After all, the Defendants were asking for an indulgence from the Court.

5. After the taking out of those two summonses, a defence was purportedly filed by all three defendants, one of whom i.e. the 3rd Defendant had already got leave from Master Levy to file the defence out of time. Mr Wong accepts that the defence disclosed a substantive and bona fide defence. In those circumstances, there was really no justification to oppose any further the two time summonses of the remaining two Defendants, i.e. the 1st and 2nd Defendants.

6. I would also agree that, as a matter of principle, the Plaintiff should be given the costs of the 3-minute hearing before Master Erik Shum on 25 October 2002, the return date of the two summonses in question. But in my judgment, the matter ought to have stopped there and then; in other words, the two Defendants should have been given leave to file the defence which was ready for filing out of time, whereas the Plaintiff should have been given the costs of the two time summonses (up to and including that hearing). In particular, in relation to the 2nd Defendant, although he did not turn up at that hearing, there was no reason why he should not have been given leave to file the defence out of time. There was absolutely no need, in relation to him, to have a further hearing to determine anything.

7. In relation to the 1st Defendant, there was some misunderstanding at the hearing before Master Erik Shum regarding whether leave had been given by the Court to the 1st Defendant to act in person and be represented by a director. In fact, leave had been given on 16 October 2002 when the 1st Defendant took out the time summons. As it happened, the 25 October hearing before Master Erik Shum achieved nothing － the matter was adjourned for argument with estimated time of 30 minutes, the Plaintiff having failed to indicate to the Master whether she would oppose or not contest the two applications; costs were reserved.

8. As I said, in relation to the 2nd Defendant's summons, I really fail to see what was required to be further argued that would require the consumption of anything near 30 minutes of the Court's time. Therefore in relation to the costs of the 30-minute hearing which eventually took place before Master D Brock whose order made at that hearing is the subject matter of the present appeal, in my judgment, the 2nd Defendant should not be held responsible for the costs. Rather, in my judgment, as a matter of principle, the 2nd Defendant should have been given the costs of that subsequent hearing.

9. In relation to the 1st Defendant, I can understand that because of the misunderstanding regarding whether the 1st Defendant had been given leave to act in person, the Plaintiff thought that there was some justification to have a 30-minute hearing to sort things out. However, the Plaintiff was made aware of the true position at the beginning of the hearing before Master Brock, yet the Plaintiff did not there and then stopped opposing the 1st Defendant's time summons. The hearing carried on for some time before the Master eventually made his order that each party should bear its own costs, after making an order in terms of the time summonses.

10. For my part, as a matter of principle, I am of the view that the 1st Defendant should not really be held responsible for the misunderstanding that the Plaintiff had had, prior to the hearing on 25 November 2002. Put another way, at best the Plaintiff's position on costs vis-à-vis the 1st Defendant should have been that each party should bear its own costs.

11. I have set out above my views on the respective positions of the parties in relation to the taking out of the two time summonses and the two hearings before the two learned Masters.

12. In my judgment, there was nothing to stop Master Brock from taking a global view of the matter based on the above views on the individual positions of the parties regarding the three sets of costs in question, and eventually coming up with a global order that each party should bear its own costs. Put another way, the order made by the Master eventually may be justified by taking the above approach. In particular, I should emphasize that it is quite apparent that the costs involved in the second hearing before Master Brock was in respect of a longer hearing time and probably involved a longer preparation time than the 3-minute hearing before Master Erik Shum. There is much to be said for the view that in fact by taking such a global view of the parties' respective responsibilities as to costs, the Master was indeed being lenient to the Plaintiff.

13. I should add that although there were two time summonses taken out respectively by the 1st and 2nd Defendants, the two summonses were heard together by the two learned Masters at the two hearings in question. So in my judgment, Master Brock was quite entitled to take a global view of the costs position regarding the two summonses together.

14. So for all those reasons, as I said, I am not convinced that this is a case in which I, sitting as a judge in chambers hearing an appeal from the Master's order on costs, should disturb the Master's order. Alternatively, if I had to exercise the discretion afresh, I would have made the same costs order myself, having heard arguments from Mr Wong. So in other words, I dismiss the present appeal.

[Submission on costs]

15. As regards the costs of this appeal, having heard Mr Wong further, I am not persuaded that the misunderstanding relating to whether the 1st Defendant had got leave to act in person can justify or excuse the lodging of this unsuccessful appeal. As I said above, the true position was made known to the Plaintiff at the beginning of the hearing before Master Brock. Looking at all the circumstances of this case, I can see no reason why the normal rule that costs should follow the event should not apply in the present appeal. So I further order that the costs of this appeal be paid by the Plaintiff to the 1st and 2nd Defendants, such costs to be taxed if not agreed.