EVERGREEN HONG KONG INVESTMENT LTD v. THE INCORPORATED OWNERS OF TREGUNTER AND ANOTHER

DCCJ 2256/2018

[2023] HKDC 892

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 2256 OF 2018

--------------------

--------------------

--------------------

DECISION

--------------------

(A)  Nature of Application

1.  On about 14 November 2022, the plaintiff took out the present summons pursuant to O.45 r.6 of the Rules of the District Court (Cap. 336H) and the inherent jurisdiction to, inter alia, seek directions and indorsement of a penal notice on the court order(s).  By the Order of Master B. Mak dated 20 December 2022, leave was granted to the Defendants to file their affirmation in opposition to the plaintiff's application.  The plaintiff was also granted leave to file affirmation in reply.  The plaintiff's summons was adjourned to this day for substantive argument.

(B)  Background

2.  I shall adopt the same nomenclatures that the trial judge used in his judgment of the trial of this action which was handed down on 27 September 2021 ("the Trial Judgment") and the Judgment of the Court also dated 27 September, 2021 ("2021 Judgment").  For ease of reference to the Trial Judgment and the 2021 Judgment, I set out the nomenclatures used by the trial judge:-

LR1:	living room
MAR:	maid's room
STOR:	storeroom
DR:	walk-in closet
DC:	duct chamber
MB:	master bedroom
YDB:	bedroom of the younger daughter
LR2:	the family area
ISS:	the internal spiral staircase
SH:	plaintiff's roof
EDB:	bedroom for the elder daughter
SR:	study room
Lam's Solo Report:	The expert report of Dr Lam Siu Shu Eddie (expert witness of the plaintiff) dated 1 February 2018

3.  At all material times, the plaintiff was the registered owner of a property known as Penthouse A on 33^rd Floor and 34^th Floor (including portion of the roof thereover) ("the Plaintiff's Flat") of Tower 2 of Tregunter ("the Estate"), No. 14 Tregunter Path, Hong Kong.  The 1^st defendant was the incorporated owners of the Estate.  The 2^nd defendant was the management company of the Estate.

4.  At all material times, Dr Huan was the director and shareholder of the plaintiff.  Dr. Huan, his wife and his two daughters lived in the Plaintiff's Flat.

5.  The plaintiff alleged that the 1^st defendant carried out renovation works of the external walls of all buildings within the Estate in about 2012.  The said renovation work was completed in about mid-2014.  However, since about 2013, there had been water seepage problems in the Plaintiff's Flat.

6.  The plaintiff commenced action at the Court of First Instance against the defendants in 2016 in High Court Action no. 2503/2016 which was then transferred to the District Court in about 2018, i.e. DCCJ 2256/2018.

7.  After a 6-day trial between September and November 2019, the plaintiff succeeded in most of its claim against the defendants in this action.

8.  The Trial Judgment is a detailed judgment with seven floor plans attached at the end of it.  The seven floor plans illustrated, inter alia, the affected areas and the examined areas within the Plaintiff's Flat.

9.  By the 2021 Judgment, the learned trial judge granted, inter alia, a mandatory injunction order against both defendants in the following term:-

"1.  There be mandatory injunction to direct the 1^st defendant and/or 2^nd defendant to effect due and effective repair to stop and rectify the water seepage problems at Penthouse A on 33^rd and 34^th Floor (including portion of the roof thereover) of Tower 2 (the "Plaintiff's Flat") of Tregunter ("the Estate") situated at No.14 Tregunter Path, Hong Kong within 150 days from the date hereof, including but not limited to:-

(a)  the replacement of the entire waterproofing membrane on the roof of Tower 2 of the Estate;

(b)  inspections and repairs to the Store Room ("STOR"), Duct Chamber ("DC"), Drain and its downpipe as stated in §§6.11 and 6.12 of Dr. Lam Siu Shu Eddie's solo report dated 1 February 2018 ("Lam's Solo Report");

(c)  inspections and repairs to the external walls of the stair hood ("SH") as stated in in §6.4 of Lam's Solo Report;

with certificate of satisfaction to be issued by an independent authorised person to be appointed by the parties with liberty to apply if the parties could not agree on the candidate." ("the Mandatory Injunction Order" hereinbelow)

10.  Hence, the deadline for the defendants to comply with the Mandatory Injunction Order of the 2021 Judgment falls on 24 February 2022.

(C)  Common Ground and the Indisputable Facts

11.  It is the common ground of the parties or the indisputable facts that:-

(a)  The deadline for the defendants to comply with the Mandatory Injunction Order of the 2021 Judgment falls on 24 February 2022.

(b)  The Mandatory Injunction Order has not been complied with by the defendants before the deadline on 24 February 2022.

(c)  By a letter dated 22 February 2022, the 2^nd defendant indicated to the court that it would like to apply for extension of time of 150 days to comply with the Mandatory Injunction Order (i.e. extended until 24 July 2022).  By a reply letter dated 19 April 2022 from the District Court to the 2^nd defendant, the court directed that if the 2^nd defendant intended to take out any application as stated in its letter, the 2^nd defendant was directed to take out proper application(s) by way of inter parte summons with supporting affidavits for the court's consideration pursuant to the rules of the District Court.  The 2^nd defendant was also invited to seek all parties' agreement without seeking court's directions.

(d)  The defendants had never taken out any application for extension of time to comply with the Mandatory Injunction Order.

(e)  The defendants had not taken out any application to restore the case for seeking court's directions regarding the appointment of an independent authorized person in compliance with the Mandatory Injunction Order.

(f)  More time is needed for the defendants to comply with the Mandatory Injunction Order.

(D)  Issues

12.  The issues that this court has to dispose of are:-

(a)  Whether a further deadline should be imposed on the defendants for them to comply with the Mandatory Injunction Order of the 2021 Judgment?  If yes, how much time should be given to the defendants to do so?

(b)  Should directions be given to the parties regarding the appointment of an independent authorized person?

(c)  Whether a penal notice should be indorsed on the order(s) to be served on the defendants, its directors and/or the committee members of the Estate?

(d)  Costs of and occasioned by this application.

13.  It should be noted that the plaintiff's present application is an application under O.45 r.6 of the Rules of the District Court (Cap. 336H).  The present application is not an application for committal for contempt.  O.45 r.6(1) RDC provides that:-

"(1)  Notwithstanding that a judgment or order requiring a person to do an act specifies a time within which the act is to be done, the Court shall, without prejudice to Order 3, rule 5, have power to make an order requiring the act to be done within another time, being such time after service of that order, or such other time, as may be specified therein."

14.  As the plaintiff is in contemplation of invoking the procedure of committal for contempt against the defendants, including the defendants' directors, I need not express my view regarding the nature of the defendant's non-compliance with the Mandatory Injunction Order of the 2021 Judgment for the purpose of this hearing.  Hence, whether the defendants' non-compliance with the Mandatory Injunction Order was contumelious, intentional, blatant or otherwise, shall be determined by the judge of the forthcoming committal for contempt hearing (if any).  Furthermore, without giving a full opportunity to the defendants and its directors to give evidence and reply, I shall refrain from expressing my view at this hearing in relation to their reasons or state of mind in relation to the non-compliance with the Mandatory Injunction Order, especially when the defendants' directors are not present at this hearing and they are not legally represented.

15.  However, in order to fairly dispose of the issues mentioned hereinabove, i.e. imposition of a further deadline, appointment of an independent authorized person, indorsement of a penal notice and costs order, I shall set out the parties' case hereinbelow as the basis of my determination.

(E)  The Plaintiff's Position

16.  The plaintiff took out the present Summons to seek the court's direction for the appointment of an independent authorized person.  The plaintiff also contended that water seepage problems in the Plaintiff's Flat was still recurring.  The plaintiff asked the court to impose a further deadline for the defendants to comply with the Mandatory Injunction Order within 56 days from today hereof, as the defendants' last chance, with a penal notice indorsed on the order to be made under the present summons.  The plaintiff also asked for a summary assessment of the costs of the summons on indemnity basis.

(F)  The Defendant's Position

17.  The defendants filed the Affirmation of Law Tsz Hang on 27 February 2023 in opposition of the plaintiff's Summons.  Mr Law Tsz Hang ("Mr Law") was the Assistant Property Manager of the 2^nd defendant.  He was authorized by the 1^st and 2^nd defendants to file his affirmation in response to the plaintiff's Summons.

18.  In Mr Law's Affirmation, he claimed that the defendants had taken all reasonable steps to comply with the Mandatory Injunction Order.  In particular, he said that:-

(a)  The defendants had 28 days to decide whether or not to appeal against the Trial Judgment and the 2021 Judgment.  However, according to Mr Law, the defendants did not wait until the deadline for appeal and the 1^st defendant had already instructed the 2^nd defendant to prepare for the rectification work before the deadline for appeal.

(b)  The defendants did not have the expertise in carrying out the rectification work.  The 1^st defendant entrusted the 2^nd defendant to manage the water seepage problems.  The 2^nd defendant would in turn engage professionals to carry out investigation and/or rectification work on the 1^st defendant's behalf.

(c)  In order to comply with the requirements of the Building Management Ordinance, tendering procedure was required for the appointment of an independent authorized person.  The 2^nd defendant had proceeded with the preparation of the tendering documents expeditiously without delay.  He exhibited a letter of invitation to tender addressed to AHL Project Management (International) Co Ltd ("AHL" hereinbelow) dated 26 October 2021.

(d)  Messrs. Y. C. Lee, Pang & Kwok, the then solicitors of the defendants, had ceased acting for the Defendants on or about 30 November 2021.

(e)  Because of the effect of COVID-19, the 1^st defendant encountered difficulties in convening a management committee meeting.  A management committee meeting was eventually held on 6 December 2021.  At that meeting, it was resolved that AHL was appointed to provide the "authorized person and project management services" in compliance of the 2021 Judgment.

(f)  Due to the effect of COVID-19, another management committee meeting could only be held on 24 February 2022, i.e. the deadline for compliance of the Mandatory Injunction Order.  At that meeting, it was resolved that Tai Yue Engineering Company Limited ("Tai Yue") would be appointed as the contractor to effect the rectification work in compliance with the Mandatory Injunction Order.

(g)  On about 25 March 2022, Tai Yue entered into a written contract with the 2^nd defendant to effect rectification work concerning the Plaintiff's Flat.

(h)  He was aware of the Court's reply letter dated 19 April 2022 which stated that a proper application for extension of time should be taken out and the parties could come to agreement by consent.  Mr Law said that the defendants had sent the work programme to the plaintiff's solicitors and the defendants received no adverse comment.  Therefore, the defendants believed that the agreed extension of time (i.e. extended until 24 July 2022) was agreeable to the plaintiff.

(i)  The defendants were not legally represented at that time and they did not know what to do.  They kept a close eye on the progress of the rectification work and they had to rely on AHL.

(j)  The rectification work was seriously affected due to the rainy season starting from May 2022.

(k)  In late June 2022, the defendants were informed by the plaintiff that water seepage was observed in the Plaintiff's Flat.  The defendants contended that the alleged water seepage occurred in new areas of which the defendants had never received any complaint before.  At around that time, Tai Yue reported completion of the rectification work.

(l)  Inspection and tests were therefore arranged by AHL.  In the professional opinion of AHL, AHL certified that the rectification work had been completed on 1 September 2022. A copy of Certificate of Practical Completion dated 27 September 2022 was issued by AHL.

(m)  The defendants acted on the advice on AHL or Tai Yue that the water seepage were new and had nothing to do with the rectification work which had been satisfactorily completed.

19.  Mr Yan, counsel for the defendants, confirmed with the court at his written skeleton submission and at this hearing that the defendants conceded that the Mandatory Injunction Order had not been complied with by the defendants.

20.  However, the defendants shifted the blame for non-compliance with the Mandatory Injunction Order to the plaintiff and they claimed that they had taken all reasonable steps to comply with the Mandatory Injunction Order in any event.  Mr Yan argued that:-

(a)  the plaintiff had once agreed that AHL was to be appointed as the independent authorized person for the purpose of the 2021 Judgment.  The appointment of AHL as an independent authorized person did not require the plaintiff to sign any appointment letter.  The fact that AHL also supervised the rectification work did not preclude it from being an independent authorized person;

(b)  as the plaintiff had already regarded AHL as an independent authorized person, the plaintiff's present Summons would serve no useful purpose in this regard.  Mr Yan submitted that the court should only entertain an application under O.45 r. 6 RDC if the application serves useful purpose; and

(c)  the three post-judgment expert reports of Dr Lam, expert of the Plaintiff, dated 8 November 2022 (Plaintiff's exhibit HGC-2), 9 May 2023 (Plaintiff's exhibit HGC-4) and 13 June 2023 were inadmissible as they were produced as exhibits to the plaintiff's affirmations without leave of the court.

21.  Mr Chiu, counsel for the plaintiff, disagreed with the defendants' contentions.  The independence of AHL was seriously challenged by the plaintiff.  Furthermore, Mr Chiu maintained that the purpose of taking out the present application was to give the defendants the last chance to comply with what they should have done under the Mandatory Injunction Order and the plaintiff was contemplating to invoke the contempt procedures against the defendants, their directors and the committee members of the Estate.  Hence, the plaintiff did not agree that the present application served no useful purpose.  The plaintiff also denied that the defendants had taken all reasonable steps in complying with the Mandatory Injunction Order. Mr Chiu submitted that the three post-judgment expert reports by Dr Lam were produced by affirmations of the plaintiff, they only show that water seepage was still found at the Plaintiff's Flat and that the Defendants had not performed their obligation under the Mandatory Injunction Order.

(G)  Analysis

22.  It should be noted that the Mandatory Injunction Order expressly required for a Certificate of Satisfaction to be issued by an independent authorized person within 150 days after the judgment, i.e. on or before 24 February 2022.

23.  In order to achieve the issuance of the Certificate of Satisfaction, the defendants had to effect due and effective repair to stop and rectify the water seepage problems at the Plaintiff's Flat within 150 days and the one who signed that Certificate of Satisfaction must be an independent authorized person.

24.  It is plainly wrong for the defendants to construe the term of the Mandatory Injunction Order in their own way as if they could disregard the deadline from the express term of the Mandatory Injunction Order, without seeking an extension of time.  Likewise, it is plainly wrong for the defendants to regard the so-called Certificate of Practical Completion as an alternative to the mandatory requirement of a Certificate of Satisfaction issued by an independent authorized person.

25.  Justice delayed is justice denied.  The plaintiff was first troubled by the water seepage problems at the Plaintiff's Flat back in 2013.  He first started this action in the Court of First Instance in 2016.  After a full trial of 6 days in the District Court between September and November 2019, he eventually got the fruit of his litigation which included the Mandatory Injunction Order on 27 September 2021. Unfortunately, from the deadline for the compliance of the Mandatory Injunction Order on 24 February 2022 to the date of this hearing, more than 15 months have lapsed.  The Certificate of Satisfaction under the Mandatory Injunction Order is nowhere to be seen.  It is not known when the defendants will strictly comply with the Mandatory Injunction Order by achieving the issuance of the Certificate of Satisfaction.

26.  The authority of the court and the administration of justice would be undermined if any court order, especially a mandatory injunction order, is not obeyed by a losing litigant or any person who is bound by the court order.

27.  As mentioned hereinabove, the defendants through their counsel now conceded that they had not complied with the Mandatory Injunction Order and the plaintiff is now contemplating to invoke the procedure of committal for contempt, I shall refrain from expressing my view concerning the state of mind of the defendants including their directors with respect to the non-compliance with the Mandatory Injunction Order without giving the relevant person(s) a full opportunity to answer these serious allegations.

28.  For the purpose of determination of the extended deadline, appointment of an independent authorized person, the issue of penal notice and costs, I am entitled to give my findings based on the following undisputed objective facts and evidence before me.

29.  First of all, the deadline for the defendants to comply with the Mandatory Injunction Order fell on 24 February 2022.  Up to this date, the Mandatory Injunction Order has yet been complied with.  I find that the delay and non-compliance with the Mandatory Injunction Order is very serious.  Even working on the assumption that AHL was really an independent authorized person as alleged by the defendants, the undisputed fact is that up to this date, no Certificate of Satisfaction has been issued by AHL.

30.  Secondly, I fail to understand how the Certificate of Practical Completion could be regarded as an alternative to the Certificate of Satisfaction issued by an independent authorized person as stipulated by the Mandatory Injunction Order.  The Certificate of Practical Completion dated 27 September 2022 plays no role in the Mandatory Injunction Order.

31.  The defendant's allegations of encountering difficulties in convening a management committee meeting lack particularity.  It is not shown how the pandemic had affected the management committee meetings.  It seems that those allegations about the pandemic are merely unsubstantiated and convenient excuses of the defendants. Likewise, if the pandemic had really caused difficulties in holding the management committee meeting as alleged, then the defendants failed to explain why two management committee meetings could be held on 6 December 2021 and 24 February 2022, i.e. exactly on the deadline for compliance of the Mandatory Injunction Order.

32.  On about 6 December 2021, when it was resolved at the management committee meeting of the 1^st defendant that AHL be appointed to provide ''authorized person and management services'', the plaintiff had not been invited to attend the management committee meeting.  The plaintiff had not been provided with all information or background of AHL at that time.  At today's hearing, Mr Yan confirmed that the documents of appointment of AHL was not produced as an exhibit in Mr Law's affirmation.  But Mr Yan submitted that, having considered the communication between the parties at that time, the appointment of AHL should be about one week after the management committee meeting on 6 December 2021.  From mid-December 2021 up to this date, the facts remain that no Certificate of Satisfaction has been issued.

33.  The defendants' alleged that the rectification work was seriously affected by rainy season.  This allegation is unsubstantiated.  It is not shown how the alleged rainy season had seriously affected any rectification work.  The length of delay allegedly caused by the rainy season is not shown.  It is more like another convenient excuse to explain the delay in complying with the Mandatory Injunction Order.

34.  The 2^nd defendant had once indicated informally to the court on 22 February 2022, i.e. 2 days before the deadline for compliance with the Mandatory Injunction Order, that it intended to seek extension of time.  However, the 2^nd defendant had never obtained any express consent from the plaintiff for extension of time to comply with the Mandatory Injunction Order.  The 2^nd defendant's alleged belief that the plaintiff had agreed to the extension of time was far from convincing.  Even if the 2^nd defendant really had such belief that the deadline was extended by another 150-day up to 24 July 2022, then the 2^nd defendant had failed to explain why it did not seek further extension to time after 24 July 2022.

35.  The 1^st defendant had never sought any extension of time to comply with the Mandatory Injunction Order at all.  Even assuming that the 1^st defendant was represented by the 2^nd defendant when the latter indicated to the Court that it would like to seek extension of time by its letter dated 22 February 2022, the facts remain that no application for extension of time was made.  If the defendants really believed that time had been extended by another 150-day until 24 July 2022 (which is denied by the Plaintiff), they failed to apply for extension of time after 24 July 2022.

36.  The defendants' allegation about due diligence is clearly self-serving.  They failed to obtain an express consent from the plaintiff with respect to the extension of time, they failed to make any proper applications by way of inter parte summons supported by affidavits as directed by the court on 19 April 2022.  Even if the defendants really believed that AHL was regarded by the parties as an independent authorized person (which is denied by the plaintiff), the defendants failed to achieve the necessary Certificate of Satisfaction as stipulated by the Mandatory Injunction Order.  But for the plaintiff's present application, it seems that the defendants were happy with their so-called Certificate of Practical Completion.  In Mr Law's affirmation, he stated that "the 1^st and 2^nd defendants received the advice from AHL/Tai Yue that the water seepage and/or damage [sic] were new and had nothing to do with the rectification works which had already been satisfactorily completed".  It is surprising to learn that without a Certificate of Satisfaction issued by an independent authorized person, the defendants could have regarded the rectification works as completed.

37.  Hence, it is clear that the defendants were and are in continuing breach of the Mandatory Injunction Order.  For avoidance of doubts, even if a new deadline is granted to the defendants to perform what they were ordered to do under the Mandatory Injunction Order, it does not absolve the defendants' obligation (including their directors' obligation) under the original Mandatory Injunction Order. That is to say, in the event that the defendants are in breach of this order by failing to comply with the Mandatory Injunction Order within the new deadline, the plaintiff is still entitled to rely on the whole period of delay from 24 February 2022 onwards, and to apply for holding the defendants and/or their directors liable.

38.  Defendants argued that the recent expert report of Dr Lam was inadmissible because the plaintiff has not obtained leave to file this expert report.  This argument is misconceived. It is the plaintiff's case that the defendant has failed to comply with the Mandatory Injunction Order and there is water seepage.  The plaintiff is simply trying to substantiate its complaint by the recent expert reports.  The plaintiff is not trying to adduce expert report to establish the liability of the defendants under the plaintiff's underlying claim.  The court is not trying the causes of the water seepage in 2022 or in 2023.  If the causes of the water seepage at the Plaintiff's Flat need to be determined, an opportunity should be given to the experts of the parties for them to adduce their evidence.  Mr Yan clarified the defendant's position that his argument actually related to the costs issue.

Penal Notice

39.  According to O.45 r.5(iii) RDC, where a person required by a judgment or order to do an act within a time specified in the judgment or order refuses or neglects to do it within that time, the judgment or order may be enforced by, inter alia, an order of committal against that person or, where that person is a corporation, against any such officer.  According to s.2 of the Companies Ordinance (Cap. 622), "officer" is defined as including director, manager and company secretary.

40.  For the purpose of the present case, the plaintiff adduced no evidence or made no allegations against the company secretary and manager of the defendants.  Furthermore, "officer" of the defendants is different from the committee members of the Estate.

41.  Mr Chiu fairly conceded and clarified that the plaintiff only sought to serve the orders with penal notices indorsed on the following persons:-

(a)  the 1^st defendant;

(b)  the 2^nd defendant; and

(c)  the directors of the 2^nd defendant for the time being by reason of their office as a director.  For this reason, the usual penal notice would suffice and no further penal notice is required to be indorsed under the limb of aiding and abetting rule: ref. to Cartier International B.V. and Others v Kaybee International Ltd. [1985] HKLR 127 at pp128-129; and Kot See For v Chan Leong Hang, unrep., HCMP 2323/2020, 26 February 2021, at para.9.

42.  But the plaintiff reserves its right to apply for further directions concerning the service of court orders indorsed with penal notices in case the directors of the defendants are found aiding and abetting the defendants in breaching the original Mandatory Injunction Order or the orders with extended deadline.

43.  I am satisfied that a penal notice should be indorsed on the Order to be made herein and the 2021 Judgment as well.  The purpose of the indorsing these orders with a penal notice is to spell out explicitly to the persons on whom these orders are served what they have to do.  So that they know what consequences they will take if they choose to disobey or neglect to obey these orders, before they are committed for contempt.  As the Mandatory Injunction Order of the 2021 Judgment made reference to paragraph 6.4, paragraph 6.11 and paragraph 6.12 of Lam's Solo Report, Lam's Solo Report and the Trial Judgment should also be served together with the 2021 Judgment indorsed with a penal notice, so that the person on whom the 2021 Judgment indorsed with a penal notice is served will know exactly what it or he has to do in order to comply with the Mandatory Injunction Order.  For this reason, this Decision should also be served together with this Order with indorsement of a penal notice.

44.  In the present case, I am also of the view that the penal notices to be indorsed shall be indorsed both in Chinese and English in red colour, with a reminder that the recipient shall consult legal opinion immediately if he does not understand the orders or the effect of the orders on him.

45.  All of the orders indorsed with penal notices, the 2021 Judgment, Trial Judgment, Lam's Solo Report and this Decision shall be served personally on the persons on whom service is effected: O.65 rr. 2 and 3 RDC.  Furthermore, according to Hong Kong Civil Procedure 2023 vol.1 at para.65/2/2, it is stated that "the following list of documents of which personal service is requisite, subject to para (2): ... (11) order to an act (unless it is an order for discovery or inspection of documents, O.24 r.16, or interrogatories, O.26 r.6) if it is intended to enforce it by committal (o.45 r.7)" (at p.1429).

Appointment of an Independent Authorized Person

46.  Originally, the defendants maintained the stance that AHL was jointly appointed as an independent authorized person and that any application by the plaintiff to seek directions for appointment of an independent authorized person would serve no useful purpose.  Even assuming AHL was really an independent authorized person as alleged by the defendants, the undisputed fact is that no Certificate of Satisfaction has been issued by AHL at all despite the long lapse of time.  At today's hearing, Mr Yan fairly conceded that given the serious dispute raised by the plaintiff concerning the appointment of AHL, the defendants agreed that a new independent authorized person should be nominated.  The parties came into agreement on the procedure of appointing a new independent authorized person which shall be reflected by the order made hereinbelow.

Order and Directions

47.  Having considered all evidence in this case, it is directed and ordered that:

(1)  The 1^st defendant and/or the 2^nd defendant shall comply with paragraph 1 (i.e. the Mandatory Injunction Order) of the Judgment dated 27 September 2021 in this action (i.e. the 2021 Judgment) on or before 90 days upon personal service of this Order.

(2)  Penal notice be indorsed as a front page and also on the back sheet of this Order and the 2021 Judgment.

(3)  The plaintiff shall serve this Order indorsed with a penal notice, the 2021 Judgment indorsed with a penal notice together with Trial Judgment, Lam's Solo Report and this Decision on the 1^st defendant and 2^nd defendant by personal service.  The penal notice shall be in the following terms both in Chinese and English in red colour:-

“罰則通知

若你（第一被告人或第二被告人公司全名）忽略服從或拒絕服從本命令，你可能被裁定藐視法庭，而你（及或你的董事）可能被判入獄或罰款或你的資產可能會被扣押。

如果你不明白本命令或本命令對你的影響，你必須立即尋求法律意見。

Penal Notice

If you (full name of the 1^st defendant or the 2^nd defendant) neglect to obey or refuse to comply with this Order, you may be held to be in contempt of court and you (and/or your directors) may be imprisoned, fined or your assets may be seized.

If you do not understand this order or the effect of this order on you, you must seek legal opinion immediately.''

(4)  Referring to order 3 hereinabove, an additional term of "within the specified time (於指定限期內)" shall be added immediately after the defendant's name on the first line of the penal notice in respect of this Order.

(5)  The plaintiff shall serve this Order indorsed with a penal notice, the 2021 Judgment indorsed with a penal notice together with the Trial Judgment, Lam's Solo Report and this Decision on the directors of the 2^nd defendant by personal service. The penal notice shall be in the following terms both in Chinese and English in red colour:-

''罰則通知

若你（第二被告人公司董事全名）於指定限期內忽略服從或拒絕服從本命令，你可能被裁定藐視法庭，而你（董事全名）可能被判入獄或罰款。

如果你不明白本命令或本命令對你的影響，你必須立即尋求法律意見。

Penal Notice

If you (full name of the directors of the 2^nd defendant) neglect to obey or refuse to comply with this Order within the specified time, you may be held to be in contempt of court and you may be imprisoned or fined.

If you do not understand this order or the effect of this order on you, you must seek legal opinion immediately.''

(6)  The plaintiff and the defendant shall jointly appoint an independent authorized person with 14 days from today hereof.  Otherwise, the plaintiff and the defendants shall seek direction of the court by filing one affirmation for each party within 7 days thereafter.  Leave be granted to the parties to file and serve one affirmation setting out all the information and exhibit all evidence about the appointment of their nominated independent authorized person.  Unless otherwise directed, the court shall dispose of the appointment of an independent authorized person by paper disposal including making a costs order absolute.

(7)  With liberty to apply for further directions.

Costs

48.  The plaintiff submitted a statement of costs.  Both counsel had made their submissions on costs at this hearing.  The Court has an unfettered discretion in making indemnity costs order: Cheung Wei Man Vivien & Anor v Centaline Agency Ltd HCA 286/2000, 15 December 2006, at para 4 per Lam J (as he then was); also Town Planning Board v Society for Protection of the Harbour Ltd (2004) 7 HKCFAR 114, at paras 16-18.

49.  I have taken into account of the lengthy delay and non-compliance with the Mandatory Injunction Order and the defendant's evidence contained in Mr Law's affirmation, including his assertion that the defendants received the advice of AHL or Tai Yue that the rectification works had already been satisfactorily completed. 

50.  If the defendants had discharged their duty and obligation in complying with the Mandatory Injunction Order, the plaintiff might not need to take out the present application at all.  I do not find it unreasonable for the plaintiff to conduct seepage tests by his expert and then prepare three expert reports on 8 November 2022, 9 May 2023 and 13 June 2023.  While the defendants are in continuing breach of the Mandatory Injunction Order, the plaintiff is entitled to incur reasonable costs on finding out the cause of the recurring or recent water seepage in the Plaintiff's Flat.

51.  I am satisfied that the costs incurred by the plaintiff was not unreasonably incurred.  I accept Mr Chiu submission that Dr Huan did not have the necessary expertise to find out the cause of the water seepage by himself.

52.  I am satisfied that an indemnity costs order should be imposed.  Costs is summarily assessed at HK$340,000 to be paid by the defendants to the plaintiff forthwith.

53.  I thank counsel for their assistance to the court.