WING HANG BANK LTD v. RICHSUN INTERNATIONAL INVESTMENT LTD AND OTHERS

CACV 150/2004

 IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 150 OF 2004

(ON APPEAL FROM HCMP NO. 52 OF 2002)

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REASONS FOR JUDGMENT

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Hon Cheung JA (giving the reasons for judgment of the court) :

1. On 22 September 2005 we dismissed the appeal by the 4^th defendant against the order of Rogers VP dated 13 June 2005 in which the 4^th defendant was ordered to pay security for costs of an appeal he lodged against the judgment of Yam J dated 7 April 2004.  Instead we allowed the 4^th defendant an extension of 14 days to comply with the order.  These are our reasons. 

2. The security was in the sum of HK$200,000 and the order of Rogers VP provided that the appeal would be dismissed in the event of the 4^th defendant failing to provide for the security.  Time for payment was initially 11 July 2005 but Rogers VP upon the 4^th defendant’s application had extended the time of payment twice to 11 August 2005 and 18 August 2005 respectively.  The 4^th defendant did not comply with these orders. 

3. In the course of the 4^th defendant’s arguments we pointed out to him that as the order of Rogers VP provided for the dismissal of the appeal in the event the security was not furnished, his appeal against Yam J’s judgment would stand dismissed in the event we dismissed his present appeal and that the only way he could pursue the appeal against Yam J’s judgment is to apply for an extension of time to comply with the order for security.  The 4^th defendant then chose to apply for an extension of time which was opposed by Mr. Chan, counsel for the plaintiff.  Upon hearing the parties we granted extension of time to the 4^th defendant.  We would have in any event dismissed his appeal against the order for security.

4. The court may on special circumstances order an appellant to provide security for costs.  This includes the situation when the appellant is shown to be impecunious and would be unable to pay for the respondent’s costs of the appeal in the event his appeal is dismissed. 

5. The respondent had adduced evidence that the 4^th defendant’s address in Hong Kong is one of the units of the property which is the subject matter of the action and of which Yam J had found that the 4^th defendant together with the other defendants had no interest therein.  The 4^th defendant had made repeated applications for legal aid which were refused and the 4^th defendant had failed to pay the taxed costs which he and the other defendants were ordered to pay to the plaintiff by Yam J. 

6. The 4^th defendant has not filed any affirmation in opposition to the application for security.  In the circumstances there is clearly sufficient material for the court to conclude that the 4^th defendant is impecunious and is unlikely to pay for the costs of his appeal in the event the appeal is dismissed. 

7. The 4^th defendant has not demonstrated that his chance of success of his appeal is so high that he ought not to be required to pay security even if he is impecunious.

8. However, as the 4^th defendant is appealing against Yam J’s judgment as of right, we considered that a further extension of time should be granted for him to comply with the order of Rogers VP.

9. We accordingly made the orders set out in paragraph 1 herein and further ordered the 4^th defendant to pay the plaintiff the costs of the present appeal.