CHOI CHUNG BUN VINCENT v. AUSTRALIA CHINA HOLDINGS LTD

HCA 539/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 539 OF 2009

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BETWEEN

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DECISION ON COSTS

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1.  There are 3 issues that fall for my determination.

2.  The first is whether I have jurisdiction to hear the application.  The jurisdiction issue arises because the applicant is out of time to apply for leave to appeal and its application for an extension of time is also filed outside of the 14 day appeal period.  As Order 59 rule 2B is silent on the power of the court to grant an extension of time in which to appeal, the source of the court’s power can therefore only be Order 3 rule 5.  The problem faced by the applicant is that there is a decision of Chu J (as she then was) in Wynn (Macau) SA v Mong Henry [2009] 5 HKC 515 to the effect that Order 3 rule 5 does not apply to applications for leave to appeal.  This decision was followed by To J in Menno Leendert Vos v Global Fair Industrial Limited and Others HCA 4200/1995.  In his judgment To J added his own very cogent reasons to those of Chu J as to why Order 59 rule 2B created a new regime for applications for leave to appeal ‑ a regime whose purpose was to more effectively reflect the goals of civil justice reform.  The applicant argues that I should depart from these decisions.  I have carefully considered the arguments and authorities relied upon by the applicant but am not persuaded that I should not follow the decisions of Chu J and To J and decline his invitation to do so.

3.  Consequently I rule that I have no jurisdiction to hear the applications for an extension of time and for leave to appeal.

4.  However, if I am wrong in this respect I shall consider the other two issues that arise for determination.  The second issue is whether, assuming the O. 3 r 5 powers are available to me, I should exercise my discretion favourably to the applicant and grant the extension of time which the applicant needs in order to seek leave to appeal.  In support of his application the applicant has filed an affirmation explaining how the applicant came to be out of time. However all this affirmation reveals is that the applicant’s previous solicitors miscalculated the appeal period and inadvertently filed the application for leave to appeal on the 15^th day rather than the 14^th. But this affirmation does not explain why the application could not be filed earlier than the last day of the appeal period.  Indeed the absence of such explanation suggests that a considered decision was made, for tactical or other reasons, to leave the filing of the application for leave until the last day of the appeal period.  But unfortunately for the applicant, his solicitors miscalculated when the last day of the appeal period fell.  Whatever might the reason, the consequence is that I am left without any explanation for why the application could not be filed within the time allowed by the rules.  In these circumstances, I would have declined to grant an extension of time had I the power to do so.

5.  The third issue is whether leave should be granted.  The application is made on the basis that in respect of the appeal from the master, costs should have followed the event and there was no basis for departing from this principle. However, this was no ordinary appeal.  It was a rehearing of an application to set aside default judgment and the applicant has not been able to produce any authority in support of the propositions either that in respect of such appeals costs should follow the event or that in respect of such appeals the court cannot take into account the nature of the underlying application when exercising its costs discretion.  Secondly, the applicant failed on the jurisdiction issue and other issues which consumed much time in argument at the hearing of the appeal.  Furthermore, as is evident from my judgment, I formed an adverse impression of the credibility of the applicant, particularly in respect of its explanation as to how it came about that it was not made aware of the proceedings. 

6.  In order to succeed on its application, the applicant must satisfy me that the appeal “has a reasonable prospect of success” (Section 14AA(4)(a) of the High Court Ordinance).  What this means was explained by Chu J in the Wynn Resorts case at paragraph 19, page 519 of the report:

“To meet the “reasonable prospect of success” test, an applicant is required to show more than just an arguable case, but an appeal that has merits and ought to be heard, although he does not have to demonstrate that the appeal will probably succeed.”

7.  I am not persuaded that, in the circumstances, had I the jurisdiction to hear the application for leave, this would have been an appropriate case in which to grant leave to appeal.  I dismiss this application and award the costs of the application to the respondent.  Costs to be paid forthwith.