SUM WING SUNG v. KWOK WING YAN VIVIAN

DCCJ 1264/2017

[2021] HKDC 1390

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 1264 OF 2017

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DECISION

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THE JUDGMENT

1.  This is a water seepage case.

2.  By a Judgment which was handed down on 24 June 2021, this court found in favour of the plaintiff and ordered the defendant to pay:

(1)  $29,400 as repair cost of the plaintiff’s Property[1];

(2)  $30,000 as general damages for discomfort and inconvenience;

(3)  interest on $29,400 to be calculated from the date of the Writ until the date of this judgment at 1% above the best lending rate of HSBC, and thereafter at judgment rate to the date of payment; and

(4)  interest on $30,000 at 2% per annum from the date of service of the writ of summons up to the date of this Judgment, and thereafter at judgment rate to the date of payment.

3.  I also made a cost order nisi that the defendant shall bear the costs of the plaintiff (including all costs reserved, if any), with certificate for counsel, to be taxed if not agreed.

THE DEFENDANT’S APPLICATION

4.  By letter dated 6 July 2021, the defendant applied to vary the said costs order nisi.

5.  The main basis relied on by the defendant in support of her variation application is that the plaintiff’s conduct had been unreasonable in that he had:

(1)  exaggerated his claim;

(2)  not demonstrated any genuine desire to settle; and

(3)  caused delay to the progress of the case.

6.  The defendant also argued that the costs of the action are seriously out of proportion when compared to the damages awarded to the plaintiff after trial.

7.  In reliance on the above grounds, the defendant proposed in her written submissions that the following orders should be made:

(1)  Costs incurred after the defendant’s without prejudice offer of $65,000 made on 2 November 2020 be disallowed;

(2)  Costs occasioned by the delay caused by the plaintiff during the 2-year period from 14 August 2017 to 28 August 2019 be disallowed;

(3)  Certificate for counsel be disallowed.  In the event certificate for counsel is granted, costs for duplicated work performed by counsel and solicitor(s) be disallowed.

8.  Alternatively, the defendant proposed that the defendant shall be ordered to bear only 15% of the costs of the action.

9.  In her written reply submissions, the defendant further proposed, as a matter of compromise, that the plaintiff shall be deprived of his costs of the trial.

10.  I will consider the defendant’s grounds in turn below.

THE DEFENDANT’S GROUNDS OF VARIATION

Exaggerated claim

11.  When this action was commenced in March 2017, the plaintiff claimed against the defendant for:

(1)  $348,635 being the costs of repair or remedial work to reinstate the part of the plaintiff’s Property which was damaged by the water seepage; and

(2)  $14,800 being the costs for engaging a surveyor for preparing an investigation report.

12.  The plaintiff’s Statement of Claim was amended in May 2020, by which a claim for “damages for distress, discomfort and inconvenience” was added.

13.  At the beginning of the trial, Mr Chung for the plaintiff accepted that the surveyor’s fees should be treated as part of the costs of the action, and therefore only two heads of claim remained.

14.  As mentioned in paragraph 2 of this Decision, the defendant was only held liable for repair costs in the sum of $29,400 and general damages in the sum of $30,000 with interest.

15.  The defendant therefore argued that the plaintiff had exaggerated his claim.  She has drawn this court’s attention to Order 62 rule 5(1)(e) of the Rules of the District Court (Cap.336H), Laws of Hong Kong) (“RDC”) which provides that, when exercising its discretion on costs, this court has to take into account the conduct of all the parties, which, pursuant to Order 62 rule 5(2)(c) of the RDC, include the consideration of whether a claimant who has succeeded in his claim, in whole or in part, has exaggerated his claim.

16.  When considering “exaggeration of claim”, I think the court should distinguish the situation where the claimant has inflated his claim dishonestly and another situation where “exaggeration” involves no more than the court having allowed only a fraction of the claim for one reason or another.  In the case of Malmesbury (James Carleton, Seventh Earl of Malmesbury) and Others v Strutt & Parker (a Partnership) [2008] EWHC 424 (QB), Jack J even distinguished 3 different levels of exaggeration:

“In my judgment, it accords with the authorities to take account of how the exaggeration of the claim has come about. I here use exaggeration to mean no more than that the claimant only recovered a fraction of his claim advanced. The worse case from a claimant’s view is where the exaggeration is deliberate and involves dishonesty as in Painting. Unreasonable conduct falls in the middle. It may occur without fault. But even where that is so it may be appropriate to reflect in the order for costs the fact that the claimant has only recovered a fraction of his claim. The appropriate order depends on the circumstances and the court must seek a solution which does justice between the parties [...]” (at paragraph 85)

17.  In the present case, the plaintiff initially claimed $348,635 as costs of the repair work.  Having heard the evidence, Mr Chung adjusted the claim downwards to $286,000 (the total of 7 items of expenses) in his closing submissions, for he accepted that part of the actual expenses had been incurred for the improvement of the plaintiff’s Property. This court had allowed 4 out of those 7 items, but the amount of special damages was only assessed at $29,400.  Be that as it may, I do not agree that the plaintiff had made his claim dishonestly.  A large part of the claim had been rejected only because this court took the view that that part of the claim should not be recoverable in law.  This is totally different from the scenario where, for example, a claimant had malingered and lied in court.

18.  It seems that the defendant’s argument on “exaggeration” may also be presented in another way, namely, that the plaintiff had raised a number of issues on quantum on which he failed.  Indeed, it is the defendant’s stance that a substantial amount of unnecessary costs had been incurred as a result thereof.

19.  In this regard, the well-known principles in In re Elgindata Limited (No. 2) [1992] 1 WLR 1207 at 1214A to D which had been set out by Yuen JA in paragraph 39 of her judgment in Wang Din Shin v Nina Kung alias Nine T. H. Wang (CACV 460/2002 and CACV 67/2003, unreported, 19 April 2005) should be considered.  Those principles are as follows:

“(i) Costs are in the discretion of the court [Order 62 r.2(4) RHC];

(ii) They should follow the event, except where it appears to the court that in the circumstances of the case some other order should be made [Order 62 rule 3(2) RHC];

(iii) The general rule does not cease to apply simply because the successful party raises issues or makes allegations on which he fails, but where that has caused a significant increase in the length or cost of the proceedings he may be deprived of the whole or part of his costs;

(iv) Where the successful party raises issues or makes allegations ‘improperly or unreasonably’ [in Hong Kong, ‘improperly or unnecessarily’], the court may not only deprive him of his costs but may order him to pay the whole or a part of the unsuccessful party’s costs [Order 62 rule 7(1) RHC]”[2]

20.  These principles were also cited by Kwan J (as her Ladyship then was) in Active Base v Roderick John Sutton ad Desmond Chung Seng Chiong, Joint and Several Liquidators of Moulin Global Eyecare Holdings Limited & Another (HCCW 470/2005, unreported, 17 October 2008).  On principle (iii) of Elgindata, her Ladyship had further explained as follows:

“(1) The party seeking to displace the general rule that costs should follow the event bears the burden of showing that the circumstances justify the exceptional course of such displacement (Mariner International Hotels Limited v. Atlas Limited (No. 2) [2007] 4 HKLRD 194 at 199, paragraph 18).

(2) The court has a discretion to exercise whether to deprive a party of all or part of his costs in respect of those issues on which he has failed. It would be wrong to read principle (iii) in Elgindata as laying down a rule, instead of a discretion. The court has to exercise its discretion to achieve a just result having regard to the circumstances of the case (Hong Kong Kam Lan Koon Limited v. Realray Investment Limited (No. 4) [2005] 4 HKC 162 at 166I to 167A, paragraph 14).

(3) Where the party who has been successful overall has failed on one or more issues, particularly where such issues have occupied a significant amount of hearing time or led to the incurring of significant expense, the court may in its discretion order a reduction in the award of the costs to him. An issue for this purpose must be something so distinct and separate in itself that the decision of it constitutes an “event” (Seepersad v. Persad [2004] UKPC 19 at paragraph 24).

(4) It is not the case that lack of success in any specific argument of itself attracts a costs sanction (Rabobank, Hong Kong Branch v. Bank of China, HCCL No. 56 of 2001, 23 July 2004,Stone J, paragraph 17). It is only if it is possible to isolate an issue in the case in that it can properly be said it is unnecessarily pursued as having no bearing on the real questions in the suit that it would be proper to deprive the successful party of all costs of that issue, otherwise a more general assessment should be made (Elgindata, supra. at 1218D to E). So unless discrete points can safely be isolated and can be shown to have led to a wastage of time and costs, the practice of the court is not to engage in any “filleting” of cases according to the success or failure of the disparate issues which, when taken cumulatively, constitute the dispute to be judged (Akai Holdings Limited (in liquidation) v. Thanakharn Kasikorn Thai Chamkat (Mahachon) (also known as Kasikornbank Public Limited Company) HCCL No. 59 of 2004, 31 July 2008,Stone J, paragraphs 28 to 31).”

(at paragraph 10)

21.  Her Ladyship continued:

“I should mention that I respectfully agree with the views of Stone J in Akai Holdings at paragraph 26 that courts in Hong Kong have not adopted the approach of more readily departing from the principle that costs should follow the event and making separate costs orders to reflect the outcome of different issues, referred to by Lord Woolf in AEI Rediffusion Music Limited v. Phonographic Performance Limited [1999] 1 WLR 1507 at 1523A to B.”

(at paragraph 11)

22.  It can be seen that there are 2 factors which this court should take into consideration:

(1)  Whether the failed issue(s) had occupied a significant amount of hearing time or led to the incurring of significant expense;

(2)  Whether such issue(s)is/are so distinct and separate in itself that the decision of it/them constitutes an “event”.

23.  I am of the view that the defendant cannot satisfy these hurdles.

24.  Firstly, while I cannot accept Mr Chung’s estimation that 90% of the time taken up by the trial was spent on liability, I do agree that a very substantial part of the trial concerned about liability. Not much time was spent on quantum, and the time spent on the failed items of expenses was minimal.   

25.  It can also be appreciated from the witness statements filed by the parties that a large majority of the content was about liability rather than quantum.

26.  Secondly, I do not think the individual items of renovation work were so distinct and separate that they would constitute an event.

27.  Moreover, even if the plaintiff was more “reasonable” in the sense that he had cut down the items which he claimed even at the early stage of these proceedings, I do not think that would have led to a settlement before trial.  The trial would have been unavoidable anyway.   I would explain why in the latter part of this Decision.

The plaintiff’s desire to settle

28.  Under this ground, the defendant is saying that the plaintiff had not been reasonable in the negotiation process and as a result, the matter could not be settled out of court.

29.  For the sake of clarity, I would set out the relevant events in chronological order below:

5 December 2016		The plaintiff’s solicitors issued a letter demanding damages of $383,435 (as “costs of repair/reinstatement work”). A surveyor’s Report was attached
11 December 2016		The defendant asked the plaintiff for “substantiation on the cost of repair/reinstatement” and asked for a breakdown of the claim of $348,635
16 December 2016		The defendant’s solicitors asked the plaintiff’s solicitors for a copy of the Surveyor’s Report
19 December 2016		The plaintiff’s solicitors provided the defendant’s solicitors with a copy of the Surveyor’s Report
27 March 2017		Service of the Writ on the defendant
23 October 2019		Mediation
30 October 2019		The plaintiff provided the defendant with a breakdown of the claim of $348,635
6 November 2019		The defendant proposed to settle the case for $7,608
8 October 2020		The plaintiff made a sanctioned offer of $195,000 (inclusive of interest) plus taxed costs
2 November 2020		The defendant made a without prejudice (“WP”) offer for the sum of $65,500 in full and final settlement of this action[3]
16 November 2020		The plaintiff made a WP offer of $345,000 (inclusive of interest and costs) in full and final settlement of this action
30 November 2020		The defendant made a WP offer for the sum of $75,500 in full and final settlement of this action
15 December 2020		The plaintiff made a WP offer of $335,000 (inclusive of interest and costs) in full and final settlement of this action
22 December 2020		The defendant rejected the plaintiff’s offer

30.  The defendant had made quite a number of points under this argument.  I will deal with them one by one.

31.  Firstly, the defendant complained that the plaintiff did not promptly provide a breakdown of his claim of $348,635.  I do not think it can be disputed that the defendant’s request for breakdown was indeed made on 11 December 2016 and that such a breakdown was not given until 30 October 2019.

32.  Mr Chung explained in his submissions that the defendant’s request was overtaken by event because the defendant had instructed a solicitors’ firm shortly after the defendant’s request for breakdown, and that the newly engaged solicitors had only requested the plaintiff’s solicitors for a coloured copy of the Surveyor’s Report by letter dated 16 December 2016, which was duly provided 3 days later.

33.  This is not a very satisfactory answer, because the plaintiff’s solicitors must have known well that the Surveyor’s Report in fact did not fully support the plaintiff’s claim, as the expert’s assessment was that the total repair and reinstatement costs would only amount to $153,000.  The plaintiff’s solicitors must also have known that if they were to properly notify the defendant the basis of the plaintiff’s claim, they would have to provide the defendant with the Building Contract (the Contract between the plaintiff and All Star Design Limited dated 16 September 2016) which showed the actual costs of renovation incurred by the plaintiff.

34.  Be that as it may, it is also a fact that neither the defendant’s newly appointed solicitors nor the defendant contacted the plaintiff’s solicitors after their receipt of the Surveyor’s Report on 19 December 2016. 

35.  Most important of all, I am of the view that even if the plaintiff had provided the defendant with a breakdown at the material time, it would not have made any difference anyway, because it can be seen from the defendant’s letter dated 6 November 2019 that, having considered the plaintiff’s breakdown, the defendant only proposed to settle these proceedings for the sum of $7,608.  The said letter did not mention about the plaintiff’s legal costs at all.   Even if the defendant’s intention was to pay for the plaintiff’s costs as well (which I doubt), the proposed settlement amount was still much less than the awarded sum.  It was just enough to cover slightly more than half of the Surveyor’s fee.

36.  I should also add that I do not accept the defendant’s argument that:

“If the plaintiff had provided the breakdown and claimed a reasonable amount, the dispute would have been resolved and these proceedings would not have been necessary.”[4]

37.  It can be seen from the defendant’s letter dated 6 November 2019 that the said proposed settlement figure of $7,608 was not arbitrarily fixed by the defendant, but after some analysis of the plaintiff’s claim by reference to the breakdown.  That being the case, I hold the view that even if the plaintiff had not claimed some of the improvement items, the defendant’s proposal would be the same, or at least, would not be anything more than $7,608.

38.  The defendant’s argument may have been stronger if her proposed settlement figure was fixed by reference to a certain percentage of the plaintiff’s claim instead of totally tied with her assessment of the merits of the plaintiff’s claim.  However, it is clearly not the position here.

39.  Secondly, the defendant alleged that the plaintiff had demonstrated no reasonable effort to settle.  Her argument is two-fold: (1) the plaintiff’s offers were unrealistic; and (2) the plaintiff failed to do better than the defendant’s WP offers.

40.  As far as the plaintiff’s offers are concerned, I do not think I can say that they were so unreasonable that the court should take them into account when it exercises its discretion on costs.  It is true that the plaintiff was unable to get any higher amount of damages after trial. However, that only means that the plaintiff could not rely on those offers and ask for a more favourable costs order against the defendant.

41.  On the other hand, the defendant’s offers were all made by way of WP letters.  Order 62 rule 5(1)(d) of the RDC provides that the court in exercising its discretion as to costs shall take into account:

“any written offer which is expressed to be ‘without prejudice save as to costs’ and which relates to any issue in the proceedings, but the Court may not take the offer into account if, at the time it is made, the party making it could have protected his position as to costs by means of a sanctioned payment or a sanctioned offer under Order 22.” (emphasis added)

42.  In Ming An Insurance Co (HK) Ltd v Ritz-Carlton Ltd (No.3) [2009] 12 HKCFAR 745, Ribeiro PJ had the following to say:

“The policy behind this rule is self-evident. If a defendant is willing to settle a claim by the payment of money, he is required to pay it into court so that there is no doubt about the seriousness of his offer of settlement. Otherwise, Calderbank Offers might be abused by defendants seeking to put off the day of judgment by promising to pay but then defaulting and requiring the plaintiff to chase them for payment.”

(at paragraph 16)

43.  In my view, the defendant could have protected her position as to costs by means of a sanctioned payment at the material time.  Therefore, the court should not take her WP offers into account.

44.  In any event, the defendant’s WP offers could not assist her, because I am of the view that the plaintiff had obtained a judgment which is better than those offers.  To recap, the defendant had made 2 further WP offers after her first offer of $7,608.  On 2 November 2020, she proposed to pay $65,500 in full and final settlement of the action.  The proposal sum was increased to $75,500 on 30 November 2020.  While these amounts were indeed more than the sum of $59,400 which was eventually awarded by this court, it must be borne in mind that those offers were supposed to cover the plaintiff’s legal costs as well.  On 16 November 2020, the plaintiff’s solicitors had informed the defendant that the plaintiff’s costs already amounted to $170,000.  Even if (for the sake of argument only) a large part of such costs were to be taxed off, I do not think it can be argued that the offer of $75,500 would be more than the total of $59,400 plus taxed costs as at 30 November 2020, not to mention the Surveyor’s fee for the preparation of expert report which the plaintiff claimed to be in the sum of $14,800.

45.  Thirdly, the defendant argued that:

“If the plaintiff had relied on the expert report from the beginning, it would have provided a reasonable basis for discussing an amicable solution and the unnecessary time spent for the entire ‘avoidable’ litigation process would have been saved.”[5]

46.  The defendant had been provided with the plaintiff’s expert report on no less than two occasions: on 5 December 2016 when the plaintiff’s solicitors made the first demand and on 19 December 2016 when the defendant’s solicitors were given the same again.  No matter how unreasonable the plaintiff’s claim was, it was up to and open to the defendant to make sanctioned payment to protect her position.  I have not forgotten the defendant’s argument that she did not get the whole picture by then because she was yet to be provided with a breakdown of the claim of $348,635.  But the objective fact is that even after she had been provided with the breakdown in October 2019, she did not make any sanctioned payment or any offer which was proved subsequently to be adequate. 

47.  This argument therefore fails.  In my view, with the defendant’s attitude towards the plaintiff’s claim, taking into account her analysis of the plaintiff’s claim set out in her letter 6 November 2019, trial was unavoidable. 

Delay

48.  The defendant then complained that while the plaintiff should have taken out a case management summons by 14 August 2017, he did not do so until 28 August 2019, which had caused unnecessary delay in these proceedings for more than two years.  Order 62 rule 7 of the RDC was relied on.

49.  The said rule provides that:

“(1) Where in any cause or matter any thing is done or omission is made improperly or unnecessarily by or on behalf of a party, the Court may direct that any costs to that party in respect of it shall not be allowed to him and that any costs occasioned by it to other parties shall be paid by him to them.

(2) Without prejudice to the generality of paragraph (1), the Court shall for the purpose of that paragraph have regard in particular to the following matters, that is to say—

(aa) the underlying objectives set out in Order 1A, rule 1;

(a) the omission to do any thing the doing of which would have been calculated to save costs;

(b) the doing of any thing calculated to occasion, or in a manner or at a time calculated to occasion, unnecessary costs;

(c) any unnecessary delay in the proceedings.

(3)     […]

(4)     […]”

50.  Mr Chung answered this argument in the following way:

“(1) This is a claim for a moderate amount. The plaintiff did not speed ahead with the case management summons because he tried to resolve the matter amicably and to minimise legal costs.

(2) At one point, the plaintiff might have taken some time to consider the way forward given that the amount of the claim was moderate, and that legal costs were likely to become disproportionate quickly. There was nothing exceptional about this.

(3) To try to save costs, the plaintiff then dispensed with the service of his solicitors and tried to negotiate for a settlement in person. But the attempt was met with a counterclaim by the defendant.

(4) What the plaintiff did was sensible and reasonable. In any event, it is difficult to see how legal costs have been wasted or what prejudice has been suffered by the defendant.

(5) Further, it is also difficult to understand how the defendant could on one hand complain that the plaintiff should have pushed the case to trial sooner, while on the other hand, she was complaining that the costs of a trial are out of proportion of the amount of the recovery.”[6]

51.  As for the reason why the plaintiff did not proceed with filing a case management summons in August 2017 right away, why there had been a delay to do so for 2 years, and why the plaintiff elected to act in person in the period between 29 April 2020 and 13 May 2020, I am afraid I cannot consider the factual assertions made by Mr Chung, for it is trite that counsel cannot give evidence from the Bar table.  In fact, what Mr Chung asserted is not supported by the objective facts, because there is no evidence that the plaintiff had made any settlement offer after the close of pleadings: The parties only attempted mediation on 23 October 2019, and the plaintiff only made his first sanctioned offer on 8 October 2020. 

52.  Having said that, I do agree that the delay of the action should not have any impact on the question of costs of the action, because of two reasons.

53.  Firstly, the defendant has not pointed to any particular item(s)  of costs which have been unnecessarily incurred by reason of such delay.

54.  Secondly, pursuant to Order 25 rule 1(5) of the RDC, if the plaintiff does not file any timetabling questionnaire or take out a case management summons, the defendant could take out the summons or apply for an order to dismiss the action.  However, the defendant did not take any such action. 

55.  In The Liquidator of Wing Fai Construction Company Limited (in compulsory liquidation) v Yip Kwong Robert & Others [2012] 1 HKLRD 589, the Court of Final Appeal had to consider the impact of the Civil Justice Reform which came into effect on 2 April 2009 on applications to strike out actions for want of prosecution (i.e. delay).  Ma CJ had the following to say:

“42.  Two specific aspects were dealt with in Birkett v James that over the years have, in my view, been controversial, namely, (a) the treatment of the limitation period and (b) the belief that a defendant to proceedings was entitled to adopt an attitude of “letting sleeping dogs lie” to proceedings which have been commenced against him.

43.  I deal with the latter first.

44.  Under the pre-CJR (and in England, the pre-Woolf Reform) system, the progress of an action was left largely in the hands of the parties themselves.  The court was passive in the vast majority of cases, only being involved when the parties chose to involve it.  Furthermore, in dealing with cases, the court would generally bear in mind only the position of the parties.  Considerations such as other litigants, the court’s own resources, procedural economy and general considerations involving the administration of justice were scarcely prominent in the way proceedings were conducted.  Quite the contrary, they were seen to be almost irrelevant considerations […]

45.  It was within this system that it was considered perfectly proper for a defendant to do little or nothing to progress an action, with the consequence that, unless the defendant was obliged (whether under Rules or by order of court) to take a step in the proceedings, he did nothing at all.  Accordingly, in the consideration of an application to dismiss for want of prosecution, the inactivity of a defendant (unless he had been obliged by the Rules or by a court order to do something) was not a relevant consideration for the court:-

(1) In Birkett v James, at 329C-E, Lord Salmon said this:-

‘These delays had become a blot on the administration of justice for it is of great public importance that actions should be brought to trial with reasonable expedition. Defendants’ solicitors might no doubt have taken out applications to dismiss for want of prosecution or for peremptory orders to compel the plaintiffs to get on with their actions. Not unnaturally they rarely did so, relying on the maxim that it is wise to let sleeping dogs lie. They had good reason to believe that a dog which had remained unconscious for such long periods of time might well die a natural death at no expense to their clients; whereas, if they were to take the necessary steps to force the action to trial, they would merely be waking up a dog for the purpose of killing it at great expense to their clients which they would have no chance of recovering. Accordingly it was unusual for summonses to dismiss actions for want of prosecution or for peremptory orders to be taken out.’

(2) This passage finds support from what was said by Diplock LJ in Allen v McAlpine at 258B-E.

46.  These statements, seemingly of principle from the highest authority in England, were applied in Hong Kong.  It gave rise to (understandably) litigation tactics on the part of defendants, whereby actions were permitted to go to sleep and an inactive plaintiff would be treated as a ‘sleeping dog’ which should not be awakened, in the hope that when it did, an application to dispose of the whole action by the defendant (in an application to dismiss for want of prosecution) could be mounted.  Defendants were simply encouraged not to progress an action to enable the real dispute between the parties to be resolved.  Prior to the Reform in England, this attitude remained one that was apparently sanctioned by the court: see Grovit v Doctor at 644F.

47.  This attitude of “letting sleeping dogs lie” is no longer acceptable post-CJR, where all parties to a litigation have the obligation to progress an action so that they are brought closer to the resolution of their dispute, rather than be distracted by litigation tactics.  It is also important to bear in mind that post-CJR, the parties and the court have at their disposal many options to enable an action to progress to the ultimate resolution of the relevant dispute.  An ‘all or nothing’ approach whereby a defendant can sit idly by while delays accumulate in the hope that, if of sufficient length, the delay can lead to a chance to apply to strike out for want of prosecution, is nowadays in my view, a deeply unattractive approach, particularly in the light of O.1A r.3 (see para. 34 above).” (emphasis added)

56.  Although Ma CJ’s view was expressed in the context of a striking out for want of prosecution application, I am of the view that the same approach should be adopted in the present case.  The common thread of this case and the Wing Fai case is that both defendants are trying to take advantage of the inaction on the part of the plaintiff.  This is no longer an acceptable attitude. 

Proportionality of the costs

57.  The defendant argued that the costs of the action are disproportionate to the amount of damages awarded and therefore it is unfair if the defendant had to bear the costs of the action.

58.  It is true that, by the end of the trial, the legal costs incurred must be much more than the amount of damages awarded to the plaintiff.  As a result, the plaintiff, the so-called successful party in this action, is in reality a loser as well, because he would most probably (if not certainly) have to pay part of his legal costs out of his own pockets. 

59.  Be that as it may, I cannot agree that the defendant should be relieved of her liability to pay the costs of the action.  As aforesaid, the defendant could have protected her position on costs by making an early sanctioned payment.  This she did not do.  More importantly, the defendant could have admitted liability, but she did not.  She had elected to dispute liability, which she had failed at the end of the day.  As a large portion of the legal costs (and a very substantial part of the trial) concerned about liability rather than quantum, I am of the view that the defendant cannot complain against having to bear such costs.

60.  The defendant further suggested that certificate for counsel should not be granted for the trial.  I disagree.  This is a water seepage case which involved expert evidence.  I have no hesitation in certifying the attendance of counsel at the trial as being proper in the circumstances of the case.

61.  The defendant also submitted that even if certificate for counsel is granted, the costs for duplicated work performed by counsel and solicitor(s) be disallowed.  This is a matter for the taxing Master to decide. 

CONCLUSION

62.  For the above reasons, I do not consider it appropriate to vary the costs order nisi dated 24 June 2021 as proposed by the defendant.  I hereby make the said costs order nisi absolute.

COSTS OF THE VARIATION APPLICATION

63.  I make a costs order nisi that the defendant shall bear the plaintiff’s costs of the variation application, with certificate for counsel, to be taxed if not agreed.    The above order nisi shall become absolute in the absence of application to vary (which shall be made by letter, if any) within 14 days hereof.  Any application to vary the costs order nisi shall be dealt with on papers.