ALAN JOHN MUIR v. JOHN ROBERT LAMPL AND ANOTHER

HCA1172/2004 & 2666/2004
(Consolidated)

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NOS. 1172  & 2666 OF 2004 (CONSOLIDATED)

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J U D G M E N T

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1.  This is an application by the Plaintiff to discontinue this action, and the summons is dated 20 July 2005, but this case has a longer history.  In fact, today’s hearing had also been fixed for the hearing of the Defendants’ summons taken out on 15 December 2004 to strike out certain paragraphs in the statement of claim.

2.  There has been an application for security for costs by the Defendants and, on 18 January this year, Master Ho granted an order for security for costs.  The Plaintiff has not complied with that order.  An extension of time was granted by another master and that was, I think, in June this year.  Again, despite that, the Plaintiff has not complied with that order.

3.  The Plaintiff seeks to argue today that notwithstanding that he applied to discontinue the action, the general rule that he has to bear the costs consequences should not follow.  The reason advanced by Mr Chang is that the discontinuance was due to the fact that the matter will be litigated in another battlefield, namely, in the section 168A petition issued by the Defendants in the present action.

4.  Of course, Mr Chang acknowledged the general rule that was quite usefully set out by Kaplan J in the case of Inchroy Credit Corporation v Cheung Man Cheung.  On the other hand, it is clear from the judgment of Kaplan J there are situations where the court may depart from the general rule.  The question is whether I should exercise my discretion in the present case to do so.

5.  At today’s hearing, Mr Chang quite frankly acknowledged one of the considerations that the Plaintiff had taken into account in deciding to discontinue the action is because they do not want to pay the security for costs.

6.  The usual consequence of a plaintiff who failed to pay security for costs which has been ordered by the court is that, sooner or later, the action will be dismissed and the Plaintiff will have to bear the costs consequences.

7.  Although Master Ho did not make an order to the effect that in default of the payment of the security as ordered the action be dismissed, one can see that this is really coming.  There is no way for the Plaintiff to avoid that and, in my view, this is clearly the primary reason why the Plaintiff decided to take out the application for leave to discontinue.

8.  In my judgment, bearing in mind the history of the matter, particularly as regards the development since my judgment last December, the Plaintiff, in order to save costs, should have applied to discontinue the action a long time ago.

9.  I do not need to repeat the exercise Mr Whitehead performed before me in terms of going through the correspondence between the solicitors.  It is quite clear that the Plaintiff should have appreciated a very long time ago that there are paragraphs in the statement of claim that are liable to be struck out and, secondly, there is no point to pursue the present action further and, if he wished to pursue it, he has to put in the security for costs.

10.  Against this sort of background, I do not see any good reason to depart from the general rule and I will therefore order that the Plaintiff shall pay the costs of the Defendants in this action and such costs to be taxed if not agreed.

11.  As regards the conditions for discontinuing the action, I see no reason why I should not order that the discontinuance should be on condition that the Plaintiff shall not start a fresh action in respect of the same subject matters, save and except that the Plaintiff will be at liberty to canvass matters raised in the present action in the context of the 168A petition which the Defendants had issued or in the cross-petition the Plaintiff may issue with the leave of Kwan J.  There is no dispute about that by Mr Whitehead.

12.  So this is the order I make.