ORIENTAL PRESS GROUP LTD AND ANOTHER v. FEVAWORKS SOLUTIONS LTD

HCA 2140/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 2140 OF 2008

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BETWEEN

(Consolidated pursuant to the Order of the
Honourable Mr Justice Yam dated 23 November 2009)

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DECISION ON COSTS

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Introduction

1.  In a judgment handed down on 25 February 2011, I found in the plaintiffs’ favour in the manner set out below.  This is the decision on the costs of the actions.  The terms defined in the said judgment will also be used in this decision on costs.

2.  The actions are the Oct 2008 action (commenced in October 2008) and the Mar 2009 action (commenced in March 2009) and they were ordered to be tried together.

3.  In the Oct 2008 action, the plaintiffs complained that they were defamed by the Mar 2007 words and the Oct 2008 words while in the Mar 2009 action, a similar complaint arose out of the Jan 2009 words.

4.  Having found the words to have defamatory meanings, judgment was entered in the plaintiffs’ favour in relation to the Mar 2007 words, but the actions were otherwise dismissed (the defendants having established the defence of innocent dissemination in relation to the Oct 2008 words and the Jan 2009 words).

Issues

5.  Both parties’ primary submissions were put forth on the basis that the actions should be treated as one action.

6.  The plaintiffs argue that:-

(a)   being the successful party in the actions, they are prima facie entitled to costs by virtue of RHC Ord. 62 r. 3(2);

(b)   there were no circumstances which would justify the usual costs order laid down by the said statutory rule to be displaced by some other orders.

Alternatively, if the actions are treated as two separate actions, the plaintiffs should be awarded the costs of the Oct 2008 action and three-quarters of the costs of the Mar 2009 action.

7.  On the other hand, the defendants rely on Ord. 62 r. 5 and contend that there were special matters which justify the following costs order:-

(1)   costs should not be awarded to the plaintiffs;

(2)   three-quarters of the costs should be awarded to the defendants.

Alternatively, should the court treat the actions as two separate actions, and the defendants being the party who was partially successful in the Oct 2008 action and wholly successful in the Mar 2009 action:-

(a)   there should be no order as to costs in relation to the Oct 2008 action;

(b)   the costs of the Mar 2009 action (with additional costs since the deadline date for accepting their sanctioned payments (see para.13 below)) should be awarded to them.

Treating the Actions as One Action

8.  The special matters relied upon by the defendants under Ord. 62 r. 5 were:-

(1)   any payment of money into court (Ord. 62 r. 5(1)(b));

(2)   the parties’ conduct (Ord. 62 r. 5(1)(e) and (2)(d));

(3)   whether a party has succeeded on part of its case, even if it has not been wholly successful (Ord. 62 r. 5(1)(f)).

9.  In relation to para. 8(3) above, the defendants submit that they were successful in establishing two main issues; namely, (i) their status as the subordinate distributors (and not the publishers) of the libel, and (ii) no negligence in relation to the majority of the libel.

10.  I agree with the plaintiffs the issues in the actions were not such as should justify treating any of them as “separate events” (using the language used in Active Base Ltd. v. Roderick John Sutton & Others, HCCW 470/2005 (17 Oct 2008), para. 10(4)).  Further, merely because arguments pertaining to certain issues have been rejected does not mean they ought never be raised.

11.  In relation to para. 8(2) above, the defendants have not specified what the parties’ conduct was.  But because only the plaintiffs’ refusal to take part in mediation was mentioned in their skeleton submissions, it is reasonable to assume that to be the conduct in question.

12.  Again, the plaintiffs’ arguments in reply to this seem to have substance.  First, the legal position of the host of an internet discussion forum in relation to a libel is a point of law which can have implications beyond the actions.  Secondly, the amount awarded does not appear to be one which could have been acceptable to the defendants (resulting in a successful mediation) in view of the sanctioned payments they paid into court (see para. 13 below).  Thus, the plaintiffs’ refusal to mediate should not be given much weight.

13.  In relation to para. 8(1) above, the defendants made a sanction payment of $101 in each of the actions.  In view of the judgment sum awarded to the plaintiffs, the sanctioned payments should not substantially affect the decision on costs.

14.  However, despite my earlier conclusion in para. 10 above, for the reasons set out in para. 15 below, I regard this to be a case where both sides can claim, with some justification, to be the winner in substance.

15.  It is true the plaintiffs have succeeded in obtaining monetary judgment the amount of which is far from being nominal.  But that does not reflect the whole picture; indeed, it can legitimately be argued that the plaintiffs’ success was limited to only one of the 3 occasions complained of.

16.  Consequently, in relation to costs, justice is best served by ordering the defendants to pay one-third of the costs of the actions since the order of 23 November 2009 (directing the actions to be tried together).  The costs before 23 November 2009 will be discussed below.

17.  To assist those involved in the taxation of costs (should the parties fail to agree on costs), the above costs order will entail two bills of costs (one for each of the actions) to be prepared for the costs incurred on and after 23 November 2009, and for taxation to proceed on that basis.

Treating the Actions as Two Actions

18.  Because of the conclusion reached above, it is inappropriate to treat the actions as two separate actions after the order directing a joint trial has been made (see para. 1 and 16 above).

19.  However, before 23 November 2009, they were two actions, albeit the issues involved were almost the same (save as to damages perhaps).

20.  The defendants have been successful in defending the Mar 2009 action but have failed to do so in relation to the Oct 2008 action.

21.  In these circumstances, and bearing in mind the objectives set out in Ord. 1A, the proper order would be that the parties are to bear their own costs of the actions incurred before 23 November 2009.