FAMOUS MARVEL CO LTD AND OTHERS v. CONVERSANT GROUP LTD AND OTHERS

HCA 2153/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2153 OF 2009

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BETWEEN

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D E C I S I O N

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1.  This is the 1^st and 2^nd defendants’ application for leave to appeal against my decision on costs given on 29 October 2012.

2.  Leave to appeal will be granted if the applicant can show that there is reasonable prospect of success or that there is some other reason in the interests of justice why the appeal should be heard.  Reasonable prospects of success involve the notion that the prospects of succeeding must be ‘reasonable’ and therefore more than ‘fanciful’, without having to be ‘probable’: SMSE v. KL [2009] 4 HKLRD 125, para 17.

3.  The Court of Appeal will not interfere with a judge’s exercise of discretion in the award of costs unless it can be shown that he (i) failed to exercise the discretion; (ii) exercised it upon a false principle; (iii) did not exercise it judicially; or (iv) the exercise of discretion was demonstrably flawed: Hong Kong Civil Procedure 2013,Vol 1, para 62/2/11, page 1106.

4.  The defendants do not dispute that this court has correctly stated the legal principles when considering the question of costs and that they had invited the court to determine the question of costs without waiting for the outcome of execution of the Settlement Order reached before me.  Nor do they challenge my analyses on the expert evidence.  However, Mr Chain submits that proceeding on the available evidence and concluding that the plaintiff would probably succeed at the trial was an erroneous approach in the circumstances of this case for the reasons set out in the proposed grounds of appeal.

5.  In respect of the 1^st ground, at the hearing on costs, what the defendants sought was an order for there to be “no order as to costs”. They had not asked for an order to defer the decision on costs until the answer to whether or not the 171/2006 Document actually prevented the sale and purchase from being registered (“the Event”) was known.  In any case, since I had declined to adjourn the trial (see paragraph 43 of the Decision on Costs) and proceeded to decide the question of costs immediately after the Settlement Order was made, I do not see why the court should make an order for costs dependent on the outcome of the Event, which was effectively a matter of “execution”.  There was no “speculation” on the outcome of the Event as what was done was simply to take a broad brush approach in the light of the evidence.

6.  In respect of the 2^nd to 5^th  and 7^th grounds, the defendants dispute the court’s assessment of the evidence that the 2^nd mode was for their  benefit.   Without disrespect to Mr Chain, I am unable to see an error of principle identified.  A settlement order always involves give and take.   The Settlement Order catered for more than one mode of performance.  In my view, it did not follow that the original mode was not workable.  Nor did it mean that the 2^nd mode did not give the plaintiff substantially all that they claimed for.

7.  In respect of the 6^th ground, there was no challenge to this court’s view of the expert evidence.

8.  Having considered the submission, I am not satisfied that there are any grounds of appeal that are capable of forming a sufficient basis to disturb what was effectively an exercise of the discretion on costs.  I therefore dismiss the application for leave to appeal.

9.  Entirely without disrespect to counsel, the leave application warrants only one counsel as no complex issue is involved.  I therefore order costs to the plaintiffs with certificate for Mr Dawes.

10.  I thank counsel for their assistance.