JOSE MIRANDA DA COSTA JUNIOR AND ANOTHER v. LORENZO YIH AND OTHERS

HCMP 2696/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO. 2696 OF 2013

(ON AN INTENDED APPEAL FROM HCA NO. 156 OF 2010)

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DECISION ON COSTS

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Hon Kwan JA (giving the decision of the Court):

1.  In our decision handed down on 7 January 2014, we refused leave to appeal to the Court of Appeal and made an order nisi that the 1^st defendant should pay the 1^st plaintiff’s costs of this application on an indemnity basis. The 1^st defendant seeks to vary the order nisi to costs on a party and party basis.

2.  It was submitted on his behalf that in awarding indemnity costs, the court should be concerned principally with the losing party’s conduct of the case, rather than the substantive merits of his position, and there are no special or unusual features in the present case to warrant the award of costs on an indemnity basis.

3.  We do not agree that the court’s discretion to order indemnity costs should be fettered in the manner as contended.  This discretion is not to be fettered or circumscribed beyond the requirement that taxation on an indemnity basis must be appropriate (Town Planning Board v Society for Protection of the Harbour Ltd (No 2) (2004) 7 HKCFAR 114 at 124 §17).

4.  We are of the view that it is entirely appropriate to award indemnity costs in this situation.  The 1^st defendant’s application to strike out parts of the prayer for relief in the Amended Statement of Claim was so “misconceived and palpably unarguable” that the court below had no hesitation in refusing leave.  Given that the onus is on the applicant of a strike out application to make out a plain and obvious case, the 1^st defendant should not have persisted in taking his application to the Court of Appeal.  The leave application is wasteful of the court’s time and the resources of the 1^st plaintiff who has to resist it.

5.  We make an order affirming the award of costs to the 1^st plaintiff on an indemnity basis, such costs on an indemnity basis to include the unsuccessful application of the 1^st defendant to vary the costs order nisi.

6.  On the basis that costs are to be taxed on an indemnity basis, we have assessed the statement of costs submitted by the 1^st plaintiff summarily.  We reduce the costs claimed from $129,348 to $103,448 and award this sum to the 1^st plaintiff.  We have disallowed the costs in item D1, as costs for the drafting of a statement of costs in the summary assessment procedure are generally not granted (Practice Direction 14.3, §13).