LO SUI LIN v. CHAN HUNG FOOK AND OTHERS

CACV 156/2017

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 156 OF 2017

(ON APPEAL FROM HCMP NO 41 of 2016)

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REASONS FOR JUDGMENT AND
DECISION ON COSTS

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Hon Lam VP (giving the Reasons for Judgment and Decision on Costs of the Court):

1.  This appeal was brought by the Plaintiff in respect of the judgment of Deputy High Court Judge Le Pichon of 14 June 2017. The Notice of Appeal was served on 11 July 2017. The appeal was set down on 20 July 2017.

2.  In the meantime, a bankruptcy order was made against the Plaintiff in HCB 2778 of 2017.  Solicitors for the Defendants learnt of the bankruptcy by conducting a bankruptcy search.

3.  Before the appointment of trustees in bankruptcy, the Official Receiver, in the capacity of provisional trustee had liaised with the Plaintiff as to the continuation of this appeal.  Due to the inability of the Plaintiff to provide indemnity on costs to the Official Receiver, the provisional trustee decided not to adopt the appeal and informed the Plaintiff accordingly on 11 September 2017.

4.  Subsequently, Mr John Lees and Tsui Chi Chiu were appointed as joint and several trustees of the property of the Plaintiff.  By a letter of 28 September 2017, the joint and several trustees confirmed to the Court that they had no objection to have the appeal “discontinued forthwith”.

5.  The Registrar of Civil Appeals directed submissions to be lodged on the disposal of the appeal in light of these developments.

6.  The Plaintiff did not lodge any submissions.

7.  Solicitors for the Defendants lodged a set of submissions on 24 October 2017 and filed a summons on the same date asking for an unless order in terms of lodging of appeal bundles by the Plaintiff.

8.  The summons is wholly unnecessary and misconceived.  As stated by the Registrar in the directions of 25 October 2017, upon the making of the bankruptcy order, the right to continue with the appeal vested in the trustees and the Plaintiff herself ceased to have any right to proceed further, see Section 58 (1) of the Bankruptcy Ordinance, Chung Kau v Hong Kong Housing Authority [2004] 2 HKLRD 650; 張榮焜 對 香港出口信用保險局 [2012] 2 HKLRD 1249.  An unless order directing the Plaintiff to take any further step in the appeal is inappropriate and meaningless.

9.  The proper course is to seek a dismissal of the appeal on the ground that trustees, as the proper person having the right to proceed with the appeal, have indicated that they would not proceed with the same: see Lee Pui Chun v Cheng Chi Wah CACV 241 of 2013, 25 July 2017.

10.  The Court therefore directed the appeal be listed for hearing to consider if it should be dismissed on this ground.

11.  At the hearing, Madam Lo and solicitors for the Trustees had no objection to the dismissal of the appeal. Mr Yiu confirmed that the Trustees would not be proceeding with the appeal.

12.  We do not see any reason why the appeal should not be dismissed in light of the bankruptcy and the refusal of the trustees to proceed.

13.  We therefore dismiss the appeal and, in line with the practice explained in First Asia Finance Ltd v Tsoi Tin Kwan Fanny CACV 149 of 2015, 18 Sept 2017, we make an order that the Plaintiff shall bear the costs of the Defendants in the appeal except the costs in respect of the summons of 24 October 2017 (which as explained above was unnecessary and misconceived). For the avoidance of doubt, the Defendants may have the costs of the submissions lodged pursuant to the direction of the Registrar. As explained in First Asia Finance, the costs order cannot be enforced and taxation cannot be proceeded with without leave from the Bankruptcy Court under Section 12(1) of the Bankruptcy Ordinance. 

14.  We would add that in the future, in order to save costs and avoid unnecessary hearings, the Court will process the dismissal of an appeal in similar situations on the papers unless any party involved requests an oral hearing after the Registrar for Civil Appeals gives a direction for intended dismissal to the parties.