NEW WORLD LIBERTY CHINA VENTURES LTD AND ANOTHER v. W.I.F. GLASS BOTTLE (INT'L) LTD AND ANOTHER

CACV 7/2007

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL 

CIVIL APPEAL NO. 7 OF 2007

(ON APPEAL FROM HCA nO. 2318 OF 2006)

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decision

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1.  The plaintiffs – New World Liberty China Ventures Ltd (“China Ventures”) and New World China Enterprises Projects Ltd (“China Enterprises Project”) commenced proceedings in the High Court in October 2006 against the defendants – W.I.F. Glass Bottle (Int’l) Ltd (“WIF”) and Huo Yi Min (“Huo”), seeking an injunction restraining them from publishing defamatory statements against the plaintiffs.

2.  An ex parte order was made by Deputy Judge Carlson on 17 October 2006, followed by an inter parte order by Yam J on 20 December 2006, restraining the defendants, their directors and/or officers, agents or servants from publishing defamatory statements against the plaintiffs.

3.  The defendants, by a Notice of Appeal dated 3 January 2007, appealed against Yam J’s order. Subsequently, WIF’s name was crossed out by hand from the Notice of Setting Down the Appeal although it had not been made clear if it still pursued the appeal or not.

4.  The plaintiffs, by this present application, seek security for the costs of the appeal against the defendants. The defendants did not appear at the hearing and the application proceeded in their absence.

5.  Order 59 Rule 10(5) of the Rules of the High Court gives the court discretion to order, in special circumstances, security for the costs of the appeal as may be just.

“It is a settled practice to require security for costs to be given by an appellant who would be unable through impecuniosity to pay the costs of the appeal, if unsuccessful, without proof of any other special circumstances.” (59/10/29, Hong Kong Civil Procedure 2007)

“The Court of Appeal will order security for costs upon proof that the respondent will be likely to encounter undue delay or be put to undue expense in enforcing any order for costs…” (59/10/30) and “it has long been the practice of the Court of Appeal to order provision of security where the appellant is resident abroad…” (59/10/31).

6.  WIF is a limited company with a paid up capital of $3 and its total equity balance, as of 30 June 2006, was only $330. Huo himself admitted that WIF could not afford to instruct a lawyer to act for it.

7.  Huo’s residential address, given to the Companies Registry, is in Beijing and the allegation that he is a resident out of the jurisdiction is not being challenged.

8.  I have also taken into consideration the defendants’ merits in the appeal. I am satisfied that this is a proper case for ordering security for costs against the defendants and I make the following orders:

(1) The defendants – WIF and Huo are to provide security for the plaintiffs’ costs of the appeal in the sum of $150,000 by making payment into court in cash within 28 days from the date of the service of this order;

(2) Until the defendants provide the security for costs aforesaid, the appeal will be stayed;

(3) If the defendants fail to provide the security for costs, the appeal will be dismissed forthwith without further order with costs of the appeal to the plaintiffs to be taxed if not agreed; and

(4) If the defendants comply with the order for security for costs, the costs of this application to be the plaintiffs’ costs in the cause of the appeal.

9.  If WIF no longer wishes to pursue its appeal, upon a proper notice to that effect filed and served, the aforesaid order, in so far as it may affect WIF will be amended accordingly.