GHALAY ROMA v. SECRETARY FOR JUSTICE sued for and on behalf of DIRECTOR OF IMMIGRATION

DCCJ 1155/2021

[2025] HKDC 493

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 1155 OF 2021

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DECISION

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1.  On 19 February 2024, the plaintiff accepted the defendant’s sanctioned payment of HK$55,055 in settlement of her whole claim (“Sanctioned Payment”).

2.  By a joint letter dated 12 December 2024 (“first letter”), the court was informed that the defendant would invoke the “otherwise proviso” in Order 22, rule 20(1) of the Rules of the District Court (“RDC”) but the parties were unable to reach an agreement on the scale or level of costs to be awarded to the plaintiff. The parties invited the court to make a determination on the papers. Directions were given for the parties to lodge written submissions.

3.  By a second joint letter dated 30 December 2024 (“second letter”), the court was further informed that the parties had reached an agreement for the plaintiff’s costs to be taxed on District Court scale if not agreed and that they were applying to withdraw the first letter. The court did not endorse their agreement and reiterated its directions for written submissions.

4.  The Department of Justice (“DOJ”) lodged submissions on behalf of the defendant on 24 January 2025. The plaintiff’s submissions were contained in her solicitors’ letter dated 12 February 2025.

5.  This is my decision on the scale or amount of costs to be paid by the defendant to the plaintiff in this action.

The law

6.  Order 22, rule 20(1) provides:

“Where a defendant’s sanctioned offer or sanctioned payment to settle the whole claim is accepted without requiring the leave of the Court, the plaintiff is entitled to his costs of the proceedings up to the date of serving notice of acceptance, unless the Court otherwise orders.”

7.  The relevant principles are well established: see para 22/20/A of Hong Kong Civil Procedure 2025. For present purpose, it may be noted that:

(a)  There is a prima facie rule that upon acceptance of a sanctioned payment, the plaintiff should be entitled (i) to his costs of the proceedings up to the date of serving notice of acceptance and (ii) to have such costs taxed on District Court scale in accordance with Order 62 of the RDC.

(b)  The prima facie rule is displaced if (i) the plaintiff has been given prior warning that the defendant would invoke the “otherwise proviso” and (ii) the defendant manages to show “exceptional circumstances” that justify departure.

(c)  Acceptance of a sanctioned payment of an amount less than the lower limit of the financial jurisdiction of the court in which the proceedings were brought is an example of “exceptional circumstances”.

(d)  There may be other considerations, such as the complexity of the factual and legal issues involved which would justify proceedings being brought in a higher court despite the lower court having financial jurisdiction.

(e)  On the other hand, the plaintiff may seek to demonstrate that in the light of the evidence and information available to him when proceedings were commenced, he enjoyed reasonable prospect of recovering a sum in excess of the limit of the financial jurisdiction of the lower court.

(f)  In considering what constitutes “exceptional circumstances”, it may be necessary for the court to look at or take into account (i) the merits of substantive issues which have not been fought to a conclusion and (ii) the underlying objectives set out in Order 1A, rule 1 of the RDC, (iii) any Calderbank offers and (iv) conduct of all the parties.

8.  The burden to establish “exceptional circumstances” is on the party seeking to invoke the “otherwise proviso” and the threshold is high. As explained in Etratech Asia-Pacific Ltd v Leader Printed Circuit Boards Ltd [2013] 2 HKLRD 1184:

“19. … What the prima facie rule does is to create certainty as to the costs consequences upon acceptance of the sanctioned payment or sanctioned offer. A party knows the exact extent of his exposure or entitlement to costs, as the case may be. Thus he will not be inhibited in proposing or accepting an otherwise reasonable offer to settle, as the case may be, because of uncertainty as to the costs consequences. This surely facilities the principal objective of sanctioned payments and sanctioned offers, which is to encourage the parties to take positive settlement seriously and avoid unproductive and expensive prolongations of the litigation, resulting in more early settlements: Montrio Limited & Anor v Tse Ping Shun David.

20. By virtue of the Otherwise Proviso, the court retains the discretion to depart from the prima facie rule where necessary. But the discretion should only be exercised in exceptional circumstances that clearly warrant a different costs order. Otherwise, the certainty as to costs consequences created by the prima facie rule, one of the very important features underpinning the effectiveness of sanctioned payments and sanctioned offers, will be greatly diminished.”

9.  It was said in Wong Chim Hing v Discovery Bay Transit Services Limited, unreported, HCPI 254/2011, 7 November 2014, that the fact that the sanctioned payment that had been accepted is below the jurisdiction of the court in which the proceedings were brought may be counterbalanced by some good reason to justify the proceedings being brought in that court (para 21). Furthermore, the court should not readily apply the “otherwise proviso” where the amount of the sanctioned payment is close to the jurisdictional limit of the court in which the proceedings were brought as to do so would unduly penalise a plaintiff who enjoyed good prospects of securing a judgment after trial within the jurisdiction of that court, but who was willing to settle at a discount to avoid the risks of litigation and in order to achieve a speedy resolution of the case (para 22).

The defendant’s stance

10.  Recognizing the burden that he had to meet, the defendant submits that:

(a)  It can reasonably be inferred from the plaintiff’s acceptance of the Sanctioned Payment that there was no merit for her to pursue and continue her claim in the District Court.

(b)  The fact that the case is settled at HK$55,055 which falls below the lower jurisdictional limit of the District Court ($75,000) is a recognized “exceptional circumstances” that justify the application of the “otherwise proviso”.

(c)  This is a typical damages claim by a non-refoulement claimant with no complex factual or legal issue that necessitates legal representation. The claim was well suited for the Small Claims Tribunal (“SCT”).

(d)  The plaintiff did not quantify her claim in her pre-action letter or Statement of Claim. She only made a settlement offer in April 2023 about 2 years after the action, which was rejected by the defendant.

(e)  A reasonable period of about 6 to 8 weeks should be allowed for the authorities to process the plaintiff’s non-refoulement claim: see Sundari v Secretary for Justice sued for and on behalf of the Director of Immigration [2023] 4 HKLRD 735 at paras 32 to 33.

11.  Making reference to the underlying objectives, the defendant submits that it is not cost-effective, not a proportionate conduct of proceedings and not consistent with fair distribution of judicial resources to pursue a claim in a higher (and more expensive) forum: see May Fung Co Ltd v Wing Lung Industrial Ltd and others [2009] 5 HKLRD 590.

12.  The defendant says he only agreed to the proposal set out in the second letter having regard to recent decisions of Sri Purwati Muhasim v Secretary for Justice sued for and on behalf of Director of Immigration [2024] HKDC 1314, Avtar Singh v Secretary for Justice sued for and on behalf of Director of Immigration [2024] HKDC 1529, Jasbir Singh v Secretary for Justice sued for and on behalf of Director of Immigration [2024] HKDC 1540, and Tarjinder Singh v Secretary for Justice sued for and on behalf of Director of Immigration [2024] HKDC 2042. Despite the genuine attempt on his part to settle, the plaintiff insisted on claiming grossly disproportionate costs and disbursements in the total sum of HK$274,350.

13.  The defendant therefore proposes that:

(a)  Insofar as the court is minded to apply the “otherwise proviso”, to follow the Court of Appeal’s decision in Cheung Yu Tin v Ho Hon Ka [2006] 2 HKLRD 674 in allowing costs on a scale similar to that of the SCT and summarily assessing the plaintiff’s costs at HK$120 (representing the filing fee at the SCT and disallowing other legal costs and disbursements).

(b)  Insofar as the court is not persuaded to apply the “otherwise proviso”, to summarily assess the plaintiff’s costs on District Court scale at no more than HK$15,000.

The plaintiff’s stance

14.  The plaintiff argues that it was reasonable for her to commence this action in the District Court (as opposed to the SCT) having regard to the following authorities:

(a)  MD Tanjer v Secretary for Justice sued for and on behalf of Director of Immigration, unreported, DCCJ_3804/2011, 24 January 2017;

(b)  A v Director of Immigration [2009] 3 HKLRD 44;

(c)  Abid Saeed v Secretary for Justice [2015] 2 HKC 187; and

(d)  more recent decisions of Govindan Sakhivel v Secretary for Justice sued for and on behalf of the Director of Immigration [2023] 4 HKLRD 721, Sundari and Sri Purwati Muhasim.

15.  The plaintiff complains that the DOJ did not respond to her pre-action letter dated 17 February 2021. Had the DOJ responded, so it is argued, the claim could have been settled as early as in the pre-action stage.

Discussion

16.  In this case, the plaintiff was warned by the letter dated 6 February 2024 that the defendant would invoke the “otherwise proviso” to apply for an order that the plaintiff be awarded costs on a scale similar to that for cases before the SCT should the Sanctioned Payment be accepted.

17.  Now that the plaintiff has accepted the Sanctioned Payment, the crucial question is whether the defendant succeeds in establishing “exceptional circumstances” to displace the prima facie rule.

18.  It is the plaintiff’s case that she was detained in breach of the Hardial Singh principles for 178 days. She also complains that she was strip-searched in the sight of other detainees. Both complaints were denied by the defendant. As the court observed in para 26 of Sundari, the most important factor in determining the amount of damages to be awarded to the plaintiff in such circumstances is the period of detention.

19.  The court recently observed in Govindan Sakhivel at para 25 and Sundari at paras 29 to 33 that a reasonable period of 6 to 8 weeks for the Director of Immigration to process the claimant’s non-refoulement claim should be factored in. But these cases were decided in 2023 after the commencement of this action and could not have guided the plaintiff on the question of forum.

20.  The plaintiff’s solicitors say they considered MD Tanjer before deciding to commence this action in the District Court. In that case, the plaintiff accepted the defendant’s sanctioned payment of HK$35,000 in settlement of his claim. At that time, the lower jurisdictional limit of the District Court was only HK$50,000. The court was “not satisfied that it was obvious to the plaintiff or his legal advisers, at the time of issuing of the writ of summons, that this case should have been commenced in the SCT rather than the District Court.” (para 26) In relation to quantum of damages, the court said:

“22. … both parties accepted that there is no pure arithmetic approach in assessing damages in such alleged torture claimants’ unlawful detention cases. Generally speaking, ‘for a short period of false imprisonment, the award can be, relatively speaking, substantial, while for any further period of unlawful detention, the progressive reducing scale will be very steep’...

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25. … in my view, it is difficult to make a direct comparison of such cases as each claimant’s circumstances are unique. But I do agree that as a general rule of thumb, for relatively short periods of detention, a daily sum of $1,000 may consider as appropriate …”

21.  Whilst no two cases are the same, local awards do provide the court with a general “feel” of the appropriate amount of award in the case at hand: see A v Director of Immigration at para 53(15). The plaintiff referred to the awards made to A (HK$80,000 for detention of 3 months) and YA (HK$100,000 for detention of 156 days) in A v Director of Immigration and the award to Abid Saeed (HK$100,000 for detention of 107 days) in argument. Such information was available to the plaintiff when she commenced this action.

22.  Based on the evidence and information available when this action was commenced, I accept that the plaintiff enjoyed reasonable prospect of recovering a sum in excess of the jurisdiction of the SCT.

23.  In my view, the below-jurisdiction settlement is counterbalanced by the reasonable prospect of the plaintiff in recovering damages within the jurisdiction of the District Court. The fact that the defendant did not reply to the plaintiff’s pre-action letter which did not quantify her claim is neither here nor there. The defendant has failed to establish “exceptional circumstances” to displace the prima facie rule.

24.  Recently in Tarjinder Singh at para 21, Avtar Singh at paras 18 to 19 and Sri Purwati Muhasim at paras 43 to 44, the court:

(a)  reiterated that both sides to the litigation and their legal advisers had a duty to further the underlying objectives, such as to promote a sense of reasonable proportion and procedural economy in the conduct of the proceedings;

(b)  emphasized that claims for damages by non-refoulment claimants should be settled promptly in view of the relatively small settlement amount involved and that public funds were at stake; and

(c)  criticized the Director of Immigration and those advising him for not settling earlier.

25.  Like those cases, this action was only settled after it had been set down for trial. Whilst the plaintiff had not quantified her claim earlier, there was nothing to stop the defendant from putting in a sanctioned payment of a suitable amount to protect the defendant’s interest after the filing of the Defence when the defence case was crystalized. That was not done and the litigation lingered on with the result that both parties had expended further costs and time in the litigation.

26.  In the recent case of Farman v Secretary for Justice sued for and on behalf of Director of Immigration [2024] HKDC 1438, the claim was settled at HK$48,000 before the filing of the Defence. The court accepted that the claim should be within the jurisdiction of the SCT and summarily assessed the plaintiff’s costs at HK$500.

27.  In this case, the plaintiff is claiming costs totalling HK$274,350 and has provided a breakdown in her solicitors’ letter dated 14 March 2024.

28.  I agree with the defendant that the claim is grossly excessive.

(a)  There was no complex factual or legal issue that justified the substantial involvement (66:30 hours) of a partner charging at HK$3,860 per hour including 3:36 hours of research.

(b)  The claim for drafting proforma court documents is excessive. For example, HK$3,088 is claimed for drafting the Acknowledgement of Service and HK$2,316 is claimed for drafting the Statement of Truth.

(c)  The plaintiff’s solicitors claim HK$10,036 for drafting the Statement of Claim and HK$7,334 for drafting the Reply in this action. I have compared these documents with the corresponding documents filed in Jasbir Singh, Avtar Singh, Tarjinder Singh and Sri Purwati Muhasim and found them to be almost identical (except the particulars of the plaintiffs). The plaintiff’s solicitors have already received costs for drafting the same documents in those proceedings.

(d)  The time charged for analyzing and considering the plaintiff’s documents is excessive. According to point 4 of the letter dated 12 February 2025, the plaintiff had no documents in her possession in relation to her detention except her recognizance form. This was confirmed by the List of Documents filed by the plaintiff. Yet, her solicitors are claiming 1:36 hours in analyzing the recognizance form.

(e)  The plaintiff’s solicitors are claiming HK$6,948 for preparing the Bill for summary assessment. In general, no costs for gathering information and drafting the schedule for summary assessment would be allowed: see PD14.3, para 13.

29.  Taking a broad-brush approach, the plaintiff’s costs are summarily assessed at HK$15,000.

Disposition

30.  The plaintiff is entitled to costs of these proceedings up to the date of serving notice of acceptance on District Court scale in pursuance of Order 22, rule 20(1) of the RDC, which are summarily assessed at HK$15,000.