SHERMA PHADINDRA v. TIN WO ENGINEERING CO LTD AND ANOTHER

CACV 272/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 272 OF 2012

(ON APPEAL FROM HCPI NO. 32 OF 2011)

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D E C I S I O N

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1.  This is an application for security for costs of an appeal and arises in the following circumstances.

2.  The plaintiff brought the action below against the 1^st and 2^nd defendants for personal injuries sustained while he was working as a bar bender and fixer on a construction site.  On 8 November 2012, Deputy High Court Judge Mayo gave judgment in favour of the plaintiff in the sum of $233,206.16 with interest and ordered that the defendants pay the plaintiff’s costs of the action to be taxed on the District Court scale if not agreed.

3.  The plaintiff being dissatisfied with the quantum of damages awarded, he issued a notice of appeal on 30 November 2012 against the judgment.  The appeal has been fixed to be heard on 10 December 2013, with an estimate of one day.

4.  By summons dated 28 May 2013, the 1^st and 2^nd defendants have applied for security for costs of the appeal on the ground that the plaintiff is impecunious and therefore there is a risk that, if unsuccessful in his appeal, the plaintiff would be unable to pay the costs of the appeal.  Security for costs is sought in the amount of $416,500 as shown in the skeleton bill prepared in support of this application.

The applicable principles

5.  It is well established that the impecuniosity of an appellant is a “special circumstance” justifying an order for security for costs pursuant to RHC Order 59 rule 10(5).

6.  The relevant principles, particularly in relation to the treatment of impecuniosity as a special circumstance, are set out in the judgment of Ma CJHC (as he then was) in Chung Kau v Hong Kong Housing Authority & others [2004] 2 HKLRD 650 at §14 and I shall apply those principles in determining this application.

The Plaintiff’s impecuniosity

7.  The evidence discloses that the plaintiff was legally aided at the trial below.  It was his case at trial that he was unable to resume gainful employment after the expiry of his sick leave on 27 June 2010.  Apart from working for about a month as a watchman in November 2011, the plaintiff does not appear to have had any employment and thus any income for about 3 years.

8.  The plaintiff’s application for legal aid for the appeal was refused on 14 December 2012.  In his affirmation in opposition to this application, he has stated that he is not financially able to furnish security for costs from his own resources or elsewhere.  He is now a recipient of Comprehensive Social Security Assistance and he states that his solicitors are now acting for him in this appeal on a pro bono basis.  They have apparently advised him that he will have to apply to act in person since he is not financially able to engage counsel to represent him in the appeal.

9.  That evidence prima facie establishes the plaintiff’s impecuniosity for the purposes of this application for security for costs.

The merits of the plaintiff’s appeal

10.  It is the plaintiff’s case that the merits of his appeal are such that he should not be ordered to provide security.

11.  The plaintiff’s main challenge to the judgment below is that the Judge erred in his assessment of pre-trial loss of earnings and in refusing to award any damages for future loss of earnings.  The main ground of appeal is that the Judge erred in relying on the 1^st and 2^nd defendants’ medical expert, Dr Lee Po Chin, whose opinion failed to take into account the findings of an MRI report dated 4 October 2012.  It is also contended that the Judge failed to take proper account of the opinion of the plaintiff’s medical expert, Dr Wong Chin Hong.  The plaintiff will contend on appeal that, having regard to the MRI report, the Judge ought to have found the plaintiff was unable to return to his previous employment.

12.  I have considered the judgment and the grounds of appeal against it.  The claim was in respect of a lower back sprain sustained whilst lifting bars.  The appeal is in the nature of a challenge to the Judge’s findings on the expert medical evidence before him.  Such an appeal is in the nature of an appeal against a finding of fact: see Au Yeung Miu Sim v Tsang Kwong Wai & Another [2004] 2 HKLRD 187 at §§16 and 19.  It is well-established that an appellate court will generally be very slow to interfere with findings of primary fact.

13.  Notwithstanding the references in the transcript to which my attention has been drawn, I am not persuaded that this is a case in which the merits of the appeal are so strong as to provide a reason on its own for refusing to order security for costs.  On the appeal, the court will be concerned to see whether it has been shown the Judge went seriously wrong, such as by overlooking critical evidence, misunderstanding the evidence or making a finding that was wholly unsupported by the evidence.  The Judge was aware of and did take the recent MRI scan into account (Judgment §78) and took the medical experts’ further opinions in the light of that scan into account (Judgment §§79 and 80).  At the very highest, it seems to me that this is a case in which the court should take the view that the appeal could go either way so that, in the absence of other factors to tilt the balance, an order for security for costs should ordinarily follow.

Exercise of discretion

14.  The plaintiff’s impecuniosity having been established and the plaintiff not having satisfied me that the merits of the appeal are so strong that this factor should weigh against an order for security for costs, it now falls to determine the amount which, in the exercise of my discretion, I should order the plaintiff to provide by way of security for costs.

15.  The skeleton bill discloses costs of $416,500 but I think there would be considerable scope for reduction of the amounts claimed on a party and party taxation of those costs.  In my view, and without prejudice to any future taxation, the reduction of the sum claimed in the skeleton bill by as much as half is not unrealistic.  On that basis, the likely costs liability of the plaintiff in the event the appeal is unsuccessful would be a sum of around $200,000 and any order for security for costs should be based on that amount of likely costs.

16.  I am conscious that the plaintiff’s evidence is that he is unable to fund an order for security for costs and I recognise that such an order may have the effect that he will not be able to proceed with the appeal.  Against that, however, is the fact that the plaintiff has had his day in court at trial and that the 1^st and 2^nd defendants are entitled to protection against the possibility that their costs of the appeal may otherwise be irrecoverable and it is the 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.

17.  In the exercise of my discretion, therefore, I direct that security for costs should be provided by the plaintiff to the 1^st and 2^nd defendants in the present case in the amount of $200,000 in accordance with the terms of paragraphs 1 to 3 of the 1^st and 2^nd defendants’ summons.

18.  The plaintiff must pay the 1^st and 2^nd defendants’ costs of this application in any event.