HOLIDAY RESORTS (MANAGEMENT) CO LTD v. CHAN MEI LING

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 20079 OF 2001, 20085 of 2001,
20088 of 2001 & 20102 of 2001 (Consolidated) and
20096 of 2001 & 20100 of 20100 (Consolidated)

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R U L I N G

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1. When I delivered judgment in this matter, I made an order nisi that the defendants should pay the successful plaintiff's costs of these actions.

2. Mr Bernard Yuen, in a disarmingly attractive submission, has sought to persuade me to change my mind and make an order going the other way. He has largely based his argument on the effect of really two payments-into court on 7 June and a further top-up on 20 November last year. He submits that when one analyses the issues before the court at the trial itself, which started six months later in May of this year, there was by then very little between the parties which concerned the plaintiff's right to be indemnified for their liability to pay the ferry operator for charges due for the operation of the ferry after the plaintiff's termination as manager at Sea Ranch.

3. Notwithstanding having made payments-in to cover such matters as the repairs to the ferry pier, the defendant sought to contest that issue before me and lost. Mr Yuen points to the fact that the payment in had covered that liability. The overall effect of Mr Yuen's argument is that where the payments-in have substantially not been beaten by the plaintiffs, and having regard to the very modest amount left in dispute, that it would be wholly unreasonable to visit the defendants with an order for costs for the action.

4. He also adds to that submission by pointing out that the plaintiffs only managed to succeed on the post-termination indemnity for the ferry charges on the basis of an amendment to the statement of claim on the day of the trial, in order to rely on the indemnity clause in the Deed of Mutual Covenant. The original pleading based on a covenant running with the land was rejected by me as a basis for the plaintiffs getting an indemnity.

5. Mr Yuen submits that against a background of three payments-in, the first in January 2002 for a very small amount, demonstrates a willingness on the part of the defendants to be reasonable and to want to settle the litigation. The effect of those payments-in was to leave very little to be fought over and where the plaintiffs had made no sensible counter-proposals and had been prepared to contest the matter to judgment, for only a small reward beyond what had been paid in should mean that the court can now take all of this into account and penalise the "successful" party in costs.

6. Initially attractive as this argument might be, it has in my judgment failed to survive the critical analysis to which it has been subjected by Mr Lau, on behalf of the plaintiffs. Mr Lau is right in suggesting that I can only view these actions in their proper setting as being a smallish part of much wider litigation, substantially over the same issues, which the parties have waged against each other. At each turn, the plaintiffs have succeeded in order to get what was owing to them. Whilst having regard to that background, I must inevitably pay greatest attention to the detail of these particular actions.

7. As to the payments-in, Mr Lau does not accept that these did in fact cover the full extent of the defendant's liabilities in respect of those parts of the claims that the payments-into court were designed to cover. I have seen Mr Lau's solicitor's calculations which I find are correct and which have shown the proper effect of the payments-in. Save for the payment in for action DCCJ 20079 where the payment in is $656.50 to the good, the others fall short in 20088/20102 and 20096/20190 by some distance.

8. This, in my judgment, is enough to dispose of Mr Yuen's resistance to the order nisi that I had originally made. I am content to decide the matter on this alone. The simple fact is that the defendants had declined to pay what the plaintiffs were asking of them. They were therefore obliged to bring these actions, together with the other actions which I have referred to in my judgment, in order to get what was rightly owing to them. Regrettably, the payments-in have fallen short overall and, therefore, costs should follow the event.

9. I should also observe that notwithstanding making payments-in on some of the issues, and here I refer principally to the repair of the pier, which had the effect of admitting that part of the claim, the defendants opted to dispute liability for this at the trial, which was a significant, if not the main, issue in the trial itself. This rather undermines the picture which Mr Yuen wishes to present of a party showing a willingness to temporise and be sensible.

10. I should also mention the costs reserved by Judge Lok in respect of the Order 14 proceedings. Now that the plaintiffs have succeeded overall, I cannot see any valid ground for making some other order on those proceedings which would deprive the plaintiffs of their costs. The fact is that at that stage the plaintiffs had been successful in all their other actions, including in particular one before Judge Muttrie, sitting as a Deputy High Court Judge. Having established the principle that they were entitled to what they were claiming from the defendants, it was perfectly reasonable of them to go under Order 14. The fact that the judge ordered quantum to go to trial as well as quantum and liability on the ferry charges, should not now deprive the plaintiffs of their costs where at the trial they have ultimately been successful.

11. Consequently, the defendants must pay the plaintiffs their costs of these actions, including the costs reserved by Judge Lok with certificate for counsel. Costs of today, I would have thought, must also go to the plaintiffs, with certificate for counsel.