HORNOR RESOURCES (INTERNATIONAL) CO LTD v. SAVVY RESOURCES LTD

HCA335/2010

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 335 OF 2010

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BETWEEN

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DECISION ON APPLICATION
TO VARY COSTS ORDER NISI

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1.  By Decision handed down on 23 March 2010, I dismissed the defendant’s application to discharge the Mareva injunction granted on 5 March 2010 and continued the Mareva injunction (with variations) until further order of the court. I further made an order nisi that the defendant pays the plaintiff the costs of the ex parte application and the costs of the summonses dated 8 and 11 March 2010 to be taxed if not agreed.

2.  By letter dated 23 March 2010 from its solicitors, the plaintiff applied to vary the costs order nisi to provide for: (1) a certificate for two counsel; and (2) summary assessment of the plaintiff’s costs. The defendant opposes the application and gave reasons and submissions for the opposition. The plaintiff replied to them. By letters dated 12 and 19 April 2010, both parties indicated no objection to the application being dealt with on paper without a hearing.

Certificate for two counsel

3.  Both parties appeared by senior and junior counsel at the substantive hearing for the two summonses. The defendant however argues that a certificate for two counsel is not warranted because the plaintiff’s claim is a simple claim for breach of contract and junior counsel who dealt with the ex parte application is of substantial seniority, thus should be well familiar with the principles relating to Mareva injunction.

4.  The substantive hearing of the defendant’s application for discharge and the plaintiff’s application for continuation of the injunction came on within a very short span of time. During the week after the hearing before Poon J (who adjourned the summonses for argument on the following summons day), both parties had filed substantial amount of evidence. The outcome of the applications undoubtedly carries importance consequences and implications for the parties. This, in my view, must be a major reason for the parties’ decision to retain both senior and junior counsel. Both junior counsel have substantial experience in legal practice. I consider this is a case where the urgency and the importance of the applications justify the engagement of two counsel. I allow the application and grant a certificate for two counsel.

Summary assessment of costs

5.  The plaintiff says that the costs relating to the Mareva injunction are self-contained and fairly straightforward, hence appropriate for them to be summarily assessed. The defendant contends that the costs should be taxed because it would not know the extent or nature of the work undertaken by the plaintiff for the ex parte application before 8 March 2010 when the Order and papers were served on it. It is said that the defendant’s position would thereby be prejudiced.

6.  The duration of the Mareva injunction application and the subsequent applications for its discharge and continuation is a short one. It lasted less than three weeks. The activities relating to the applications and that are relevant to inter-partes costs should be readily identifiable. Further, as the proceedings in the action (other than those relating to the injunction) have been stayed pending arbitration, the costs in question will be self-contained.

7.  The primary purpose of summary assessment of costs is the saving of costs and time. A full taxation, which involve the preparation of a full itemized bill of costs and a detailed list of objection and call-over and substantive hearings, will entail a lot of more costs as well as time. For a short matter like the present, it will not be in the parties’ interest to undergo a full taxation.

8.  The plaintiff’s costs are awarded on party-and-party basis. As such, only costs that are necessary or proper for the attainment of justice or for enforcing or defending the taxing party’s rights will be allowed: Order 62 rule 28(2) of Rules of the High Court, Cap.4A. The same principle applies whether in summary assessment or full taxation of costs. The defendant’s concern that it does not know the actual nature or amount of work carried out by the plaintiff’s legal representatives before 8 March 2010 is therefore immaterial. In any case, a full taxation will not put the defendant in a different position.

9.  Accordingly, I agree that the plaintiff’s costs should be summarily taxed. And I make the following directions to facilitate the assessment:

(1)  The plaintiff to lodge with the court and serve on the defendant the statement of costs for summary assessment within 14 days from the date of this Decision.

(2)  The defendant to lodge with the court and serve on the plaintiff its objections to or comments on the statement of costs within 14 days thereafter.

(3)  The plaintiff to lodge with the court and serve on the defendant its reply (if any) within 7 days thereafter.

10.  The parties should also note and comply with the requirements in Practice Direction 14.3.