ALEPH FABRIZIO KRAUS, a minor by ERIC GEORGE KRAUS, his next friend and father v. ALL ASSET MANAGEMENT (ASIA) LTD AND ANOTHER

CAMP 264/2023, [2024] HKCA 1002

On Appeal From [2022] HKCFI 2992

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO 264 OF 2023

(ON AN INTENDED APPEAL FROM HCA NO 86 OF 2021)

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J U D G M E N T

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Hon G Lam JA (giving the Judgment of the Court):

1.  By our judgment dated 12 July 2024,[1] we dismissed the plaintiff’s summons for leave to appeal against the joinder of Twenty Two East Limited (in liquidation)  (“TTE”)  as an additional defendant in the action below (“Action”)  and also dismissed the plaintiff’s two summonses issued in this court dated 12 October 2023 and 12 December 2023 respectively for leave to adduce new evidence. The background to and the reasons for our decision are set out in the judgment and will not be repeated here.

2.  In paragraph 38 of our judgment we made an order nisi that the plaintiff pay TTE’s costs of all three summonses.  By summons dated 26 July 2024, the plaintiff applies for a variation of the costs order nisi: it does not dispute liability to pay the costs of the application for leave to appeal, but it contends that there should be no order as to costs in respect of its two summonses for leave to adduce new evidence.

3.  Those two summonses sought leave to adduce the writs of summons issued by TTE in two new actions respectively, which were brought against, among others, the plaintiff and Mr Kraus.  The main argument raised on behalf of the plaintiff now is that the undertaking given by TTE (to the effect that the second new action would be discontinued should the plaintiff fail to overturn the judge’s joinder decision in the Action)  was given very late.

4.  In our view the variation sought should be refused.  The first new writ was issued on 28 October 2022 but never served, and expired just a little over two weeks after the plaintiff’s summons dated 12 October 2023 to adduce it as new evidence. The plaintiff cannot put the blame on TTE for his summons becoming pointless, and has to bear the costs consequences.

5.  The second new writ was issued on 30 October 2023.  In TTE’s written submissions dated 5 December 2023 lodged for the disposal on paper of the plaintiff’s summons dated 12 October 2023, TTE had already stated it had no intention to serve this second new writ if the plaintiff failed to have the joinder decision in the Action overturned. Notwithstanding this, the plaintiff issued another summons dated 12 December 2023 for leave to adduce the second new writ as new evidence.  Mr Kam submits that a statement of intention in written submissions is very different from an undertaking.  However, had the plaintiff felt a formal undertaking from TTE was needed, it could have asked for one.  As it transpired, even after TTE offered the undertaking, the plaintiff considered it insufficient and “meaningless” (see plaintiff’s reply written submissions dated 6 March 2024, paragraph 25)  and continued to press for an order allowing the second new writ to be adduced as evidence.

6.  In any event, as can be seen from paragraphs 23, 26 and 29 of this court’s judgment, this court took the view that the judge was correct in joining TTE as an additional defendant based on the facts before him.  We also pointed out in the judgment the overlooked distinction between the question of joinder and the question of what part TTE should properly take in the Action.  We are far from persuaded that the mere existence of the second new writ would have affected our conclusion refusing leave to appeal.  The existence of a subsequent action brought by TTE itself, if pursued, might have required special directions for it to be case-managed together with the Action so as to coordinate and streamline the conduct of the two related but opposing sets of proceedings, but is not necessarily a reason for reversing the joinder of TTE in the Action.

7.  For these reasons, the plaintiff’s summons dated 26 July 2024 is dismissed with costs to TTE, summarily assessed in the sum of $70,000.