CHOY BING WING v. OFFICIAL RECEIVER & TRUSTEE OF NG YAT CHI, DISCHARGED BANKRUPT AND ANOTHER

CACV 164/2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 164 OF 2003

(ON APPEAL FROM HCA NO. 667 OF 2003)

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J U D G M E N T

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Woo JA:

Preliminary application

1. At the start of the hearing of this appeal, the plaintiff made an application to us to step down from hearing the appeal. He put forward three points in support:

(1)	He doubted the independence of the judges of the judiciary. He drew our attention to a judgment dated 9 May 2003 of Recorder E Chan SC in HCA 3397/2002 in which he appeared as a basis for saying that the judges were not independent and it would be highly dangerous for them to hear his cases because they would deny him justice. He requested a judge outside the judiciary be appointed to hear this appeal.
(2)	He submitted that I should not hear this appeal because the judicial acts that I carried out in two previous cases were contrary to the law. He identified the cases as my judgment dated 24 May 2002 in CACV 1233/2001 referred to below and my judgment dated 9 November 1999 when I sat as a Court of First Instance Judge in HCMA 554/1999.
(3)	He also submitted that any judge who had made a previous decision on matters in connection with the issues he raised should not sit on such matters again. Regarding Stone J, he intimated that as Stone J had endorsed Yeung JA's judgment in an appeal case involving him, Stone J should not hear any of his cases again.

2. In our view, none of these points has any substance and we dismissed his preliminary application.

3. Thereafter, the plaintiff refused to address us on the appeal, on the ground, as he submitted, that he would not have a just hearing.

4. Notwithstanding, we have perused all the papers relating to this appeal and the skeleton submissions of counsel for the defendants, and are able to reach our judgment in this appeal.

Background

5. This is an appeal from the decision of Yuen JA made on 25 July 2003 ordering the plaintiff to provide security for costs of the appeal brought by the plaintiff against an order of Deputy Judge Muttrie made on 11 June 2003. The sum ordered to be secured was $75,000. By the order of the Deputy Judge, the plaintiff's statement of claim was struck out on the grounds that it disclosed no reasonable cause of action, was scandalous, frivolous or vexatious and was otherwise an abuse of the process of the Court. The action was dismissed. The Deputy Judge also made a Grepe v Loam order against the plaintiff, who was ordered to pay the costs of the application to the defendants, to be taxed on the indemnity basis if not agreed.

6. The action stemmed from on a bankruptcy matter. The plaintiff was a creditor of Ng Yat Chi, a bankrupt. The 1st defendant was appointed as Mr Ng's trustee in bankruptcy in HCB 242/1992.

7. In 2001, the plaintiff took out a notice of motion against the 1st defendant under s 84 of the Bankruptcy Ordinance for an order that the 1st defendant disclose to the plaintiff documents connected with the sale of the entire shareholding in a company called Alljean Investment Ltd, part of Mr Ng's assets, and for an enquiry into the 1st defendant's conduct in connection with the sale after the disclosure of the documents.

8. On 15 February 2001, Yuen J (as she then was) dismissed the plaintiff's motion with an order nisi for costs against him. Subsequently the plaintiff asked for a variation of the costs order nisi on the ground of lack of jurisdiction. On 2 May 2001, Yuen J refused to vary the costs order.

9. Thereafter, the plaintiff appealed against the decision on costs. However, he did not apply for leave to appeal, which was held by Master Kwan on 22 May 2001, and upheld by Kwan J on appeal on 7 June 2001, to be required.

10. The plaintiff appealed against Kwan J's decision in CACV 1233/2001. The Court of Appeal, comprising Chu J and I, dismissed the appeal on 24 May 2002. The plaintiff sought leave from the Court of Appeal to appeal to the Court of Final Appeal, which was refused on 19 July 2002. The plaintiff applied for leave from the Court of Final Appeal, and the application was dismissed by the Appeal Committee on 17 September 2002.

11. In all the proceedings referred to above, costs orders were made against the plaintiff. The costs had been taxed to a sum of about $440,000.

12. On 24 March 2003, Deputy Judge To made a charging order against a property of the plaintiff for the taxed costs. The plaintiff appealed in CACV 78/2003. On the application of the 1st defendant, on 30 May 2003, Cheung JA ordered the plaintiff to provide security for costs of the appeal in the sum of $75,000. The plaintiff sought leave to appeal out of time from Cheung JA's order for security for costs but did not appear before the Court of Appeal, comprising Rogers VP and Le Pichon JA, on 18 July 2003. His application for leave to appeal out of time was dismissed with costs.

13. In the present action, HCA 667/2003, the plaintiff issued a writ against the 1st defendant and the 2nd defendants, who were the 1st defendant's solicitors in the legal proceedings referred to above. The statement of claim challenged the jurisdiction and lawfulness of the various courts in the above 2001 and 2002 proceedings in making the costs orders. In substance, it sought two declarations, namely, a declaration that the costs order against the plaintiff are all void and unenforceable in law, and a declaration that the 1st defendant be subject to an enquiry as to the transaction in disposing of the shares in Alljean Investment Ltd.

14. The defendants applied for the statement of claim be struck out and for a Grepe v Loam order to prohibit further or new proceedings.

15. On 11 June 2003, Deputy Judge Muttrie struck out the statement of claim and made a Grepe & Loam order.

16. On 25 June 2003, the plaintiff issued the notice of appeal in CACV 164/2003. Upon the defendants' application, on 25 July 2003, Yuen JA made an order for security of costs of the appeal by requiring the plaintiff to pay a sum of $75,000 into court within 14 days, that until such security is given, the appeal be stayed, and that in default of such security being furnished within the period of 14 days, the appeal do stand dismissed without further order with costs to be taxed and paid by the plaintiff to the defendants.

17. Against Yuen JA order, the plaintiff took out a summons on 4 August 2003 under order 59 rule 14 (12) of the Rules of the High Court to appeal. This is the appeal before us.

The appeal

18. On appeal from a decision of a single Judge of the Court of Appeal, the Court of Appeal would not exercise a discretion afresh and cannot interfere with the exercise of discretion by a single Judge, unless there was error in principle. See para 59/14/26 of Hong Kong Civil Procedure, 2002, Vol 1.

19. Order 59 rule 10(5) of the Rules of High Court provides:

"The Court of Appeal may, in special circumstances, order that such security shall be given for the costs of the appeal as may be just."

20. It is an established category of "special circumstances" where the respondent in the appeal will be likely to encounter undue delay or be put to undue expense in enforcing any order for costs in respect of the appeal. If the appellant contends the security should not be awarded because it will prevent him pursuing his appeal, one of the conditions he has to fulfil is to demonstrate that his appeal has a sufficiently good chance of success to justify exposing the respondent to the injustice of having to bear his own costs win or lose. See paras 59/10/30 and 59/10/35 of Hong Kong Civil Procedure, 2002, Vol 1.

21. It is clear from her decision dated 25 July 2003 that Yuen JA has considered all the aforesaid matters. Taking into account the history given rise to the present action, and the fact that the plaintiff has so far refused to pay any of the costs ordered against him and his opposition to an appeal against the charging order for enforcing the taxed costs, Yuen JA was satisfied that there was adequate justification for the proposition that the defendants would be likely to encounter undue delay or be put to undue expense in enforcing any order for costs in respect of the appeal against Deputy Judge Muttrie's order dated 11 June 2003.

22. Yuen JA also considered the merit of the plaintiff's appeal against the Deputy Judge's order and concluded that it was difficult to see how the plaintiff could say that his prospect of success on the appeal was so high that he needed not provide security for costs. I can discern no ground whatever for saying that this decision is wrong, for to say the least the plaintiff's claims for the declarations in relation to the costs orders and the enquiry are clearly res judicata, and it would be most unlikely that the Grepe v Loam order can be successfully challenged in view of the history of this matter that I have attempted to summarise above.

23. Having considered the quantum of the costs as suggested by the defendants, supported by a skeleton bill, Yuen JA ordered the costs in the sum $75,000 to be secured.

24. There was ample material for Yuen JA to come to her conclusions referred to above. I am not satisfied that Yuen JA erred in principle or in any other manner in the exercise of her discretion.

25. The plaintiff's appeal against Yuen JA order must be dismissed.

26. I would make an order nisi as to costs against the plaintiff. I am not persuaded that it is appropriate to order costs on the indemnity basis as sought by the defendants in their counsel's skeleton submissions.

Stone J:

27. I agree.