CHAK HUNG v. MO TAK YAU and Another

1996 P.I. No. 797

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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J U D G M E N T

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1. The reason why I made the order nisi that the 2nd Defendant should pay to the Plaintiff half the Plaintiff's costs of the action was because the Plaintiff succeeded only against the 2nd Defendant, not against the 1st Defendant. I therefore treated half the Plaintiff's costs as having been incurred in the action against the 2nd Defendant which succeeded, and half as having been incurred in the action against the 1st Defendant which failed. Mr. Clough has persuaded me that that provisional view is not the right approach. The only reason why the action against the 1st Defendant failed was because he was not a partner in the business which employed the Plaintiff. However, the evidence relating to that issue was relatively brief, and the costs incurred in the preparation of that issue for trial must therefore have been very modest. In those circumstances, my concluded view is that it would not be right to deprive the Plaintiff of any part of his costs. Accordingly, the order I make is that the 2nd Defendant must pay to the Plaintiff the whole of the Plaintiff's costs of the action to be taxed in accordance with the Legal Aid Regulations.

2. The reason why I made the order nisi that only the 2nd Defendant be liable for the Plaintiff's costs was because it was only against the 2nd Defendant that judgment was given. It is true that, at the end of my judgment, I said that the application form completed by the 1st Defendant for his name to be registered as the owner of the business misled the Plaintiff's advisers into thinking that the Plaintiff may have had a case against the 1st Defendant. Judge Longley's judgment in favour of the Plaintiff against both Defendants must have confirmed the Plaintiff in that belief. However, I remain of the view that that is best reflected by denying to the 1st Defendant his legal costs, rather than by making the wholly exceptional order that in the case of the Plaintiff's action against the 1st Defendant costs should not follow the event. I therefore confirm that the liability to pay the Plaintiff's costs should be borne by the 2nd Defendant alone.

3. Finally, both Defendants have reminded me that I found that the Plaintiff had contributed to the accident to the extent of two-thirds. That is correct, but it should have no impact on the correct order for costs. That is because it was open to the Defendants to protect themselves against that eventuality by either paying into court a sum which reflected the true extent of the Plaintiff's loss, or by writing a "Calderbank" letter, i.e. a letter marked "without prejudice save as to costs", or by making an offer to the Plaintiff's solicitors in the course of pre-trial negotiations. Since none of these courses were taken, the fact that the Plaintiff did not recover anything like the sums which he was claiming is not a factor to be taken into account in the overall determination as to the extent of the liability for the Plaintiff's costs.