PINE ENTERPRISES LTD v. CYBER STRATEGY LTD AND ANOTHER

CACV 116/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 116 of 2008

(On Appeal from HCA No. 1221 of 2006)

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REASONS FOR JUDGMENT and
DECISION ON QUANTUM OF COSTS

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Hon. Cheung JA:

1.  I agree with Yuen JA.

Hon. Yuen JA:

2.  The Defendants filed a Notice of Motion for leave to appeal to the Court of Final Appeal from our judgment given on 11 December 2008 dismissing the Defendants’ summons of 26 September 2008 for

(1)  leave to appeal out of time Rogers V-P’s order dismissing their application for an extension of time for payment of security for costs for their appeal against Deputy Judge To’s judgment;

(2)  setting aside that order;

(3)  leave to make the payment into court.  

At the conclusion of the hearing, we dismissed the Notice of Motion.  My reasons appear below.

Relevant dates

3.  The history of the proceedings has been set out in our reasons for judgment handed down on 12 December 2008.  It is not necessary to repeat the details here.  Suffice it to note the following events:

(1)  on 18 July 2008 the Vice-President gave the Defendants 4 weeks to provide security for costs for their appeal, either in cash or by bankers draft or bank guarantee (“the Security order”);

(2)  there was no appeal from that order;

(3)  3 days before the deadline for payment, the Defendants issued a summons for an extension of 6 weeks;

(4)  on 18 August 2008 the Vice-President dismissed the summons (“the No Extension order”);

(5)  there was no appeal from that order in time (28 August 2008);

(6)  on 26 September 2008, the Defendants applied for leave to appeal the No Extension order out of time.

Reasons for judgment

4.  In our reasons for judgment, we held that the Defendants had given no satisfactory explanation for the delay after the Vice-President’s No Extension order (para. 15).  We also held that the Defendants had failed to show special reasons to justify extending the period for providing the Security (para. 16).  The reference to “special reasons” comes from the Security order which provided that the court may “for special reasons” allow further time for providing the Security.  We appreciated that the refusal to interfere with the Vice-President’s exercise of discretion in making the No Extension order would lead to the Defendants not being able to pursue their appeal and that would lead to severe prejudice but it was their own failure to provide substantial supporting evidence which led to the position in which they found themselves (para. 18).  We also noted that the appeal revolves around findings of fact made by the trial judge (para. 19).

Application for leave to appeal to CFA

5.  The Defendants applied for leave to appeal to the Court of Final Appeal under “both limbs” of s.22(1)(b)  Hong Kong Court of Final Appeal Ordinance cap. 484, viz. that the questions involved in the intended appeal are ones which, “by reason of its great general or public importance, or otherwise”, ought to be submitted to the Court of Final Appeal for decision.

“Questions”

6.  The Defendants suggested there are the following questions:

i.  whether the test for “special reasons” to be provided in an application for extension of time to pay security for costs is a subjective test or an objective test;

ii.  whether a delay of 28 days in lodging the appeal can be said to be an inordinate delay;

iii.  whether a party should be deprived of his right to appeal to the Court of Final Appeal when albeit after a short delay, the party is able to offer security for costs in the appeal and where the appeal is clearly not one which is so lacking in merit that the Court of Final Appeal would refuse leave. 

7.  As far as question i. is concerned, this issue never arose in the judgment either of the Vice-President or this court.  Miss Gwilt accepted that this was the case.  Questions ii. and iii. are clearly case-sensitive issues.  I do not consider that these are questions of great general or public importance. 

8.  As for the “or otherwise” limb, it is well-established that this is an exceptional course .  I do not see anything which justified this court taking this exceptional course.

Order

9.  In the circumstances the Notice of Motion was dismissed. 

Gross sum costs

10.  Miss Gwilt did not object to a gross sum order for costs but made submissions on the skeleton bill put forward by the Plaintiff and 1^st Third Party.  I consider that items 1, 2 and the first of the two item 3s in the skeleton bill could be reduced by $4,000, $6,000 and $2,000 respectively.  As for disbursements, the fee is reasonable for counsel of Miss Chan’s experience and even if less senior counsel could have been instructed for this application, fees would have to be incurred for his reading into the case afresh and one would probably come up with the same figure.  I take the view that the proper gross sum order would be $38,500 and would order accordingly.