FUNG TIN YAU (IN HIS OWN CAPACITY AND SUING AS A SHAREHOLDER OF MAXFORTUNE TRADING LTD AND ON BEHALF OF MAXFORTUNE TRADING LTD AS SHAREHOLDER OF SAMDOR CO LTD) v. FUNG TIN SHING AND OTHERS

HCCW 170/2016, HCCW 171/2016,
HCCW 172/2016, HCA 2225/2016
HCA 2078/2017, HCA 2998/2017,
HCA 2999/2017, HCA 3000/2017,
HCA 133/2018, HCA 136/2018,
HCA 1291/2018
(Consolidated)

[2020] HKCFI 1051

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING‑UP) PROCEEDINGS NOS 170, 171, 172 OF 2016
AND

ACTION NOS 2225 OF 2016, 2078, 2998, 2999, 3000 OF 2017,

133, 136, 1291 OF 2018

_____________

_____________

________________________

DECISION ON COSTS

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1.  On 23 January 2020, I handed down my Decisions on the 3 Sets of Appeals ^[1] (the “Appeal Decisions”[2]).  On 4 March 2020, I handed down further my Decisions on the Direction Summons and the Costs Summons (the “Direction & Costs Decisions”[3]).  I made certain costs orders nisi therein.  Parties have since made submissions for variation of those orders.  Below are my decisions on costs. 

2.  In this Decision, I will refer to Madam Lai, Andy, Jenny, Wing Yan, Wing Yin, Great Anchor, Maxfortune, Premium, Wyse and Samdor individually as such, and collectively as the Respondents. I will call TY the Petitioner.

The 3 Sets of Appeals

3.  In respect of the Appeal Decisions, the Petitioner seeks a variation of the costs order nisi so as to cover also the costs of the Directions Hearing on 11 January 2019.  Those costs have been reserved.  He also seeks summary assessment and immediate payment of the costs of the 3 Sets of Appeals.  The amount stated in the relevant Statement of Costs of 13 February 2020 (“P’s Statement of Costs”) is HK$816,171.90.

4.  In reply, the only objection made on behalf of the Respondents relates to quantum.  Mr Tang on their behalf submits[4] that the costs stated in P’s Statement of Costs should be substantially taxed down “because the Petitioner’s legal team just repeated or regurgitated their work already done before the Masters, and they have done negligible additional work for the Appeals”.

5.  I do not accept the submission that the 3 Sets of Appeals were just repetition or regurgitation of the hearings before the learned Masters.  Mr Ho has in his written submissions of 1 April 2020[5] drawn to my attention §15 of the written submission made on the Respondents’ behalf during the Directions Hearing on 11 January 2019, that:

“ It is pompous and inappropriate for [the Petitioner] to suggest that the appeal hearings are mere regurgitations of the hearings before the Masters. Although no new evidence can be adduced at the appeal hearings, there is otherwise no restriction requiring the appellants to argue and present their cases in the same way as they did before the Masters. Appellants are not debarred from relying on different or additional authorities on the appeal hearing.”

6.  I accept Mr Ho’s submissions that in the circumstances, the Petitioner and his legal representatives were justified in approaching the 3 Sets of Appeals as de novo hearings before the Court.

7.  I have considered P’s Statement of Costs.  Necessarily I adopt a broad brush approach.  In my view, the total Professional Work (D1‑D8) of 17 hours is, with 2 counsel having being engaged, too high.  10 hours would in my view have been reasonable.  The attendance of 2 counsel (total brief fees of HK$113,000) for the Directions Hearing on 11 January 2019 (which appears to have lasted no more than 30 minutes — see D4) appears to me to be not necessary, and the total fees too high.  I tax it down to HK$50,000. 

8.  In all, I summarily assessed the costs for the 3 Sets of Appeals to be HK$700,000.

9.  I accordingly vary the costs order nisi at §96 of the Appeal Decisions and make a costs order that:

(a)  the Petitioner shall have the costs of all 3 Sets of Appeals, including the reserved costs for the Directions Hearing of 11 January 2019 (the “Total Appeal Costs”), to be summarily assessed;

(b)  the costs of the appeals in respect of the 2078 Strike Out Summons be borne by Madam Lai and Jenny, those of the appeals in respect of the 2998‑3000 O.14 Summonses be borne by Maxfortune, Wyse and Premium respectively, and those of the appeals in respect of the 133/136 Strike Out Summonses be borne by Madam Lai, Jenny and Andy;

(c)  I grant the Petitioner certificate for two counsel, save the hearing on 20 May 2019 when only Mr Ho appeared;

(d)  The Total Appeal Costs are summarily assessed at HK$700,000, to be paid within 14 days of this Order.

10.  No request has been made by parties for apportionment of the Total Appeal Costs amongst the Respondents.  On that basis, I leave the question of apportionment to the parties.

The Direction Summons

11.  Summary assessment is sought by the Respondents.

12.  Mr Ho submits that as a general principle, costs incurred for case management applications should be in the cause (K&L Gates v Navin Kumar Aggarwal and Others, HCA 1061/2011 (15 July 2013, per B Chu J at §32), Astro Nusantara International BV and Others v Pt a Yunda Prima Mitra and Others, CACV 251/2013 (2 September 2015, per Master Lai at §85), and Tierra Trading Ltd and Another v Land Base Ltd, HCMP 3074/2014 (21 August 2015, per Recorder Teresa Cheng SC at §20), and that the general principle remains the same even if the application has been contested (K&L Gates (per B Chu J at §32)), TH and Another v Director of Immigration, CACV 224/2015 (24 November 2015, per Lam VP at §7), Komal Patel v Chris Au, HCA 183/2014 (14 January 2016, per Zervos J at §65), Wong To Yick Wood Lock Ointment Ltd v Merika Medicine Factory Ltd and Another, HCA 562/2014 (10 March 2017, per Deputy Judge Lee at §§11 and 31), and Mass Ocean International Ltd v Trinity Holdings (Hong Kong) Ltd [2019] HKCFI 2323, per Au‑Yeung J at §§53‑54.

13.  I accept those submissions of Mr Ho.  There is no reason to depart from that general principle.  I vary the costs order nisi at §14 of the Direction & Costs Decisions, and order that the costs of the Direction Summons be in the cause of the consolidated action.

The Costs Summons      

14.  As I have said in the Direction and Costs Decisions at §15, the Costs Summons was, and should have remained to be, a very trivial matter involving the payment of requested costs in the sum of HK$1,040 for a consent summons so that certain sums which Andy and Jenny as the Respondents in HCCW 170‑172 had paid into court could be paid out to them. The Respondents seek summary assessment of the costs involved.  Their Statement of Costs suggests that more than HK$50,000 of costs have been spent on it.  That was out of all proportion.  I summarily assess the costs to be HK$5,000 to take account of the usual standard costs and the time (which was very brief) spent on it during the hearing, to be set off against the costs to be paid to the Petitioner in respect of the 3 Sets of Appeals.