JASBIR SINGH v. SECRETARY FOR JUSTICE sued for and on behalf of DIRECTOR OF IMMIGRATION

DCCJ 1248/2021

[2024] HKDC 1540

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 1248 OF 2021

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BETWEEN

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DECISION

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Introduction

1.  There is before me a joint application by the parties for the determination by the court on what scale or level of the costs of this action, including this application, be paid by the Defendant (“D”) to the Plaintiff (“P”) and the summary assessment of those costs.

Background and Procedural History

2.  P issued the Amended Writ of Summons and Amended Statement of Claim (“SOC”) on 12 May 2021 against D. According to the SOC, P claims as follows:

(1) He was born in India on 2 March 1987;

(2) He lodged a claim under the Unified Screening Mechanism on or about 28 July 2015;

(3) He was detained at the Castle Peak Bay Immigration Detention Centre from 16 September 2020 to 30 November 2020. (“the Detention”) unlawfully in breach of the Hardial Singh principles;

(4) During the Detention, he was subjected to degrading treatment as he was forced to strip and pose nude in the sight of other detainees;

(5) As a result of the loss of liberty and the degrading treatment, he suffered from adjustment disorder; and

(6) He claims damages for unlawful detention, interest and costs.

3.  On 9 February 2024, the Department of Justice (“DOJ”), on behalf of D, made a sanctioned payment in the sum of HK$46,000 (“the Sanctioned Payment”) in settlement of the whole of P’s claim in this action.

4.  On 19 February 2024, P accepted the Sanctioned Payment.

5.  By letter dated 25 March 2024, DOJ stated that whilst it was agreed D would pay P’s costs of this action up to the date of acceptance of the Sanctioned Payment (ie until 19 February 2024), it was only agreed on the condition that P’s costs be assessed on the Small Claims Tribunal (“SCT”) scale to be taxed if not agreed. The reason given was that as held in Sundari v Secretary for Justice [2023] 4 HKLRD 735, in determining the scale of costs the focus is on whether the present action should be commenced in the District Court under the “reasonable prospect test”. It was stated that there was no reasonable prospect that P would be awarded a judgment sum close to the jurisdictional limit of the District Court.

6.  Since the parties were unable to reach agreement on the scale of costs, by joint letter dated 4 July 2024, the parties sought the court’s determination on the scale of costs and summary assessment of this action including this application.

7.  On 18 July 2024, His Honour Judge Andrew Li directed the parties to lodge written submissions on the scale/level of costs together with a statement of costs for the purpose of summary assessment on or before 22 August 2024.

8.  On 26 August 2024, as no statement of costs were lodged as previously directed, I directed P to lodge his Statement of Costs on or before 30 August 2024 and D to lodge any objections on or before 6 September 2024. Parties did so accordingly.

Applicable Law

9.  O 22, r 20(1) of the Rules of the District Court, Cap. 336H (“RDC”) provides:

“Where a defendant’s sanctioned offer or sanctioned payment to settle the whole claim is accepted without requiring the leave of the Court, the plaintiff is entitled to his costs of the proceedings up to the date of serving notice of acceptance, unless the Court otherwise orders.”

10.  In Govindan Sakhivel v Secretary for Justice [2023] 4 HKLRD 721, His Honour Judge Andrew Li (applying the construction of the equivalent provisions in the Rules of the High Court, Cap 4, by Bharwaney J in Wong Chim Hing v Discovery Bay Transit Services Ltd [2016] 1 HKC 491), held that upon the plaintiff’s acceptance of the defendant’s sanctioned payment, the plaintiff is entitled to his costs of the proceedings up to the date of service of his notice of acceptance and further, that he is entitled to have those costs taxed at the District Court scale (see §11).

11.  The prima facie rule in O 22, r 20(1) should apply unless: (1) the defendant discharges the burden of proof of showing exceptional circumstances that justify a departure from the prima facie rule; and (2) the defendant has given a prior warning to the plaintiff that he will apply to invoke the “otherwise proviso” upon acceptance of the sanctioned payment. See Etratech Asia-Pacific Ltd v Leader Printed Circuit Boards Ltd [2013] 2 HKLRD 1184 §§20-23 and 26 per Poon J (as he then was) applied in Govindan Sakhivel, §§14-16.

12.  The importance of the prima facie rule which creates certainty as to costs consequences and the requirement to give prior warning to the plaintiff that the defendant will apply the “otherwise proviso” was clearly explained in Etratech Asia-Pacific Ltd at §§19-20 and 23:

“19. The prima facie rule is important. In ordinary civil litigations, costs are incurred in a recoverable inter-parties sense from the moment the proceedings commenced and continue to be incurred as the litigation progresses. Every litigant, who needs to incur costs in order to pursue or defend a claim, definitely regard them as very real and present expenses. Further, litigation is inescapably chancy. The prospect of paying costs to the other side after losing one’s case in addition to his own costs must very much exercise a party’s mind. Costs thus factor heavily in the negotiations and considerations of settlement. Sometimes, it may even make or break the settlement. But uncertainty as to costs is a notoriously difficult subject. It may easily frustrate an otherwise meaningful settlement negotiation and even become an irremovable obstacle to the settlement itself. What the prima facie rule does is to create certainty as to the costs consequences upon acceptance of the sanctioned payment or sanctioned offer. A party knows the exact extent of his exposure or entitlement to costs, as the case may be. Thus he will not be inhibited in proposing or accepting an otherwise reasonable offer to settle, as the case may be, because of uncertainty as to the costs consequences. This surely facilities the principal objective of sanctioned payments and sanctioned offers, which is to encourage the parties to take positive settlement seriously and avoid unproductive and expensive prolongations of the litigation, resulting in more early settlements: Montrio Limited v Tse Ping Shun David.

20. By virtue of the Otherwise Proviso, the court retains the discretion to depart from the prima facie rule where necessary. But the discretion should only be exercised in exceptional circumstances that clearly warrant a different costs order. Otherwise, the certainty as to costs consequences created by the prima facie rule, one of the very important features underpinning the effectiveness of sanctioned payments and sanctioned offers, will be greatly diminished.

…

23. Further, when applying the Otherwise Proviso, the court is in effect depriving the plaintiff of his costs or even ordering him to pay the defendant costs. The plaintiff will be significantly disadvantaged. In my view, fairness dictates that the plaintiff, who is considering whether to accept the sanctioned payment or sanctioned offer, should be given a prior warning that the defendant will apply to invoke the Otherwise Proviso and how it is to be invoked. The plaintiff can then make an informed decision whether to accept the payment or offer with the full knowledge that upon acceptance, the prima facie rule on his entitlement as to costs may be displaced. Further, if a defendant is allowed to invoke the Otherwise Proviso without giving the prior warning, a plaintiff who has accepted the payment or offer on the faith that he would be entitled to recover his costs up to the date of serving notice of acceptance would never know if at the next moment the defendant would apply for a different costs order. The certainty as to costs created by the prima facie rule will be gone. Faced with the uncertainty as to costs, the plaintiff would be greatly handicapped in deciding if he should accept the payment or offer in the first place. It would render the operation of sanctioned payments and sanctioned offers ineffectual.”

13.  Moreover, the requirement for a prior warning also has the intended effect of encouraging settlement and avoiding prolonged and expensive litigation consistent with the CJR objectives: see ibid at §§19 and 25.

14.  That prior warning is a pre-requisite was accepted by the learned judge in Govindan Sakhivel (see §§12, 41 and 45) and was the sole reason that the learned judge did not depart from the prima facie rule in that case (see §47).

Analysis and Disposition

15.  In the present case, it seems to me that D has not given any prior warning to P that he will invoke the “otherwise proviso” upon acceptance of the Sanctioned Payment. The warning was only given after P had considered and accepted the Sanctioned Payment.

16.  As stressed in Govindan Sakhivel at §46, “The design of O 22, r 20(1) of RDC is to promote amicable settlement in accordance with the certainty of costs. As stated at [12] above, the rule allows the plaintiff to consider his exposure or entitlement to costs before accepting the defendant’s sanctioned payment in settling the whole of this claim. It is not right to allow the defendant to ambush the plaintiff by applying to court for variation of costs scale without any forewarning at/or before the plaintiff’s acceptance to the Sanctioned Payment. It would violate the plaintiff’s expectation that he was entitled to costs at the District Court scale.”

17.  In the present case, it is not right for D to apply for a variation of costs scale without any warning prior to P’s acceptance of the Sanctioned Payment. For this reason alone, the court should not depart from the prima facie rule. Notwithstanding the submissions of Ms Zhi, counsel for D, on the exceptional circumstances in the present case, it is not necessary for me go further to decide this.

18.  Accordingly, P’s costs of this action should be assessed at the District Court scale.

19.  In P’s Statement of Costs, P has claimed costs and disbursements totaling HK$96.609.33. I agree with Ms Zhi that the hours spent on communications and professional work were excessive and could have been handled by the legal executive. This is particularly in light of the large number of similar cases handled by P’s solicitors and apparent repetition of the submissions and/or court documents in other cases handled by the same solicitors. Furthermore, in the exercise of my discretion, I should have regard to the underlying objectives and my view of the parties’ conduct in persisting in litigating in the District Court and settling after the pre-trial review and just before the trial, and the settlement sum below SCT’s jurisdictional limit. Adopting a broad-brush approach, I have summarily assessed P’s costs at HK$15,000.

20.  As for costs of this application, P should be considered the successful party on the scale of costs. Just 2 days before the deadline for parties to lodge submissions on costs, on a without prejudice save as to costs basis, DOJ had proposed costs of this action to be paid by D to P at the agreed sum of HK$15,000 and no order as to costs of this application but this was not accepted by P. I am not convinced given the lateness of DOJ’s offer the costs spent on the written submissions could have been saved. In the exercise of my discretion, I would make no order as to costs of this application.