TERKILD JOHAN TERKILDSEN AND ANOTHER v. BARBER ASIA LTD AND OTHERS

HCA 1963/2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1963 OF 2003

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RULING

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1.  On 8 March 2007, I handed down judgment in an interlocutory application in this matter in which the defendants sought to have the various causes of action against them struck out, and the plaintiffs sought leave to amend the statement of claim, the amendments being required principally to avoid striking out. 

2.  In the result Mr Andrew Barber succeeded in having some of the causes of action against him struck out, but he remains a party to the action, and liable under other causes of action which, with amendment, survived his challenge.

3.  In that judgment I made an order nisi that the costs of the application to amend, and the application to strike out, should be costs in the cause.

4.  Prior to 15 March 2007, the solicitors for the fifth defendant, Mr Clark, drew my attention, by letter, to a factual error in the judgment, which related only to Mr Clark’s position.  On 15 March 2007, I heard counsel for the plaintiffs, and the solicitor from Mr Clark, as to the steps to be taken to deal with that factual error.

5.  On 19 March 2007, by summons filed on that date, the seventh defendant, Mr Dunford, made an application to vary the costs order nisi.  That application was duly set down for hearing on 23 March 2007.

6.  On 22 March 2007, the costs order nisi became absolute by virtue of O 42 r 5B(6).  But that was not the case however in respect of Mr Dunford, who had properly made application by summons, prior to the exploration of 14 days after the order nisi had been made, to vary the costs order.

7.  On Friday 23 March 2007, I heard counsel for the plaintiffs and Mr Clark on the consequences of the factual error.  At the same time I heard counsel for Mr Dunford on the issue of costs in so far as the costs order related to Mr Dunford.  In a judgment handed down on 27 March 2007, I dealt with the factual error, and, in a separate judgment, handed down on the same day, I dealt with the costs order, which was not varied.

8.  On 12 April 2007, the solicitors for Mr Andrew Barber wrote to my clerk applying to vary the costs order nisi, in so far as it affected him.  No summons was filed, but I directed that the matter should be heard.  The application to vary the costs order came before me on 4 May 2007.

9.  Mr Bedford takes the point that the 14 day period by which, pursuant to O 42 r 5B(6), the costs order nisi became absolute, had elapsed, and consequently there was no jurisdiction to vary the order.  That is right, but there is no doubt that the court has jurisdiction to extend the time within which a costs order nisi may be varied: see Ma Wan Farming Ltd v Chief Executive in Consul & Another [1998] 2 HKLRD 314.  For the time to be extended there must be a reasonable excuse for the delay, and no prejudice to the other side.

10.  The argument for Mr Andrew Barber is that he and those advising him were unaware of the steps being taken by Mr Clark in relation to the judgment, and accordingly were not in a position to take any steps in relation to costs. 

11.  Mr Bedford sensibly concedes that there is no real prejudice to the plaintiffs, but says that there is no reasonable excuse for not having applied within time to vary the costs order.  He says that whenever any solicitor receives a judgment in which there is a costs order nisi it will be necessary to make a considered decision whether or not to accept the costs order, or to apply for it to be varied.  Every solicitor knows, Mr Bedford says, that that decision must be made within 14 days of judgment being handed down.

12.  The factual error in the judgment is a matter that related solely to Mr Clark.  It did not impact in any way at all upon Mr Andrew Barber, or indeed any of the other defendants.  It was open to Mr Andrew Barber or his advisers, prior to 22 May 2007, if they were dissatisfied with the costs order, to apply properly by way of summons to have it varied.  They did not do so.  That was plainly a considered decision.  There is no evidence to the contrary.

13.  Consequently any matter involving Mr Clark cannot provide Mr Andrew Barber with a reasonable excuse for not having applied within the required time to vary the costs order.  That Mr Dunford was unable to apply, apparently without difficulty, to vary the costs order within time, demonstrates that there is no reason why Mr Andrew Barber, equally, could not have applied within time.

14.  There being no reasonable excuse for not having applied within time, I decline to extend the time within which application may be may to vary the costs order, which shall be absolute.  Costs on the application to vary to be to the plaintiffs, to be paid forthwith.