XCHRX LO WO (a female) AND OTHERS v. CHEUNG CHAN KA, JOSEPH AND ANOTHER

HCA618/97

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO.618 OF 1997

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J U D G M E N T

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1. This is an appeal by the plaintiffs from an order of the master made on 30 November 2000 whereby he ordered that :

(1) the taxation of the plaintiffs' costs be adjourned part heard;

(2) with two days to be reserved, to a date after the hearing of the 2nd defendant's appeal; and

(3) with liberty to the plaintiffs to apply for an earlier date if there is undue delay in the hearing of the appeal.

The present appeal of the plaintiffs is as to the second and third aspects of the order of the master.

2. The history of this matter requires a short recitation in order that we can understand what led to the making of the order of the master of 30 November 2000.

3. After a long trial before me, on 9 June 2000 I ordered by my judgment that the purported sale by the plaintiffs to the 2nd defendant be set aside on the ground of unconscionable bargain, and I ordered costs of the action in favour of the plaintiffs and against the 1st and 2nd defendants. So far as the costs I have awarded to the plaintiffs against the 1st and 2nd defendants are concerned, I ordered that in respect of the costs of the trial itself, it should be immediately ascertained by way of gross sum assessment under Order 62, rule 9(4)(b), and that the balance of the costs of the action should go to taxation. I ascertained the costs of the trial by way of gross sum assessment, also on 9 June 2000, in the sum of some $1.2 million, and the costs of the balance of that action should of course go to taxation, which the parties did, and that was what took place on 30 November 2000.

4. In the meantime, the 2nd defendant lodged a Notice of Appeal to the Court of Appeal. There was no date fixed for the hearing of the appeal as of 30 November 2000. The 2nd defendant applied by summons, also returnable to be heard on 30 November 2000 for the taxation hearing to be stayed because of the appeal. That stay application was heard by the master and was dismissed. It was of course rightly dismissed because, as is well-known, an appeal normally does not operate as a stay and the court does not easily deprive a successful litigant from the fruit of the judgment. In fact there was, earlier on 9 June 2000, an application by counsel for the 2nd defendant for a stay of enforcement of the judgment which I refused.

5. What then happened after the dismissal of the application for a stay by the 2nd defendant was that the master proceeded to hear the parties on taxation. He apparently was hoping for some measure of agreement, but there was no agreement at all and the matter was fought out on all fronts, as I understand it. There were large number of items - I think, 69 items - that had to be determined. The matter took the whole day and, at the end of the day, on 30 November 2000, the taxation had not yet been completed, so it had to be adjourned. It is estimated that another two days would be required to complete the taxation.

6. So far there was no problem but the master, very curiously, by what I can only call an internal self-contradiction, ordered that the resumed date for the taxation hearing should be after the hearing of the appeal, with a proviso that if there is an unduly delay of the hearing of the appeal, then the plaintiffs are at liberty to go back to him to fix an earlier date. It seems to me that the master was entirely wrong in that order because by so doing, he was in fact granting a stay of the taxation hearing or depriving the plaintiffs the right to the normal taxation hearing which follow an order for costs. Whether one calls the order bad on the basis of lack of jurisdiction because he has no jurisdiction to grant the stay or wrongful exercise of discretion, seems to me does not matter here very much. It was the wrong order to make and he should not have made it. He should simply order the date to be adjourned to the earliest possible date to be fixed, so that the taxation can be completed. It seems to me that he was persuaded, whether by the difficulty of the taxation or by other matters, to make the erroneous order.

7. At today's appeal, Mr Szeto, in his able submission, tried to persuade this court that there could be some other basis that the order of the master might be seen, with hide-sight to be not wholly incorrect or should not be disturbed. He relied, inter alia, on material that were not in affidavit evidence before the master, such as the fact that there had been a sale of the property and that there might have been difficulty with the return of taxed costs if paid out to the plaintiffs.

8. It seems to me wrong on this appeal for me to receive the additional material. But in any event even if I do, in my view, the same conclusion that I have come to earlier would still be reached, namely that the order was wrong. There is a distinction to be drawn between halting the taxation in the manner he did as opposed to making an order after taxation on compelling grounds for a stay of execution of the costs so ascertained. What he did was in fact halting the taxation in a bizarre way.

9. My judgment is that the appeal sought by the plaintiffs must be allowed. The second and third parts of the order that I recited earlier of the master should be set aside. Instead, this court orders that the hearing of the resumption of the taxation should take place as soon as possible and without regard to the date of the hearing of the appeal by the Court of Appeal.

10. So far as the costs of this appeal from the master is concerned, I order the costs in favour of the plaintiffs and I propose also to assess the costs by way of gross sum assessment now.