ANTONIA LOUISE ZOYA ANTON v. CATHAY PACIFIC AIRWAYS LTD

DCEC 724/2020

[2022] HKDC 650

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO. 724 OF 2020

--------------------------

IN THE MATTER OF AN APPLICATION BETWEEN

--------------------------

--------------------------

DECISION

--------------------------

THE APPLICATION

1.  By summons filed on 24 November 2021 (“the Replacement Summons”), the respondent applied for leave to withdraw the Affidavit of Albert Ki-Yan Yeung (“Mr Yeung”) filed on 3 September 2021 and replace it with the 1^st Affidavit of Kwong, Tannie Tsz Pang (“Mr Kwong”) filed on 24 November 2021, in support of its summons for specific discovery against the applicant filed on 3 September 2021 (“the Discovery Summons”)

2.  By a Decision which was handed down on 11 May 2022, this Court:

(1)  expunged Mr Yeung’s “affidavit” which was not sworn at all;

(2)  granted retrospective leave for the respondent to file and serve Mr Kwong’s 1^st Affidavit in support of the Discovery Summons;

(3)  made a costs order nisi that there be no order as to the costs of the Replacement Summons (“the Costs Order Nisi”).

3.  When this Court made the Costs Order Nisi, the following brief explanation was made:

“23. The whole application stemmed from the respondent having put forward Mr Yeung as a deponent, who did not even sign his Affidavit.

24. On the other hand, with greatest respect, the applicant was trying to seek the dismissal of the Discovery Summons by a knock-out blow. However, the arguments advanced were totally unmeritorious. If the matter had been handled in a more reasonable way, the Discovery Summons would not have been stalled for half a year.

25. Having taken the above matters into account, I make a costs order nisi that there be no order as to the costs of the application.”

4.  Pursuant to paragraph 26 of the Decision, the respondent applied to vary the Costs Order Nisi and asked for an order that:

(1)  The applicant do pay costs of and occasioned by the Replacement Summons on party and party basis, to be taxed if not agreed, with certificate for counsel (including the costs of the hearing on 26 November 2021);

(2)  Alternatively, the applicant do pay costs of and occasioned by the Replacement Summons from 6 December 2021 onwards, or from such other date as the Court deems proper, on party and party basis, to be taxed if not agreed, with certificate for counsel.

THE LEGAL PRINCIPLES

5.  It is trite that the Court has a wide discretion on costs.

6.  Order 62 rule 3(2A) of the Rules of the District Court (Cap.336H) (“the RDC”) provides that:

“If the Court in the exercise of its discretion sees fit to make any order as to the costs of or incidental to any interlocutory proceedings, it may, subject to this Order, order the costs to follow the event or make such other order as it sees fit.”

7.  In Melvin Waxwan v Li Fei Yu (HCA 1972/2012, unreported, 11 September 2013), To J had the following to say:

“Summing up on the post-CJR position, I think the court has much wider discretion as to costs in interlocutory proceedings. Unlike other proceedings, the general rule of costs following the events do not apply. The court is entitled to take into account all the circumstances of the case, including those set out in rule 5, to make such order as it thinks fit. In the exercise of its discretion, the court may take the issue-based approach or may take into account merit of the parties’ case or the possible outcome of the action. The circumstances of interlocutory proceedings are so numerous that it is impossible to make any general rule. Costs to follow the event and costs be to the successful party’s costs in the cause are obvious options.”

8.  Order 62 rule 5(1) of the RDC sets out a number of special matters which the Court may take into account in exercising its wide discretion. They include, among other things:

(1)  the underlying objectives set out in Order 1A, rule 1 of the RDC;

(2)  any written offer which is expressed to be “without prejudice save as to costs” and which relates to any issue in the proceedings, but the Court may not take the offer into account if, at the time it is made, the party making it could have protected his position as to costs by means of a sanctioned payment or a sanctioned offer under Order 22 of the RDC;

(3)  the conduct of all the parties;

(4)  whether a party has succeeded on part of his case, even if he has not been wholly successful;

(5)  any admissible offer to settle made by a party, which is drawn to the Court’s attention.

9.  In respect of “conduct of the parties”, Order 62 rule 5(2) of the RDC stipulates that it includes:

(1)  whether it was reasonable for a party to raise, pursue or contest a particular allegation or issue;

(2)  the manner in which a party has pursued or defended his case or a particular allegation or issue;

(3)  whether a claimant who has succeeded in his claim, in whole or in part, exaggerated his claim; and

(4)  conduct before, as well as during, the proceedings.

DISCUSSION

10.  The respondent’s primary position is that the applicant should be ordered to bear the costs of the Replacement Summons because, it was said, this summons could and should have been avoided had the applicant acted reasonably.

11.  As I pointed out in the Decision, the Replacement Summons stemmed from the respondent having put forward Mr Yeung as a deponent, who did not even sign his Affidavit. Hence, the respondent would have to ask for the Court’s indulgence anyway in putting in another affidavit in support of the Discovery Summons.

12.  In these circumstances, I do not consider it right to order the applicant to bear the entirety of the respondent’s costs of the Replacement Summons as suggested.

13.  However, for the purpose of this variation of Costs Order Nisi application, this Court’s attention had been drawn to the following Calderbank offer which was made by the respondent on 6 December 2021. It reads:

“Providing your client agrees to paragraph 1 of [the Replacement Summons] and/or for retrospective leave for our client to file and serve the Affidavit of Kwong, Tannie Tsz Pang dated 24 November 2021, our client will pay your client’s costs of [the Replacement Summons] as follows:

Costs of this application up to and including the hearing on 26 November 2021 herein be to the Applicant in any event, to be taxed if not agreed and there be no order as to costs after the hearing on 26 November 2021.”

14.  The applicant did not make any reply to the said offer.

15.  By reference to the Decision, the applicant has apparently failed to do better than the offer contained in the said Calderbank letter. In other words, costs could have been saved should the applicant have accepted the said offer.

16.  In these circumstances, there is no reason why the applicant should not bear the costs consequence for her refusal to accept the said offer. Indeed, in his written submissions, the applicant’s solicitor had failed to address the said Calderbank offer altogether.

17.  I therefore order that the applicant do pay the respondent’s costs of and occasioned by the Replacement Summons from 6 December 2021 onwards, on party and party basis.

18.  Although Mr Sakhrani initially suggested in his written submissions[1] that the respondent’s costs of the Replacement Summons should be taxed if not agreed, he at the end of his submissions clarified that the respondent would support a summary assessment of costs. The applicant also accepted that any costs granted herein should be summarily assessed. I agree that this is an appropriate approach. Further directions for summary assessment of the respondent’s costs of the Replacement Summons from 6 December 2021 onwards will be given below.

19.  Without disrespect to Mr Sakhrani, I am of the view that the issues involved in the Replacement Summons are so straight-forward that it was not necessary for counsel to be engaged. Even though this Court appreciates that counsel had been instructed to act for the respondent from the outset of this action [2], I take the view that the Court should still take into account the complexity of the interlocutory application involved when deciding whether to grant certificate for counsel.

COSTS

20.  The respondent has succeeded in varying the Costs Order Nisi. I therefore make a costs order nisi that the applicant shall bear the respondent’s costs of this application, which is going to be summarily assessed.

21.  The above order nisi shall become absolute in the absence of application to vary (which, if any, shall be made by letter, and will be disposed of on paper) within 14 days hereof.

22.  Unless any application for variation of the aforesaid costs order nisi is made within time:

(1)  The respondent shall lodge and serve its Revised Statement of Costs[3] within 7 days after the expiry of the said 14-day period;

(2)  The applicant shall lodge and serve her Statement of Objection within 7 days thereafter.

(3)  Summary assessment of the respondent’s costs of the Replacement Summons from 6 December 2021 onwards and of the variation of Costs Order Nisi application pursuant to Order 62 rule 9A(1)(a) of the RDC will be conducted on paper (no matter whether any statement of objection is lodged by the applicant within time) thereafter.

23.  The costs summarily assessed shall be payable by the applicant within 14 days after assessment.