BHAGWAN SHANKARDAS MOORJANI v. THE KA WAH BANK LTD.

CACV 116/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 116 OF 2000

(ON APPEAL FROM HCA NO. 16440 OF 1998)

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J U D G M E N T

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1. On 10 March, Yam J dismissed the action of the Plaintiff, Bhagwan Shankardas Moorjani, against the Defendant, the Ka Wah Bank Ltd ("the Bank"). Mr Moorjani is appealing to the Court of Appeal against the dismissal of the action. The Bank now applies for security for its costs of the appeal. It does so on two grounds. The first is that Mr Moorjani is not resident in Hong Kong. The second is that the appeal has no chance of success.

2. I am satisfied that the Bank's costs of the appeal should be secured on the first ground. It is not disputed that Mr Moorjani lives in India, and the court's normal practice in such a case would be to order security. Residence of an appellant abroad is normally regarded as justifying security for a respondent's costs because of the undue delay and expense in enforcing an order for costs abroad and because of the possibility that the order will not be enforced at all.

3. The only ground on which Mr Moorjani contends that the usual practice should not apply is that he has no available assets as a result of the Bank's conduct towards him, that he would not be able to comply with an order for security for costs, and that the effect of making an order for security for costs would be to stifle his appeal. The problem, though, is that he has not filed any evidence relating to his impecuniosity, and his impecuniosity would itself be a ground for ordering security (subject, of course, to his point that it was the Bank which was responsible for his current poverty).

4. In The Supreme Court Practice 1999, Vol. 1, para. 59/10/33, it is stated that

"..... there is no absolute rule that security will not be awarded where the appellant contends that his insolvency or impecuniosity has been caused by what he alleges to be wrongful acts committed by the respondent(s). The court has a discretion. The question is whether awarding security would amount to a denial of justice to the appellant..... In assessing that issue the Court takes into account the merits of the appeal."

The difficulty for Mr Moorjani is that, although he has filed an affirmation headed "Objections of Appellant for ordering fresh security of costs due to illegal judgment" in which he criticises some of the features of the judgment of Yam J, and although I am prepared to assume (though without deciding) that his appeal is not hopeless, he has not spelt out the precise grounds of his appeal in such a way as to enable the court to form a view as to the real merits of his appeal. Accordingly, after some hesitation, I have concluded that the circumstances are not such as to justify a departure from the court's usual practice to require an appellant resident abroad with no assets in Hong Kong to provide security for the respondent's costs.

5. However, the amount of the security sought - $108,000.00 - does not take into account the incidence of taxation. In my view, the amount of security which Mr Moorjani should be ordered to provide is $60,000.00. I therefore direct that all proceedings in the appeal be stayed until Mr Moorjani pays the sum of $60,000.00 into court as security for the Bank's costs of the appeal. I further direct that if Mr Moorjani fails to pay that sum into court by 4:30 p.m. on 19 October, his appeal be dismissed, and that he be required to pay the Bank's costs of the appeal to be taxed if not agreed, though I give Mr Moorjani liberty to apply for an extension of time to provide the security if he finds himself in genuine difficulty raising the $60,000.00 by 19 October.