WONG WING SZE TIFFANY, Administratix of the Estate of CHAN CHUNG HAN also known as CHAN CHUNG HONG v. TSANG WING FAI AND ANOTHER

HCMP 367/2019

[2019] HKCFI 2761

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 367 OF 2019

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DECISION

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1.  I have before me two summonses:

(1)  The Plaintiff’s Summons dated 14 October 2019 for uplifting the automatic stay of proceedings that arose as a result of the Defendants’ applications for legal aid (the “Uplift Summons”);and

(2)  The 1^st Defendant’s Summons dated 27 September 2019 to suspend the Order made by this Court on 23 July 2019 (the “Order dated 23 July 2019”).

2.  On 31 October 2019, the Court received a letter from the 1^st Defendant applying for an adjournment of the present hearing to March 2020 on medical grounds.  Mr Kok for the Plaintiff opposed the application.

3.  Although the Court is sympathetic with the medical condition of the 1^st Defendant, I do not consider that it is fair to the Plaintiff to adjourn the hearing of both Summonses to March 2020.  The two Summonses can be disposed of rather easily and there are no good reasons why the Order dated 23 July 2019 should not be complied by the Defendants.  In any event, there is no reason why the 2^nd Defendant cannot attend the present hearing.

Material facts

4.  On 23 July 2019, this Court made the Order dated 23 July 2019, which include the Orders that (i) the Defendants do deliver vacant possession of the Properties (as defined in the said order) to the Plaintiff before 30 September 2019, and (ii) the 1^st Defendant do deliver up and/or transfer to the Plaintiff all assets and monies of the Estate within 14 days (ie 6 August 2019), failing which the 1^st Defendant do file an explanatory affirmation within 28 days (ie 20 August 2019).

5.  I am informed that to date, neither the Defendants have complied with the aforesaid Orders.  This morning I am informed by Mr Kok for the Plaintiff that the Defendants have lodged an appeal against this Court’s Order dated 23 July 2019 but so far no papers have been served on the Plaintiff.

6.  Instead, only a few days before the deadline for delivering vacant possession, the 1^st Defendant and the 2^nd Defendant respectively filed applications for legal aid on 23 and 25 September 2019.  The legal aid applications were made on the basis of prosecuting an appeal against this Court’s Order dated 23 July 2019, notwithstanding the time for the Defendants to lodge any appeal had already expired. 

7.  As a result of the Defendants’ legal aid applications, there is a 42-day automatic stay of the proceedings.  For present purposes, the automatic stay of proceedings was due to expire on 6 November 2019 (ie 42 days after the 2^nd Defendant’s legal aid application). 

8.  On 27 September 2019, the 1^st Defendant filed the Suspension Summons, which was fixed to be heard today before this Court.

9.  On 4 October 2019, the Director of Legal Aid (“DLA”) refused both of the Defendants’ application for legal aid.

10.  On 11 October 2019, the Plaintiff’s solicitors issued a letter to the 1^st Defendant, by which the Plaintiff, inter alia, requested the 1^st Defendant to withdraw its unmeritorious application under the Suspension Summons, failing which the Plaintiff would seek costs against the 1^st Defendant on an indemnity basis (“the Letter”).  To date, the 1^st Defendant has not replied to the Letter. 

11.  On 14 October 2019, the Plaintiff filed the Uplift Summons for the purposes of uplifting the automatic stay.  The Uplift Summons was fixed to be heard together with the Suspension Summons.

The Uplift Summons

12.  The purpose of the legal aid stay is to allow sufficient time for the DLA “to process an application for legal aid”: Woo Ming Han Juliana v Woo Koo Ping & Others HCA 2558/2015, unreported, 30 November 2015 at §27 per Deputy High Court Judge Kwok SC. 

13.  In the present case, the Defendants’ legal aid applications have already been refused on 4 October 2019.  Hence, any purpose for the stay would have already been served, and as such it ought to be uplifted.  (See The Hongkong and Shanghai Banking Corporation Ltd v Lam Chun Hing HCMP 997/2016, unreported, 14 July 2017 at §30 per Deputy High Court Judge Kwok SC.)  As no purpose will be served by continuing the stay, I agree that the stay should be uplifted.   

14.  Further, I also agreed that unless this Court were to formally uplift the stay (which was due to expire in two days), the 1^st Defendant’s Suspension Summons would need to be adjourned to a further hearing.  There is no reason for such adjournment, which would only lead to unnecessary wastage of costs and the Court’s resources. 

15.  Mr Kok for the Plaintiff also submitted that the timing and nature of the Defendants’ legal aid applications clearly demonstrate that they were not made for bona fide purposes, but were merely tactical moves for the purposes of causing delay: see Woo Ming Han Juliana (supra)at §29. 

16.  For the purpose of this hearing, I do not need to decide whether the applications for legal aid were made in good faith. However, as no purpose is to be served by the continuous stay, I am of the view that the proper course is to uplift the stay so that this Court can also deal with the Defendants’ Suspension Summons.

Suspension Summons

17.  I agree that there is simply no basis for the 1^st Defendant to seek the “suspension” of this Court’s Order dated 23 July 2019.  

18.  Mr Kok for the Plaintiff also rightly pointed out that the 1^st Defendant’s only ground for seeking to suspend this Court’s Order dated 23 July 2019 was that “Legal Aid had been applied on September 23, 2019”.

19.  The simple point is that the fact that the 1^st Defendant had made a legal aid application (which has since been refused) is not a viable basis for suspending any court order.

Disposition

20.  For all the reasons stated above, I make an order in terms of the Uplift Summons and dismiss the Suspension Summons.

21.  As for the costs of the Suspension Summons, Mr Kok for the Plaintiff submitted that costs of and occasioned by the Suspension Summons should be personally paid by the 1^st Defendant to the Plaintiff forthwith, to be taxed if not agreed and on an indemnity basis.  I agree that this is a suitable case to make a costs order on an indemnity basis.

22.  First, as observed by the Court of Appeal in Huge Dragon Corp Ltd v Lung Mun Oasis (IO) [2014] 3 HKLRD 286 at §13 per Jeremy Poon J (as he then was), “where the proceedings in question should never have been brought or defended but the party nevertheless unreasonably and unjustifiably persisted, he may well be visited with indemnity costs”. 

23.  Secondly, I agree that the 1^st Defendant’s Suspension Application is entirely unmeritorious, and should never have been made in the first place. 

24.  Thirdly, upon the DLA’s refusal of the 1^st Defendant’s application and his receipt of the Letter dated 11 November 2019, the 1^st Defendant still failed and/or refused to withdraw the Suspension Summons.  The 1^st Defendant unreasonably and unjustifiably persisted with the application.  In the circumstances, it is only just and fair that the 1^st Defendant should pay the costs of and incurred by the Plaintiff personally on an indemnity basis.

25.  As for the costs of the Uplift Summons, I agree that the costs of and occasioned by the Uplift Summons should be paid personally by the Defendants to the Plaintiff forthwith.  Such costs were incurred because of the unreasonable conduct of the Defendants. 

26.  I also make an order that to the extent that the Plaintiff’s aforesaid costs are not paid for by the Defendants, the Plaintiff is entitled to have her costs to be paid out of the Estate, on a trustee basis pursuant to Order 62, rule 6 of the Rules of the High Court, Cap 4A.

27.  Finally, it remains for me to thank Mr Kok for the Plaintiff for his able and helpful submissions.