CLP POWER HONG KONG LTD v. COMMISSIONER OF RATING AND VALUATION

HCMP 3207/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO 3207OF 2015

(ON AN INTENDED APPEAL FROM LDGA NO 241 OF 2004 AND
LDRA NOS 365 TO 369 OF 2004)

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JUDGMENT

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Hon Lam VP (giving the Judgment of the Court):

1. This is an application for leave to appeal against an order for costs made by the Lands Tribunal in a rating appeal. CLP was successful in the appeal. By a judgment of 9 April 2015, the Tribunal gave CLP costs of the appeal but disallowed costs incurred on certain valuation approaches placed by CLP before the Tribunal. In so doing, the Tribunal varied the costs order nisi made by the Tribunal in the main judgment of 24 April 2013. The costs order nisi gave CLP all the costs in the appeal.

2. There had been a change in the composition of the Tribunal: the President who sat with Member Lo in giving the main judgment was Au J.  However, by the time the application for variation of costs order nisi was heard, L Chan J became the President.  The decision of 9 April 2015 was made by L Chan J sitting with Member Lo.  Member Lo was in the case throughout and he agreed with L Chan J in the decision of 9 April 2015. 

3. On 20 November 2015, the Tribunal refused to grant leave to appeal.  CLP renewed the application for leave before us.

4. After hearing very helpful submissions from counsel, we reserved our judgment. 

5. In the end, we decide we should refuse leave for the following reasons:

(a) It is well established that this court will not interfere with the costs decision of a lower court unless it can be shown that the lower court has erred in principle or its decision was plainly wrong: see Ho Shu Kwong v Chiang Chun Yuan [2002] 3 HKLRD 419; Chan Shun Kei v Hong Kong Construction (HK) Ltd CACV 192 of 2014, 7 March 2016;

(b) We are not satisfied that the Tribunal has committed any palpable error of principle or that its decision of 9 April 2015 could be said to be plainly wrong: the Tribunal was well aware that CLP was the successful party in the appeal.  It is within the Tribunal’s wide discretion to rule that, notwithstanding that it was the successful party, CLP should be deprived of some of its costs on account of the lack of utility of some of the evidence.  It falls within the conduct of the parties under Order 62 Rule 5(2) which could be taken into account under Rule 5(1)(e).  It is also consistent with the underlying objectives in Order 1A rule 1 to have regard to such matters.  In this connection, we do not think it is necessary to be bogged down by asking whether the use of such evidence constitute the raising of a different issue or allegation.  Even if it does not, it is a matter of the conduct of the appeal, as such within Rule 5(2)(d);

(c) The proposition that one should not depart from the starting point of costs following the event too readily cannot arguably be a ground to challenge the decision of the Tribunal in the present case in view of the cogent and careful reasons given by it for making its costs order;

(d) Quite obviously, the Tribunal had exercised its discretion bearing in mind the success of CLP as well as how CLP had conducted the appeal.  As Mr Yu SC (leading Ms Cheng SC appearing on behalf of the Commissioner) submitted, the Tribunal was entitled to make the findings that the evidence pertaining to Approaches 2 and 3  was unreliable and it was unreasonable to use such evidence in the appeal.  In this connection, we do not accept there was any inconsistency between the main judgment and the judgment of 9 April 2015.  Given that the Tribunal was only making a costs order nisi in the main judgment, it would not be right to expect the Tribunal to comment on the reasonableness of the use of such evidence in the main judgment.  Even so, the Tribunal had explained in clear terms and by reference to some elementary valuation principles why CLP’s evidence on Approaches 2 and 3 was unreliable. The Tribunal, in particular Member Lo, was in the best position to assess whether the use of such evidence was unreasonable and he, together with L Chan J, found that it was unreasonable.  Mr Litton (appearing for CLP), despite his able and skilful submissions, had not been able to persuade us that it is reasonably arguable that such finding is wrong in principle or otherwise plainly wrong.  We are not persuaded that the Tribunal had approached the matter simply with the benefit of hindsight or failed to pay proper regard to the need for circumspection in departing from the starting point. 

(e) In substance, CLP tried to invite this court to come to a different view on how the discretion should be exercised. As explained in the cases cited above, this is not a proper approach;

(f) We do not find any ground for saying that the Tribunal’s decision is plainly wrong; and

(g) Therefore, the intended appeal does not have any reasonable prospect of success.  Nor do we see any other reason in the interest of justice to grant leave to appeal.     

6. The application is dismissed with costs.  Having heard parties on costs in light of the costs statement of the Commissioner, we fixed the costs that CLP shall pay to the Commissioner in this application at $450,000. 

7. Lastly, we wish to express our gratitude to counsel for their able assistance in this matter.