CHINA SHANSHUI CEMENT GROUP LTD AND OTHERS v. ZHANG CAIKUI AND OTHERS

HCA 2880/2015
[2018] HKCFI 39

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2880 OF 2015

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DECISION ON COSTS

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1.  By their summons dated 26 July 2017, the 1^st and 2^nd defendants have applied for a variation of the costs order nisi made in paragraph 54 of my judgment in these proceedings dated 18 July 2017 arising from applications in relation to Mareva orders against those two defendants. That paragraph reads as follows:

“(1) The 1^st to 3^rd plaintiffs do pay the Zhangs the costs of their summons for discharge dated 18 November 2016 and their Variation Summons dated 26 May 2017.

(2) The 2^nd and 3^rd plaintiffs do pay the Zhangs the costs of their summons dated 7 November 2016 (for continuation of the injunction).

(3) The Zhangs do pay the costs of §1 of the plaintiffs’ summons dated 7 November 2016, as amended pursuant to the plaintiffs’ summons dated 2 June 2017.

(4) No order as to costs of the ex parte application.”

2.  Essentially there are three points raised by the 1^st and 2^nd defendants.  First, they contend that the costs ordered in their favour should be either summarily assessed and paid forthwith or taxed forthwith if not agreed.  I accept that post-CJR, the court is generally more ready to deal with costs immediately following an interlocutory decision either by way of summary assessment or otherwise. Indeed, Practice Direction 14.3, paragraph 6, states that the court will give preference to summary assessment or provisional summary assessment unless there is good reason not to do so. 

3.  In this particular case, the costs orders that I made on a provisional basis, and as a result of this decision, do not all go one way.  Further, there are likely to have been costs orders between the same parties, in these proceedings or other actions, not all of which will have been summarily assessed, and which may be capable of being set off one against another on a commercial basis.  The amount of costs under my orders in question is unlikely to have any impact on the cash flow of any of the parties.  Accordingly, I decline the variation sought.  For the avoidance of doubt, the costs are ordered in any event, to be taxed if not agreed.

4.  The second point raised by the 1^st and 2^nd defendants is that all four plaintiffs (instead of only the 2^nd and 3^rd plaintiffs) should be required to pay the defendants the costs of the summons dated 7 November 2016 for continuation of the Mareva order.  This should be considered together with the third point, which is that, instead of ordering the 1^st and 2^nd defendants to pay the costs of paragraph 1 of the plaintiffs’ summons dated 7 November 2016 as amended pursuant to the plaintiffs’ summons dated 2 June 2017, there should be no order as to the costs of the domestic Mareva order granted on 18 July 2017. 

5.  The basis put forward for these contentions, very broadly, is that it is said that the four plaintiffs have failed on their continuation summons in its entirety and that the domestic Mareva orders were granted in the exercise of discretion by the court and not upon the plaintiffs’ applications. 

6.  The argument is, in my view, overly technical in relation to the 1^st plaintiff.  While it is true that the plaintiffs did not in terms ask for a “re‑grant” of the Mareva order in the event of its discharge on the ground of material non‑disclosure, the re‑grant of a Mareva order to the extent of HK$24 million in favour of the 1^st plaintiff was the result of and based on the arguments raised in the contested hearing on 7 June 2017.  The 1^st plaintiff was therefore in substance successful in obtaining a Mareva order, to the extent of its own claim against the 1^st and 2^nd defendants.  The fact that the ex parte order was discharged was reflected in the order that the 1^st to 3^rd plaintiffs have to pay the costs of the defendants’ summons for discharge. 

7.  So far as the 4^th plaintiff is concerned, the 1^st and 2^nd defendants’ argument is, in my view, incorrect.  There had never been any Mareva order granted in favour of the 4^th plaintiff.  It was only joined as an applicant in the application under the summons of 7 November 2016 by amendment, permitted at the hearing, pursuant to the plaintiffs’ summons dated 2 June 2017.  The Mareva order in favour of the 4^th plaintiff was thus granted pursuant to the 4^th plaintiff’s first application which was unsuccessfully contested by the 1^st and 2^nd defendants. I see no reason why there should be no order of costs in favour of the 4^th plaintiff, as contended for by the 1^st and 2^nd defendants. 

8.  It is right, however, that §54(3) of my judgment should be clarified in that the 1^st and 2^nd defendants are to pay the 1^st and 4^th plaintiffs’ costs (as was implicit reading §54(2) and (3) together), given that the 2^nd and 3^rd plaintiffs have wholly failed in their applications.

9.  Accordingly, in the exercise of my discretion, I decline to order the 1^st and 4^th plaintiffs to pay the costs of the summons dated 7 November 2016, and confirm the order nisi at §54(3) of the judgment, subject to the clarification mentioned, that the 1^st and 2^nd defendants should pay the 1^st and 4^th plaintiffs’ costs of paragraph 1 of the plaintiffs’ summons dated 7 November 2016 as amended pursuant to the plaintiffs’ summons dated 2 June 2017. 

10.  Subject to the clarification mentioned, the 1^st and 2^nd defendants’ application to vary the costs order nisi fails, with costs to the plaintiffs in any event.