SO YEE MUI AND OTHERS v. LAM PUI CHI

CACV 283/2010

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 283 OF 2010

(ON APPEAL FROM HCAP NO. 7 OF 2008)

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BETWEEN

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REASONS FOR DECISION

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1.  There are two applications taken out by the plaintiffs, who are the respondents in this appeal. The 1^st summons is dated 7 March 2011, in it the plaintiffs seek security for costs of the appeal against the defendant in the estimated sum of $1,152,000. The 2^nd summons is dated 25 March 2011, in it the plaintiffs seek an unless order that the defendant be required to file and serve a draft appeal bundle within 28 days.

2.  I should mention that the day before the hearing of these summonses, on 7 April 2011, the Director of Legal Aid issued a Notice of Application for legal aid by the defendant.  The defendant has applied for legal aid on 9 December 2010 to prosecute her appeal and this was rejected on 29 December.  As I understand from the defendant, her latest application for legal aid is in respect of the plaintiffs’ application for security for costs of the appeal.  Under section 15(4) of the Legal Aid Ordinance, Cap. 91, the court has discretion to lift the stay of proceedings notwithstanding the Director of Legal Aid has filed a memorandum of notification that a party has applied for legal aid.  I have exercised my discretion to lift the statutory stay in this instance, as I consider the fresh application for legal aid to be without merit.

3.  The judgment being the subject of the appeal is in hostile probate litigation.  The single issue at trial is whether the 1^st plaintiff or the defendant was the lawful wife of the deceased.  The determination of this issue will resolve the conflicting claims to the grant of letters of administration for the deceased’s estate.  After a 5-day trial in October 2010, Lam J handed down judgment on 1 December 2010.  He found in favour of the plaintiffs.  He ordered the defendant’s caveat to be vacated and letters of administration be granted to the 2^nd plaintiff.  The defendant was ordered to pay the plaintiffs’ costs on a party-and-party basis.  The defendant’s application to vary the costs order nisi was dismissed on 29 December 2010 and she was ordered to pay gross sum costs of $20,000 to the plaintiffs in respect of that failed application.

4.  The defendant was legally represented at the trial.  She is acting in person in this appeal.  The Notice of Appeal was filed on 28 December, followed by a Notice of Setting Down an Appeal on 29 December.  As mentioned earlier, she applied for legal aid to prosecute her appeal but the application was turned down on 29 December .

5.  On 11 January 2011, the defendant wrote to the court stating that she would adopt the trial bundles as the appeal bundle and would like to obtain a transcript of the trial.  It would appear from the letter of the Registrar of Civil Appeals to the plaintiffs’ solicitors on 28 February 2011 that the defendant’s application for a transcript was granted by the judge and the transcript had been sent to her on an earlier date.  As the defendant is acting in person, a preliminary directions hearing is required and the hearing date for this would only be given after the defendant has submitted a draft appeal bundle.

6.  The plaintiffs’ solicitors and the Registrar of the High Court have written to the defendant on 10 and 15 March 2011 asking her to lodge the appeal bundle without delay.  As this was not complied with, the plaintiffs issued the summons for an unless order on 25 March 2011 requiring her to lodge the bundle within 28 days failing which her appeal would be dismissed.  I understand from the defendant the reason why she has not done so is because she is still looking for solicitors to represent her in the appeal.  This is plainly not a reason for failing to lodge the bundle.  Other than this, she has no difficulty in lodging the bundle.  I consider she should do so without delay, so as not to hold up the progress of the appeal, as prejudice would be occasioned to the plaintiffs who would not be able to obtain letters of administration from the probate registry until the appeal has been disposed of one way or other.  I am not minded to make an unless order on this occasion but will lay down a specific period within which the defendant is required to lodge the draft appeal bundle.

7.  I turn to the summons for security for costs of the appeal.

8.  The 2^nd plaintiff filed evidence in support of that summons on 7 March 2011.  The plaintiffs’ solicitors have written to the defendant on 10 March drawing her attention to the fact that if she should fail to file evidence in opposition before the hearing, the plaintiffs would proceed with the application on the day of the hearing.  The defendant has not filed any evidence in opposition.

9.  In the absence of countervailing factors, if it is established that the respondent would have difficulty or encounter delay in recovering his costs on appeal due to the impecuniosities of the appellant, the court would generally exercise its discretion to order security to be provided by the appellant for the costs of the appeal.

10.  On the available evidence, I am satisfied that the plaintiffs have made out a case that they would have difficulty or would encounter delay in recovering their costs from the defendant if the appeal is dismissed.  I have taken into account the defendant has said in her witness statement she was completely dependent on the deceased financially, and it was the deceased who had provided for her monthly maintenance and all her needs.  The deceased passed away on 18 March 2008.  She had incurred legal fees in the trial estimated by her solicitors to be in the region of $1 million. She is liable to pay the costs of the plaintiffs and such costs for the 5-day trial are very likely to exceed $1 million.  She has made two applications for legal aid in this appeal.

11.  I have considered the grounds of appeal in the Notice of Appeal. Three grounds are raised, they seek to challenge the findings of fact made by the judge, who has found the defendant not to be a credible witness.  Counsel for the plaintiffs submitted that the appeal is hopeless.  On a preliminary view, I am inclined to think the grounds as they stand do not have reasonable prospects of success.

12.  It is appropriate in the circumstances to order security.

13.  The amount sought is $1,152,000 on the basis that senior counsel and junior counsel would be engaged, as in the trial below.  It seems to me that this appeal on findings of fact should be straightforward.  The amount of security should be premised on the estimated costs that would be allowed on taxation on a party-and-party basis.  On the basis that the plaintiffs are to recover the costs incurred in engaging a reasonably competent counsel to handle this appeal which is unlikely to last more than one day, I reduce the amount of security for costs of this appeal to $350,000.  The orders I have made on the two summonses are as follows:

(1) the defendant is to lodge the draft appeal bundle within 21 days hereof;

(2) the defendant is to pay into court $350,000 as security for costs of this appeal within 42 days hereof;

(3) the appeal proceedings are to be stayed until payment by the defendant of the security for costs as ordered in paragraph (2) hereof;

(4) for the avoidance of doubt, the time for the defendant to lodge the draft appeal bundle as ordered in paragraph (1) hereof is to continue to run notwithstanding the stay of proceedings in paragraph (3) hereof;

(5) in the event security is not provided as ordered in paragraph (2) hereof, this appeal do stand dismissed with costs without further order; and

(6) costs of the plaintiff’s summonses are to be in the cause of the appeal.