SINCERE BRAND MANAGEMENT LTD v. CORTINA WATCH HK LTD AND OTHERS

HCA 823/2023 & HCCT 51/2023

[2024] HKCFI 1189

HCA 823/2023

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 823 OF 2023

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HCCT 51/2023

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTRUCTION AND ARBITRATION PROCEEDINGS

ACTION NO 51 OF 2023

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DECISION ON COSTS

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1.  With the withdrawal of the Injunction Summonses in these actions (dated 19 June 2023 in HCA 823/2023 and dated 21 June 2023 in HCCT 51/2023)  by way of 2 Withdrawal Summonses both dated 23 February 2024, the parties had agreed that the costs of both the Injunction Summonses and Withdrawal Summonses be dealt with by the Court on paper. 

2.  The issues between the parties are (i)  whether these costs (save that the costs order dated 13 July 2023 should not be disturbed)  should be paid on indemnity basis and (ii)  whether they should be taxed and paid forthwith.

3.  The Defendants seek to have the costs awarded on indemnity basis and have them taxed and paid forthwith.  Their main argument is that the injunction applications were bound to fail by reason of the delay on the part of the Plaintiff in seeking such relief, and the Plaintiff should have withdrawn the injunction applications well before the Withdrawal Summonses. 

4.  In my view, the Court should not be overly critical of Plaintiff who had tried to dissuade the Defendants from acting against its interest as the sole distributor of Franck Muller watches without going to court.  There is force in the Plaintiff’s submission that the point in time of significance was May 2023 when the Defendants, despite the Plaintiff’s repeated warnings, were pressing ahead with setting up premises for the sale of Franck Muller watches under “new distributorship”.  The Injunction Summonses were taken out not long afterwards.

5.  It may be said that the Withdrawal Summonses could have been taken out earlier.  On the other hand, the issue is whether the lateness of the withdrawal application should be reflected in a costs order in the terms sought by the Defendants.

6.  Taking into account all relevant considerations and the principles on indemnity costs set out in Town Planning Board v Society for Protection of the Harbour Ltd (No 2)  (2004)  7 HKCFAR 114, I am not satisfied that costs should be awarded on indemnity basis.  On the other hand, these constitute a discrete set of costs.  I see no good reason why taxation should wait until the conclusion of these proceedings. 

7.  In the premises, I order that the costs of the Injunction Summonses and the Withdrawal Summonses be paid by the Plaintiff to the Defendants, to be taxed on party and party basis if not agreed and paid forthwith.