FRIENDO INCORPORATED v. COSMOS MANOR DEVELOPMENT LTD

HCA1661/2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO.1661 OF 2003

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D E C I S I O N

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1. On 7 November 2003, I dismissed the applicant's appeal against the Master's decision made on 5 August 2003 refusing its application to be joined as a defendant to these proceedings. By summons filed on 21 November 2003, the applicant applies under Order 45, rule 11 and Order 59, rule 13 of Rules of the High Court for a stay of execution of my judgment.

Order 45, rule 11

2. Order 45, rule 11 provides that the court may, if it thinks just, grant a stay of execution on the ground of matters that have occurred since the date of the judgment. In Tam Ho Man v. Wong Kwok Tai (unreported), HCA No. A4736 of 1985 (20 October 1986), it was held that matters relied upon as having occurred since the date of the judgment or order must be matters that go to the validity of the judgment or order which is sought to be stayed.

3. The applicant has not filed any affidavit in support of the present application. That being the case, there is no evidence on the matter that may be said to have arisen since 7 November 2003 that goes to the validity of the judgment. There is therefore no basis for an application under Order 45, rule 11.

Order 59, rule 13

4. As for Order 59, rule 13, it provides that a stay of execution may be granted pending an appeal against the judgment or order. It is trite law that an appeal does not operate as a stay. The court will not grant a stay unless it is satisfied that there are good reasons for so doing. It may be a good reason if it can be shown that without the stay, the appeal will be rendered nugatory or the appellant may suffer loss that cannot be compensated in damages.

5. Likewise, where the appellant can satisfy the court that without a stay of execution, he will be ruined and that his appeal has some prospect of success, the court may grant a stay : Linotype-Hell Finance Ltd v. Baker [1992] 4 All ER 887. Plainly the burden is on a party seeking a stay to satisfy the court that the discretion ought to be exercised in its favour.

The present application

6. In the present case, the applicant had on 20 November 2003 filed a Notice of Appeal against the judgment of 7 November 2003. The applicant has not, as noted above, filed any affidavit in support of the present stay application. In submission, Mr Allan for the applicant submits that the judgment substantially affects the applicant's rights to occupy the Property and has the effect of ruining the applicant's restaurant businesses carried out on the Property. It is said that the livelihood of some 50 staff of the restaurants will be placed in jeopardy. Additionally, Mr Allan submits that the applicant's appeal has a reasonable prospect of success with regard to at least whether the applicant has the necessary locus standi to apply to be joined.

7. As a starting point, it must be pointed out that there is no evidence before the court to substantiate the assertions regarding the hardship or difficulties said to be suffered by the applicant. More importantly, in my judgment, the applicant's stay application is misconceived. The effect of the judgment of 7 November 2003 is to uphold the Master's decision to dismiss the applicant's application to be made a party to these proceedings. As the matter now stands, the applicant is not a party to these proceedings. Neither the Master's order nor my judgment requires the applicant to do or to refrain from doing any act, save in relation to costs. The present application is, however, not to stay the order for payment of costs. It aims at preventing the plaintiff from recovering possession of the Property in question. The plaintiff's right to recover possession is founded upon another decision of the Master, which has since been upheld on appeal by the judgment of Miss Recorder Leong SC handed down on 10 November 2003.

8. An order staying the judgment of 7 November 2003 does not prevent the plaintiff from recovering possession of the Property. Still less will it enable the applicant to remain on the Property, or confer a right on the applicant to continue to occupy the Property. Even assuming that the applicant has made out a case that it would be ruined if it were unable to continue its restaurant businesses on the Property, an Order staying the judgment of 7 November 2003 will not alleviate the difficulties faced by the applicant.

9. I do not understand the applicant to be applying to stay the judgment on possession in favour of the plaintiff. But even if it were, the application cannot stand. This is because, as matters stand, the applicant is not a party to these proceedings and it has no right to seek a stay of the judgment for possession.

10. In the circumstances, it is not necessary to deal with the other submissions relating to the merits of the intended appeal, the prejudice to the plaintiff as well as the suggested motive behind the application.

11. For the reasons set out above, the applicant's summons is dismissed.

Application for temporary stay

12. Upon the summons being dismissed, Mr Allan applies for what he calls a "temporary stay" of the judgment dated 7 November 2003 pending the applicant's application to the Court of Appeal for a stay. It is said that there is urgency because the plaintiff has commenced execution process and the court bailiffs had attended the Property in relation to it. Mr Allan asks that the applicant be given 14 to 21 days.

13. As pointed out, a stay of the judgment of 7 November 2003 does not have the effect of suspending the plaintiff's execution process. In seeking to recover possession, the plaintiff is enforcing the summary judgment for possession against the defendant, not the judgment of 7 November 2003. There is therefore no basis or justification for granting an interim stay of the judgment of 7 November 2003.

14. Mr Allan refers to the Notice of Appeal in which the applicant seeks from the Court of Appeal a stay of the proceedings generally. I do not wish to pre-empt the Court of Appeal on such an application. What I cannot overlook is the fact that the applicant's summons is not for a general stay of the proceedings. The applicant is similarly not seeking an interim stay of the proceedings generally. The summons and the oral application are for a stay of the judgment of 7 November 2003, which for reasons indicated, are misconceived.

15. I need not deal with the plaintiff's submissions that terms should be imposed if interim stay were to be granted. I would only note that it would be a proper exercise of the court's discretion to require the applicant to pay into court the mesne profits outstanding as a condition if stay were to be ordered. But for the reasons that I have mentioned, it is not necessary to dwell into this question. In short, I refuse the application for an interim or temporary stay.

Costs

16. On the costs of the applicant's application there is no reason why costs should not follow event. Indeed Mr Allan does not dispute that.

Conclusion

17. To conclude, the orders I make are as follows :

(1)	The applicant's summons is dismissed.
(2)	The applicant's oral application for an interim stay of the judgment of 7 November 2003 is refused.
(3)	The costs of the application be to the plaintiff against the applicant, to be taxed if not agreed.