AKAI HOLDINGS LTD (IN LIQUIDATION) v. THANAKHARN KASIKORN THAI CHAMKAT (MAHACHON) ALSO KNOWN AS KASIKORNBANK PUBLIC CO LTD

cacv 177/2008

in the high court of the

hong kong special administrative region

court of appeal

civil appeal no. 177 of 2008

(on appeal from HCCL NO. 59 of 2004)

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BETWEEN

AKAI HOLDINGS LIMITED
(IN LIQUIDATION)
Plaintiff
THANAKHARN KASIKORN THAI CHAMKAT (MAHACHON)
also known as KASIKORNBANK PUBLIC COMPANY LIMITED
Defendant

Before: Hon Le Pichon JA in Chambers

Date of Hearing: 2 April 2009

Date of Decision: 2 April 2009

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D E C I S I O N

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1. This is an application by the bank, the respondent to the appeal, for security for costs. Quantum is the only issue as it is acceptedthat security should be furnished. The bank seeks security of costs of $6.48 million in respect of an appeal that has been set downfor five days in June 2009. The appellant considers the amount excessive and, on 3 February 2009, offered the bank security in thesum of $2.4 million.

2. The trial below before Stone J took four weeks or 20 days. For the purposes of the trial, the amount of security furnished cameto $11 million.

3. The present appeal seeks to overturn findings of primary fact and conclusions of the judge as to knowing receipt, dishonest assistanceand apparent authority. Mr Fung referred to the fact that there are 48 grounds of appeal; that this is a very complex case and,because there will be an appeal directed at overturning findings of fact, a great deal of time will have to be spent on the evidenceand the transcript; and all that will be time consuming.

4. I do not propose to go into the skeleton bill because it would not be appropriate to do so in a case such as this. The amount hasto be a rough estimate of what this court considers it will cost to engage a suitable counsel competent to do the case on behalfof the bank, and in respect of the other costs attendant upon it.

5. I have to say that even for an exceptional case in the sense that it is complex, the amount sought is one that is far beyond thosethat I have come across in the past. Most of the issues involved are essentially legal issues. Many authorities have been citedin the judgment, and the judge is said to have gone wrong in his application of some of the principles embodied in those cases.

6. But there is a matter that I should mention. In this case the appellant being a company in liquidation is being funded by funderswhose identities are not known and are believed to be out of the jurisdiction. Although there would not appear to be any impedimentto pursuing the funders for any shortfall in the event of the bank successfully resisting the appeal and obtaining taxed costs thatexceed the amount of security granted, it will have, first of all, to take steps or even issue proceedings in order to find out whothe funders are and then decide whether or not to pursue them. I think this is an unusual circumstance that I ought to take intoaccount.

7. Looking at the matter broadly, I come to the view that the appropriate amount of security to be ordered should be $3 million. Iwill therefore make an order in the standard form.

8. It is ordered that:

(1) the appellant do on or before 16 April 2009 give security to answer costs in case any shall be awarded to be paid by theappellant to the respondent by making lodgment in court of the sum of $3 million by cash or bankers draft, or by the provision ofa bank guarantee of the like amount, which guarantee shall have been approved by the Registrar; and until such lodgment be made andnotice thereof given to the Registrar and to the solicitors for the respondent (such notice to be given on the same day as the lodgmentis made) all proceedings in the said appeal are to be stayed;

(2) in default of the appellant making such lodgment as aforesaid within the time specified above or within such further timeas the court may for special reasons allow, the said appeal do (upon the solicitors for the respondent certifying such default tothe Registrar) stand dismissed out of this court without further order;

(3) in the event that the appeal is dismissed in the circumstances provided for above the appellant do pay to the respondenttheir costs occasioned by the said appeal such costs to be taxed; and

(4) the costs of this application be costs in the appeal.

(Doreen Le Pichon)
Justice of Appeal

Mr Rimsky Yuen, SC, instructed by Messrs Lovells, for the Plaintiff/Respondent

Mr Eugene Fung, instructed by Messrs Baker & McKenzie, for the Defendant/Applicant