FAMOUS MARVEL CO LTD AND OTHERS v. CONVERSANT GROUP LTD AND OTHERS

HCA 2153/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2153 OF 2009

____________

BETWEEN

FAMOUS MARVEL COMPANY LIMITED 1st Plaintiff
CAMTRON DEVELOPMENT LIMITED 2nd Plaintiff
LUK HIN MAN LAWRENCE (陸軒文) 3rd Plaintiff
LUK HIN FAI THOMAS (陸軒輝) 4th Plaintiff

and

CONVERSANT GROUP LIMITED 1st Defendant
LOK HIN CHING (陸軒青) 2nd Defendant
KTB LIMITED (錦達集團有限公司) 3rd Defendant

____________

Before: Hon Au-Yeung J in Chambers

Date of Hearing: 4 January 2013
Date of Decision: 4 January 2013

_____________

D E C I S I O N

_____________

1. This is the 1st and 2nd defendants’ application for leave to appeal against my decision on costs given on 29 October 2012.

2. Leave to appeal will be granted if the applicant can show that there is reasonable prospect of success or that there is some otherreason in the interests of justice why the appeal should be heard. Reasonable prospects of success involve the notion that the prospectsof succeeding must be ‘reasonable’ and therefore more than ‘fanciful’, without having to be ‘probable’: SMSE v. KL [2009] 4 HKLRD 125, para 17.

3. The Court of Appeal will not interfere with a judge’s exercise of discretion in the award of costs unless it can be shown thathe (i) failed to exercise the discretion; (ii) exercised it upon a false principle; (iii) did not exercise it judicially; or (iv)the exercise of discretion was demonstrably flawed: Hong Kong Civil Procedure 2013,Vol 1, para 62/2/11, page 1106.

4. The defendants do not dispute that this court has correctly stated the legal principles when considering the question of costs andthat they had invited the court to determine the question of costs without waiting for the outcome of execution of the SettlementOrder reached before me. Nor do they challenge my analyses on the expert evidence. However, Mr Chain submits that proceeding onthe available evidence and concluding that the plaintiff would probably succeed at the trial was an erroneous approach in the circumstancesof this case for the reasons set out in the proposed grounds of appeal.

5. In respect of the 1st ground, at the hearing on costs, what the defendants sought was an order for there to be “no order as to costs”. They had notasked for an order to defer the decision on costs until the answer to whether or not the 171/2006 Document actually prevented thesale and purchase from being registered (“the Event”) was known. In any case, since I had declined to adjourn the trial (seeparagraph 43 of the Decision on Costs) and proceeded to decide the question of costs immediately after the Settlement Order was made,I do not see why the court should make an order for costs dependent on the outcome of the Event, which was effectively a matter of“execution”. There was no “speculation” on the outcome of the Event as what was done was simply to take a broad brush approachin the light of the evidence.

6. In respect of the 2nd to 5th and 7th grounds, the defendants dispute the court’s assessment of the evidence that the 2nd mode was for their benefit. Without disrespect to Mr Chain, I am unable to see an error of principle identified. A settlementorder always involves give and take. The Settlement Order catered for more than one mode of performance. In my view, it did notfollow that the original mode was not workable. Nor did it mean that the 2nd mode did not give the plaintiff substantially all that they claimed for.

7. In respect of the 6th ground, there was no challenge to this court’s view of the expert evidence.

8. Having considered the submission, I am not satisfied that there are any grounds of appeal that are capable of forming a sufficientbasis to disturb what was effectively an exercise of the discretion on costs. I therefore dismiss the application for leave to appeal.

9. Entirely without disrespect to counsel, the leave application warrants only one counsel as no complex issue is involved. I thereforeorder costs to the plaintiffs with certificate for Mr Dawes.

10. I thank counsel for their assistance.

(Queeny Au-Yeung)
Judge of the Court of First Instance
High Court

Mr Ambrose Ho SC and Mr Victor Dawes, instructed by So, Keung, Yip & Sin, for the plaintiffs

Mr Benjamin Chain, instructed by T H Koo & Associates, for the 1st and 2nd defendants

The 3rd defendant was not represented and did not appear