IN THE HIGH COURT OF JUSTICE
Coram: Hon. Mantell J. in Chambers
Date of Hearing: 10 April, 1984.
Date of Delivery of Decision: 10th April, 1984.
1. This is an application for security for costs by the defendants to four actions now consolidated in each of which the plaintiff isdifferent. In each case, the plaintiff is a company with paid-up capital of $2. In those circumstances, the defendants ask for securityas provided for under S.357 of the Companies Ordinance. Miss Loh who appears for the plaintiffs, having been given an adjournment to file affidavit evidence to show that the company’sassets were greater than appeared as a result of company searches, has not done so and now does not resist the making of an orderfor security in the form of bank guarantees. What she does question, however, is the amount of the security which, in the first instance,was claimed at just over $400,000.
Now I have read the pleadings in this case and I have to do the best I can to make an assessment of the issuesinvolved and the difficulty of those issues and I have come to the conclusion that this is a case in which it will probably be foundnot to have been reasonable or necessary to instruct leading counsel. It seems to me that the questions of fact and law raised onthe pleadings are well within the competence of experienced junior counsel such as has appeared before me on behalf of the defendantsin this application. Miss Loh may be right in saying that it could take less but I think at the very most the action will last atotal of five days. I think it right to come to my assessment of the proper figure for security on the basis that the case will lastfive days and it will involve the instructing of junior counsel only. I bear in mind, as was very properly brought once again mynotice, the judgment of the Court of Appeal in England in the Procon case and in particular the words of Lord Justice Cumming-Bruceat page 18 of the transcript of the judgment, in which, the learned Lord Justice criticized the statement of principle containedin the White Book with regard to the fixing of the amount of security and in particular that there is no basis for fixing a sum oftwo thirds of the estimated party and party costs. But he does say this:
That seems to me to leave the court with a very wide discretion in the exercise of which the aim should be to provide in the propercase a sum by way of security which the court considers at the time of the application sufficient to indemnify the defendants ona party and party basis for the likely costs to be incurred in the action and it is on that basis that I have approached the questionof amount. I think, having regard to everything that has been said to me, that an allowance by way of security of $8,000 on the briefto junior counsel would be a proper allowance and with refreshers of $4,000 a day over four days makes a total for counsel’s feesin the action of $24,000. I also think it right to allow something in relation to settling of pleadings and affidavits in the action.I have not, for the purposes of ordering security, taken into account the costs of the application for security itself. The figureI have allowed for those interlocutory matters in relation to counsel’s fees is $10,000. The figure which I am prepared to orderby way of security in relation to solicitors’ profit costs is by necessity an arbitrary one. I do not set out to tax the solicitors’bill at this stage and I propose to allow $20,000 in all. That makes a total of $54,000 which I propose to order by way of securitydivided between the four plaintiffs. That means that each plaintiff will provide security in a form satisfactory to the defendantsin the sum of $13,500 and the action will be stayed until such security is provided. Against the event of there being a questionas to whether or not the form of security is satisfactory, I will give liberty to apply. Costs of today and the adjourned hearingto he the defendants in any event.
Miss E. Loh of Loh & Co. for Plaintiff.
R. Sujanani instructed by Ip, Ku & Stoppa for Defendants.