A A
B HCA 2114 / 2007 B
C IN THE HIGH COURT OF THE C
HONG KONG SPECIAL ADMINISTRATIVE REGION
D D
COURT OF FIRST INSTANCE
E E
ACTION NO. 2114 OF 2007
F
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G BETWEEN G
st
Shenzhen Futaihong Precision Industry 1 Plaintiff
H Co., Ltd. H
(深圳富泰宏精密工業有限公司)
I I
J Hong Fu Jin Precision Industry 2nd Plaintiff J
(Shen Zhen) Co. Ltd.
K K
(鴻富錦精密工業（深圳）有限公司)
L
and L
M BYD Company Limited 1st Defendant M
BYD (H.K.) Co. Limited 2nd Defendant
N N
Golden Link Worldwide Limited 3rd Defendant
O BYD Electronic Company Limited 4th Defendant O
Lead Wealth International Limited 5th Defendant
P P
Tianjin BYD Electronics Company 6th Defendant
Limited (天津比亞迪電子有限公司)
Q Q
BYD Precision Manufacture Co. Ltd. 7th Defendant
R (比亞迪精密制造有限公司) R
S ------------------------ S
T T
U U
V V
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A A
B B
Coram: Deputy High Court Judge Au
C C
D Date of Decision on Costs: 11 August 2008 D
E E
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F DECISION ON COSTS F
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G G
I. Introduction
H H
I 1. On 27 June 2008, I handed down written judgment (“the I
earlier judgment”) dismissing the 1st and 2nd Defendants’ application for
J J
stay of these proceedings on the ground of forum non conveniens. I
K further granted a costs order nisi that the 1st and 2nd Defendants K
L
(collectively “the Defendants”) should pay the Plaintiffs’ costs of the L
1
application with certificate for two counsel .
M M
N 2. By a letter dated 9 July 2008, the Defendants through their N
solicitors apply to vary the costs order nisi to the extent as follows:
O O
P (1) There should not be certificate for two counsel, or P
alternatively, if one is to be granted, it should be clarified
Q Q
that counsel fees recoverable should be those for one Senior
R Counsel and one junior Counsel. R
S S
T 1 The Plaintiffs had engaged two Senior Counsel (Mr Winston Poon, SC and Mr Godfrey Lam, SC) and T
one junior Counsel (Ms Elizabeth Cheung) to represent them at the hearing.
U U
V V
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A A
B (2) There should be a reasonable deduction in the costs B
recoverable by the Plaintiffs, since the Plaintiffs only
C C
confirmed the withdrawal of the 2006 PRC Action (as
D defined in the earlier judgment) in the beginning of March D
2008.
E E
F 3. The parties have agreed to dispose of this application by way F
of written submissions. The Defendants set out their submissions in their
G G
solicitors’ letters dated 9 and 31 July 2008, while the Plaintiffs’
H H
submissions are in their solicitors’ letter dated 14 July 2008.
I I
4. This decision should be read together with the earlier
J J
judgment, and I also adopt in this decision the abbreviations used in the
K earlier judgment. K
L L
II. The application
M M
Applicable principles
N N
O 5. Costs are within the general discretion of the Court, to be O
exercised judicially: Hong Kong Civil Procedure 2008, paras 62/2/5 –
P P
62/2/8.
Q Q
6. Insofar as whether costs of two counsel should be allowed,
R R
such costs are generally recoverable if they are necessarily and properly
S S
incurred. Whether the costs incurred are proper or necessary depend on
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V V
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A A
B all the circumstances of the case: Hong Kong Civil Procedure 2008, B
para 62/App/48.
C C
D 7. I consider that following non exhaustive factors are relevant D
to the exercise of the discretion as to whether costs of two counsel be
E E
allowed:
F F
(1) The nature of the case.
G G
(2) The complexity of the case, such as whether it involves
H H
difficult question of fact or difficult or novel points of law.
I
(3) The skill, specialized knowledge or expertise required for the I
case.
J J
(4) Where money or property is involved, its amount or value.
K (5) The importance of the matter to client. K
(6) The general importance of the case, for example as affecting
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other cases;
M (7) If a junior counsel has already been instructed, the M
experience, competency and seniority of that junior.
N N
(8) Whether the other side has instructed a leader.
O (9) Whether it is necessary to instruct a junior to assist in O
carrying out legal research on difficult or novel questions of
P P
law.
Q Q
See: Hong Kong Civil Procedure 2008, para 62/App/48, citing
R R
the decision of Master Poon (as he then was) in Xin Juan Trading
S S
Co Ltd v NPH Petrochemical Ltd (unrep., HCA 18159/1998 and
T CACV 276/1998, 25th September 2000) T
U U
V V
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A A
B The Defendants’ submissions B
C C
8. The Defendants’ submissions in support of the application to
D vary the costs order nisi can be summarized as follows: D
E E
(1) The stay application did not justify the engagement of two
F counsel or alternatively two senior counsel for the following F
reasons:
G G
(a) The governing principles on forum non conveniens are
H H
well established and settled, and thus the Defendants’
I
stay application involved no difficult or novel question I
of law.
J J
(b) It was only an interlocutory application and the
K evidence of facts involved was contained in a K
relatively small number of affidavits and exhibits.
L L
(c) The case was not of any general importance.
M (d) The Defendants did not instruct counsel at all. M
N N
(2) There should be a reduction of the Plaintiffs’ recoverable
O costs because: O
(a) The Defendants had included in their Summons for
P P
stay an independent ground based on the existence of
Q the 2006 PRC Action. Q
(b) Since the Plaintiffs only applied to the Shenzhen
R R
Court to withdraw the 2006 PRC Action in February
S S
2008 (which application was allowed in March), the
T
Plaintiffs should only be entitled to their costs relating T
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V V
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A A
B to the Defendants’ application from the date of the B
withdrawal of the 2006 PRC action, or alternatively
C C
the Plaintiffs’ costs should be reduced by an
D appropriate percentage. D
E E
Discussions
F F
Certificate for two counsel
G G
H 9. Having considered all the circumstances of the present case, H
I
notwithstanding the Defendants’ submissions, I consider it appropriate to I
grant certificate for two counsel in relation to the stay application. My
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reasons are as follows:
K K
(1) Although the principles on the doctrine of forum non
L L
conveniens are generally settled, in the present case, I am of
M the view that the following issues cannot be said to be simple M
and well settled:
N N
(a) the specific application of these principles to a claim
O which is based on breach of confidence (which is the O
main cause of this action), and the interplay between this
P P
cause of action and a claim based on tort, and
Q (b) whether procedural differences in discovery and Q
interrogatories between the two jurisdictions can amount
R R
to a juridical disadvantage to be considered under Stage II
S S
of the Spiliada test.
T T
U U
V V
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A A
B (2) In my view, these issues involve a degree of complexity and B
more extensive legal research. This could be borne out by
C C
my discussions on the issues set out at paragraphs 51 to 61,
D and 80 to 97 of the earlier judgment. They justify the D
engagement of a leading counsel, and a junior counsel to
E E
assist.
F F
(3) The evidence involved in the application cannot be described
G G
as little. It was contained in 13 affidavits and affirmations
H H
filed by the parties. It also involved expert evidence on PRC
I
law. Together with the exhibits, the evidence occupied some I
five lever arch files. I found leading counsel’s involvement
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in addressing the Court on the evidence useful and helpful.
K K
(4) The claim involves a claim for injunction, account of profit
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and damages (of a substantial amount) against the
M Defendants for breach of confidence in relation to M
commercial confidential information. The matter is clearly
N N
important to the Plaintiffs. This is particularly so as the
O Defendants are one of their main competitors. An O
application to stay the proceedings for the Shenzhen Court is
P P
thus similarly important to the Plaintiffs, especially when it
Q is accepted by the Defendants that the remedies of tracing Q
and constructive trust are not available under the PRC legal
R R
system. I therefore regard this a good justification for the
S S
Plaintiffs to engage leading counsel with the assistance of a
T
junior. T
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V V
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A A
B B
(5) In light of the above, I do not think the Defendants’ own
C C
decision not to engage counsel at all to conduct the
D application, and that the case may not be of general D
importance amount to sufficiently weighty factors to justify
E E
the disallowance of certificate for two counsel.
F F
10. On the other hand, I accept the Defendants’ submissions that
G G
only the fees of Mr Poon, SC and a junior counsel should be recoverable
H H
under the certificate for two counsel, as I do not think the application
I
justifies the engagement of two senior counsel. Given the Plaintiffs’ I
submissions that Mr Lam SC had been involved in the matter as a junior
J J
before he took silk this year, it is up to them to satisfy the taxing master
K that Mr Lam’s fee incurred during the preparation for the stay application K
was so incurred as junior counsel, and before Ms Cheung’s involvement.
L L
To avoid any doubt, I would also direct that, insofar as the briefs and
M refreshers for the actual hearing are concerned, it is only those of Mr M
Poon, SC and Ms Cheung that are recoverable under the costs order.
N N
O Withdrawal of the 2006 PRC Action O
P P
11. For the following reasons, I also do not see any basis for any
Q reduction in the costs recoverable by the Plaintiffs by reason of the their Q
withdrawal of the 2006 PRC action in March 2008:
R R
S S
(1) Although the existence of 2006 PRC Action was raised as an
T
independent ground in the Defendants’ Summons to stay the T
U U
V V
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A A
B proceedings, in the Plaintiffs’ evidence filed in opposition, B
matters relating to the 2006 PRC Action constitutes only an
C C
insignificant part.
D D
(2) Further, in the Plaintiffs’ skeleton, submissions made in
E E
relation to the issue of the existence of the 2006 PRC Action,
F as an independent reason for staying the proceedings, F
constitutes also an insignificant proportion.
G G
H H
(3) Given that the 2006 PRC Action had been withdrawn, at the
I
hearing, practically no time was spent on dealing with this as I
an independent ground in support of the stay application.
J J
K (4) In light of the above observations, I do not think it has been K
demonstrated to me that any of the Plaintiffs’ costs (since
L L
we are now dealing with the recoverability of the Plaintiffs’
M costs) have been substantially or appreciably increased by M
reason of the independent issue relating to the 2006 PRC
N N
Action. In other words, no appreciable extent of the
O Plaintiffs’ costs has been incurred solely for this issue. O
P P
(5) In the premises, I do not see any reason to justify the
Q reduction of any parts of the Plaintiffs’ costs, simply because Q
this issue was no longer live in the stay application as a
R R
result of the Plaintiffs’ withdrawal of the 2006 PRC Action.
S S
T III. Conclusion T
U U
V V
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A A
B B
12. For the above reasons, I vary the costs order nisi to the
C C
extent that the certificate for two counsel granted covers only the fees of
D Mr Poon SC and a junior counsel, and subject to my directions set out at D
paragraph 10 above. The costs order nisi as varied is also hereby made
E E
absolute.
F F
13. To avoid any doubt, it must be emphasized that nothing said
G G
in this decision are intended to (and should not be read as to) limit or
H H
restrict the taxing Master’s power and discretion to tax the costs in
I
accordance with the basis and principles of taxation. I
J J
14. I further order that costs of this application be part of the
K costs of the stay application. K
L L
M (Thomas Au) M
Deputy High Court Judge
N N
O O
Written submissions made by Messrs JSM, for 1st & 2nd Plaintiffs.
P P
Written submissions made by Messrs Coudert Brothers for 1st & 2nd
Q Q
Defendants.
R R
S S
T T
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