HCA2665/2017 CRAFT BAMBOO HOLDINGS LTD v. RICHARD PAUL COLEMAN AND ANOTHER - LawHero
HCA2665/2017
高等法院（民事訴訟）B Chu J11/9/2024[2024] HKCFI 2482
HCA2665/2017
A A
HCA 2665/2017
B B
[2024] HKCFI 2482
C C
IN THE HIGH COURT OF THE
D HONG KONG SPECIAL ADMINISTRATIVE REGION D
COURT OF FIRST INSTANCE
E E
ACTION NO. 2665 OF 2017
F ______________________ F
G BETWEEN G
CRAFT BAMBOO HOLDINGS LIMITED Plaintiff
H H
and
I I
RICHARD PAUL COLEMAN 1st Defendant
J MAYFIELD SPORTS MANAGEMENT 2nd Defendant J
LIMITED
K K
______________________
L L
M M
Before: Hon B Chu J in Chambers (Open to Public) (By Paper Disposal)
N Date of Plaintiff’s Submissions: 8 August 2024 N
Date of Decision: 12 September 2024
O O
P P
Q Q
R R
S S
T T
U U
V V
- 2 -
A A
B B
______________________________________________
C DECISION C
D (On Variation of Costs Order Nisi) D
______________________________________________
E E
F A. INTRODUCTION F
G G
1. This Court handed down a judgement on 6 June 2024, after a 7
H day trial, and among other things, gave judgment to P against D1 and D2 H
jointly and/or severally for a total amount of HKD 19,723,449.80 and
I I
dismissed Ds’ counterclaim (“Judgment”). In the present decision, the
J Court will continue to adopt the nomenclature and abbreviations in the J
Judgment unless otherwise indicated.
K K
L 2. This Court further ordered on nisi basis D1 and D2 to pay P’s L
costs of this action including the counterclaim and the Amendment
M M
Summons and all reserved costs with certificate for two counsel, to be made
N final after 14 days (“Order Nisi”). N
O O
3. On 18 June 2024, P issued a summons to vary the Order Nisi
P (“Variation Summons”), which was supported by an affidavit by a Mrs Li P
Lau Lai Hing Joanna (“Mrs Li”), a partner of P’s solicitors King &
Q Q
Company. P is seeking that the Order Nisi be varied to costs of the action
R from 21 August 2020, including all costs reserved and costs for the trial be R
paid by Ds to P on indemnity basis with certificate for two counsel, to be
S S
taxed if not agreed.
T T
U U
V V
- 3 -
A A
B B
4. On 19 June 2024, this Court gave directions to parties’
C respective solicitors by letter indicating the Court’s intention for the C
Variation Summons to be dealt with on paper unless there was written
D D
objection from the parties. At that time, Messrs Howse Williams (“HW”)
E were still solicitors on the court record acting for Ds. E
F F
5. As P indicated no objection to the Variation Summons to be
G dealt with on paper, and with no response from HW within the stipulated G
deadline, the Court proceeded to give directions on 11 July 2024 for the
H H
Variation Summons to be dealt with on paper, and various directions
I including leave for Ds to file any affirmation in opposition to Mrs Li’s I
affirmation, and the time for lodging written submissions (“Directions
J J
Order”). On 12 July 2024, the Court received a letter from HW formally
K informing the Court that Ds had terminated their retainer with HW and had K
signed notices to act in person on 19 June 2024 but the originals had not yet
L L
been filed. It was further confirmed by HW in their letter of 12 July 2024
M that they had forwarded a copy of the Directions Order to Ds. As at M
handing down of this decision, the originals of the notices to act in person
N N
had still not yet been filed in court.
O O
6. HW were solicitors on record for Ds when the Variation
P P
Summons was served on HW, and in light of the contents of the letter of
Q 12 July 2024 from HW, this Court is satisfied that the contents of Variation Q
Summons and the Directions Order have been brought to Ds’ attention, and
R R
that they are fully aware of this application.
S S
T T
U U
V V
- 4 -
A A
B B
7. So far, no affidavits and/or written submissions have been
C received from Ds and/or HW. C
D D
B. P’S GROUNDS FOR VARIATION
E E
8. P relied on two letters produced in Mrs Li’s affirmations,
F namely: F
G G
(a) A letter marked “3 Letter” dated 23 July 2020 containing a
rd
H
“sanctioned offer” pursuant to Order 22 of the Rules of the H
High Court (“Sanctioned Offer”); and
I I
(b) A letter dated 30 August 2023 containing an offer to settle
J J
before trial (“Pre-Trial Offer”).
K K
9. As ultimately P has done better than the proposals in both the
L L
above letters, P should be entitled to costs on indemnity basis.
M M
C. RELEVANT LEGAL PRINCIPLES
N N
10. The relevant provisions regarding sanctioned offers are set out
O O
in Order 22, rule 24 of the Rules of High Court (Cap 4A).
P P
11. Suffice to say, the objective of the sanctioned offer regime has
Q Q
been reiterated by Recorder Wong SC in Qvist Henrik v Clatronic Far East
R Ltd [2020] 1 HKLRD 703 at §17: - R
S S
T T
U U
V V
- 5 -
A A
B B
“17. As summarised by HHJ Mimmie Chan (as she then was) in
Maysun Engineering Co Ltd v International Education and
C Academic Exchanges Foundation Co Ltd: C
‘In McPhilemy v Times Newspapers Ltd (No 2) [2002]1 WLR
D 934, it was made very clear that an order under rule 36.21 of D
the English rules, which is equivalent to O.22 r.24, carries no
E implied disapproval of the defendant's conduct, nor any stigma. E
The orders are aimed to provide a means of achieving a fairer
result for a plaintiff, to compensate the plaintiff for having to
F come to court to bring proceedings and for the incidental F
inconvenience, anxiety, distress and disruption to its business
(Petrotrade Inc v Texaco Ltd [2002] 1 WLR 947), which are
G G
not compensated by orders for costs in the proceedings, even
when they are made on an indemnity basis. These principles
H were recognised and accepted by Johnson Lam J in Golden H
Eagle International (Group) Ltd v GR Investment Holdings
Ltd [2010] 3 HKLRD 273…’ ”
I I
(emphasis added)
J J
K
12. Thus, a successful plaintiff is entitled to costs on an indemnity K
basis after the last day in which the defendant could have accepted the
L L
sanctioned offer without leave of the court unless it is unjust to do so (see
M Chan Wai Chung v China Travel Tours Transportation Development (HK) M
Ltd and Another [2023] HKCFI 1442 at §30).
N N
O
13. The onus is on the defendants to demonstrate the circumstances O
that would render an indemnity costs and enhanced costs order unjust, which
P P
includes the factors stated in Order 22 rule 24(4), as held by Deputy High
Q Court Judge William Wong SC in Wah Lun International Development Q
Limited v Lau Chiu Shing, unreported, HCA 1429/2015, 8 July 2021 at §7.
R R
S S
T T
U U
V V
- 6 -
A A
B B
D. DISCUSSION AND CONCLUSION
C C
14. I am satisfied that the Sanctioned Offer was made in
D D
accordance with the requirements as stipulated in Order 22 rule 5. It is also
E
indisputable that P has done better than what was proposed in the Sanctioned E
Offer. The question is whether it is unjust to make an order under Order
F F
22 rule 24(2) and rule 24(3).
G G
15. The Sanctioned Offer was made in July 2020 more than three
H H
years prior to the commencement of trial in September 2023 and the
I
proposed settlement sum was further lowered closer to the trial date by way I
of the Pre-Trial Offer.
J J
16. In accordance with Order 22 rule 5, Ds had until 20 August
K K
2020 to accept the Sanctioned Offer. They had failed to do so and did not
L L
provide any reasons for refusing the same.
M M
17. The parties exchanged the first round of witness statements in
N around October 2018 and had already filed their respective lists and N
O
supplemental list of documents by the time the Sanctioned Offer was made. O
P 18. As submitted by P, there had been sufficient information and P
ample time for Ds to review the merits of the parties’ cases and Ds were
Q Q
legally represented throughout the pre-trial and trial stages. After service
R of the Sanctioned Offer, Ds had not raised any inquiries nor sought for R
S
further information from P so as to assist them in a proper assessment in the S
T T
U U
V V
- 7 -
A A
B B
event that there were any uncertainties. I accept P’s submissions and find
C there were no reasonable efforts made by Ds to settle the matter as early as C
possible.
D D
E 19. P was clearly the successful party in this action. E
F F
20. Having considered all the circumstances of this case, I am
G satisfied that the order sought by P is not unjust and I am prepared to vary G
the Order Nisi and grant an order in the terms sought by P. The costs of
H H
the Variation Summons shall be on the same basis.
I I
J J
K K
L L
M M
N ( Bebe Pui Ying Chu ) N
Judge of the Court of First Instance
O High Court O
P P
Mr Derek Hu and Ms Jacqueline HH Chan, instructed by King & Company,
for the Plaintiff
Q Q
st nd
Howse Williams for the 1 and 2 Defendants (on record)
R R
S S
T T
U U
V V
CRAFT BAMBOO HOLDINGS LTD v. RICHARD PAUL COLEMAN AND ANOTHER
A A
HCA 2665/2017
B B
[2024] HKCFI 2482
C C
IN THE HIGH COURT OF THE
D HONG KONG SPECIAL ADMINISTRATIVE REGION D
COURT OF FIRST INSTANCE
E E
ACTION NO. 2665 OF 2017
F ______________________ F
G BETWEEN G
CRAFT BAMBOO HOLDINGS LIMITED Plaintiff
H H
and
I I
RICHARD PAUL COLEMAN 1st Defendant
J MAYFIELD SPORTS MANAGEMENT 2nd Defendant J
LIMITED
K K
______________________
L L
M M
Before: Hon B Chu J in Chambers (Open to Public) (By Paper Disposal)
N Date of Plaintiff’s Submissions: 8 August 2024 N
Date of Decision: 12 September 2024
O O
P P
Q Q
R R
S S
T T
U U
V V
- 2 -
A A
B B
______________________________________________
C DECISION C
D (On Variation of Costs Order Nisi) D
______________________________________________
E E
F A. INTRODUCTION F
G G
1. This Court handed down a judgement on 6 June 2024, after a 7
H day trial, and among other things, gave judgment to P against D1 and D2 H
jointly and/or severally for a total amount of HKD 19,723,449.80 and
I I
dismissed Ds’ counterclaim (“Judgment”). In the present decision, the
J Court will continue to adopt the nomenclature and abbreviations in the J
Judgment unless otherwise indicated.
K K
L 2. This Court further ordered on nisi basis D1 and D2 to pay P’s L
costs of this action including the counterclaim and the Amendment
M M
Summons and all reserved costs with certificate for two counsel, to be made
N final after 14 days (“Order Nisi”). N
O O
3. On 18 June 2024, P issued a summons to vary the Order Nisi
P (“Variation Summons”), which was supported by an affidavit by a Mrs Li P
Lau Lai Hing Joanna (“Mrs Li”), a partner of P’s solicitors King &
Q Q
Company. P is seeking that the Order Nisi be varied to costs of the action
R from 21 August 2020, including all costs reserved and costs for the trial be R
paid by Ds to P on indemnity basis with certificate for two counsel, to be
S S
taxed if not agreed.
T T
U U
V V
- 3 -
A A
B B
4. On 19 June 2024, this Court gave directions to parties’
C respective solicitors by letter indicating the Court’s intention for the C
Variation Summons to be dealt with on paper unless there was written
D D
objection from the parties. At that time, Messrs Howse Williams (“HW”)
E were still solicitors on the court record acting for Ds. E
F F
5. As P indicated no objection to the Variation Summons to be
G dealt with on paper, and with no response from HW within the stipulated G
deadline, the Court proceeded to give directions on 11 July 2024 for the
H H
Variation Summons to be dealt with on paper, and various directions
I including leave for Ds to file any affirmation in opposition to Mrs Li’s I
affirmation, and the time for lodging written submissions (“Directions
J J
Order”). On 12 July 2024, the Court received a letter from HW formally
K informing the Court that Ds had terminated their retainer with HW and had K
signed notices to act in person on 19 June 2024 but the originals had not yet
L L
been filed. It was further confirmed by HW in their letter of 12 July 2024
M that they had forwarded a copy of the Directions Order to Ds. As at M
handing down of this decision, the originals of the notices to act in person
N N
had still not yet been filed in court.
O O
6. HW were solicitors on record for Ds when the Variation
P P
Summons was served on HW, and in light of the contents of the letter of
Q 12 July 2024 from HW, this Court is satisfied that the contents of Variation Q
Summons and the Directions Order have been brought to Ds’ attention, and
R R
that they are fully aware of this application.
S S
T T
U U
V V
- 4 -
A A
B B
7. So far, no affidavits and/or written submissions have been
C received from Ds and/or HW. C
D D
B. P’S GROUNDS FOR VARIATION
E E
8. P relied on two letters produced in Mrs Li’s affirmations,
F namely: F
G G
(a) A letter marked “3 Letter” dated 23 July 2020 containing a
rd
H
“sanctioned offer” pursuant to Order 22 of the Rules of the H
High Court (“Sanctioned Offer”); and
I I
(b) A letter dated 30 August 2023 containing an offer to settle
J J
before trial (“Pre-Trial Offer”).
K K
9. As ultimately P has done better than the proposals in both the
L L
above letters, P should be entitled to costs on indemnity basis.
M M
C. RELEVANT LEGAL PRINCIPLES
N N
10. The relevant provisions regarding sanctioned offers are set out
O O
in Order 22, rule 24 of the Rules of High Court (Cap 4A).
P P
11. Suffice to say, the objective of the sanctioned offer regime has
Q Q
been reiterated by Recorder Wong SC in Qvist Henrik v Clatronic Far East
R Ltd [2020] 1 HKLRD 703 at §17: - R
S S
T T
U U
V V
- 5 -
A A
B B
“17. As summarised by HHJ Mimmie Chan (as she then was) in
Maysun Engineering Co Ltd v International Education and
C Academic Exchanges Foundation Co Ltd: C
‘In McPhilemy v Times Newspapers Ltd (No 2) [2002]1 WLR
D 934, it was made very clear that an order under rule 36.21 of D
the English rules, which is equivalent to O.22 r.24, carries no
E implied disapproval of the defendant's conduct, nor any stigma. E
The orders are aimed to provide a means of achieving a fairer
result for a plaintiff, to compensate the plaintiff for having to
F come to court to bring proceedings and for the incidental F
inconvenience, anxiety, distress and disruption to its business
(Petrotrade Inc v Texaco Ltd [2002] 1 WLR 947), which are
G G
not compensated by orders for costs in the proceedings, even
when they are made on an indemnity basis. These principles
H were recognised and accepted by Johnson Lam J in Golden H
Eagle International (Group) Ltd v GR Investment Holdings
Ltd [2010] 3 HKLRD 273…’ ”
I I
(emphasis added)
J J
K
12. Thus, a successful plaintiff is entitled to costs on an indemnity K
basis after the last day in which the defendant could have accepted the
L L
sanctioned offer without leave of the court unless it is unjust to do so (see
M Chan Wai Chung v China Travel Tours Transportation Development (HK) M
Ltd and Another [2023] HKCFI 1442 at §30).
N N
O
13. The onus is on the defendants to demonstrate the circumstances O
that would render an indemnity costs and enhanced costs order unjust, which
P P
includes the factors stated in Order 22 rule 24(4), as held by Deputy High
Q Court Judge William Wong SC in Wah Lun International Development Q
Limited v Lau Chiu Shing, unreported, HCA 1429/2015, 8 July 2021 at §7.
R R
S S
T T
U U
V V
- 6 -
A A
B B
D. DISCUSSION AND CONCLUSION
C C
14. I am satisfied that the Sanctioned Offer was made in
D D
accordance with the requirements as stipulated in Order 22 rule 5. It is also
E
indisputable that P has done better than what was proposed in the Sanctioned E
Offer. The question is whether it is unjust to make an order under Order
F F
22 rule 24(2) and rule 24(3).
G G
15. The Sanctioned Offer was made in July 2020 more than three
H H
years prior to the commencement of trial in September 2023 and the
I
proposed settlement sum was further lowered closer to the trial date by way I
of the Pre-Trial Offer.
J J
16. In accordance with Order 22 rule 5, Ds had until 20 August
K K
2020 to accept the Sanctioned Offer. They had failed to do so and did not
L L
provide any reasons for refusing the same.
M M
17. The parties exchanged the first round of witness statements in
N around October 2018 and had already filed their respective lists and N
O
supplemental list of documents by the time the Sanctioned Offer was made. O
P 18. As submitted by P, there had been sufficient information and P
ample time for Ds to review the merits of the parties’ cases and Ds were
Q Q
legally represented throughout the pre-trial and trial stages. After service
R of the Sanctioned Offer, Ds had not raised any inquiries nor sought for R
S
further information from P so as to assist them in a proper assessment in the S
T T
U U
V V
- 7 -
A A
B B
event that there were any uncertainties. I accept P’s submissions and find
C there were no reasonable efforts made by Ds to settle the matter as early as C
possible.
D D
E 19. P was clearly the successful party in this action. E
F F
20. Having considered all the circumstances of this case, I am
G satisfied that the order sought by P is not unjust and I am prepared to vary G
the Order Nisi and grant an order in the terms sought by P. The costs of
H H
the Variation Summons shall be on the same basis.
I I
J J
K K
L L
M M
N ( Bebe Pui Ying Chu ) N
Judge of the Court of First Instance
O High Court O
P P
Mr Derek Hu and Ms Jacqueline HH Chan, instructed by King & Company,
for the Plaintiff
Q Q
st nd
Howse Williams for the 1 and 2 Defendants (on record)
R R
S S
T T
U U
V V