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In less than three months before the trial, the Defendants applied to the Court for security for costs and for an order permitting two witnesses to give evidence from India by video link. Both applications were rejected by the trial judge, and the Court of Appeal refused to grant leave to appeal to the Defendants. As regards the application for security for costs, it was rejected on the basis that the Defendants failed to prove their case on evidence, and that there was inordinate and unexplained delay on the part of the Defendants in seeking security for costs. So far as the application for an order permitting two witnesses to give evidence from India by video link is concerned, the Courts rejected the application on the basis that the Defendants supplied no good reason to justify their request.
Hong Kong Dispute Resolution Bulletin: For full analysis of this case subscribe to the Sweet & Maxwell HKDRB, produced in association with Clifford Chance.
This article is available in [2010] 14 HKDRB.
This was an application by the Defendant against the Plaintiff who was incorporated abroad for further security for costs up to and including the trial of the action in the approximate sum of HK$1.5 million.
Relying on an alleged oral agreement between the Plaintiff and the Defendant, the Plaintiff commenced an action to claim for the outstanding 10% of the Defendant’s net commission and brokerage in placing the shares of a Hong Kong listed company with investors.
On 1 June 2009, the Plaintiff voluntarily paid $350,000.00 into Court as security for the Defendant’s costs up to and including the preparation of witness statements. The security then sought by the Defendant was in relation to the additional costs of the Defendant in preparation for trial.
On the evidence available before the Court, it was held that the Plaintiff failed to demonstrate a high probability of success. Further, other than a bald assertion that further security would stifle the Plaintiff’s claim, the Plaintiff adduced no evidence (whether in form of audited accounts, bank statements, etc.) to substantiate its impecuniosity.
In exercising its discretion to decide the amount of security to be awarded against the Plaintiff, Master Ko was mindful of the underlying objectives of the Civil Justice Reform. With a view to promoting a sense of reasonable proportion and procedural economy in the conduct of proceedings, Master Ko adopted a “broad-brush” approach and decided to order further security in the sum of HK$400,000.00 only.
Hong Kong Dispute Resolution Bulletin: For full analysis of this case subscribe to the Sweet & Maxwell HKDRB, produced in association with Clifford Chance.
This article is available in [2010] 4 HKDRB.
