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Gallium Development Ltd And Others v Winning Properties Management Ltd And Another

Judgment Cited authorities 2 Cited in Precedent Map Related
Vincent
CourtCourt of Appeal (Hong Kong)
Judgment Date06 July 2005
Judgement NumberCACV186/2003
Subject MatterCivil Appeal
CACV000186B/2003 GALLIUM DEVELOPMENT LTD AND OTHERS v. WINNING PROPERTIES MANAGEMENT LTD AND ANOTHER

CACV 186/2003
CV 400/2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 186 OF 2003 AND

CIVIL APPEAL NO. 400 OF 2003

(ON APPEAL FROM BUILDING MANAGEMENT

APPLICATION NO. LDBM 121 OF 2000)

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BETWEEN

　 GALLIUM DEVELOPMENT LIMITED and
LEN TONG HOLDINGS LIMITED		 1st Applicant
　 WONG SAIO LING CONNIE 2nd Applicant
CHUNG YEE INDUSTRIES LIMITED 3rd Applicant
WONG ALICE and JOO RIKA YOLANDA 4th Applicant
HUNG HING DEVELOPMENT LIMITED 5th Applicant
HAU KWAN HAP 6th Applicant
RAINBOW WEALTH LIMITED 7th Applicant
FULLEREX COMPANY LIMITED 8th Applicant
LIM CHING LANG and HENRY LESMANA 9th Applicant
SO YIK 10th Applicant
SMARTJET LIMITED 11th Applicant
SANKO SETSUBI COMPANY LIMITED 12th Applicant
SUN ON TAT INVESTMENT COMPANY LIMITED 13th Applicant
IP WOON CHI 14th Applicant
NGAI PETER 15th Applicant
GLORY HOPE COMPANY LIMITED 16th Applicant
SWEEPER COMPANY LIMITED 17th Applicant
NG TZE CHUEN 18th Applicant
ZHAO FENG 19th Applicant
HUA RONG COMPANY LIMITED 20th Applicant
CHINA EUROPUS LIMITED 21th Applicant
SOURCE CHANNEL INVESTMENT LIMITED 22th Applicant
WU YI CONSTRUCTION COMPANY LIMITED 23th Applicant
and
WINNING PROPERTIES MANAGEMENT LIMITED 1st Respondent
WINNING PROPERTIES HOLDINGS LIMITED 2nd Respondent

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Before : Hon Woo VP, Le Pichon and Yuen JJA in Court

Date of Hearing : 30 June 2005

Date of Decision : 6 July 2005

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D E C I S I O N

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Hon Woo VP:

Introduction

1. On 17 September 2004, we handed down judgment in these two appeals (“our main judgment”) with orders nisi as to costs. The applicants, the 1st Respondent (“R1”) and the 2nd Respondent (“R2”) have made applications for variation of the costs orders.

2. The two appeals, namely, CACV 186/2003 and CACV 400/2003, were launched by R2 to challenge the decisions made by His Honour Judge Yung, sitting as a presiding officer of the Lands Tribunal.

3. The Judge held that R2 was liable to pay damages to each of the applicants individually in the proportion of his/her/its respective contribution as flat owner in the building known as Island Beverly in the heart of Causeway Bay (“the Building”) towards the Sinking Fund established for major overhauls or replacement of facilities of a capital nature that had been used to pay for the works for the shopping arcade exclusively owned by R2. He dismissed all the claims raised by the applicants against R1, the manager of the Building, for having allowed R2 to convert to R2’s own use some of the common parts of the Building within the shopping arcade and for having applied the Building’s Sinking Fund and Management Fund towards the expenses for the conversion and the works for R2’s exclusive benefit. The Judge then assessed the damages payable by R2, but did not award damages against R2 for the conversion.

4. By CACV 186/2003, R2 appealed against the Judge’s decision on liability against it, and the applicants cross-appealed against the dismissal of their claims against R1. By CACV 400/2003, R2 appealed against the order for damages.

The essential holdings of our main judgment

5. In our main judgment we held that

(a) the Judge’s order of payment of damages as assessed by him, on the basis of $10,309,981, proportional to the applicants’ contributions towards the management and maintenance of the Building, being a total of 20.5% of the sum, was wrong and we made an order that R1 and R2, jointly and severally, were to pay the entirety of that sum into the Sinking Fund (paras 49, 51 and 76 of our main judgment);
(b) R1 was liable to the applicants for allowing the conversion of the common parts of the shopping arcade for R2’s own private use; R1 was also liable for allowing the moneys in the Sinking Fund to be applied towards the expenses for the conversion and the works for R2’s exclusive benefit (para 60 of our main judgment); and
(c) the Judge was wrong to have made no decision on the applicants’ claim for particular items of relatively small amounts, set out in schedules entitled Annexes A, B and C, to have been wrongfully or wrongly paid by R1 towards the expenses for the conversion and the works for R2’s exclusive benefit, affecting the amount of the damages R2 ought to pay and also affecting the amount of management fees that R1 was entitled to charge (paras 62, 70 and 71 of our main judgment).

Our costs orders nisi

6. In our main judgment, after dealing with a number of issues and arguments raised by the parties, we made the following orders with orders nisi as to costs, which were mainly set out in paras 75 to 81 of our main judgment, namely,

(a) R2’s appeals in both appeals were dismissed with costs;
(b) The applicants’ cross-appeal in CACV 186/2003 was allowed, and there be no order as to costs of the cross-appeal and their summons dated 1 June 2004 (to amend their notice of appeal to clarify the sums mentioned in Annexes A, B and C);
(c) The applicants do have their costs of the proceedings below against both R1 and R2 with a certificate for counsel.

The applications

7. The applicants now apply to vary our costs orders nisi and ask to have their costs of the cross-appeal against R1 and R2. They also ask that their costs of the trial, which we granted to them, be taxed on the High Court Scale, if not agreed.

8. On the other hand, by their summons dated 2 October 2004, R1 and R2 seek to have the costs of the appeals, the cross-appeal and of the trial to be awarded to them. They also request the costs of the trial to be taxed on the High Court Scale with a certificate for two counsel for the hearing on 1 December 2003.

9. By their summons dated 23 June 2005, the respondents seek to amend their application. By their amendment, R2 asks for an award of costs to R2 in CACV 400/2003. The respondents request to have the costs of CACV 186/2003 (including the costs of the applicants’ cross-appeal) or alternatively there be no order for costs of this appeal and cross-appeal.

10. The respondents maintain their application for the costs of the trial before the Lands Tribunal, with a certificate for counsel, but in respect of the hearing on 1 December 2003, a certificate for two counsel. Alternatively, they seek costs of the hearing on 1 December 2003 with a certificate for two counsel, and other than that they ask for no order for costs of the trial.

The authorities

11. In their submissions, the parties refer us to a number of authorities regarding the award of costs, which can be summarised as follows:

(a) Re Elgindata (No. 2) [1992] 1 WLR 1207 and other cases to the same effect, that costs should follow the event, except when it appears to the court that in the circumstances of the case, such as the successful party having unreasonably and unjustifiably increased the costs, some other order should be made;
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