THE JOINT AND SEVERAL TRUSTEES OF THE PROPERTY OF SO CHING WAN v. ASSEN LTD (IN LIQUIDATION) AND OTHERS

HCB 4475/2002

[2024] HKCFI 851

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

BANKRUPTCY PROCEEDINGS NO 4475 OF 2002

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JUDGMENT

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1.  This is a review of a taxation review conducted by Master Lai. The costs orders that were the subject of the taxation arose from a judgment dated 6 June 2019 of Deputy High Court Judge William Wong SC ([2019] HKCFI 1491). The judgment concerned an amended summons that (if allowed) would have required the 2^nd to 4^th Respondents to answer certain questions and provide related documents. Deputy Judge Wong dismissed the amended summons. He ordered the Applicant to pay the 2^nd to 4^th Respondents’ costs on a party-and-party basis with certificate for two counsel. The Applicant appealed. The Court of Appeal dismissed the appeal as “totally without merits” on 29 December 2020 ([2021] 3 HKC 5).

2.  The facts underlying the taxation before Master Lai have been set out in detail in Deputy Judge Wong’s and the Court of Appeal’s judgments. I will not repeat them here.

3.  The Applicant’s grounds of complaint in this review focus on four matters:

(1)  Three counsel appeared at the hearing before Deputy Judge Wong. The most junior (Ms Sakinah Sat) appeared on a complimentary basis, as evidenced by her brief which was placed before Master Lai. The Applicant says that the certificate for two counsel only covered the briefs of senior counsel (Mr Anson Wong SC) and Ms Sat. In other words, the Applicant claims the benefit of the complimentary brief. But Master Lai instead allowed the briefs of senior counsel (HK$360,000) and senior junior counsel (Mr Alan Kwong) (HK$130,000) in full.

(2)  The Applicant says that the solicitors’ hourly rates applied by Master Lai did not reflect solicitors’ hourly rates as approved by the Chief Justice from time to time.

(3)  The 2^nd to 4^th Respondents’ solicitors are said to have charged too many hours. The solicitors billed HK$1,731,209 in fees. Master Lai taxed the amount down by HK$979,906 to HK$751,303 (43.40%). According to Mr Chu (appearing for the Applicant), the amended summons was not complicated, even taking account that the Applicant (then acting in person) addressed numerous questions to the 2^nd to 4^th Respondents’ solicitors before the amended summons was heard. If one assumes an average hourly rate of HK$5,500 (reflecting the fact that 81.8% of the work was done by a senior solicitor), then the taxed down amount of HK$751,303 is equivalent to about 136 billing hours. That (Mr Chu submits) is excessive for a simple application of the sort that was before Deputy Judge Wong.

(4)  Regardless of the outcome of Complaint (1), the amounts charged by senior and senior junior counsel were excessive and should not have been allowed in full. At most, Master Lai should only have allowed HK$280,000 and HK$100,000 respectively for the two counsel.

4.  Before examining the Applicant complaints, I should deal with the Applicant’s discovery application.

5.  On 15 July 2022, the Applicant issued a summons seeking disclosure of: (1) the timesheets and time-recording details of the 2^nd to 4^th Respondents’ solicitors; (2) all documentary evidence of the 2^nd to 4^th Respondents' agreement to pay the costs and disbursements incurred by their solicitors; and (3) all documentary evidence showing payment by the 2^nd to 4^th Respondents of such costs and disbursements. Master Lai dismissed the Applicants’ discovery summons on 18 July 2022. The Applicant issued a Notice of Appeal on 9 February 2024, seeking leave to appeal out of time against Master Lai’s dismissal of the Applicant’s discovery summons.

6.  Having heard Mr. Chu, I dismissed the application for leave to appeal out of time. In my view, there was no justification for the extreme lateness of the appeal (some 1.5 years out of time). The Applicant claims not to have known about the possibility of appeal against the Master’s decision. But ignorance of the law is not an excuse. In any event, the Applicant is an experienced insolvency practitioner. He would have known about the possibility of appeal. The Applicant vaguely ascribes the delay to COVID-19. But there is only so much that one can blame on COVID-19. The court was in operation throughout 2023, so it is difficult to see how COVID-19 can excuse the delay here.

7.  Nor did I see how the wide-ranging discovery sought could be of any assistance to this review of taxation. The discovery summons was essentially a fishing exercise. The discovery would not be pertinent to Complaints (1) and (2) Complaint (1) is a question of legal principle, namely, should the Applicant have the benefit of the complimentary brief. It does not hinge on the disclosure of further documents. Complaint (2) is a matter of comparing the hourly rates applied by Master Lai with the hourly rates approved by the Chief Justice. Discovery of documents will not help on that comparison. Complaints (3) and (4) are a matter of evaluating whether the hours charged by solicitors and the briefs charged by counsel were excessive given the nature of the application before Deputy Judge Wong. Discovery will not assist in either exercise.

8.  I move to considering the Applicant’s complaints. I am conscious that when so doing, my role is constrained. In Lam & Lai Solicitors v Ho Chu Yau Albert [2018] 2 HKLRD 127, the Court of Appeal (Lam VP, Kwan and Yuen JJA) contrasted two lines of approach to a judge’s review of a taxation of costs:

“23. The first line is to the effect that a review of taxation by a judge ... is not a hearing de novo, and the judge should only interfere with the decision of the taxing master in limited circumstances: if it is shown to have been arrived at under a mistake of law, or in disregard of principles, or under a palpable misapprehension as to the facts, or plainly in reliance on irrelevant matters, or to be such as to fall outside the generous ambit within which reasonable disagreement is possible ...

24. The other line of cases is to the effect that the approach should be no different from an interlocutory appeal against a discretionary order ... Hence, the judge on a review of taxation is in no way fettered by the previous exercise of the master’s discretion and is entitled to exercise it as though it came before him for the first time. The judge will give the weight it deserves to the decision of the master but is in no way bound by it ....”

9.  The Court of Appeal came down firmly in favour of the first approach:

“29. Insofar as there is any confusion as to the appropriate approach, I wish to state clearly that in my view the decision in [Chan Yin Na v Union Medical Centre Ltd [2011] 5 HKC 158] is correct. As Bharwaney J rightly stated in [26], the parties to taxation already enjoy a right of review before the taxing master under O.62 rr.33 and 34, in which the master may “exercise all the powers he might exercise on an original taxation”. In applying for a second review before the judge, the aggrieved party must first request the master to state the reasons for his decision in respect of that item or part and any special facts or circumstances relevant to it. The taxing master is the primary decision maker under the statutory mechanism. The relevant provisions in O.62 rr.34(2), (4) and 35(1) support the conclusion that the judge, in the second review of the matters of complaint, does not conduct a taxation de novo and should not interfere with the taxation decision, which is essentially a matter for the discretion of the master, save on limited grounds.”

10.  I am bound by the Court of Appeal’s decision. Thus, my views on the correctness or otherwise of the amounts allowed or disallowed by Master Lai are not relevant. What must be shown is that Master Lai erred on the law, disregarded operative principles, misapprehended the facts, or plainly relied on irrelevant matters. That means that an applicant has a high threshold to meet on a judge’s review of a master’s taxation.

11.  On Complaint (1), I am unable to find any fault of law or principle in Master Lai’s approach on his review. He stated:

“272. In this case, the learned Deputy Judge granted certificate for two counsel to the Receiving Parties in the Costs Order. The Receiving Parties had instructed a Senior Counsel and two junior counsel. Mr Frost, the law costs draftsman for the Receiving Parties, informed the court that the brief for Ms Sat was a complimentary brief. The Receiving Parties had produced the brief sent to Ms Sat for the 27 May 2019 hearing confirming that it was a complimentary brief.

273. As certificate for two counsel had been granted to the Receiving Parties, the Receiving Parties were entitled to claim the fee of two counsel. At the hearing of 27 May 2019, the Receiving Parties instructed Mr Wong SC, Mr Kwong and Ms Sat to attend the hearing. The Receiving Parties claimed the fees of Mr Wong SC and Mr Kwong.”

12.  It is common practice for very junior counsel to be instructed to appear in court on a complimentary basis. This enables very junior counsel to work with experienced counsel; to gain experience working with other counsel in court; and to see how experienced counsel deal with questions that arise during court proceedings. This does not mean that, if a certificate for two counsel is granted, a master should treat the certificate as covering the very junior counsel’s complimentary charge, rather than the fees of the senior junior counsel briefed.

13.  It is convenient to deal with Complaint (4) at this juncture.

14.  In assessing whether to allow the fees of senior counsel and senior junior counsel in full, Master Lai said:

“274. In Poon Shu Fan v Wong Tin Yan [2012] 5 HKLRD 512, the Court of Appeal pointed out in §31 of the judgment that after the Civil Justice Reform, in determining the amounts of fee allowed for counsel, the court should have regard to all the relevant circumstances and in particular to the following matters:

(a) the complexity of the matter and the difficulty or novelty of the questions involved;

(b) the skill, specialized knowledge and responsibility required of, and the time and labour expended by, counsel;

(c) the number and importance of the documents prepared or perused;

(d) the place and circumstances in which the business involved is transacted;

(e) the importance of the matter to the client;

(f) where money or property is involved, its amount or value; and

(g) any other fees and allowances payable to counsel in respect of other items in the same cause or matter, but only where work done in relation to those items has reduced the work which would otherwise have been necessary in relation to the item in question.

275. In these proceedings, there were mixed issues of facts and law raised by the Amended Summons including: whether the Amended Summons was to enforce the 2016 Order or a fresh application; if it was a fresh application under section 29 of the Ordinance whether the essential conditions for making a section 29 order had been satisfied; how the discretionary power conferred to the court under section 29 of the Ordinance should be exercised; and whether the order sought in the Amended Summons was within the ambit of section 29 of the Ordinance.

276. The application by the Amended Summons was also found to be oppressive by the learned Deputy Judge as the applicant intended to bring contempt proceedings against the Receiving Parties and by the application required them to prove the case against themselves on oath prior to the contempt proceedings being brought.

277. Mr Tang also made serious accusation against the 2^nd respondent in the application. The Court of Appeal noted the following stance of Mr Tang in §6.14 of the CA Judgment:

‘In his 5^th affirmation the applicant continued his allegation that the 2^nd respondent had been ‘cooking the books of and producing false accounts of Assen’. He referred to the ‘artificial valuation’ and ‘manipulation of an opaque auction’. He said there is clear evidence of ‘outright lies’ of the 2^nd respondent. He claimed the valuation reports obtained by the 2^nd respondent were procured to support the assertion that the value of shares in Assen is nil to support the pre-packaged auction sale at 9.2 million. The applicant used the words ‘Acts of perjury and contempt of Court’ in dealing with the conduct of the 2^nd respondent.’

278. Furthermore, in these proceedings, the Receiving Parties were required to deal with an application which the Court of Appeal had described as follows in §7.13 of the CA Judgment:

‘The Judge described the original summary as being convoluted, incomprehensible, lacking in focus and more in the nature of Mr Tang’s personal comments. Although the summary has since been trimmed, my view is that the Judge’s comment on this summary is still valid.’

279. In the circumstances of this case, I am of the view that it was proper or necessary for the Receiving Parties to instruct Senior Counsel to represent them in this matter. I am of the further view that the brief fee charged by the counsel, including the Senior Counsel, and claimed by the Receiving Parties under in these items were proper. I allowed them in full at the Taxation.

15.  I am unable to say that Master Lai somehow erred in his apprehension of facts or took account of irrelevant matters in reaching his conclusion on counsel’s fees. Given the Applicant’s allegations of fraud and the “convoluted,” “incomprehensible,” and unfocussed nature of the Applicant’s submissions, Master Lai was entitled to conclude as he did.

16.  On Complaint (2), Mr Chu accepted at the hearing before me that there was little difference between the hourly rates allowed by the Master and the hourly rates approved by the Chief Justice. It does not seem to me that Complaint (2) is a ground for interference with the Master’s decision.

17.  On Complaint (3), Mr Chu contends (on the Applicant’s instructions) that 70 hours of billable time would have been more apposite. Mr Chu notes that four fee earners were involved on behalf of the 2^nd to 4^th Respondents. In addition, a trainee solicitor and a paralegal also worked on the case. Mr Chu says that is just too many fee earners. There will inevitably have been duplication of work. Mr Chu suggests that, given the amended summons was not complicated, 136 hours can hardly be justified. He submits that Master Lai erred in conducting the taxation item by item, without stepping back at the end and taking a reality check. Master Lai should (he says) have asked whether the overall taxed down bill amount for solicitors’ fees (that HK$751,303) was proportionate and reasonable given the subject matter of the amended summons.

18.  I personally am somewhat surprised at the number of hours involved. But, as I have noted, that cannot be a basis for my intervention. It is plain from Master Lai’s Determination that he considered a range of factors in finding as he did on how much to allow of solicitors’ fees. See, for instance, paragraphs [23]-[26], [32]-[33], [36]-[42], [44], [63]-[65], as well as Master Lai’s ensuing item by item review. I cannot substitute assessments as to what I would have thought reasonable in place of the evaluations which Master Lai conducted. He in fact taxed solicitors’ fees down by 43.4%. Mr Chu says that was not enough. But absent an error in principle or law or some glaring misapprehension of the facts (none of which I can find), I am not in a position to disturb Master Lai’s taxation.

19.  It follows that the Applicant fails on this review of Master Lai’s taxation. The review is dismissed.

20.  I shall now hear the parties on costs and consequential orders.

Mr George Chu, instructed by KB Chau & Co, for the applicant

Mr Vincent Lung and Ms Ivy Ho, instructed by Hom & Associates for the 2^nd to 4^th defendants

The Official Receiver was absent

HCB 4475/2002

[2023] HKCFI 2153

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

BANKRUPTCY PROCEEDINGS NO 4475 OF 2002

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BETWEEN

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DETERMINATIONS FOR TAXATION REVIEW

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1.  This is the paying party’s application to review my rulings made at the taxation of the party-and-party costs claimed in the bill of costs of the 2^nd to 4^th respondents (the “Receiving Parties”) filed herein on 5 December 2019 (the “Bill”).

Brief Summary of Proceedings

2.  In this case, Mr So Ching Wan (the “Bankrupt”) was adjudged bankrupt on 19 August 2002 upon a creditor’s petition.

3.  Mr Alan Chung Wah Tang (“Mr Tang”) and Mr Wong Kwok Man (“Mr Wong”) were appointed as joint and several trustees of the property of the Bankrupt at a creditors’ meeting held on 14 November 2002.

4.  On 7 June 2016, Chung J made an order, pursuant to section 29(1) of the Bankruptcy Ordinance (Cap 6) (the “Ordinance”), requiring the respondents herein to provide answers and documents as set out in Annex A and Annex B of that order (the “2016 Order”).

5.  The application before Chung J was made by the applicant, described as “the Joint and Several Trustees of the Property of So Ching Wan (‘the Bankrupt’)”.

6.  On 12 October 2018, Mr Tang signed a summons (the “Summons”) taken out under section 29 of Ordinance and Order 45 of the Rules of the High Court (the “RHC”) against the respondents to enforce the 2016 Order. The 1^st respondent was in liquidation and Hom & Associates (“H&A”) acted for the 2^nd to 4^th respondents, ie the Receiving Parties. The applicant also issued another summons dated 6 November 2018 (which does not concern this taxation) seeking leave to continue these proceedings against the 1^st respondent retrospectively given its liquidation.

7.  The applicant named on the Summons was “The Joint and Several Trustees of the Property of So Ching Wan (“Bankrupt”)” and the Summons was signed by Mr Tang as “Joint and Several Trustee of the Property of the Bankrupt”.

8.  The Summons was supported by the 3^rd affirmation of Mr Tang filed on 12 October 2018 as “one of the joint and several trustees-in-bankruptcy of the property of the Bankrupt”.

9.  The Summons was amended on 22 November 2018 (the “Amended Summons”). The Amended Summons was signed by Mr Tang as “Joint and Several Trustee of the Property of the Bankrupt”.

10.  On 7 March 2019, the 5^th affirmation of Mr Tang was filed in support of the application by the Amended Summons. The said 5^th affirmation was said to be “filed on behalf of the Joint and Several Trustees of the Discharged Bankrupt”.

11.  On 6 June 2019, Deputy High Court Judge William Wong SC dismissed the Amended Summons and ordered “the Applicant” to pay the costs of the 2^nd to 4^th respondents for the Amended Summons which was varied on 2 July 2019 (the “Costs Order”). The court also dismissed the applicant’s applications against the 1^st respondent with costs.

12.  The part of the Costs Order concerning the 2^nd to 4^th respondents provides that:

“1. As for the costs of the Amended Summons including the costs of the hearing on 27^th May 2019 and the reserved costs under the Order dated 16^th November 2018, that:-

(a) The Applicant do pay the costs of the 2^nd to 4^th Respondents, on a party to party basis, with a certificate for two counsel, to be taxed if not agreed;”

13.  The applicant appealed to the Court of Appeal in CACV 306/2019 against the dismissal of the Amended Summons and the Costs Order (the “Appeal”). The Appeal was dismissed with costs on indemnity basis to be paid by Mr Tang personally and not from the estate of the Bankrupt.

14.  The Court of Appeal found that “the proceedings had all along been conducted by Mr Tang himself” (§2.6 of the judgment of the Court of Appeal dated 29 December 2020 (the “CA Judgment”)). In the CA Judgment the Court of Appeal further stated in §2.7 that: “From now on the reference to the applicant must be understood to be referring to Mr Tang himself.”

15.  On 5 December 2019, H&A commenced taxation for the 2^nd to 4^th respondents under the Costs Order and filed the Bill.

16.  Mr Tang filed his list of objections to the Bill on 11 February 2020 and amend the same on 7 July 2020 (the “Amended LOO”).

17.  The taxation hearings for the Bill took place before me on 24 August 2021, 18 July 2022 and 6 December 2022 (the “Taxation”). Mr Tang attended the hearings personally as the paying party.

18.  After the Taxation, Mr Tang issued an appointment to review taxation on 30 January 2023 (the “Review”). The review hearing took place on 31 May 2023 before me. This is my determination of the Review.

Preliminary issues

19.  In the Amended LOO, Mr Tang raised the following matters as preliminary issues:

(1) Solicitors hourly rates (“Issue 1”);

(2) Grossly excessive time charges (“Issue 2”); and

(3) Others (“Issue 3”).

20.  In Issue 3, Mr Tang complained that H&A had failed to split the costs for the hearings of 16 November 2018 and 27 May 2019 or state the costs of each of the counsel involved. He further complained that H&A did not explain why counsel fees of Ms Sakinsh Sat (“Ms Sat”) had been excluded in the Bill. Mr Tang also complained that the Bill referred to “support document” but there was no legend to explain what these references were. He also contended that H&A should produce copies of all their bills/invoices to the 2^nd to 4^th respondents together with evidence of payment of these bills/invoices to substantiate their statement of “we certify that the amount claimed in this Bill does not exceed the 2^nd, 3^rd and 4^th Respondents’ liability for costs to our firm in respect of the Amended Summons”. Mr Tang stated that he reserved the rights to file formal complaints against H&A and the handling solicitor personally for inflating the Bill.

21.  I was of the view that Issue 1 and Issue 2 were matters for taxation, not preliminary issues for taxation. The matters raised in Issue 3 were either matters for taxation or unsubstantiated bare assertions or matters irrelevant to taxation. As such, I refused to deal with those issues as preliminary issues for the Taxation and ordered the Taxation to proceed with.

Grounds of review

22.  In the review application dated 30 January 2023 (the “Review Application”), Mr Tang relies on the following grounds to review my rulings at the Taxation:

(1) hourly rates of KC and all other fee earners should be further reduced (Ground 1);

(2) work done by KC should have been performed by less senior solicitors (Ground 2);

(3) excessive time charged and/or duplication of work (Ground 3);

(4) more details of work done required (Ground 4);

(5) irrelevant work (Ground 5); and

(6) for counsel’s fees, failure to meet the statutory requirements of Order 62 Part II Section 2(1)(a) of the RHC.

Ground 1

23.  The Receiving Parties claimed in the Bill fees of 4 fee earners (ie KC, LML, NC and TN) as well as fees of trainee solicitors (“TS”) and para-legal (“PL”). The Receiving Parties claimed different hourly rates for KC, LML, TS and PL for the periods prior to 1 April 2019 (“Period 1”) and from 1 April 2019 onwards (“Period 2”). The Receiving Parties claimed the same rates for both periods in respect of NC and TN.

24.  KC was admitted in Hong Kong in 1994. He was previously admitted in New South Wales, Australia in 1993. He was also admitted in England and Wales in 1994. When Mr Tang issued the Summons in October 2018, KC had had 24 years’ local experience. By April 2019, KC had had 25 years’ local experience.

25.  The Receiving Parties claimed the hourly rates of $5,500 for KC for Period 1 and $6,000 for Period 2. At the Taxation, I allowed $4,000 per hour to KC prior to 2018 (“KC(2017)”); $5,500 per hour from 1 January 2018 to 31 March 2019 (“KC(1)”); and $5,800 per hour for Period 2 (“KC(2)”).

26.  In view of the experience of KC both locally and overseas, I am of the view that the hourly rates for different periods allowed for KC at the Taxation are fair and reasonable in all circumstances. I maintain my aforesaid rulings.

27.  Mr Tang asked for evidence to be produced to prove that the Receiving Parties were contractually bound to accept the hourly rates of the fee earners as claimed.

28.  There is a presumption that if a party has a solicitor on the record that party is liable to pay the solicitor’s costs. The party seeking to recover costs does not have to adduce evidence to support the presumption. (See R v Miller (Raymond Karl) [1983] 1 WLR 1056; [1983] 3 All ER 186; (1984) 78 Cr App R 71) It is for the paying party to adduce evidence to rebut that presumption. (See 62/App/2 of the Hong Kong Civil Procedure 2023 Vol 1)

29.  Under §17(7) of Practice Direction 14.3, a solicitor has to certify on the taxation bill that his claim does not exceed his client’s liability to his firm. That signature is no empty formality. The bill specifies the hourly rates claimed. The certificate in the bill of costs signed by the receiving solicitor is effectively the certificate of an officer of the court that the receiving party’s solicitors are not seeking to recover in relation to any item more than they have agreed to charge their client under a contentious business agreement. The court can (and should unless there is evidence to the contrary) assume that the certificate shows that the indemnity principle has not been offended. (See Bailey v IBC Vehicles Ltd [1998] 3 All ER 570 per Henry LJ)

30.  H&A had signed a certificate in the Bill certifying that the amount claimed in the Bill did not exceed the Receiving Parties’ liability for costs to H&A (the “Certificate”). The Certificate is prima facie evidence of hourly rates of the fee earners claimed in Bill not exceeding the Receiving Parties’ liability to H&A. Mr Tang produced no evidence to rebut this evidence but made the following serious allegation in the Review Application without any supporting evidence:

“In the event that Respondents never actually agreed to pay all of these Claimed Costs, the Certification was untrue; HA and Mr. Kevin Leung [sic] would have made knowingly an untrue Certification to mislead the Court. This is a very serious matter for an officer of the Court.” (§4(c)(ii) of Part B of the Review Application)

31.  Knowing that the accusation “is a very serious matter for an officer of the Court”, Mr Tang saw fit to advance such accusation in the Review without a single piece of supporting evidence other than his own speculation.

32.  Mr Tang invited the court to re-consider the rates claimed by KC in light of the fact that the profit costs claimed by KC accounted for 81.8% of all profit costs claimed. He contended that much of the work required to be performed could have been done by a less senior solicitor.

33.  The fact that the work done by KC amounted to 81.8% of the profit costs claimed in the Bill is no ground to reduce the hourly rates of KC. There may be works which can be done by solicitors with less experience charging at lower rates. However, solicitors with less experience will require more time than a more experienced solicitor to complete the same piece of professional work. The correct question for the taxing master is whether it was proper or necessary for the fee earner concerned to undertake the work claimed. The fact that certain works can be done by a more junior fee earner is not a ground to reduce the hourly rate of a solicitor as the time allowed for a solicitor to finish a job will be determined in accordance with his experience and the hourly rate allowed for him. Of course, if a fee earner took up work for unqualified person or work which was not proper or necessary for him to do, he/she will only be allowed to charge at the rate of unqualified person or junior fee earner for that particular piece of work. This will be dealt with item by item and will not affect the hourly rate allowed for the fee earner in respect of the whole bill.

34.  Mr Tang further submitted that even if the hourly rates claimed were proven to have been contractually payable by the Receiving Parties to H&A, evidence of their actual payment should be produced.

35.  If the Receiving Parties were legally liable to pay the claimed costs to H&A, it is not a legal pre-requisite that the Receiving Parties have to actually paid these costs to H&A before they may tax the recoverable costs from the paying party. I see no merits in this contention of Mr Tang.

36.  Mr Tang submitted that for consistency reasons, rates of other fee earners (eg LML, NC and TN) should also be adjusted downwards.

37.  LML was admitted in Hong Kong in 2001. LML had 17 years’ experience when the Summons was issued in 2018. LML claimed $4,800 per hourly for Period 1 (“LML(1)”) and $5,250 per hour for Period 2 (“LML(2)”).

38.  NC was admitted in 2011. NC had 7 years’ experience when the Summons was issued. NC claimed a single rate of $4,200 per hour.

39.  TN was admitted in 2014. TN had 4 years’ experience when the Summons was issued. TN claimed a single rate of $3,520.

40.  At the Taxation, I allowed the hourly rates claimed by LML, NC and TN in full. I am of the view that the hourly rates claimed by them are appropriate for their experience. I see no grounds for changing my aforesaid rulings.

41.  The Receiving Parties claimed $1,540 per hour for both TS and PL for Period 1 and $1,800 per hour for Period 2. At the Taxation, I allowed $1,300 per hour for TS and PL for the period prior to 2018 (“TS/PL(2017)”) and $1,540 for the period from 1 January 2018 to 31 March 2019 (“TS/PL(1)”). I allowed $1,700 per hour for TS and PL for Period 2 (“TS/PL(2)”).

42.  Prior to 2018, the usual hourly rates allowed for trainee solicitors in party-and-party taxation ranged from $1,066 to $1,300. From 1 January 2018 onwards, the usual hourly rate allowed for trainee solicitors in party-and-party taxation is $1,700. Para-legal will be treated similarly. The hourly rates which I had allowed for TS and PL at the Taxation are in line with the usual rates allowed in party-and-party taxation. I see no grounds for varying my aforesaid rulings.

43.  In the premise, Mr Tang’s review relying on Ground 1 is disallowed.

Ground 2

44.  As stated above, solicitors with less experience will require more time than a more experienced solicitor to complete the same piece of professional work and the correct question is whether it was proper or necessary for the fee earner concerned to undertake the work claimed. If a fee earner took up work for unqualified person or work which was not proper or necessary for him to do, he/she will only be allowed to charge at the rate of unqualified person or junior fee earner for that particular piece of work. This will be dealt with item by item when I come to specific items in the Review.

Ground 3 to Ground 5

45.  These grounds will be considered when I come to specific items in the Review.

Ground 6

46.  Mr Tang submitted that there was no contemporaneous evidence of H&A having agreed to the fees claimed by counsel as required under Order 62 Part II Schedule 2(1)(a) of the RHC.

47.  Order 62 of the RHC does not have Part II. Mr Tang must be having in mind Order 62 First Schedule Part II paragraph 2(1)(a) of the RHC which provides that:

“Except in the case of taxation under the Legal Aid Ordinance (Cap 91) and taxations of fees payable by the Crown, no fee to counsel shall be allowed unless ―

(a) before taxation its amount has been agreed by the solicitor instructing counsel;”

48.  The same provision is reiterated in paragraph (1)(a) of Part III in the Appendix to Order 62. (See 62/App/28 of Hong Kong Civil Procedure 2023 Vol 1)

49.  At the Taxation, I allowed the brief fee of Mr Jason Lee (“Mr Lee”) of counsel in the sum of $9,000, brief fee of Mr Anson Wong SC (“Mr Wong SC”) in the sum of $360,000 and brief fee of Mr Alan Kwong (“Mr Kwong”) of counsel in the sum of $130,000.

50.  The Receiving Parties had produced the briefs sent to these counsel stating their respective agreed brief fees in the sums claimed in the Bill and the fee notes of counsel for such sums which were allowed at the Taxation.

51.  The Receiving Parties also claimed fee of Mr Lee of counsel for drafting the 3^rd affirmation of the 2^nd respondent in the sum of $61,200 for which I had allowed $45,000 at the Taxation.

52.  The Receiving Parties had produced the fee note of Mr Lee dated 10 January 2019 for the aforesaid work for the sum of $61,200. This is clear evidence of the amount claimed being agreed by the instructing solicitors before the Taxation which took place on 31 May 2023.

53.  Mr Tang’s review relying on Ground 6 is wholly without merits and is disallowed.

Review items

54.  In the Review Application, Mr Tang sought to review my rulings on 45 items in the Taxation. It transpires that out of these 45 items, 4 items (ie items 31, 33, 34 and 36.13) were in fact taxed in accordance with the parties’ agreement and another 4 items (ie items 4, 36.10, 36.12 and 56) had in fact been taxed off at the Taxation. Mr Tang withdrew his review application in respect of these items at the review hearing leaving 37 items to be dealt with at the review hearing (the “Review Items”).

55.  I shall now deal with the Review Items one by one according to the item number in the Bill.

Items 1, 2 and 3

56.  Item 1 was time claimed by KC for reviewing and considering background documents received in February 2017. KC claimed 7 hours and 30 minutes. At the Taxation, I allowed 4 hours of KC’s time.

57.  Item 2 was time claimed by KC for reviewing and considering company search to ascertain the joint and several liquidators of the 1^st respondent on 18.2.2017. KC claimed 3 minutes which I had allowed in full at the Taxation.

58.  Item 3 was time claimed by KC for reviewing and considering land searches on 20.3.2017. KC claimed 12 minutes which I had allowed in full at the Taxation.

59.  Mr Tang relied on Grounds 1, 2 and 4 to review these items.

60.  I have disallowed review under Ground 1.

61.  For Ground 2, Mr Tang contended that these works should have been performed by less senior solicitors. As KC was the handling solicitor, it was proper or necessary for him to undertake these works. I see no merits for review of these items under Ground 2.

62.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced documents considered by KC under these items for my assessment. I do not see that further details are required.

63.  Mr Tang further contended that these costs were incurred to advise or enable the respondents to comply with the 2016 Order and none should be allowed.

64.  The Receiving Parties were represented by other solicitors firms prior to instructing H&A in February 2017. In compliance with the 2016 Order, the Receiving Parties had through other solicitors firms provided various information and documents to Mr Tang from June 2016 to February 2017. However, Mr Tang was of the view that the Receiving Parties still had not complied with the 2016 Order which led the issuance of the Summons in 2018. When H&A were instructed in February 2017, Mr Tang had already been accusing the Receiving Parties of non-compliance of the 2016 Order. In §6.8 of the CA Judgment, the Court of Appeal noted that:

“After receiving the answers and documents from the respondents, the applicant wrote yet another letter dated 18 January 2017 posing 16 follow-up questions, many of which were of little or no relevance or had already been answered by the 2^nd to 4^th respondents in earlier correspondences. By a letter dated 21 March 2017, Messrs Hom & Associates, on behalf of the 2^nd and 4^th respondents, made clear to the applicant that the follow-up questions posed by the application were simply ‘unnecessary, if not frivolous vexatious and/or oppressive’.”

65.  KC had to spend time for considering and reviewing background documents to answer Mr Tang’s accusations against the Receiving Parties which eventually led to issuance of the Summons. Such costs although incurred prior to the issuing of the Summons were closely related to the subject matters of the Summons and are recoverable under the Costs Order. (See Lau Tsz Hung Ringo v First Refrigeration Engineering Limited (unrep HCMP 1166/2013, 4 July 2013) at §46)

66.  I maintain my previous rulings on these items.

Item 6

67.  In this item, KC claimed 4 hours and 55 minutes in reviewing and considering the 3^rd affirmation of Mr Tang which consisted of 23 pages with 225 pages of exhibits. I allowed 3 hours and 30 minutes of KC’s time at the Taxation.

68.  Mr Tang relied on Grounds 1 and 2 to review this item.

69.  I have disallowed review under Ground 1.

70.  For Ground 2, as KC was the handling solicitor, it was proper or necessary for him to consider the affirmation filed by Mr Tang in support of the Summons.

71.  I see no merits for review of this item under Ground 2 and maintain my previous ruling at the Taxation.

Item 7

72.  In this item, KC claimed 57 minutes in reviewing and considering the valuation report of the 1^st respondent’s properties. I allowed 30 minutes of KC’s time at the Taxation.

73.  Mr Tang relied on Grounds 1, 2, 4 and 5 to review this item.

74.  I have disallowed review under Ground 1.

75.  For Ground 2, as KC was the handling solicitor, it was proper or necessary for him to consider the valuation report on the 1^st respondent’s properties.

76.  I see no merits for review of this item under Ground 2.

77.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced documents considered by KC under this item for my assessment. I do not see that further details are required.

78.  For Ground 5, Mr Tang contended that work done under this item was irrelevant. In the Amended LOO, Mr Tang contended that the time claimed was excessive as the valuation report was only pertinent and the relevant information to note was the value and date. Mr Tang now contended in the Review that the valuation report was irrelevant and the time claimed should be taxed off.

79.  Paragraphs 26 to 29 of Mr Tang’s 3^rd affirmation in support of the Summons dealt with “Valuation of Properties” of the 1^st respondent. Mr Tang was challenging that the properties of the 1^st respondent had been sold undervalue at $9.2 million when Mr Tang alleged that they worth about $140 million. In such case, how may the valuation report on the 1^st respondent’s properties be said to be irrelevant? Mr Tang’s aforesaid contention is wholly devoid of merits.

80.  I maintain my previous ruling at the Taxation on this item.

Item 8

81.  In this item, KC claimed 1 hour and 45 minutes in reviewing and considering the affirmation of the 1^st respondent’s liquidator which consisted of 13 pages with 64 pages of exhibits. I allowed 1 hour and 30 minutes of KC’s time at the Taxation.

82.  Mr Tang relied on Grounds 1, 2, 4 and 5 to review this item.

83.  I have disallowed review under Ground 1.

84.  For Ground 2, as KC was the handling solicitor, it was proper or necessary for him to consider the affirmation filed by the 1^st respondent in response to the Summons.

85.  I see no merits for review of this item under Ground 2.

86.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced document considered by KC under this item for my assessment. I do not see that further details are required.

87.  For Ground 5, Mr Tang contended that work done under this item was irrelevant. He submitted that it was not proper and necessary for KC to read the liquidator’s affirmation in any details.

88.  Mr Tang had named the 1^st respondent as a party to the Summons and the information and documents sought by Mr Tang were related to the 1^st respondent. I do not see how the affirmation filed by the liquidator of the 1^st respondent in response to the Summons can be irrelevant and need not be read in details.

89.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Item 12

90.  In this item, KC claimed 21 minutes in reviewing and considering the consent summons in respect of the hearing scheduled for 16 November 2018. I allowed 15 minutes of KC’s time at the Taxation.

91.  Mr Tang relied on Grounds 1 and 2 to review this item.

92.  I have disallowed review under Ground 1.

93.  For Ground 2, as KC was the handling solicitor, it was proper or necessary for him to consider the consent summons.

94.  I see no merits for review of this item under Ground 2.

95.  I maintain my previous ruling on this item made at the Taxation.

Item 15

96.  In this item, KC claimed 15 minutes in reviewing and considering the skeleton submissions of the 1^st respondent dated 15 November 2018. I allowed this item in full at the Taxation.

97.  Mr Tang relied on Grounds 1, 2, 4 and 5 to review this item.

98.  I have disallowed review under Ground 1.

99.  For Ground 2, as KC was the handling solicitor, it was proper or necessary for him to consider the skeleton submissions filed by the 1^st respondent for the hearing of 16 November 2018.

100.  I see no merits for review of this item under Ground 2.

101.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced documents considered by KC under this item for my assessment. I do not see that further details are required.

102.  For Ground 5, Mr Tang contended that work done under this item was irrelevant. He submitted that it was not proper and necessary for KC to read the liquidator’s skeleton in any details.

103.  The 1^st respondent was a party to the Summons. I do not see how the skeleton submissions of the liquidator of the 1^st respondent can be said to be irrelevant and need not be read in details.

104.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Item 16

105.  In this item, LML claimed 37 minutes in attending the hearing of 16 November 2018 and claimed 59 minutes for preparing for the hearing. PL also claimed similar times for preparing and attending the aforesaid hearing. At the Taxation, I allowed the time claimed by LML for attending the hearing in full. I also allowed 30 minutes to LML for preparation but taxed off the times claimed by PL.

106.  Mr Tang relied on Grounds 1 and 2 to review this item.

107.  I have disallowed review under Ground 1.

108.  For Ground 2, as LML was a solicitor with less experience and charging at a lower rate when comparing with KC, it was proper delegation of work for LML instead of KC to attend the hearing to achieve costs savings. The time incurred by LML and allowed at the Taxation for preparing and attending the hearing was proper or necessary.

109.  However, I do not consider that it was appropriate for KC to delegate PL, being a para-legal, to attend the aforesaid hearing on his/her own with counsel which hearing being a hearing before judge.

110.  I see no merits for review of this item under Ground 2.

111.  I maintain my previous ruling on this item made at the Taxation.

Item 19

112.  In this item, KC claimed 9 hours and 36 minutes and PL claimed 7 hours and 6 minutes in reviewing and considering the 3^rd affirmation of the 2^nd respondent consisted of 23 pages with 225 pages of exhibits drafted by counsel. I allowed 5 hours to KC and 3 hours to PL at the Taxation.

113.  Mr Tang relied on Grounds 1, 2, 3 and 4 to review this item.

114.  I have disallowed review under Ground 1.

115.  For Grounds 2 and 3, as KC was the handling solicitor, it was proper or necessary for him to consider the draft affirmation of the 2^nd respondent to be filed to oppose the Summons. It was proper delegation of work to involve PL to organize the bulky exhibits to achieve costs savings. There was no duplication of work.

116.  I see no merits for review of this item under Grounds 2 and 3.

117.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced documents considered by KC under this item for my assessment. I do not see that further details are required.

118.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Item 20

119.  In this item, KC claimed 2 hours and PL claimed 1 hour and 30 minutes in reviewing the 5^th affirmation of Mr Tang which consisted of 21 pages with 34 pages of exhibits. I allowed KC’s time in full and taxed off PL’s time at the Taxation.

120.  Mr Tang relied on Grounds 1 and 2 to review this item.

121.  I have disallowed review under Ground 1.

122.  For Ground 2, as KC was the handling solicitor, it was proper or necessary for him to consider the affirmation filed by Mr Tang in support of the Summons.

123.  I see no merits for review of this item under Ground 2 and maintain my previous ruling at the Taxation.

Item 23

124.  In this item, KC claimed 49 minutes and PL claim 12 hours and 21 minutes in reviewing and revising the hearing bundles. PL further claimed 6 hours and 30 minutes in preparing copy set of the hearing bundles to counsel. I allowed 30 minutes to KC and 9 hours to PL at the Taxation.

125.  Mr Tang relied on Grounds 1, 2 and 4 to review this item.

126.  I have disallowed review under Ground 1.

127.  For Grounds 2, as KC was the handling solicitor, it was proper or necessary for him to supervise the preparation of the hearing bundles to consider and review the same. It was proper delegation of work to involve PL as the main handler in preparing the hearing bundles to achieve costs savings. There was no failure to delegate or duplication of work.

128.  I see no merits for review of this item under Ground 2.

129.  For Ground 4, Mr Tang contended that more details of work done were required. The receiving parties had produced the index of the hearing bundles and the parties’ correspondence on the same for my assessment. I do not see that further details are required.

130.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Item 26

131.  In this item, KC and PL both claimed 3 hours in reviewing and considering the skeleton submissions and authorities of Mr Tang dated 21 May 2019. I allowed 2 hours to KC and taxed off PL’s time at the Taxation.

132.  Mr Tang relied on Grounds 1 and 2 to review this item.

133.  I have disallowed review under Ground 1.

134.  For Ground 2, as KC was the handling solicitor, it was proper or necessary for him to consider the skeleton submissions and authorities filed by Mr Tang for the hearing of 27 May 2019.

135.  I see no merits for review of this item under Ground 2. I maintain my previous ruling on this item made at the Taxation.

Item 27

136.  In this item, both KC and PL claimed 1 hour and 30 minutes in reviewing and considering the skeleton submissions and authorities of the 1^st respondent for the hearing of 27 May 2019. I allowed 1 hour of KC’s time and taxed off PL’s time at the Taxation.

137.  Mr Tang relied on Grounds 1, 2, 4 and 5 to review this item.

138.  I have disallowed review under Ground 1.

139.  For Ground 2, as KC was the handling solicitor, it was proper or necessary for him to consider the skeleton submissions filed by the 1^st respondent for the hearing of 27 May 2019.

140.  I see no merits for review of this item under Ground 2.

141.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced documents considered by KC under this item for my assessment. I do not see that further details are required.

142.  For Ground 5, Mr Tang contended that work done under this item was irrelevant. He submitted that it was not proper and necessary for KC to read the liquidator’s skeleton in any details.

143.  The 1^st respondent was a party to the Summons. I do not see how the skeleton submissions of the liquidator of the 1^st respondent can be said to be irrelevant and need not be read in details.

144.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Item 28

145.  In this item, both KC and PL claimed 2 hours in reviewing and considering the Receiving Parties’ skeleton submissions and authorities prepared by counsel. PL further claim 12 minutes in arranging copies for service to other parties. I allowed KC’s time in full and taxed off PL’s time at the Taxation.

146.  Mr Tang relied on Grounds 1, 2 and 3 to review this item.

147.  I have disallowed review under Ground 1.

148.  For Grounds 2 and 3, Mr Tang submitted that it was not proper and necessary for KC just to read skeleton prepared by counsel. The Receiving Parties had to demonstrate how H&A had contributed to the actual hearing.

149.  As KC was the handling solicitor, it was proper or necessary for him to review and consider the skeleton submissions and authorities prepared by counsel irrespective of whether he had any suggested amendments. It is wrong to assume that when counsel is instructed, instructing solicitors can sit there without doing anything and leaving everything to counsel. Instructing solicitors still have to review and consider documents prepared by counsel and to discuss his views (if any) with counsel. Costs incurred by the solicitor for discussions with counsel will be covered by other items for conferences and communications with counsel.

150.  The Receiving Parties’ skeleton submissions prepared by counsel consisted of 20 pages with 8 legal authorities. It was proper or necessary for KC to spend 2 hours to review and consider the same.

151.  I see no merits for review of this item under Grounds 2 and 3. I maintain my previous ruling on this item made at the Taxation.

Item 29

152.  In this item, both KC and PL claimed 2 hours in reviewing and considering Mr Tang’s supplemental skeleton submissions and authorities. I allowed KC’s time in full and taxed off PL’s time at the Taxation.

153.  Mr Tang relied on Grounds 1, 2 and 3 to review this item.

154.  I have disallowed review under Ground 1.

155.  For Grounds 2 and 3, Mr Tang submitted that it was not proper and necessary for KC just to read his supplemental skeleton which would be dealt with by counsel. The Receiving Parties had to demonstrate what additional work H&A had performed after such reading.

156.  As KC was the handling solicitor, it was proper or necessary for him to review and consider Mr Tang’s supplemental skeleton submissions and authorities. It is wrong to assume that when counsel is instructed, instructing solicitors can sit there doing nothing and leaving everything to counsel. Instructing solicitors still have to review and consider skeleton prepared by other parties and to discuss his views (if any) with counsel. Costs incurred by the solicitor for discussions with counsel will be covered by other items for conferences and communications with counsel.

157.  Mr Tang’s supplemental skeleton submissions consisted of 12 pages with 6 legal authorities. Being skeleton of the opposite side in litigation, KC had to consider it in more details. It was proper or necessary for KC to spend 2 hours to review and consider the same.

158.  I see no merits for review of this item under Grounds 2 and 3. I maintain my previous ruling on this item made at the Taxation.

Item 30

159.  In this item, both KC and PL claimed 3 hours and 24 minutes for attending court hearing on 27 May 2019. The hearing was scheduled to commence at 10 am. Court records showed that the hearing ended at 13:22 hours. Time spent by the fee earners of the Receiving Party’s solicitors for the aforesaid hearing was 3 hours and 22 minutes. As such, I allowed 3 hours and 22 minutes of KC’s time and taxed off PL’s time at the Taxation.

160.  Mr Tang relied on Grounds 1 and 2 to review this item.

161.  I have disallowed review under Ground 1.

162.  For Ground 2, Mr Tang contended that the hearing should have been attended by a less senior solicitor. As KC was the handling solicitor, it was proper or necessary for him to attend the hearing.

163.  I see no merits for review of this item under Ground 2. I maintain my previous ruling on this item made at the Taxation.

Item 32

164.  In this item, both KC and PL claimed 1 hour for reviewing the court decision dated 6 June 2019 (the “Decision”). I allowed KC’s time in full and taxed off PL’s time at the Taxation.

165.  Mr Tang relied on Grounds 1, 2 and 3 to review this item.

166.  I have disallowed review under Ground 1.

167.  For Grounds 2 and 3, Mr Tang contended that it was not proper and necessary for KC just to read the Decision. HA has to demonstrate what additional work was performed after such “reading” of the Decision.

168.  The Decision consist of 20 pages. As KC was the handling solicitor, it was proper or necessary for him to review the Decision so as to advise his client. To review a document is not simply reading a document. The reader has to consider and analyze the contents of the document. For KC to spend 1 hour in “reviewing” (not only “reading”) the Decision was proper or necessary.

169.  This item only covers the time spent by KC in reviewing the Decision. The time spent by KC in advising his client in respect of the Decision including recovering costs against the paying party under the Costs Order would have been covered by other items for conference or communications with the clients.

170.  I see no merits for review of this item under Grounds 2 and 3. I maintain my previous ruling on this item made at the Taxation.

Item 35.1

171.  In this item, KC claimed 882 minutes, NC claimed 180 minutes, TN claimed 162 minutes, TS claimed 804 minutes and PL claimed 144 minutes in attending 13 meetings with client. I allowed 600 minutes (ie 10 hours) to KC and 78 minutes to PL. I taxed off the time of NC, TN and TS at the Taxation.

172.  Mr Tang relied on Grounds 1, 2 and 4 to review this item.

173.  I have disallowed review under Ground 1.

174.  For Ground 2, as KC was the handling solicitor and PL was the para- legal assisting the fee earners in handling this case, it was proper or necessary for KC to attend meetings with client to take instructions and advise client. It was also costs efficient for KC to delegate PL to attend some meetings with client on matters suitable to be dealt with by para-legal.

175.  I see no merits for review of this item under Ground 2.

176.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced attendance records for the meetings under this item for my assessment. I do not see that further details are required.

177.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Item 35.2

178.  In this item, KC claimed 582 minutes, TS claimed 120 minutes and PL claimed 462 minutes in attending 7 conferences with counsel. I allowed 150 minutes each for KC(1) and KC(2) totaling 300 minutes (ie 5 hours). I taxed off the times of other fee earners at the Taxation.

179.  Mr Tang relied on Grounds 1, 2 and 4 to review this item.

180.  I have disallowed review under Ground 1.

181.  For Ground 2, as KC was the handling solicitor, it was proper or necessary for KC to attend conferences with counsel.

182.  I see no merits for review of this item under Ground 2.

183.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced attendance records for the conferences under this item for my assessment. I do not see that further details are required.

184.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Item 36.1

185.  In this item, KC claimed 3,696 minutes, NC claimed 6 minutes, TS claimed 23 minutes and PL claimed 692 minutes in communicating with client consisting 143 letters (out), 117 letter (in) and 13 telephone calls. At the Taxation, I allowed 96 minutes for KC(2017), 1,104 minutes for KC(1) and 600 minutes for KC(2), totaling 1,800 minutes (ie 30 hours). I also allowed 330 minutes for PL(1) and 120 minutes for PL(2), totaling 450 minutes (ie 7.5 hours). I allowed the times of NC and TS in full.

186.  Mr Tang relied on Grounds 1, 2 and 4 to review this item.

187.  I have disallowed review under Ground 1.

188.  For Ground 2, as KC was the handling solicitor assisted by NC, TS and PL in handling this case, it was proper or necessary for KC to attend to communications with client to take instructions and advise client. It was also costs efficient for KC to delegate to other junior fee earners to attend to some communications with client on matters suitable to be dealt with by junior fee earners.

189.  I see no merits for review of this item under Ground 2.

190.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced copies of the letters and attendance records for the telephone calls under this item for my assessment. I do not see that further details are required.

191.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Item 36.2

192.  In this item, KC claimed 3,451 minutes, NC claimed 402 minutes, TS claimed 1,200 minutes and PL claimed 612 minutes in attending communications with the applicant of the Summons consisting 26 letters (out), 32 letters (in) and 8 telephone calls.

193.  At the Taxation, I went through each of the letters and telephone calls claimed under this item. I taxed off some communications claimed, allowed some communications by 70% of the time claimed and allowed some communications by specific minutes.

194.  Mr Tang relied on Grounds 1, 2 and 4 to review this item.

195.  I have disallowed review under Ground 1.

196.  For Ground 2, as KC was the handling solicitor assisted by other fee earners in handling this case, it was proper or necessary for KC to attend to communications with the applicant. It was also costs efficient for KC to delegate other junior fee earners to attend to some communications with the applicant on matters suitable to be dealt with by junior fee earners.

197.  I see no merits for review of this item under Ground 2.

198.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced copies of the letters and attendance records of telephone calls claimed under this item for my assessment. I do not see that further details are required.

199.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Item 36.3

200.  In this item, KC claimed 127 minutes and PL claimed 51 minutes in attending communication with the 1^st respondent consisting of 3 letter (out) and 12 letters (in).

201.  At the Taxation, I went through each of the letters claimed under this item. I disallowed 1 letter and allow 70% of the time claimed in respect of other letters.

202.  Mr Tang relied on Grounds 1, 2, 4 and 5 to review this item.

203.  I have disallowed review under Ground 1.

204.  For Ground 2, as KC was the handling solicitor and PL was the para- legal assisting the fee earners in handling this case, it was proper or necessary for KC to attend to communications with co-respondent. It was also costs efficient for KC to delegate PL to attend to some communications with co-respondent on matters suitable to be dealt with by para-legal.

205.  I see no merits for review of this item under Ground 2.

206.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced copies of the letters claimed under this item for my assessment. I do not see that further details are required.

207.  For Ground 5, I do not see how communications with co-respondent in respect of the Summons/Amended Summons can be said to be irrelevant.

208.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Item 36.4

209.  In this item, KC claimed 46 minutes and PL claimed 15 minutes in attending communications with the Official Receiver consisting of 2 letters (out) and 3 letters (in). I allowed 70% of the times claimed after considering each of the letters concerned.

210.  Mr Tang relied on Grounds 1, 2 and 4 to review this item.

211.  I have disallowed review under Ground 1.

212.  For Ground 2, as KC was the handling solicitor and PL was the para- legal assisting the fee earners in handling this case, it was proper or necessary for KC to attend to communications with the Official Receiver. It was also costs efficient for KC to delegate PL to attend to some communications with the Official Receiver on matters suitable to be dealt with by para-legal.

213.  I see no merits for review of this item under Ground 2.

214.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced copies of letters claimed under this item for my assessment. I do not see that further details are required.

215.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Items 36.6, 36.8 and 48

216.  In these items, KC claimed 30 minutes for communications with Chow Wong & Lawyers consisting of 1 letter (out) and 1 letter (in) (item 36.6) and 30 minutes for communications with CW Lawyers also consisting of 1 letter (out) and 1 letter (in) (item 36.8). In item 48, both KC and PL claimed 1 hour in reviewing 126 pages of documents received from CW Lawyers.

217.  At the Taxation, I allowed KC 20 minutes for communications with Chow Wong & Lawyers and 30 minutes for communications with CW Lawyers after considering the letters concerned. I also allowed 45 minutes for KC to review the documents received from CW Lawyers but taxed off PL’s time.

218.  Mr Tang submitted that the applicant of the Summons was not aware of the existence and involvement of Chow Wong & Lawyers and CW Lawyers.

219.  From the letters produced by the Receiving Parties at the Taxation, it could be seen that Chow Wong & Lawyers were solicitors acting for the petitioner in HCCW 299/2016 in which the 1^st respondent was being wound-up by the court. The handling solicitor of HCCW 299/2016 in Chow Wong & Lawyers subsequently left Chow Wong & Lawyers and joined CW Lawyers.

220.  Mr Tang relied on Grounds 1, 2 and 5 to review these items.

221.  I have disallowed review under Ground 1.

222.  For Ground 2, as KC was the handling solicitor, it was proper or necessary for KC to attend to communications with solicitors acting for the petitioner in HCCW 299/2016 to make enquiries and to review documents received as the Summons/Amended Summons was related to the 1^st respondent’s affairs.

223.  I see no merits for review of these items under Ground 2.

224.  For Ground 5, Mr Tang contended that these works were irrelevant.

225.  As the disposal of the 1^st respondent’s properties in August 2016 (which was about the same time when the winding-up petition was presented against the 1^st respondent on 24 August 2016) was the core matter concerning the Summons/Amended Summons, the documents relating to the winding-up petition against the 1^st respondent were relevant. Furthermore, the learned Deputy Judge noted in §29 of the Decision that: “Mr Tang submitted that the 1^st respondent was wound up in suspicious circumstances.” In such circumstances, it was proper or necessary for the Receiving Party’s solicitors to contact lawyers acting for the petitioner in HCCW 299/2016 to obtain documents relating to the winding-up petition against the 1^st respondent and to spend time to review the documents obtained.

226.  Mr Tang’s review on these items has no merits. I maintain my previous ruling on these items made at the Taxation.

Item 36.9

227.  In this item, KC claimed 545 minutes and PL claimed 115 minutes in communicating with Mr Lee of counsel consisting of 46 letter (out), 40 letters (in) and 11 telephone calls.

228.  After considering the letters concerned and the telephone attendance records, I allowed at the Taxation 37.80 minutes for PL(2) and 70% of the time claimed by KC.

229.  Mr Tang relied on Grounds 1, 2 and 4 to review this item.

230.  I have disallowed review under Ground 1.

231.  For Ground 2, as KC was the handling solicitor and PL was the para-legal assisting the fee earners in handling this case, it was proper or necessary for KC to attend to communications with counsel instructed to deal with this case. It was also costs efficient for KC to delegate PL to attend to some communications with counsel on matters suitable to be dealt with by para-legal.

232.  I see no merits for review of this item under Ground 2.

233.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced telephone attendance records and letters claimed under this item for my assessment. I do not see that further details are required.

234.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Item 36.11

235.  In this item, KC claimed 1,106 minutes and PL claimed 450 minutes in communicating with Mr Kwong of counsel consisting of 29 letter (out), 13 letters (in) and 6 telephone calls.

236.  After considering the letters concerned and the telephone attendance records, I allowed at the Taxation 37.10 minutes for PL(2) and 70% of the time claimed by KC.

237.  Mr Tang relied on Grounds 1, 2 and 4 to review this item.

238.  I have disallowed review under Ground 1.

239.  For Ground 2, as KC was the handling solicitor and PL was the para-legal assisting the fee earners in handling this case, it was proper or necessary for KC to attend to communications with counsel instructed to deal with this case. It was also costs efficient for KC to delegate PL to attend to some communications with counsel on matters suitable to be dealt with by para-legal.

240.  I see no merits for review of this item under Ground 2.

241.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced telephone attendance records and letters claimed under this item for my assessment. I do not see that further details are required.

242.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Item 36.14

243.  In this item, KC claimed 659 minutes and PL claimed 522 minutes in communicating with the court consisting of 8 letter (out), 11 letters (in) and 1 telephone call.

244.  After considering the letters concerned and the telephone attendance records, I allowed PL(2) 18 minutes and 70% of the time claimed by KC in the Taxation.

245.  Mr Tang relied on Grounds 1, 2 and 4 to review this item.

246.  I have disallowed review under Ground 1.

247.  For Ground 2, as KC was the handling solicitor and PL was the para-legal assisting the fee earners in handling this case, it was proper or necessary for KC to attend to communications with the court. It was also costs efficient for KC to delegate PL to attend to some communications with the court on matters suitable to be dealt with by para-legal.

248.  I see no merits for review of this item under Ground 2.

249.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced telephone attendance records and letters claimed under this item for my assessment. I do not see that further details are required.

250.  Mr Tang’s review on this item has no merits. I maintain my previous ruling on this item made at the Taxation.

Items 39 and 42

251.  In these items, KC claimed 4 hours for conducting research. At the Taxation, I allow 3 hours of KC’s time.

252.  Mr Tang relied on Grounds 1, 2 and 4 to review these items.

253.  I have disallowed review under Ground 1.

254.  For Ground 2, as KC was the handling solicitor, it was proper or necessary for KC to research on relevant legal issues especially on cases referred to by the court or by the Official Receiver.

255.  I see no merits for review of these items under Ground 2.

256.  For Ground 4, Mr Tang contended that more details of work done were required. The Receiving Parties had produced copies of the materials considered by KC for my assessment. I do not see that further details are required.

257.  Mr Tang’s review on these items has no merits. I maintain my previous rulings on these items made at the Taxation.

Items 57 and 58

258.  In these items, KC claimed 1 hour and 50 minutes for care and conduct. At the Taxation, I allow KC’s time in full.

259.  Mr Tang relied on Grounds 1 and 2 to review these items.

260.  I have disallowed review under Ground 1.

261.  For Ground 2, as KC was the handling solicitor, it was proper or necessary for KC to have care and conduct of this matter in supervising works of unqualified staff and junior fee earners in the daily handling of this case.

262.  Mr Tang contended that: “There is no legal basis for such “care and conduct”. Secretary and support staff costs are part of admin overhead of HA, which have been reflected in their professional hourly rates.” (p 19 of the Review Application)

263.  Item 5 and note (b) to Item 5 of Part I of First Schedule of Order 62 of the RHC provides that the Registrar may allow such fee as he thinks proper in respect of the general care and conduct of the proceedings. To say that claim for these items lacks legal basis is plainly wrong.

264.  “Care and conduct” does not cover staff costs of the receiving party’s solicitors’ firm but time spent by the supervising fee earner in supervising unqualified persons and junior fee earners in conducting the proceedings. Paragraph 62/App/23 of the Hong Kong Civil Procedure 2023 Vol 1 provides that:

“General care and conduct – In allowing the time for general care and conduct of the proceedings, the taxing master will have regard to, inter alia, the duration of the proceedings; the steps taken; and the number of unqualified persons or junior solicitors who required supervision.”

265.  I see no merits for review of these items under Ground 2.

266.  In this case, the Summons was issued on 12 October 2018. The proceedings for the Summons/Amended Summons concluded at the Court of First Instance in about July 2019 when the Costs Order was sealed. However, before issuance of the Summons, the Receiving Parties’ solicitors had since February 2017 already spent times to deal with the applicant’s requests for information and documents, the subject matters of the Summons. As such, the Receiving Parties’ solicitors had been dealing with the proceedings in respect of the Summons/Amended Summons and related matters for about 2.5 years. For the supervising fee earner to spend 1 hour and 50 minutes to supervising work of unqualified staff and other junior fee earners for such period of time was proper or necessary.

267.  Mr Tang’s review on these items has no merits. I maintain my previous rulings on these items made at the Taxation.

Items 59, 60 and 63

268.  These items were for counsel fee.

269.  Mr Tang contended that the Receiving Parties had instructed three counsel to attend the hearing of 27 May 2019. The court granted certificate for two counsel. As such, the Receiving Parties might only claim fees for the two junior counsel instead of fee for one Senior Counsel together with one senior junior.

270.  When the court grants certificate for two counsel, the receiving party may claim the fee of any of the two counsel instructed to attend the hearing if more than two counsel were instructed. It is for the taxing master to consider whether the amount of counsel fee claimed was proper or necessary.

271.  When a hearing judge in the Court of First Instance grants certificate for two counsel for an application, the judge must be of the view that the application involved certain complex issues of law which justify the involvement of more than one counsel. Usually, in such case, one of the counsel will be a Senior Counsel or a senior junior leading a junior counsel. In determining whether fee of Senior Counsel is allowed, the correct question for the taxing master is not whether the case was well within the capabilities of junior counsel but rather whether or not it was reasonable and proportionate to instruct Senior Counsel. (See R v Dudley Magistrates’ Court Ex p Power City Stores Ltd (1990) 154 JP 654; (1990) 154 JPN 490; (1990) 140 New LJ 361)

272.  In this case, the learned Deputy Judge granted certificate for two counsel to the Receiving Parties in the Costs Order. The Receiving Parties had instructed a Senior Counsel and two junior counsel. Mr Frost, the law costs draftsman for the Receiving Parties, informed the court that the brief for Ms Sat was a complimentary brief. The Receiving Parties had produced the brief sent to Ms Sat for the 27 May 2019 hearing confirming that it was a complimentary brief.

273.  As certificate for two counsel had been granted to the Receiving Parties, the Receiving Parties were entitled to claim the fee of two counsel. At the hearing of 27 May 2019 the Receiving Parties instructed Mr Wong SC, Mr Kwong and Ms Sat to attend the hearing. The Receiving Parties claimed the fees of Mr Wong SC and Mr Kwong.

274.  In Poon Shu Fan v Wong Tin Yan [2012] 5 HKLRD 512, the Court of Appeal pointed out in §31 of the judgment that after the Civil Justice Reform, in determining the amounts of fee allowed for counsel, the court should have regard to all the relevant circumstances and in particular to the following matters:

(a) the complexity of the matter and the difficulty or novelty of the questions involved;

(b) the skill, specialized knowledge and responsibility required of, and the time and labour expended by, counsel;

(c) the number and importance of the documents prepared or perused;

(d) the place and circumstances in which the business involved is transacted;

(e) the importance of the matter to the client;

(f) where money or property is involved, its amount or value; and

(g) any other fees and allowances payable to counsel in respect of other items in the same cause or matter, but only where work done in relation to those items has reduced the work which would otherwise have been necessary in relation to the item in question.

275.  In these proceedings, there were mixed issues of facts and law raised by the Amended Summons including: whether the Amended Summons was to enforce the 2016 Order or a fresh application; if it was a fresh application under section 29 of the Ordinance whether the essential conditions for making a section 29 order had been satisfied; how the discretionary power conferred to the court under section 29 of the Ordinance should be exercised; and whether the order sought in the Amended Summons was within the ambit of section 29 of the Ordinance.

276.  The application by the Amended Summons was also found to be oppressive by the learned Deputy Judge as the applicant intended to bring contempt proceedings against the Receiving Parties and by the application required them to prove the case against themselves on oath prior to the contempt proceedings being brought.

277.  Mr Tang also made serious accusation against the 2^nd respondent in the application. The Court of Appeal noted the following stance of Mr Tang in §6.14 of the CA Judgment:

“In his 5^th affirmation the applicant continued his allegation that the 2^nd respondent had been ‘cooking the books of and producing false accounts of Assen’. He referred to the ‘artificial valuation’ and ‘manipulation of an opaque auction’. He said there is clear evidence of ‘outright lies’ of the 2^nd respondent. He claimed the valuation reports obtained by the 2^nd respondent were procured to support the assertion that the value of shares in Assen is nil to support the pre-packaged auction sale at 9.2 million. The applicant used the words “Acts of perjury and contempt of Court’ in dealing with the conduct of the 2^nd respondent.”

278.  Furthermore, in these proceedings, the Receiving Parties were required to deal with an application which the Court of Appeal had described as follows in §7.13 of the CA Judgment:

“The Judge described the original summary as being convoluted, incomprehensible, lacking in focus and more in the nature of Mr Tang’s personal comments. Although the summary has since been trimmed, my view is that the Judge’s comment on this summary is still valid.”

279.  In the circumstances of this case, I am of the view that it was proper or necessary for the Receiving Parties to instruct Senior Counsel to represent them in this matter. I am of the further view that the brief fee charged by the counsel, including the Senior Counsel, and claimed by the Receiving Parties under in these items were proper. I allowed them in full at the Taxation.

280.  Mr Tang relied on Ground 6 to review these items.

281.  I have disallowed review under Ground 6.

282.  Mr Tang’s review on these items has no merits. I maintain my previous rulings on these items made at the Taxation.

Others

283.  In the Review, Mr Tang sought to challenge the Costs Order, and even the Decision, under the disguise of disputing quantum of the costs claimed. To illustrate this, I only need to cite some of his submissions.

284.  In the Review Application, Mr Tang submitted that:

“Learned Master is invited to focus on the references to “for the attainment of justice” and reconsider exercising his discretion in light of the over-all unreasonableness of the Claimed Costs for a three-hour hearing, the conduct of the Respondents in refusing to comply with the S29 Order of Mr. Justice Chung made in 2016 (ie the 2016 Order) and the fact that these proceedings were instigated when Trustee was performing his statutory duties to enforce a Court Order under Section 29 of the Bankruptcy Ordinance against the Respondents, who have clearly failed to comply with the same. Trustee submits that the wording of O.62, r.28(2) gives Learned Master substantial scope and discretion for reviewing the taxation on a “big-picture” basis.” (original underline) (§1(c) of Part B)

“Post-taxation comments:

a. For Respondents to choose to “flight” Trustee acting in person by engaging three counsel, including Senior Counsel, the onus is on them to justify how and why that was “necessary or proper” to defend or enforce their rights. … …

b. … …

c. As things turned out for the Hearing in June 2019, those advising Respondents made a last-minutes drastic about turn in their key arguments only in their skeleton submissions. Instead of claiming that Respondents had duly complied with the S29 Order, they suddenly introduced the new argument that the Amended Summons was in fact a new S29 application, on which DHCJ Mr. William Wong SC ruled in their favour. With Trustee acting in person, such last-minute legal ambush by the legal team of Respondents is lamentable and despicable. If nothing else, such conduct of the legal team (no doubt involving Senior Counsel who argued their case) should not be condoned by the Court by disallowing their fees now claimed to be paid by Trustee as victim of such legal ambush.” (original emphasis and underline) (§3(a) of Part C)

285.  In his supplemental written submissions dated 31 May 2023 (the “Supplemental Submissions”), Mr Tang submitted that:

“8. Taxation on a party to party basis is to allow necessary and proper costs for the attainment of justice in the context of the proceedings. This is an over-riding principle. These proceedings in question had to be brought by the Trustee (ie the applicant) as an officer of the Court and discharging his duties as such in seeking to enforce Mr. Justice Chung’s S29 Order (ie the 2016 Order) against the Respondents. Respondents had been deploying all kinds of tactics to avoid full compliance with the Order (see also their conduct as discussed below). There is clear evidence that Respondents failed to fully disclose documents in their possession or under their control; the documents they disclosed were produced after the event if not fabricated.

9. At the hearing in May 2019, Senior Counsel for Respondents made a last-minute drastic about-turn in their key arguments (but only in their submissions and not in affirmations filed – see their skeleton as annexed to the Review Application dated 30 January 2023) that Trustee’s application was a new S29 application. This was unprofessional legal ambush that caught Trustee (acting in person) totally unprepared and exposed with little if not no counter arguments at short notice. In his Decision (§§8, 12 and 18), DHCJ William Wong SC accepted this argument and dismissed Trustee’s application to enforce the Chung Order.

10. Thus, Respondents’ winning the legal battle by legal ambush is professionally unethical and cannot be considered as doing “justice” to the Trustee. This is more so when Trustee was acting in person (because there were no funds in bankruptcy estate) to engage legal counsel to seek to enforce the Chung Order.

11. In this light, consequential costs awarded against the Trustee should be taxed and reflect these fundamental principles of attaining justice for the Trustee as a officer of the Court.” (Original underlining)

286.  Mr Tang submitted that although costs were awarded to the Receiving Parties with certificate for two counsel under the Costs Order, the amount of costs allowed to the Receiving Parties at the Taxation should be nil or nominal. I do not propose to go through all these submissions of Mr Tang which were put forwarded by him at the Taxation and again in the Review, it suffices for me to say that taxation hearing is not the appropriate forum for him to challenge the Decision or the Costs Order. I am of the view that such attempts amount to abuse of process.

287.  Mr Tang also included irrelevant matters in the Review Application when he submitted that: “In the event a substantial part of the Bill is to be taxed down, Applicant reserves the rights to file formal complaints against HA and Mr. Kevin Cheung personally for inflating the Bill, which must be a matter of professional misconduct, if nothing more serious, as Mr. Cheung is an officer of this Honourable Court.” (§4(f) of the Review Application)

288.  Mr Tang further submitted in §39 of the Supplemental Submissions that:

“On costs of taxation, the general rule that “unless one-sixth or more of the amount of a bill … is taxed off, the client shall pay the costs of taxation”. (62/App/69). Applying this principle, costs of taxation herein with at least 40% of the Bill (before review) taxed off should not be paid by Trustee at all.” (Original italic)

289.  Mr Tang, if not intended to mislead the court, has mixed up solicitor-and-client taxation with party-and-party taxation.

290.  By including irrelevant and/or misleading matters in the Review, Mr Tang has caused unnecessary costs being incurred, to say the least.

Costs and conclusion

291.  For the reasons stated above, Mr Tang’s review application totally fails. Costs shall follow the event.

292.  As can be seen from the above, the Review is wholly devoid of merits. In the Review Application, Mr Tang had included items which were taxed and allowed with his agreement or had been taxed off in the Taxation as review items. Such items were withdrawn only at the review hearing. Mr Tang sought to challenge the Decision and/or the Costs Order in the name of reviewing quantum of the costs claimed. He relied on speculation not supported by evidence for the Review. He raised various matters in the Summons/Amended Summons causing the Receiving Parties to incur costs to deal with those matters but submitted at the Review that those matters were irrelevant matters which the Receiving Parties should not have incurred costs to deal with. In such circumstances, I am of the view that Mr Tang shall bear the costs for this review application on indemnity basis.

293.  I make a costs order nisi that Mr Tang shall pay the Receiving Parties’ costs for this review application on indemnity basis. I shall assess such costs by summary assessment.

294.  The aforesaid costs order nisi shall become absolute after 14 days from the date of this determination unless application is received from either party within these 14 days to vary the same.

295.  To conclude, I dismiss Mr Tang’s review application. I also order Mr Tang to pay the Receiving Parties’ costs for this review application on indemnity basis on nisi basis to be assessed by summary assessment.

296.  I direct the Receiving Parties to submit their statement of costs for this review application to the court within 14 days after the aforesaid costs order nisi shall become absolute with copy to Mr Tang.

297.  I direct Mr Tang to submit his comment(s), if any, on the Receiving Parties’ aforesaid statement of costs to the court within 7 days thereafter with copy to the Receiving Parties.

298.  The court shall assess the costs payable by Mr Tang to the Receiving Parties for this review application by summary assessment by way of paper disposal.

Mr S Frost, law costs draftsman, instructed by Hom & Associates, for the 2^nd to 4^th Respondents (the Receiving Parties).

Mr Tang Chi Wah, the Applicant (the Paying Party), acting and attending the hearing in person

HCB 4475/2002

[2019] HKCFI 1491

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

BANKRUPTCY PROCEEDINGS NO 4475 OF 2002

_______________

________________

________________________

DECISION

________________________

1.  The Joint and Several Trustees of the Property of the Bankrupt, Mr So Ching Wan (the “Trustees”) applied, by Amended Summons filed on 22 November 2018, for the following orders:

“ 1. Each of the Respondents comply with the Order of Mr. Justice Chung made on 7 June 2016 (‘Chung Order’) by answersing on oath all of the questions (thethereto Annex A as attached to the Order of Mr Justice Chung dated 7^thJune 2016 (the ‘Chung Order’)) and producing all of the documents (the Annex B theretoto the Chung Order), and with reference to a Summary shown as Exhibit ACWT-18 in the supporting affirmation of Mr. Alan CW Tang filed herein (‘Summary’), stated in the Chung Order within 14 days of the Order to be made herein;

2.  If any of the Respondents cannot provide answers to any of the questions in Annex A to the Chung Order, and with reference to the Summary, each of these relevant Respondents file an affidavit/affirmation to state the reasons for not being in such a position to comply within 14 days of the Order to be made herein.

3.  If any of the Respondents cannot provide any of the documents in Annex B to the Chung Order, and with reference to the Summary, each of these relevant Respondents file an affidavit/affirmation to state whether any of these documents had ever been in his/her possession, custody or control (including power to procure the same from third parties); and if these had been in his/her possession, custody or control (including power to procure same from third parties) but no longer now, since when they are no longer available and under what circumstances that they became unavailable within 14 days of the Order to be made herein;

4.  Each of the 2^nd, 3^rd and 4^th Respondents attend the court to be examined on oath at such time and place as the court shall direct and that the Trustees be at liberty to examine these Respondents under Section 29 of the Bankruptcy Ordinance (Cap.6) concerning the Bankrupt’s investment in the Company, its assets, liabilities, affairs, books and records and any other relevant matters including the matters and transactions set out in Annex A and Annex B of the Chung Order and with reference to the Summary in paragraph 1 herein.

5.  Either one of the two Trustees or their legal representatives be appointed examiner for the purpose of conducting the said examination.

6.  Penal notice be endorsed to the Order to be made herein.

7.  Such other relief/directions as may be granted by the Court; and

8.  Costs of this application (including the professional time costs of the Trustees on the ‘Panel A’ rates) be paid by the directors of Assen Limited, namely Mr. Cheung Ying Ho, Ms. Cheung Cho Yi Natalie and Ms. Lam Yuk Chun personally on a joint and several basis.”

2. The Trustees have also taken out a summons to seek leave to continue these proceedings against the 1^st respondent on a retrospective basis as the 1^st respondent has been wound up.  (“Leave Summons”)

3. Mr So Ching Wan (the “Discharged Bankrupt”) was adjudicated bankrupt on 19 August 2002.  He has since been discharged from bankruptcy as from 19 August 2010.

4. The Discharged Bankrupt used to be a director and is still a shareholder of Assen Limited, the 1^strespondent.  The 2^nd to 4^th respondents were directors and are still shareholders of the 1^st respondent.

5. On 27 July 2015, the Trustees took out a summons under section 29(1) of the Bankruptcy Ordinance, Cap 6 to direct the 1^st respondentand/or each of the 2^nd and 4^threspondents, being directors of the 1^st respondent, to answer a list of questions and to provide a list of documents primarily to help the Trustees to ascertain the real worth of the Discharged Bankrupt’s shareholding in the 1^st respondent.

6. On 7 June 2016, Chung J made an order that:

“ The 1^st Respondent and/or each of the 2^nd and 4^th Respondents, being directors of the 1^st Respondent, do provide to the Applicant the answer(s) and/or document(s) as set out in the schedules attached to this Order marked as ‘Annex A’ and ‘Annex B’ withina reasonable period (in any event, not more than 21 days from the date of this Order.” (‘Chung J’s Order’)

7. The Trustees take the view that Chung J’s Order has not been complied with by the respondents.  Accordingly, the Trustees took out the present summons on 12 October 2018 which was amended on 22 November2018.  The Trustees were represented by Mr Alan Tang, one of the Trustees in these proceedings.  Mr Tang complained that despite the clear terms of Chung J’s Order, each of the 1^st to the 4^th respondents, after nearly three years, have not yet fully complied with the same.  Mr Tang in paragraph 2 of his Supplemental Skeleton Submissions stated that:

“ Although drafted by the Applicant, paragraph 1 of the Amended Summons was carefully and repeatedly reviewed and amended by Mr. Justice A. Chung. This is clearly an ‘Enforcement Order’. As stated in paragraph 30 of Applicant’s Skeleton filed on 21 May 2019 (‘Tang Skeleton’), the Amended Summons is to seek to enforce compliance by the Respondents with the S29 Order in order to enable the Applicant to perform the 5 specific areas of investigation as set out in the Decision. It is not a ‘new [S29] application’ as stated in paragraph 11 of the Cheung Skeleton.”

8. Mr Wong SC, for the 2^nd to the 4^th respondents submitted that this is a new section 29 application and not an enforcement action.  In any event, the position of the 2^nd to the 4^th respondents is that they have fully complied with Chung J’s Order.

9.  I am of the view that it is important to determine the nature of the application first.

NATURE OF APPLICATION

10.  Mr Tang relied on Order 45, rule 6(1) of the Rules of High Court, Cap 4A, albeit that the margin note of the Amended Summons cited Order 45, rule 7.  I accept that it is a mere typographical error.  Order 45, rule 6(1) provides:

“ Notwithstanding that a judgment or order requiring a person to do an act specifies a time within which the act is to be done, the Court shall, without prejudice to Order 3, rule 5, have power to make an order requiring the act to be done within another time,being such time after service of that order, or such other time, as may be specified therein.”

11.  Mr Tang referred this court to the case of Wah Sun Hong Ltd v Wong Lee Yuk Ping Agnes HCA 874/2015, unreported, 12 August 2016.  DHCJ Wilson Chan (as he then was) at paragraph 17 said:

“ The operation of Order 45, rule 6 has been explained in Re Ho YukWah David (bankrupt) [2015] 2 HKLRD 603, at paragraph 19:-

(1) Order 45, rule 6 enables the court to give the respondent one last chance to comply with its order before the applicant may invoke the penal sanctions available in the court’s armoury.

(2) The burden is on the applicant to prove that an order had been made requiring the respondent to perform an act within a specified time and the respondent failed to do so.

(3) Once that is proved, the burden is then shifted to the respondent to show why he should not be required to comply with the order why he should not be required to comply with the order to perform the act, upon being given a second chance.

(4) The obligation to perform the act required had been determined and made an order of the court. Thus, in considering whether to exercise the discretion under this rule,there is no need for the court to revisit the appropriateness or otherwise of its previous order.

(5)   The question is simply whether in all the circumstances the respondent should be excused from performing the act under its previous order.  As the court’s orders are made to be complied with, such circumstances must be made to be very rare indeed.  A possible example would be impossibility of performance as a result of change of circumstances.”

12.  Mr Wong SC submitted that this is clearly not an enforcement application of Chung J’s Order under Order 45, rule 6(1) because the words “comply with the Order of Mr. Justice Chung made on 7 June 2016 (‘Chung Order’)” were specifically deleted by way of amendment.  This, Mr Wong SC submitted, could only mean that the Amended Summons is not about compliance with Chung J’s Order but an entirely new application.  Mr Tang submitted that those words were struck through because Mr JusticeChung considered the same to be unnecessary and the Trustees could simply proceed with what they like to apply.

13.  I am of the view that the deletion of the words is not critical in determining whether this is a new application or an enforcement action as contended by Mr Tang.  If the exact same orders were applied so that the respondents herein could be given more time to comply with Chung J’s Order, then it does not matter whether the words were deleted or not.  The application would have been an application under Order 45, rule 6(1).

14.  However, Mr Wong SC is right that the Trustees are not applying the exact same orders as Chung J’s Order.  In the present application, the Trustees are seeking to order the respondents to answer on oath all of the questions and produce all of the documents as set out in Chung J’s Order.  Paragraph 2 of the Amended Summons provides that:

“ If any of the Respondents cannot provide answers to any of the questions in Annex A to the Chung Order, and with reference to the Summary, each of these relevant Respondents file an affidavit/affirmation to state the reasons for not being in such a position to comply within 14 days of the Order to be made herein.”

15.  In Chung J’s Order there is no requirement that the respondents answer any question on oath.

16.  Further, paragraph 4 of the Amended Summons seeks for oral examination of the 2^nd to 4^th respondents under section 29 of the Bankruptcy Ordinance, Cap.6 which again does not form part of Chung J’s Order.

17.  I agree with Mr Wong SC that these reliefs go beyond the ambit of Chung J’s Order.  In Wan Sun Hong Ltd v Wong Lee Yuk Ping Agnes (supra), DHCJ Wilson Chan (as he then was) at paragraph 18 said:

“ It is important to note that by this application, the plaintiff simply asks this court to fix another time within which the defendant must comply fully with the FBP Order.”

18.  In the circumstances, I am of the view that it is difficult for Mr Tang to maintain that this is simply an application for enforcement of Chung J’s Order.  I agree with Mr Wong SC that this is a new application under section 29 of the Bankruptcy Ordinance, Cap 6.  This court needs to be satisfied that a new section 29 application is justified in view of the new developments since Chung J’s Order and all the evidence before this court at the present stage.

APPLICATION UNDER SECTION 29 OF THE BANKRUPTCY ORDINANCE 

Chung J’s Order and new developments

19.  Mr Tang understandably relied heavily on Chung J’s Decision dated 7 June 2016.  However, it is important to note that at paragraph 17 of Chung J’s Decision, it is stated that:

“ Such investigation would help the trustees’ determination of (among other things) whether the suit properties still belong to Assen.”

20.  There are two significant developments since Chung J’s Order. First, the 1^st respondent has since been wound up by an order of the court on 2 November 2016 and liquidators were appointed to take over and investigate the affairs of the 1^st respondent.  The 1^st respondent is indeed represented by its liquidators in the present proceedings.

21.  Secondly, on 25 August 2016, Kingston Capital Investment Limited (“Kingston”), as mortgagee in possession, sold the suit properties, by auction, to one Ample Sparkle Development Limited, being the highest bidder, at HK$9.2 million.

22.  It is of great importance that liquidators were appointed into the 1^st respondent for a considerable period of time.  The liquidators of the 1^strespondent informed this Court that there is no asset identified or realizedin the liquidation of the 1^strespondent.  The liquidators of the 1^st respondentsubmitted that any information or documents to be discovered in the present application would not beneficial to the administration of the estate of the Discharged Bankrupt.

Applicable legal principles

23.  The legal principles on disclosure under section 29 of the Bankruptcy Ordinance, Cap 6 are well established and have recently been summarised by Recorder Eugene Fung SC in Re Ho Yuk Wah David (bankrupt) (No 3) [2019] 1 HKLRD 961 (HCB 3819/2011, 18 January 2019). The learned Recorder at paragraph 14 said:

“ The relevant legal principles on the provision of information or documents under s.29 are as follows:

(1) The Court’s power under s.29 of the Bankruptcy Ordinance to order production of information or documents is to be exercised in the same way as an application under the now repealed s.221 of the Companies Ordinance (Cap.32): Re LaiKwok Ying (a bankrupt) (HCB 8750/2007, [2009] HKEC 1300, 7 August 2009) at [5] (Kwan J (as she then was)).

Whether provision of information or documents is reasonably required

(2) The applicant must satisfy the court the essential condition that the provision of information or documents is reasonably required for him to carry out his functions: Hau Po Man Stanley (in bankruptcy) v Joint and Several Trustees [2008] 1 HKC 256 at [21(a)] (Chung J sitting in the Court of Appeal); Joint & Several Liquidators of Kong Wah Holdings Ltd v Grande Holdings Ltd (2006) 9 HKCFAR 766 at [27] (Lord Millett NPJ).

(3) In considering this question, great weight should be given to the views of the applicant, for he is an officer of the court and alone has the necessary knowledge of the problems facing him in understanding the affairs of the estate and his reasons for seeking production of documents in the terms proposed: Kong Wah Holdings Ltd (above) at [27].

Whether respondent is able to provide information or documents

(4) The applicant must also establish a prima facie case that the respondent is able to provide such information or documents:Hau Po Man Stanley (above) at [21(b)].

Balancing exercise

(5) If the above criteria are met, the court must carefully strike a balance between the applicant’s reasonable requirements and the need to avoid making an order which is wholly unreasonable, unnecessary or oppressive to the person concerned. The burden is on the applicant to satisfy the court, after balancing all the relevant factors, there is a proper case for such an order to be made. See Hau Po Man Stanley (above) at [21(c)].

(6)   The applicant may not embark on a ‘fishing expedition’ that ignores costs and proportionality: Re Lee Priscilla Hwang (bankrupt) [2012] 4 HKLRD 581 at §23 (Recorder A Chow SC(as he then was)); Re Lee Siu Fung Siegfried [2017] 1 HKLRD 1155 at [34] (G Lam J).”

24.  Applications for oral examination are more oppressive than those for disclosure of documents, and the court should be more cautious when considering such applications.  (Cloverbay Ltd v BCCI Ltd [1991] Ch 90, per Sir Nicolas Browne-Wilkinson VC at 103C–E.)

Analysis

25.  Having carefully considered the parties’ submissions, I am of the view that the Amended Summons and the Leave Summons should both be dismissed.

26.  First, the 1^st respondent has been wound up.  Liquidators were appointed into the 1^st respondent. The 2^nd to 4^th respondents have ceased to be directors of the 1^strespondent.  The affairs of the 1^st respondent are under the supervision of the liquidators of the 1^st respondent.

27.  Upon the winding up of the 1^st respondent, as far as the investigations of its affairs are concerned, the liquidators bear the primary responsibility.  The Discharged Bankrupt is a shareholder.  The Trustees of the Discharged Bankrupt can only exercise the rights of a shareholder of the 1^st respondent.  The duties and powers of a liquidator of a company are not affected by the bankruptcy of any shareholder of the company.

28.  I am of the firm view that if the liquidators of the 1^st respondent consider it necessary to make any application for disclosure of documents against the 2^nd to 4^th respondents, they, as officers of the court, will duly take out such an application.  In the present case, the liquidators of the 1^st respondent positively affirm that they do not consider it in the interest of the liquidation to make such an application as the 1^st respondent has duly recovered all its assets and distributed to its creditors.  The liquidators have confirmed on oath that “[t]here is no assets identified or realized in the winding up case of [the Company]…and the amount of assets to be realized in the winding up case of [the Company] up to present is HK$0.”

29.  Mr Tang submitted that the 1^st respondent was wound up in suspicious circumstances. I do not think I need to go into whether there are merits in Mr Tang’s submission on this point.  The important point is that there was no objection to the winding up petition.  The Trustees have full knowledge of such petition and did not resist the same.  The winding up order is valid and binding on this Court.  There is nothing for this Court to second guess the findings and professional judgments of the liquidators of the 1^st respondent.

30.  Mr Tang further submitted that the liquidators of the 1^strespondent would never carry out any further investigation into the affairsof the 1^strespondent.  Mr Lau of the liquidators of the 1^st respondent rejectedsuch submission.  Mr Lau submitted that the matters raised by Mr Tang had been investigated by the liquidators and they do not find any falsification of accounts and have duly reported the same to the Official Receivers.  I also note that Mr Tang has taken no steps to question the conduct of the liquidators of the 1^st respondent.

31.  I am of the view that if any interested parties in the liquidation are dissatisfied with the decisions of the liquidators in relation to investigations,recoveries and/or distributions, the proper procedure is for such interested parties to take out proper application before the Companies Court.  It is not conducive to the orderly administration of liquidation for concurrent investigations to take place.  The underlying theme of Mr Tang’s submissionis that in addition to the liquidators of the 1^strespondent, the Trustees should also be given the right to investigate into the affairs of the 1^st respondent which is now in compulsory liquidation.  I am of the view that such approach is incorrect.  Indeed, if there were four or five bankrupt shareholders in a company, and if Mr Tang’s submission is right, multiple sets of investigationsat huge and overlapping costs would be inevitable.  That, in my view, cannot be right.  This is against the notion of an orderly winding-up process.

32.  Hence, on this ground alone, I will dismiss the new application under section 29 of the Bankruptcy Ordinance.

33.  Secondly and fundamentally, I accept the liquidators of the 1^st respondent’s evidence and submission that in contrast to the circumstances existed at the time when Mr Justice Chung made his orders,presently, based on the evidence before this Court, there are no assets to be recouped which can enhance the value of the Discharged Bankrupt’s shareholding in the 1^st respondent.

34.  The essence of Mr Tang’s submission is that the auction sale resulted in a sale of the assets of the 1^st respondent at gross undervalue.  However, Mr Tang adduced no expert evidence to support his submission that the subject property should be worth about HK$140 million instead of HK$9.2 million.  I accept Mr Wong SC’s submission that Mr Tang’s affirmation evidence is opinion evidence and as such is not admissible as evidence for the purpose of this hearing.

35.  Mr Lau of the liquidators of the 1^st respondent submitted that the open auction was supported by a surveyor’s report.  It is also fair to pointout that Mr Tang has been requested to produce expert report to support hisallegation that the auction sale was a sale at undervalue but he failed to do so. Mr Tang explained that he has no financial resources to prepare a valuation to support his allegation which I accept to be true and correct.  However, the position remains that there is no evidence to substantiate the claim of an undervalue sale.

36.  In the circumstances, given that there is no evidence to contradict the factual position that the 1^st respondent has no assets and there are no further assets to be recovered, I do not think it is right to invoke section 29 of the Bankruptcy Ordinance to order the respondents to carry out a futile exercise.

37.  Thirdly, Mr Wong SC, for the 2^nd to 4^th respondents submitted that the entire order sought by the Trustees is by reference to the 22-page Summary and the Summary is convoluted, incomprehensible, lacking in focus and are more in the nature of Mr Tang’s personal comments.  It would be wrong as a matter of principle and oppressive to make an order under the Amended Summons which requires the respondents to comply by reference to the Summary.

38.  It is trite law that any order made by the court must be clear, since grave consequences may follow from any non-compliance with it.  (Spry on Equitable Remedies (9^th ed) at pp 386 – 389.)

39.  While I appreciate that Mr Tang tried to assemble his comments and further follow up questions in one document, I am sympathetic with Mr Wong SC’s submission that one does need to go through the Summary very carefully in order to identify what questions to be answered and what further documents to be produced.  The Summary also contains questions and demands that have been answered in earlier correspondence.

40.  I agree that the Summary in its current form is susceptible to further disputes and as such it is not appropriate to order the respondents to make disclosure by reference to the Summary. 

41.  Fourthly, section 29(1A) of the Bankruptcy Ordinance, Cap 6 provides:

“ The court may require a person referred to in subsection (1), other than the bankrupt, to submit an affidavit to the court containing an account of his dealings with the bankrupt or to produce any documents in his possession or under his control relating to the bankrupt or the bankrupt’s dealings, affairs or property.”

 ( emphasis added)

42.  None of the documents sought under Annex B of Chung J’s Order are concerned with dealings with the Discharged Bankrupt.  They all relate to the internal affairs of the 1^st respondent.  The same applies to the questions as set out in Annex A of Chung J’s Order, save and except question 8 which the 2^nd to 4^th respondents submitted that it has been fully answered.  In the circumstances, I am of the view that paragraphs 2 and 3 of the Amended Summons cannot be granted.

43.  To be fair, Mr Tang has made clear that he would seek leave from this court to withdraw the Trustees’ application as set out in paragraph 3 of the Amended Summons.  I duly grant the Trustees the leave to withdraw such application.

44.  Fifthly, in the course of oral submissions, Mr Wong SC submitted that the Trustees’ present application is also oppressive in the sense that given the Trustees’ expressed intention to bring contempt proceedings against the 2^nd to 4^th respondents, it is wrong as a matter of principle to require a person suspected of wrongdoing to prove the case against himself on oath prior to proceedings being brought.

45.  In Joint & Several Liquidators of Kong Wah Holdings Ltd v Grande Holdings Ltd (2006) 9 HKCFAR 766, Lord Millett NPJ at §30 said:

“ Over the years the courts have laid down general principles governing the balancing exercise which the court is called upon to undertake. They are conveniently set out in the Cloverbay Ltd (Joint Administrators) v Bank of Credit and Commerce International SA [1991] Ch 90 at pp.102–103 per Sir Nicolas Browne-Wilkinson V-C and British & Commonwealth Holdings Plc v Spicer & Oppenheim [1992] Ch 342 at p.372 per Ralph Gibson LJ and at p.392 per Woolf LJ. They can be summarised as follows:

(1) The liquidator must show that the documents are reasonably required to enable him to carry out his functions, not that they are necessary to enable him to do so;

(2) the case for making an order under the section in respect of aformer officer is usually stronger than in respect of a stranger who owes no fiduciary duties to the company and who is not under a statutory duty to assist the liquidator;

(3) there is an element of oppression in requiring a party to provide information which exposes him to potential liability;

(4) an order for oral examination is likely to be more oppressive than an order to produce documents;

(5) it is oppressive to require a person suspected of wrongdoing to prove the case against himself on oath prior to proceedings being brought;

(6) an order is not necessarily oppressive because it is inconvenient for the party subject to it or causes him a lot of work or may make him vulnerable to future claims;

(7) in the light of the summary nature of the procedure and the need for expedition, the court cannot be expected to indulge in fine judgments as to the precise width of the order which should be made; and

(8)   the court must take care not to cut down the width of the ordersought by the liquidator in a way which would risk making it ineffective.”

46.  In Cloverbay Ltd (Joint Administrators) v Bank of Credit and Commerce International SA (supra) at p 103G, Sir Nicolas Browne-Wilkinson VC said:

“ But for myself I am unable to accept, in the absence of specific statutory authority, that it is not oppressive to require someone suspected of wrongdoing to prove the case against himself on oathbefore any proceedings are brought. In the exercise of its discretion,the court may consider that the legitimate requirements of the liquidator outweigh such oppression: but it remains oppressive.”

47.  As a matter of law, it must be right that it is oppressive to require a person suspected of wrongdoing to prove the case against himself on oath prior to proceedings being brought.  This is particularly the case when the information and documents are not reasonably required for the stated purposes. 

48.  Mr Tang submitted that it is normal for the court to make disclosure orders and it is for an affected party to assert the right against self-incrimination if he or she deems it proper to do so.  Whilst that is correct, I am of the view, on the facts of the present case, it is oppressive to require the 2^nd to 4^th respondents to provide information and documents and to commit themselves on oath when the Trustees positively allege that the 2^nd to 4^th respondents have committed the crime of perjury and are in contempt of court.

49.  In the absence of tangible and/or potential benefits to the Trustees by engaging in this discovery exercise, I am of the views that, on balance, judicial discretion should be exercised against exposing the 2^nd to 4^th respondents to the risk of having to prove the case against themselves on oath prior to proceedings being brought.

50.  The above reasons apply, a fortiori, to the application for oral examination against the 2^nd to 4^th respondents under paragraph 4 of the Amended Summons.

EXERCISE OF DISCRETION

51.  In the exercise of my discretion, I also take into account two specific matters.  First, Mr Tang’s main submission is that Chung J’s Order has not been complied with and he relied on a number of specific examples which the liquidators ofthe 1^strespondent take a different view.  The 2^nd to 4^th respondents’ position is that they have fully complied with Chung J’s Order. Given my ruling that this is a new application under section 29 of the Bankruptcy Ordinance,Cap 6, it is not for this Court to determine whether there are breaches of Chung J’s Order in this hearing.  There is no question that Chung J’s Order is valid and binding on the respondents and has to be complied with.

52.  If the Trustees consider that the respondents have breached Chung J’s Order, they are liberty to bring contempt proceedings against the relevant respondents.  At that stage, the issue of compliance can be ventilated fully and with precision.

53.  Secondly, if the Trustees have any complaints about how the liquidation of the 1^st respondent is being conducted including whether there is any undervalue sale of assets, again if the claims are meritorious, the Trustees are at liberty to take out applications in the winding up proceedings after taking proper legal advice. 

DISPOSITION

54.  For the reasons stated above, I decline to accede to the Trustees’ application under section 29 of the Bankruptcy Ordinance, Cap 6.  The Amended Summons is accordingly dismissed. 

55.  I also formally dismiss the Trustees’ Leave Summons dated 6 November 2018.

56.  As for the costs of the Amended Summons including the costs of this hearing, I make a costs order nisi, that:

 (1) the Trustees do pay the costs of the 2^nd to 4^th respondents, on a party to party basis, with certificate for two counsel, to be taxed if not agreed.

 (2) the Trustees do pay the costs of the 1^st respondent, on an indemnity basis, to be taxed if not agreed.   

57.  As for costs of the Leave Summons, I also make an order nisi that the Trustees do pay the costs of the 1^strespondent, on an indemnity basis, to be taxed if not agreed.

58.  I accept Mr Lau’s submission that the Trustees were well aware of the facts that the liquidators of the 1^st respondent do not have answers to any of the questions as set out in Annex A of Chung J’s Order and they have also delivered whatever documents they have to the Trustees prior to the taking out of the Amended Summons.

59.  Mr Tang submitted that what the Trustees asked for is for the liquidators to file an affirmation to confirm that they have provided all the documents that they have and they are not in a position to answer any of thequestions as set out in Annex A of Chung J’s Order.  First, no such requests were made prior to the taking out of the Amended Summons.  Secondly, the Trustees have not advanced any basis as to why the liquidators should be subject to the orders as set out in the Amended Summons.

60.  Mr Tang submitted that “[w]hilst they may not have first handpersonal knowledge of the affairs of Assen, it is possible that the Liquidatorswould be able to comply (to some extent) with the S29 Order which remains of effect against Assen (even now in liquidation).”  This Court cannot make an order on the speculative basis that it is possible that the Liquidators would be able to comply.  This is wrong.

61.  I am of the view that it is unreasonable and unnecessary to join the liquidators of the 1^st respondent to the present application.  There is also no basis for the Leave Summons.  Accordingly, it is proper that costs should be awarded to the 1^st respondent on an indemnity basis.

62.  The above costs order nisi will be made absolute within 14 days from the date hereof unless the parties take out an application to vary the same within the 14-day period.

63.  Finally, it remains for me to thank Mr Tang for the Trustees, Mr Lau for the liquidators of the 1^st respondent, Mr Wong SC, Mr Kwong and Ms Sat for the 2^nd to the 4^th respondents for their helpful assistance rendered to this court.