WONG YAU KWAN AND OTHERS v. ZHANG HONGJIE AND OTHERS

bjbjs HCCW574/2009 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE COMPANIES WINDING UP PROCEEDINGS NO.574 OF 2009 ------------------------------ IN THE MATTER of Sections 168A and 177(1)(f) of the Companies Ordinance, Cap. 32 of the Laws of Hong Kong and United Technology Holdings Company Limited ------------------- BETWEEN WONG YAU KWAN 1st Petitioner CHONG YUK YUEN 2nd Petitioner WONG MING KWAN 3rd Petitioner and ZHANG HONGJIE 1st Respondent UNITED TECHNOLOGY HOLDINGS 2nd Respondent COMPANY LIMITED CHANG YAN INTERNATIONAL 3rd Respondent COPPER INDUSTRY LIMITED ------------------- Before : Hon Poon J in Chambers Dates of written submissions on costs : 7 and 10 May 2010 Date of Decision on Costs : 19 May 2010 ----------------------------------------------- D E C I S I O N O N C O S T S ----------------------------------------------- AUTONUMOUT By decision dated 13 April 2010, I dismissed the 1st respondent s application, supported by the 2nd respondent, to strike out the winding-up relief in the amended petition. I further directed the parties to lodge their submissions on costs within 28 days, which they have done. This is my decision on costs. AUTONUMOUT There are three sets of costs that the court needs to deal with. AUTONUMOUT First, as between the petitioners and the 1st respondent, I reject the 1st respondent s submission that costs should be reserved until trial. Contrary to its submissions, I fail to see how the trial will impact on the costs of the striking out application. Indeed, I can see no justification whatsoever why costs of the striking out application, which is self-contained, should not be disposed of at this stage. AUTONUMOUT After the CJR, as well as before it, the parties should be discouraged from unnecessarily and unreasonably maintaining or resisting interlocutory applications. If they do, the courts will not hesitate to order the losing party to pay the costs forthwith. See a similar observation by Sakhrani J in Hui Yin Sang v Tsoi Ping Kwan, HCA392/2008, unreported, 14 July 2009, at para.17. See also Re Mahr China Ltd [2008] 4 HKLRD 141, per Deputy Judge Harris, SC (as he then was) at para.17. I therefore order the 1st respondent to pay the petitioners the costs of the application including all the costs reserved, to be paid forthwith and to be taxed if not agreed. AUTONUMOUT Second, as between the petitioners and the 2nd respondent, as I understand its submission, the petitioners are not seeking costs against the 2nd respondent. I will therefore make no order. AUTONUMOUT Third, the petitioners argued that it is unnecessary and inappropriate for the 2nd respondent, the company, to participate in the striking out application. The costs incurred should not be borne by the 2nd respondent but should be borne by those who authorized such costs to be incurred. The 2nd respondent argued that it supported the application because it owed a duty to the shareholders and it was in the interest of the shareholders to have the winding up relief removed. AUTONUMOUT Unless there exist exceptionally good reasons, it is ordinarily inappropriate for a company, as a nominal party, to actively participate or to expend its funds in proceedings by shareholders for relief under section 168A or section 177(1)(f) of the Companies Ordinance (Cap.32) : See Re Core Pacific-Yamaichi International (HK) Ltd, HCCW804/2003, unreported, 17 October 2003, per Barma J at paras.47-48. AUTONUMOUT Here, I can see no good reason why the 2nd respondent needed to participate in the striking out application, let alone supported it. The costs incurred in so doing should not be borne by the company. I therefore order that the costs so incurred should not be borne by the 2nd respondent. (J. Poon) Judge of the Court of First Instance High Court Mr Anderson Chow, SC, leading Mr Adrian Leung, instructed by Messrs K.C. Ho & Fong, for the Petitioners Mr Anthony P.W. Cheung, instructed by Messrs S.W. Tai & Co., for the 1st and 3rd Respondents Ms Mak Chui Wah, instructed by Messrs Chan & Chan, for the 2nd Respondent Official Receiver: excused from attendance PAGE - PAGE A B C D E F G H I J K L M N O P Q R S T U V 1udk 1udk t"(# \!t" \!t" (#p# (#p# (#p# (#p# (#p# &`#$ H I J K L M N O P Q R S T U V [Content_Types].xml Iw}, $yi} _rels/.rels theme/theme/themeManager.xml K Y, sQ}# theme/theme/theme1.xml w toc'v )I`n 3Vq%'#q x}r :\TZaG I u3 L+M2 e\O* $*c? )6-r IqbJ#x ,AGm T[XF64 E)`# R>QD =(K& =al- 4vfa 0%M0 theme/theme/_rels/themeManager.xml.rels 5 6?$Q K(M&$R(.1 [Content_Types].xmlPK _rels/.relsPK theme/theme/themeManager.xmlPK theme/theme/theme1.xmlPK theme/theme/_rels/themeManager.xml.relsPK <?xml version="1.0" encoding="UTF-8" standalone="yes"?> <a:clrMap xmlns:a="http://schemas.openxmlformats.org/drawingml/2006/main" bg1="lt1" tx1="dk1" bg2="lt2" tx2="dk2" accent1="accent1" accent2="accent2" accent3="accent3" accent4="accent4" accent5="accent5" accent6="accent6" hlink="hlink" folHlink="folHlink"/> h@ 8 & 6" CACV Jeannie MY MokSo ABC.dot setup Microsoft Office Word Judiciary CACV Title Microsoft Office Word 97-2003 Document MSWordDoc Word.Document.8