RE B. F. CONSTRUCTION CO LTD

HCCW 691/2004

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES WINDING-UP PROCEEDINGS NO. 691 OF 2004

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D E C I S I O N

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1.  On 28 February 2007 I refused the Company’s application for release of the Report prepared by the Provisional Liquidators and I order that the costs be to the Provisional Liquidators and to be assessed by me.

2. On 3 April 2007 Messrs. Kennedys, solicitors for the Provisional Liquidators (“PLs”), submitted its Statement of Costs by which the PLs asked for a total sum of $24,227.00.  My first impression is that the amount claimed is on the high side.  The application was disposed of by me on paper without a hearing.  It was my assumption that time and costs could be saved without attending court.

3. My assumption does not prove to be correct.  The parties had to prepare quite a number of correspondences more than usual, partly because I had not given any specific directions in the conduct of the proceedings.

4. The total time spent according to my calculation Mr. Nigel Bacon (“NB”) spent 2 hours 27 minutes while his assistant Ms. Tse Mei Ling (“JT”) 6 hours 18 minutes.  The application only dealt with a minor issue.  No law has been cited notwithstanding JT claimed that she had made research for 30 minutes.

5.  I do not see any particular reason why two solicitors were engaged in such relatively simple job.  As I understand, the case was formerly handled by another solicitor firm for the PLs and Messrs. Kennedys had taken over the case only shortly before when the application was made.  Resulting from this, extra time was spent, for example, Kennedys had to go through the file to see whether their predecessor had lodged any objection to the application which was originally made to Kwan J.

6.  After considering all the items, I find generally the amounts of time spent and the sums claimed are reasonable, except for those items to which requisitions were raised by Messrs. Ng and Partners as set out below.

7. The 1^st objection is related to item 1 where it is stated that NB considered the application made by Ng & Partners as contained in the letter of 28 December 2006 which initiated the application.  It was a 2-page letter setting out the background.  NB needed time to consider the matter.  I do not find it justified to deduct the small difference of 3 minutes.  I overruled the objection.

8. The 2^nd objection is related to item 12: the PLs’ solicitor charged for preparing a reply dated 11 January 2007.  In the letter, Kennedys confirmed no comment had been made by its predecessor.  The letter also set out the facts and background of the matter.  It is obvious that some time was spent in reading through the file and trying to locate the necessary relevant documents.  I am convinced that the time of 2½ hours required to prepare the letter is excessive.  I deduct 45 minutes from the JT’s claim.

9. The 3^rd objection is related to item 15: NB perused and considered the reply of Ng and Partners to the Kennedys’ letter of 11 January above mentioned.  It is a short letter re-iterating its position.  I agree that 5 minutes would be sufficient and I deduct 7 minutes from NB.

10. The last objection is related to NB approving the calculations.  Ng and Partners suggested to deduct 10 minutes.  My view is that a solicitor of such seniority should not be involved in such tedious mechanical work.  I would have suggested that such work be carried out by a law costs draftsman, a trainee solicitor or at most JT.  I agree to the deduction of 10 minutes from NB.

11. The deductions are summarized as follows:

Objection No.	Item No.	Result	Paragraph above	Costs deducted
1	1	No deduction	7	Nil
2	12	45 mins from JT	8	$1,875
3	22	7 mins from NB	9	$408
4	23	10 mins from NB	10	$584
Costs to be deducted:				$2,867

12. I assess the costs awarded to the Provisional Liquidators in respect of the Company’s application for release of the Misfeasance Report to be $21,360 (i.e. the amount of $24,227 claimed less $2,867).  Such sum is to be deducted from the money held the Provisional Liquidators.