WONG KI v. SHUN TAK ELECTRICAL, MECHANICAL AND AIR-CONDITIONING ENGINEERING (HONG KONG) CO LTD

DCEC835/2007

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

EMPLOYEES’ COMPENSATION CASE NO. 835 OF 2007

----------------------

----------------------

----------------------

R U L I N G

----------------------

1.  The applicant applies for costs against the 1st respondent at the application to discontinue this action against the 1st respondent.  The basis of the applicant’s application is that the applicant was led on by the 1st respondent’s letters before action and the answer filed to the application because the 1st respondent merely denied it was liable because the applicant was not injured in the course of employment when in fact the strongest defence for the 1st respondent is that the 1st respondent was not in existence as it was only incorporated one month after the applicant’s accident.  This was not pleaded in the answer and the applicant claimed that it was not alerted to it until the 1st respondent filed a list of documents on 20 September 2007 which contained the certificate of incorporation disclosing the date of incorporation. 

2.  The 1st respondent’s counsel, Miss Chao, on the other hand, submitted that there is nothing in this case that should induce the applicant to carry on with the proceeding against the 1st respondent because all along the 1st respondent had denied any liability and claimed it was not the applicant’s employer.  These were disclosed in the correspondences and in the answer filed on 13 September last year.

3.  The applicant claimed that the three cheques to the applicant were issued by the 1st respondent and these were strong, cogent evidence for the applicant to join the respondent as the employer.  Furthermore, the applicant was under pressure from the time limit, the applicant’s solicitor decided the 1st respondent should be joined at that stage with the limited information available to the applicant.

4.  I do not find the applicant has a strong case against the 1st respondent on costs.  The matter on costs on the discontinuance should have been sorted out as soon as the applicant found out the 1st respondent’s date of incorporation was after the accident, to say the least.  My reasons are:

(a)   it is the applicant’s solicitors or the applicant’s legal representative’s duty to ascertain who the applicant should join in the action.  This duty includes running a full company search on the 1st respondent before commencement of the action.

(b)   The applicant claimed that he was misled by the 1st respondent’s failure to inform the solicitor the incorporation date of the 1st respondent.  1st respondent’s solicitor referred to matters such as the 2nd respondent was the true employer, etc., etc. rather than informing the applicant the strongest and most obvious reason that the 1st respondent could not be the employer at the time of the accident.

5.  I cannot find any strong reason that the 1st respondent or its solicitor has a duty to assist the applicant even though it would have saved both parties a lot of time and costs.  If the 1st respondent had done so as soon as the applicant informed the 1st respondent that the applicant intended to join the 1st respondent as a respondent in the claim, then, little costs would have been incurred by the 1st respondent.  Even though the 1st respondent might have failed to alert the applicant at the earliest opportunity, the 1st respondent is not under a duty to advise the applicant’s legal representative and the applicant’s legal representative is bound to make its own investigation even though the writ had already been issued to beat the limitation period.  The duty to represent the interests of the applicant includes continuing the investigation.

6.  In any event, the applicant was alerted the date of the incorporation of the 1st respondent on 20 September 2007 when the 1st respondent filed a list of documents which contained its date of incorporation, yet there is a lapse of three months before the applicant’s solicitors became conscious of this very strong defence against the applicant’s claim against the 1st respondent.  This showed the applicant’s legal representatives failed to act on the applicant’s behalf with due diligence.  It is the applicant’s legal representative’s duty to save costs so far as its own client is concerned, and as the applicant is legally aided, to save taxpayers’ money not to unnecessarily expand a minor disputed portion of the action out of proportion.

7.  For the aforesaid reasons, I find the applicant should pay the 1st respondent’s costs after 20 September 2007 when the 1st respondent filed its list of documents.  I order that costs of this application and hearing should be borne by the applicant.  I would further like to find out why the applicant’s solicitor should not personally bear costs.  The applicant’s solicitor to submit the reasons in writing setting out the reasons why the applicant’s legal representative should not personally bear costs.  I understand there has been a change of solicitors.  There may be good reasons not disclosed at this stage.  So far as the 1st respondent’s costs are concerned, they are to be borne by the applicant with certificate for counsel.  The applicant’s own costs to be taxed in accordance with Legal Aid Regulations.