ONWAY ENGINEERING LTD v. CHINNEY CONSTRUCTION CO LTD

HCCT 10/2002

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTRUCTION AND ARBITRATION PROCEEDINGS

NO. 10 OF 2002

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J U D G M E N T

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1. This is an application by the plaintiff in relation to the review by the master of the taxation of the defendant’s bill of costs. 

2. The review was heard by Master Lung on 28 September 2007 and his reasons for decision are set out in the reasons for review dated 23 October 2007. 

3. Essentially, the plaintiff complains of four items.  These are items 457, 463, 467 and 473 in the defendant’s bill of costs.  I shall deal with each of these in turn. 

4. Item 457 is Senior Counsel’s fee for 18 and 19 June for which Senior Counsel Mr Clayton charged 12 hours for perusal of the joint expert report and for preparation of the cross-examination.  As the master said in his reasons at paragraph 3, this was charged as one refresher.

5. The evidence before the master was that the joint expert report under this item was a completely different one from the one which had been submitted to the Court previously.  The joint expert report was only submitted in the late afternoon of 17 June 2005.  By that time the trial had already commenced.  The trial commenced on 13 June 2005. 

6. The correspondence that I have been shown shows that on 20 May 2005 the brief fee and the refresher was agreed with Mr Clayton on the basis of a 7-days’ trial commencing on 13 June 2005 and the agreement with Mr Clayton was that in addition to the brief fee and refreshers he would charge $5,000 per hour for other attendances. 

7. The evidence before the master was that the new joint expert report was a new document.  And from the directions of the Court which I have been referred to, I am satisfied that at the time Mr Clayton agreed his fees it was not anticipated that there would be the third joint expert report which is the document that Mr Clayton considered in respect of item 457.

8. Mr Clayton, of course, is not entitled to charge refreshers for days not sitting in court.  But he charged not a refresher but for 12 hours for the perusal of the joint expert report and preparation in relation to this new and unanticipated report.  His hourly rate was $5,000.  That should make it $60,000 but he reduced it and charged it as one refresher.  The master considered that it was fair for Mr Clayton to charge the extra time for the preparation arising out of the new material from the joint report.  I agree.  There is no basis for reviewing this item.

9. As to item 463, this deals with Mr Clayton’s fee for $30,000 for his preparation in respect of the re-examination of the expert on 22 June 2005.  Ms Fong submitted that this was a duplication of work that Mr Clayton had already charged for under the previous item.  She also made the point that counsel is not entitled to charge for preparation for re-examination separate from the brief fee which would include all these items. 

10. There is no dispute that the brief fee would include all the preparation prior to trial including examination, cross-examination and re-examination.  However, the fees included under item 463 was as a result of the new joint expert report which was not anticipated at the time briefs were delivered.  The master considered that the 6-hours’ preparation at the hourly rate of $5,000 was reasonable and allowed the item.  I do not think that this decision can be faulted and I agree with the master.

11. As to item 467, this deals with the fee to Mr Clayton for perusal of papers and telephone conferences on the draft supplement expert report on 23 and 25 August 2005.  The fee is for the sum of $10,000 for two hours’ work. 

12. The evidence before the master was that the supplementary expert report was only dated 26 August 2005 and the work that was charged for was in relation to that supplementary report.  This was not something that was anticipated at the time the brief was delivered.  This was additional work which was unanticipated at that time. 

13. As the master said, he considered that this piece of work was extra work not contemplated by the parties before the commencement of the trial.  I also agree that the charge was reasonable.  Again the master cannot be faulted for his decision and I agree with him.

14. As to item 473, this is in relation to Mr Clayton charging 36 hours for consideration of documents, preparation for resumed hearing and of closing submissions and consideration of supplemental expert reports and conference with expert on 30 August, 2 to 7 September 2005. 

15. The master considered that the matter was part-heard and that there was a time gap of about 2½ months.  In the interim there were new expert reports namely, the defendant’s supplemental expert report dated 26 August 2005 and the second supplemental expert report dated 2 September 2005.  There is no dispute that these reports were necessary and proper for the trial but they only arose much later well into the trial. 

16. The master considered that it was not proper for        Mr Clayton to charge separately for closing submissions and reduced the item from $180,000 to $100,000.  However, the master considered that Mr Clayton should be given some time for refreshing his memory.  

17. From the reason for objection lodged by the defendant at page 27 of the defendant’s bundle before me, it is made clear that counsel was charging for time to re-read all the papers and for preparation for the resumed hearing due to the adjournment which lasted for more than 2½ months since June 2005.  This was included in the global figure of $180,000 which was not broken down. 

18. I consider that the fees for consideration of the supplemental expert reports and the conference with the expert on 30 August 2005 and 2 to 7 September 2005 were proper as these were matters which were not anticipated at the time of the delivery of the brief. 

19. However, I do not consider that it was proper for counsel to be paid a fee for refreshing his memory and for re-reading the papers because there was a time gap.  Time gaps are frequent in litigation especially heavy litigation where cases do overrun and matters are part-heard.  I do not think that it was proper for a separate fee to be paid to counsel for re-reading the papers in the time gap. 

20. So in respect of this item I would allow the review by taking a figure which I consider to be proper for the allowance of this item under item 473.  Since there is no breakdown in respect of the $80,000 allowed by the master I will split this equally.  I will reduce this item by $40,000.  The review is successful to that extent and the rest of the review is dismissed.  That is the order I make.