LO WAI YIN v. LI CHUN KOU

HCPI 26/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO. 26 OF 2006

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BETWEEN

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DETERMINATION

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1.  This is the application of the Plaintiff for the following orders:

“(1)	The Defendant do pay the taxed party and party profit costs, disbursements, costs of taxation, taxing fee and interest thereon, into court.
(2)	Further directions as the court deems fit.
(3)	There be no order as to costs.”

The application is supported by the Defendant.

2.  At the call-over hearing on 15 June 2010, I made known to the parties after hearing submission that I was not inclined to allow the application.  I nonetheless gave them an opportunity to submit further and said I would rule on the papers.  I have since received 2 submissions from the Plaintiff’s solicitors dated 17 and 21 June 2010 respectively and the Defendant has filed nothing further. 

3.  Having looked at the application again in the light of the Plaintiff’s submissions, I remain convinced that I should dismiss the application.  These are my reasons.

The application

4.  Let me begin by setting out the relevant background.

5.  In this action, the Plaintiff claimed against the Defendant for damages for personal injury, loss and damage arising out of a traffic accident that happened on 11 January 2003.

6.  By an interlocutory judgment entered on 2 February 2006, the Defendant was adjudged to pay the Plaintiff damages to be assessed with costs to be taxed.  On 22 May 2009, a Master certified the damages payable by the Defendant to be $1,138,287.70 with interest and ordered the Defendant to pay costs of the assessment to be taxed.

7.  On 9 September 2009, the Plaintiff filed her bill of costs seeking taxation of her costs.  On 8 January 2010, I provisionally taxed the Plaintiff’s bill under O.62, r.21B.  Thereafter, I was informed that the Plaintiff did better upon taxation than her sanctioned offer which had been rejected by the Defendant.  On 28 April 2010, I made the following orders in pursuance of O.62A, r.20:

(a)	interest on the whole amount of the costs allowed to the Plaintiff at 2% above judgment rate for the period after the date on which the sanctioned offer was served on the Defendant;
(b)	the Plaintiff be entitled to her costs on the indemnity basis after the date on which the sanctioned offer was served on the Defendant; and
(c)	interest on those costs at 2% above judgment rate.

8.  The Defendant is desireth to pay the taxed costs plus interest to the Plaintiff as soon as possible so as to minimize the interest payable.  However, the Defendant is unwilling to pay through the Plaintiff’s solicitors.  The Plaintiff therefore makes this application to facilitate payment.

9.  I have been informed that the Defendant’s insurer(Anglo Starlite) has gone into liquidation and the defence is funded by the Motor Insurers’ Bureau (“MIB”).  Mr. Mcdaid (the solicitor representing the Defendant) says it is the policy of the MIB to pay directly to the injured.  He explains that the MIB has such a policy to ensure that the injured (as opposed to some intermediaries such as recovery agents) will receive payment.  He says that given the ongoing investigation into the practice of Anglo Starlite, it is important for the MIB to be able to maintain that they have never effected payment through an injured’s solicitors. 

10.  Mr. Mcdaid has made it clear at the hearing that there is no allegation of impropriety against the Plaintiff’s solicitors.  However, he says he is aware that there has been third party interference in the Plaintiff’s receipt of the taxed costs and interest from the Defendant.

11.  Mr. Nasir (the solicitor representing the Plaintiff) has put forward a number of justifications for the application.  First, he says that the MIB is agreeable to pay the money into court (as opposed to insisting on a discharge directly from the Plaintiff) and both parties have consented to the application.  Secondly, he says the Plaintiff has not fully settled her own costs although she has already received the assessed damages.  Given the suspicion of interference by third parties, there is a real likelihood that the Plaintiff will be incited not to pay her own costs.  If that happens, he submits, there will be a breach of Principle 14.5 of the Guide to Professional Conduct issued by the Law Society of Hong Kong.

12.  Assuming that payment in is ordered, Mr. Nasir suggests that I should further direct payment out to the Plaintiff’s solicitors.  He says no one would be prejudiced by such an order as the Plaintiff’s solicitors is entitled to the taxed costs anyway.  In view of the MIB’s concern that the Plaintiff should receive what she is entitled to, Mr. Nasir suggests that I can direct the Plaintiff’s solicitors to report to the Defendant’s solicitors when they release money to the Plaintiff.

Discussion

13.  I do not regard the consent of the parties as sufficient justification for the application.  It remains for them to convince me that it is right to make the order sought.

14.  The Plaintiff has cited Orders 1A and 1B in the margin of the summons as the jurisdictional basis for the application.  The court has already adjudicated on the Plaintiff’s claim and dealt with the issues on costs.  What remains is for the Defendant to satisfy the costs orders.  This can be effected between the parties themselves.  Frankly, I do not see how an order to pay the taxed costs and interest into court can be said to be for the purpose of managing the case orin furtherance of the underlying objectives set out in Order 1A. 

15.  Whilst I can appreciate the stance taken by the MIB, I am not dictated by their policy.  It is for the MIB to consider the practicality of their policy against their own interest in achieving an early settlement.  In my view, there are ways for the MIB to pay through the Plaintiff’s solicitors without offending their policy.  For example, the MIB can issue a cheque to the Plaintiff personally and pass the cheque to the Plaintiff through her solicitors.  The Plaintiff’s solicitors have confirmed at the hearing that they do have instructions to receive payment on behalf of the Plaintiff.

16.  Indeed, I am concerned that by allowing the present application where there is no allegation of impropriety on the part of the Plaintiff’s solicitors, I would be setting a precedent for the MIB to effect payment through the court in all cases.

17.  No one has elaborated on the interference encountered by the Plaintiff.  I have looked at Principle 14.5, which is concerned with implied terms of solicitors’ professional undertakings.  Mr. Nasir has not explained why there will be a breach of that principle and, at present, I do not see how it can be relevant.

18.  Mr. Nasir has submitted in his submission dated 17 June 2010 that “an order for payment out to the Plaintiff’s solicitors will avoid the danger of the Plaintiff seeking payment without an explanation to the court or by other means”.  I am not sure what explanation is required of the Plaintiff before she can obtain payment.  In my view, paying through the court or through the Plaintiff’s solicitors will not prevent the Plaintiff from sharing her money with others after she has obtained payment if she is minded to do so.

19.  In his latest submission dated 21 June 2010, Mr. Nasir has submitted that an order to have the money paid into court would “avoid the need to issue an injunction/stop order against the Defendant” and reference was made to s.70 of the Legal Practitioners Ordinance, Cap.159. 

20.  Section 70 empowers a court before whichproceedings are being heard or are pending to declare a solicitor employed inconnection with the proceedings to be entitled to a charge on propertyrecovered or preserved in the proceedings.  The court’s power under s.70 is discretionary: see Fairbairn & Kwok v Middle East Finance International Limited (unreported, HCB 303/1985, Jones J, 11 August 1986).  I do not know what is going on between the Plaintiff and her solicitors and cannot assess whether such an application would have been justified.  For example, I do not know if the Plaintiff’s solicitors have delivered their bill of costs to the Plaintiff and whether the Plaintiff has refused payment.  In any event, it will be wrong for me to consider the present application as if it were made under s.70 in the absence of the Plaintiff in person or someone representing her interest. 

Conclusion

21.  For the above reasons, I will dismiss the summons with no order as to costs.