GEORGE Y C MOK & CO (a firm) v. TRADE ADVISERS CO LTD

DCCJ18479/2001

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 18479 OF 2001

D E C I S I O N

1.  This is an application for leave to appeal against my judgment given in favour of the Plaintiff on 21 August 2009.

2.  The facts of the present case are rather complicated.  They have been set out in full in paragraphs 3 to 41 of my judgment and so I do not want to repeat the same here. 

3.  As I have set out in paragraphs 52 to 54 of my judgment, the main issues in the present case are: (i) whether the amounts charged in Bill Nos. 1,2,4 and 6 were final; (ii) whether the party had made an oral agreement on 9 February 2000; and (iii) if such agreement existed, whether such agreement is valid and enforceable. 

4.  Under section 63A(2) of the District Court Ordinance, Cap336, leave to appeal shall not be granted unless the court is satisfied that the appeal has a reasonable prospect of success, or there is some other reason in the interests of justice that the appeal should be heard.

5.  This case has been argued by senior counsel for both parties with the trial lasting for 5 days.  In such circumstances, it would be very tempting for the court to grant leave to appeal under such circumstances.  However, based on the reasons given below, I do not see it fit to grant leave to appeal in the present case.

6.  There are 5 grounds of appeal listed in the draft Notice of Appeal.  Under Ground 1, the Defendant challenges a factual finding made by the court that the parties did not understand Bill Nos. 1,2,4 and 6 to be final.  Under Ground 2, the Defendant argues that the court erred in his finding about the existence of the agreement made on 9 February 2000. 

7.  In the case of Ting Kwok Keung v Tam Dick Yuen [2002] 5 HKCFAR 336, Bokhary PJ set out with clarity the test to be applied by the Court of Appeal when considering findings of fact by the trial judge.  At paragraph 42 of the judgment, the learned judge put the test in this way:

“The question for the Court of Appeal is whether, even though it does not enjoy the advantages enjoyed by the trial judge who received the evidence at first-hand, it is nevertheless satisfied that his conclusion on the facts is plainly wrong.  The Court of Appeal should intervene if so satisfied.  But if not so satisfied, the Court of Appeal should defer to the trial judge’s conclusion even if in some doubt as to its correctness.”

8.  As laid down in the case of Chin Yuk Lun, Francis & Anor v Messrs Lo & Lo (a firm), unreported, HCMP1142/2000 (decision on 7 July 2006 by Deputy High Court Judge To, as he then was) referred to in paragraph 60 of my judgment, whether the bills issued by the solicitor in the course of legal proceeding are final is a question of fact. 

9.  In Ground 1 of the draft Notice of Appeal, the Defendant has set out the reasons why I was wrong in making such findings.  However, I have dealt with all these arguments in details in paragraphs 62 to 75 of my judgment.  The ultimate test is whether the Plaintiff and the Defendant understood those interim bills to be final and not subject to change.  According to my analysis of the relevant conduct of the Defendant after the issuance of the bills and throughout the course of the litigation, I came to the conclusion that both parties did not intend Bill Nos. 1,2,4 and 6 to be final. 

10.  As I see it, it would be very difficult for the Defendant to persuade the Court of Appeal to disturb my findings of fact and so I do not find that there is any reasonable prospect of success in this ground of appeal. 

11.  Grounds 2 to 4 relate to the existence and the validity of the oral agreement made on 9 February 2000.  As mentioned in paragraph 55 of my judgment, I have some difficulty in understanding the object of the Defendant’s challenge against the agreement:

“ … … I have some difficulty in understanding the object of the Defendant’s challenge against the Agreement allegedly made on 9 February 2000.  It is trite law that, in the absence of an express agreement on the charging of solicitor’s fees as it was in the case here, the Plaintiff was entitled to charge the Defendant for its profit costs on solicitor and client basis, as the Defendant had the right to apply to tax the Plaintiff’s bill of costs on such basis under s.67 of [the Legal Practitioner Ordinance].  It is also common practice that costs allowed on solicitor and client basis are more generous than those allowed on party and party basis.  On taxation on party and party basis, there shall be allowed only such costs as were necessary or proper for the attainment of justice or for enforcing or defending the rights of the party whose costs are being taxed; whereas on taxation on solicitor and client basis, all costs between solicitor and his client shall be allowed except insofar as they are of an unreasonable amount or have been unreasonably incurred.  Hence, by making the Agreement with the Defendant on 9 February 2000, the Plaintiff was, in substance, offering a discount or concession to the Defendant regarding the charging of legal fees, as the Plaintiff’s profit costs would be subject to a less generous basis for taxation.  If the Agreement did not exist, the Plaintiff then, in all likelihood, would have been entitled to charge remunerations higher than those already charged in the Bills.  In such circumstances, I cannot quite understand why the Defendant has to challenge the existence and the legal effect of the Agreement.” 

12.  Up to now, Miss Mak, solicitor for the Defendant, cannot supply the court with a ready answer.  If the agreement did not exist, the Plaintiff was entitled to charge the Defendant for its profit costs on a solicitor and client basis.  The Plaintiff issued the various 11 Bills to the Defendant but the Defendant did not apply to tax the Bills within the statutory time limit.  Hence, I cannot see how a finding on the existence and the validity of the agreement in the Defendant’s favour can actually assist the Defendant’s case. 

13.  Further, Ground 2 relates to a challenge against a finding of fact.  In paragraphs 76 to 86 of my judgment, I have already set out my detailed reasons as to why I prefer to accept the evidence of Mr Mok about the existence of the oral agreement.  Again, it is very difficult for the Defendant to persuade the Court of Appeal to disturb my findings of fact and so I also see no reasonable prospect of success in this ground of appeal.

14.  Ground 3 of the draft Notice of Appeal relates to the challenge about the validity of the oral agreement.  As I have mentioned above, I do not see how a finding in favour of the Defendant on this particular issue can assist the Defendant’s case.  In any event, the full reasons for my decision in relation to the validity of the agreement have been set out in the judgment, and I see no merits in the Defendant’s challenge in relation to those reasonings.  Again I find no reasonable prospect of success in this ground of appeal.

15.  Under Ground 4 of the draft Notice of Appeal, the Defendant argues that the court erred in its finding that, in the absence of oral agreement, the Plaintiff would be able to charge its normal fee rates subject to solicitor and client taxation.  However, it is trite law that in the absence of an express agreement on costs, a solicitor is entitled to charge his normal fees so I cannot understand the Defendant’s challenge in this regard.  The Defendant seems to suggest that there was an implied term of the retainer between the Plaintiff and the Defendant that, through the course of dealings, the Plaintiff would give substantial discounts to the Defendant regarding the charging of legal fees.  If that was the case, the Defendant was obliged to plead such implied term.  As the Defendant has not done so, this argument is not now open to the Defendant.  Further, I have serious doubt as to whether the court is entitled to take into account the judicial notice as set out in Ground 4 of the draft Notice of Appeal.

16.  Ground 5 of the draft Notice of Appeal relates to the court’s ruling on the issue of costs.  In my judgment handed down on 21 August 2009, I made an order nisi that the costs of the action be to the Plaintiff with certificate for two counsel.  I also directed that the order nisi shall be made absolute 21 days after the date of the handing down of the judgment.  The Defendant did not make any application to vary the order nisi and so I have not given any reason on the decision on the costs order.  In the absence of any application to vary the costs order nisi, I doubt whether the Defendant is now entitled to challenge my decision on the issue of costs. 

17.  Even if the Defendant is entitled to do so, it is a general principle that costs should generally follow the event.  Further, the present case involves very serious allegations against a professional solicitor firm and so the involvement of senior counsel is reasonable in the circumstances.  The Defendant had also engaged senior counsel to handle: (i) the trial in this case; and (ii) the related dispute between the parties when the Defendant tried to apply to have the Bills taxed out of time under section 67 of the Legal Practitioners Ordinance, Cap 159, which was rejected by Deputy High Court Judge Muttrie with indemnity costs.  In such circumstances, I see no merits in the Defendant’s challenge against my cost order and so I also find no reasonable prospect of success in Ground 5. 

18.  Based on my reasoning above, I dismiss the Defendant’s application for leave to appeal against my judgment handed down on 21 August 2009.