KAM SIU KEI v. YUEN ON ENGINEERING LTD AND ANOTHER

HCPI 573/2010

[2019] HKCFI 1408

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO 573 OF 2010

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D E C I S I O N

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1.  I have before me an application to review the order made by Master S Lo, upon his own review of the taxation of certain items of the plaintiff’s bill of costs in this case. The application before me is made by the defendants pursuant to Order 62, Rule 35, of the Rules of the High Court. The principles governing such reviews by a judge in chambers are quite well settled.

2.  There is no dispute between the parties as to those principles which have been set out in my judgment in Chan Yin Na v Union Medical Centre Limited [2011] 5 HKC 158 at page 171 to 172:

“The judge is not required to conduct the taxation de novo but he should consider the reasons for the taxing master’s decision on his review in order to ascertain whether he erred in principle or took into account irrelevant matters or failed to take into account relevant matters. More specifically, the judge is only able to interfere with a taxation decision of the master if it is shown to have been arrived at under a mistake of law or in disregard of principle or under a palpable misapprehension as to the facts or plainly a reliance on irrelevant matters or a failure to take into account relevant matters or to be such as to fall outside the generous ambit within which reasonable disagreement is possible.”

3.  The items in question total a princely sum of $17,335.  It is surprising to me that such small matters have been brought to the High Court, at a hearing listed for two hours and with counsel instructed.

4.  The items are objected to by the defendants on the ground that the learned master ought not to have allowed these items and that he was not entitled to do so by reason of certain cost orders made by Master Pang in the defendants’ favour, and by Master Li also in the defendants’ favour.

5.  The action concerned an action for damages for personal injuries, in the course of which certain cost orders were made in favour of the defendants, but the action was eventually settled on terms, including the term that the defendants pay the plaintiff his costs of the action, to be taxed, if not agreed.  It was in the course of the taxation of the plaintiff’s bill of costs that specific objections were made to these specific items by the defendants.

6.  Item 75 of the bill of costs related to the costs incurred by the plaintiff in the drafting of the plaintiff’s supplemental witness statement, dated 28 December 2011, in respect of which the master had allowed one hour, which, at the hourly rate of $4,000, amounted exactly to that sum.

7.  Leave was granted to the defendants to file supplemental witness statements in reply, which they did.  Items 76 and 77 related to the plaintiff’s solicitor’s claiming costs for considering the second witness statement of a certain Mr Kwok, and a second witness statement of a certain Mr Chan, both dated 16 February 2012, and in respect of which the learned master allowed the plaintiff some 40 minutes in total, which, at the hourly rate of $4,000, amounted to the sum of $2,667.

8.  The order in question, that the defendants relied upon as not entitling the taxing master to allow these sums, was an order made by Master Pang.  It was an amended order dated 22 December 2011 by Master Pang whereby he granted leave to the plaintiff to file a supplemental witness statement, and the defendants to file supplemental witness statements in reply on or before 16 February 2012, and where he specifically ordered, in §6, that:

“The costs of, occasioned by and consequential upon, the application for leave by the plaintiff to serve the supplemental witness statement and to re-amend the amended statement of claim be to the defendants in any event.”

9.  I think it has been said enough times that when the court conducts a taxation of costs, when it is acting in taxation mode, the duty of the court is to give effect to the costs orders that have been made.  It is not its function to question the rightness or wrongness of that order.  So giving effect to this costs order, I have no hesitation in concluding that the defendants are right to object to the costs claimed by the plaintiff’s solicitors for considering the second supplemental witness statement of Mr Kwok, and of Mr Chan, and that those two items ought not to have been allowed.  The perusal, or the considering, of these witness statements was occasioned by and consequential upon the application for leave by the plaintiff to serve his supplemental witness statement.

10.  Whilst one would have thought that these types of costs should be regarded as costs of the action, given the specific costs order made by Master Pang, the conclusion that I have reached is inescapable and, therefore, to this extent, I allow the review and disallow these two items.

11.  However, I do not accept the defendants’ objections to the costs incurred by the plaintiff in drafting of the plaintiff’s supplemental witness statement dated 28 December 2011. The costs of drafting a supplemental witness statement is not part of the costs of the application for leave to serve the supplemental witness statement. Those costs are costs of the action.  The order made by Master Pang did not state, and did not have the effect, that the plaintiff was to be deprived of the costs of drafting the supplemental witness statement.

12.  I then turn to the other items objected to: these being items 89, 94 and item 6 under Part 2, Section B of the bill of costs.  Item 89 is a claim for costs incurred by the plaintiff’s solicitors in considering the re-revised statement of damages dated 9 October 2012 drafted by plaintiff’s counsel. The master allowed I hour and awarded $4,000.  The master also allowed the claim under item 94 for the plaintiff’s costs in considering the revised answer to re-revised statement of damages dated 16 January 2013. The master allowed 20 minutes and awarded $1,334.  Finally, item 6 under Part 2, Section B, was allowed in the sum of $8,000 being plaintiff’s counsel’s fee for drafting the re-revised statement of damages.

13.  The defendants submit that these 3 items ought not to have been allowed by reason of an order made by Master Li in their favour.

14.  The events that led to the making of this order are somewhat chequered. In summary, the events occurred in this fashion. On 11 July 2011, the plaintiffs served his revised statement of damages.  On 19 August 2011, the defendants served their answer to the revised statement of damages.  On 5 June 2012, Master Chow ordered the plaintiffs to make discovery of certain bank statements.

15.  On 28 August 2012, Master Ng made an unless order in respect of those bank statements, and she specifically ordered that unless the plaintiff, on or before 4 pm on 25 September 2012, served a supplemental list of documents making discovery of those statements and served on the 1^st and 2^nd defendants copies of such documents, then certain paragraphs of the plaintiff’s revised statement of damages, dated 21 July 2011, be struck out. She also specifically ordered, in §8 of her order, that upon compliance of the unless order that she had just made, the plaintiff had leave to file and serve a re-revised statement of damages within 14 days thereafter; that is to say on or before 9 October 2012.

16.  On 31 August 2012, the defendants’ solicitors wrote to the plaintiff’s solicitors undertaking to pay reasonable charges for those copies to be provided to them, as ordered by Master Ng, and, in partial compliance of Master Ng’s order, the plaintiff filed his second supplemental list of documents on 18 September 2012.

17.  However, the plaintiff had not, on or before 25 September 2012, served copies of those documents and so, as at that date, the plaintiff was, on the face of it, in breach of Master Ng’s order.  On 25 September 2012, the plaintiff filed a summons and this was returnable on 4 October, and in this summons the plaintiff claimed this relief:

“the plaintiff do have leave to file and serve his revised statement of damages[1] within 14 days from the date of order to be made herein. The revised statement of damages shall be accompanied by a statement of truth.”

Apparently, this was an attempt to seek relief from sanction because the plaintiff had failed to fully comply with Master Ng’s order.

18.  On 4 October 2012, the defendants themselves took out a summons to strike out the specific paragraphs identified by Master Ng in her order, by way of enforcement of the unless order that Master Ng had made. The defendants’ summons to enforce the unless order was returnable on 11 October 2012.  At the hearing, before Master Chow in the afternoon of 4 October 2012, of the summons taken out by the plaintiff on 25 September 2012, Master Chow adjourned that summons to be dealt with, together with the defendants’ summons, on 11 October 2012.

19.  At 6:53 pm, on 4 October 2012, the plaintiff’s solicitors sent to the defendants’ solicitors, by fax, copies of the documents set out in their second supplemental list of documents in purported compliance with Master Ng’s unless order.  On 9 October 2012, the plaintiff’s solicitors served a re-revised statement of damages again purportedly pursuant to the leave granted by Master Ng.

20.  On 11 October 2012, Master Chow ordered both the defendants’ and the plaintiff’s summonses to be further adjourned, and she fixed a hearing of that to take place, with two hours reserved, and she also reserved costs.

21.  The next event that took place was on 16 November 2012, when the plaintiff’s solicitors wrote to the PI Master, informing the PI Master of the parties’ disagreement over, and parties’ the inability to agree, the contents of the trial bundles, because of the outstanding summonses that had not yet been resolved.

22.  On 3 December 2012, consequent upon the receipt of this letter of 16 November 2012, Master Ng heard the parties and made two orders:  firstly, she granted leave to the plaintiff to apply for relief from the sanction in §3 of her order of 28 August 2012; and she also gave general extension of time to the 1^st and 2^nd defendants to file an answer until the disposal of the outstanding summonses and the disposal of the plaintiff’s application to seek relief from sanction.

23.  The plaintiff finally did so, on 10 December 2012, by issuing a summons returnable before Master Li on 20 December 2012 for relief from sanction.  The hearing before Master Li never took place because, by a consent order he made on 19 December 2012, he vacated that hearing. It is that order which I turn to, which I recite in some detail.

24.  By the consent order dated 19 December 2012, the plaintiff was granted relief from sanction for failing to comply with §3 of the order of Master Ng dated 28 August 2012. The defendants were given an extension of time to file their answer within 28 days from that order.  §3 specifically granted leave to the plaintiff to withdraw its summons dated 25 September 2012. §4 granted leave to the 1^st and 2^nd defendants to withdraw their strike-out summons of 4 October 2012.  Accordingly, an order was also made to vacate the hearing that had been fixed for these two summonses to be heard.

25.  §7 of the order is the important paragraph which I set out in full:

“7. The costs of and occasioned by

(a) the said Summons in Paragraph 3 above inclusive costs reserved;

(b) the hearing on 3^rd December 2012;

(c) the Plaintiff’s summons, dated 10^th December 2012, and this application;

be to the 1^st and 2^nd defendants to be taxed if not agreed.”

The summons referred to in §3 of the order was the plaintiff’s summons, dated 25 September 2012, for leave to serve his revised statement of damages.  The hearing on 3 December 2012 was the hearing before Master Ng. The plaintiff’s summons, dated 10 December 2012, and “this application” was the summons for relief against sanction.

26.  That is the convoluted history that led the defendants to submit that the master ought not to have allowed any costs to the plaintiff for counsel’s fee for drafting the re-revised statement of damages, and for the plaintiff’s solicitors’ fees for considering counsel’s draft of the re-revised statement of damages and for considering the revised answer to the re-revised statement of damages.  It is specifically submitted that those costs fall within the aforesaid §7, being costs occasioned by all the three matters set out in §7.

27.  I am unable to accept this submission.  I fully understand what has happened.  However, as I have already set out above, in taxation mode, the court looks specifically at the costs order that was made and does not seek to vary or revise it in any way. The court must construe it according to its plain words.  The costs order in question referred to the costs of and occasioned by the said summons of 25 September 2012.  That cannot, in any way, be connected to the re‑revised statement of damages.

28.  Whilst the purported service of the re-revised statement of damages on 9 October 2012 may be faulted as being in breach of the unless order of Master Ng, once the relief from sanction was granted by the order of 19 December 2012, that relief validated the service of the re-revised statement of damages. This validation was further supported by the extension of time given to the defendants to file an answer to that document within 28 days from 19 December 2012. I conclude, after carefully reading this costs order, and giving effect to it, that it cannot entitle the taxing master to disallow the costs that were claimed under items 89, 94 and item 6 under Part 2 of Section B.

29.  If the defendants’ intention was that those costs were not to be awarded, or not to be part of the costs of the action, then they should have specifically spelled that out.  §79(a) of the order, which is part of the consent order made by the parties, certainly does not spell that out, and the sub-paragraphs (b) and (c) thereof also cannot be construed as denying the plaintiffs these costs.

30.  For these reasons, I only allow the review to the extent of reducing the taxed costs by the sum of $2,667.

[Submissions on costs]

31.  I order the 1^st and 2^nd defendants to pay 70 per cent of the plaintiff’s costs of this application, and of this hearing, to be taxed if not agreed.  I also order that the plaintiff’s own costs be taxed pursuant to the Legal Aid Regulations.