FUNG CHUN MAN v. HOSPITAL AUTHORITY AND ANOTHER

HCPI 1113/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO. 1113 OF 2006

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

BETWEEN

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

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

D E C I S I O N

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

1.  On 11 November 2011, I entered judgment in the sum of HK$1,381,694 and interest in favour of the plaintiff against the 2^nd defendant in this case. I also made a costs order nisi that the 2^nd defendant pays the costs of the action of the plaintiff, and the costs of the 1^st defendant, to be taxed if not agreed.

2.  By separate summonses dated 24 November 2011, the 1^st and 2^nd defendants applied to vary my costs order nisi. I have already dealt with that part of the 2^nd defendant’s summons seeking to vary my costs order nisi that the 2^nd defendant pays the costs of the 1^st defendant.  I now deal with the joint application of the defendants to vary my costs order nisi on the ground that the plaintiff failed to beat a sanctioned payment jointly made by them in the sum of HK$1,750,000 which was available for acceptance up to 31 August 2011.  Both defendants seek an order that the plaintiff pays the costs of the 1^st and 2^nd defendants from 1 September 2011 to the date of judgment, including the costs of this application, to be taxed on an indemnity basis, if not agreed.  Having heard the parties on this matter, I am prepared to and hereby vary my costs order nisi and make an order in terms of this application.

3.  Both defendants also sought an order for enhanced interest on their costs.  I had made clear in Shih Pik Nog v. G2000 (Apparel) Ltd. [2011] 4 HKLRD 121 that an order for enhanced interest on costs should only be made for the period from the last date of acceptance of the sanctioned payment or offer up to the date of judgment and that an order for enhanced interest should only be made if the receiving party has made payment of costs and disbursements, or on account of costs and disbursements, during this period. As the 1^st defendant has only made payment of costs and disbursements after the date of my judgment on 11 November 2011, I decline to make an order for enhanced interest in favour of the 1^st defendant.

4.  The 2^nd defendant is publicly funded. Just as employed legal aid counsel act as solicitors in charge of the civil litigation for the aided person and incur costs in the conduct of their cases, so do employed government counsel for the government department involved in the civil litigation.  Their costs are taxed in the same way as costs claimed by private solicitors.  If any such costs were incurred during the period from the last date of acceptance of the sanctioned payment or offer up to the date of judgment, an order for enhanced interest may be made in respect of such costs, from the dates on which the work was done up to the date of judgment, notwithstanding that no payment in respect of or on account of those costs had been paid by the aided person or government department involved in the litigation.

5.  Just as private solicitors pay disbursements, including fees for experts’ reports, and counsels’ fees, so does the Legal Aid Department and the Secretary for Justice. If any payment of such fees and other disbursements were made during the period from the last date of acceptance of the sanctioned payment or offer up to the date of judgment, an order for enhanced interest may be made in respect of such fees and disbursements, from the dates of payment up to the date of judgment.  An order for enhanced interest should be made from the date of payment of such fees and disbursements and not from the date liability for the payment of such fees and disbursements costs accrued.  An award of enhanced interest from the date liability for the payment of such fees and disbursements costs accrued would produce an unjust windfall for the receiving party.  For this reason, I decline to follow Waller LJ who was prepared to award enhanced interest from the date liability for the payment of such fees and disbursements costs was incurred by the publicly funded body (see §23 of his judgment in KR v. Bryn Alyn Community (Holdings) Ltd. [2003] PIQR P30, at p. 570).

6.  I award enhanced interest on the costs incurred by the 2^nd defendant at 9% per annum from the dates, after 31 August 2011, on which the work was done up to the date of judgment, and on the amount paid as mediator’s fees from 28 September 2011, the date of payment, up to the date of judgment, and on the amount paid as counsel’s fees from 13 October 2011, the date of payment, up to the date of judgment.          

7.  I also direct that the plaintiff’s own costs be taxed pursuant to the Legal Aid Regulations.