STAR RAINBOW INVESTMENTS LTD v. LIN PAI CHING AND OTHERS

HCA2410/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 2410 OF 2009

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BETWEEN

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DECISION
ON ASSESSMENT OF COSTS

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Introduction

1.  On 22 January 2010, I dismissed the 1^st defendant’s application for leave to appeal to the Court of Appeal with costs to the plaintiff. The plaintiff had provided a bill of costs for gross sum assessment. The total costs claimed are $355,500. Pursuant to my directions, the 1^st defendant had lodged her Objections and the plaintiff had lodged the Response to the 1^st defendant’s Objections. My determination appears below.

General

2.  Before dealing with the individual items on the bill of costs, there are three general matters that need to be dealt with.

3.  The first is the 1^st defendant’s indication at the end of her Objections that the bill is too simple and that it is necessary for the plaintiff’s costs to be taxed in lieu of a summary assessment. The leave application is not complex; it lasted for less than a month and the papers involved are not voluminous. It is appropriate for the costs to be dealt with by way of gross sum assessment. It is not in the 1^st defendant’s interest to ask the plaintiff to draw up a full bill of costs and to subject it to a full taxation procedure, including holding a taxation hearing, because this will incur a lot more time and costs.

4.  The second matter is that the plaintiff’s bill of costs had not followed the provisions in Practice Direction 14.3, notably paragraphs 7 and 10. Fortunately, the non-compliance has not caused delay or additional costs. Nevertheless, parties ought to bear in mind the need to comply fully with the Practice Direction and the potential consequences of non-compliance as set out in paragraph 15 thereof.

5.  The third general point to note is that the plaintiff’s costs are assessed on party-and-party basis, such that costs will only be allowed where they are necessary or proper for the attainment of justice or for enforcing or defending the rights of the party whose costs are being taxed: Order 62 rule 28(2) of Rules of the High Court, cap.4A.

Solicitors’ professional costs

6.  Item 1: I am prepared to allow the 2 hours claimed by ZK for perusing and considering the summons and the supporting affirmation, taking instructions from client and giving instructions to counsel.

7.  Items 2 and 3: Both these items relate to the 2^nd affirmation of Miao Tai Wai David in opposition to the leave application. ZK claimed a total of 6.5 hours on drafting, obtaining counsel’s advice and client’s instructions on the affirmation. In respect of obtaining client’s instructions, there must be some duplication with item 1. Further, the affirmation was settled by counsel, and was charged separately from the brief. It is not a lengthy or complicated affirmation and is mainly to give an account of the events that happened after the Order (against which the 1^st defendant sought leave to appeal) was made. The incurrence of 6.5 hours is not justified on party-and-party basis. I will allow 3 hours.

8.  The litigation clerk further claims 4.5 hours on the service and filing of the affirmation. The costs for filing the affirmation should not be charged on time basis, but should be charged under the scale in Item 2, Part 1, First Schedule to Order 62, Rules of the High Court. The costs allowed for each attendance at filing is $110. As for the service of the document, the practice is not to assess on time basis: see also Item 3, Part 1, First Schedule to Order 62. I note from the affirmation of service that there were three attendances to serve the affirmation (at the 1^st defendant’s addresses in Sheung Wan and in New Territories and also at the 1^st defendant’s former solicitors in Mongkok) and one of which was to the New Territories. I allow $500 for the service of the affirmation. The total costs of LC allowed under Item 3 are $610.

9.  Item 4: This item relates to the preparation and service of (i) the hearing bundle, and (ii) the affirmation of service. MC claims 4 hours and LC claims 4.5 hours. Under Item 1, Part 1, First Schedule to Order 62, $4 per page is allowed for the first copy of a hearing bundle and $1 for each of the subsequent copy. This covers preparation of the bundle and includes the costs of copying and collating the documents and also compiling the bundle (including indexing and pagination). The costs for the preparation of the hearing bundle should therefore not be charged on time basis. The plaintiff’s bundle consisted of 102 pages (99 pages of documents + 3 pages of index). $408 ($4 x 102) is allowed for the first copy. The costs for the subsequent copies will have been covered by Item 3 under Disbursement (photocopying and miscellaneous charges). The costs of MC’s time are disallowed in total.

10.  As for LC’s costs, there were two attendances at the court to lodge the bundle and to file the affirmation of service, giving rise to $220 ($110 x 2). I further allow $350 for the service of the bundle made at the 1^st defendant’s address in the New Territories and the 1^st defendant’s former solicitors in Mongkok. Additionally, one hour of LC’s time is allowed for the preparation of the affirmation of service. The total costs allowed for LC is $1,570 ($220 + $350 + $1,000).

11.  Items 5 and 6: They are for perusing submissions and authorities of plaintiff’s counsel and preparing for the hearing. ZK claims 5 hours in total. These items should be considered together as their nature is the same, namely, to prepare for the hearing. I do not agree that because counsel were retained, it was no business of solicitors to consider the submissions and/or to prepare for the hearing. I however accept it is not necessary to spend a total of 5 hours. I allow 2 hours.

12.  Item 7: This relates to the time spent on the hearing. The hearing lasted for 15 minutes. The plaintiff says that ZK had a post-hearing conference with client for 30 minutes. This however is not party-and-party costs. Hence, only 15 minutes of ZK’s time is allowed under this item.

Counsel fees

13.  The 1^st defendant rightly points out that there is no certificate for two counsel. I also do not accept it is necessary to engage both senior and junior counsel for the leave application; it is not a complicated application and senior counsel would be familiar with the action since he was involved in the hearing leading to the application. I allow only the fees of senior counsel. I allow the brief fee in full. I also allow senior counsel’s fee on incidental advice.

Summary

14.  The total costs of the plaintiff on the application are assessed and allowed at HK$ 234,180. The breakdown is as follows:

Items	Time allowed	Costs allowed
Solicitors' costs
1.	ZK: 2 hours (at $4,000 per hour)	$   8,000
2. & 3.	ZK: 3 hours	$  12,000
	LC	$   610
4.	LC	$   1,570
5. & 6.	ZK: 2 hours	$   8,000
7.	ZK: 15 minutes	$   1,000
Disbursements
1.	Senior counsel’s fees	$200,000
3.	Photocopying & miscellaneous charges	$   3,000
Total		$234,180