HCPI 298/2015
[2018] HKCFI 76
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
PERSONAL INJURIES ACTION NO 298 OF 2015
__________________________
BETWEEN
TAI YUK CHEUNG
Plaintiff
and
HUNG SING CONSTRUCTION
1st Defendant
ENGINEERING CO
YAU LEE – HSIN CHONG JOINT VENTURE
2nd Defendant
__________________________
Before: The Hon. Mr Justice Bharwaney in Court
Date of Hearing: 4 December 2017
Date of Decision: 4 December 2017
Date of Reasons for Decision: 16 January 2018
________________________
REASONS FOR DECISION
________________________
1. This is an appeal from the decision of Master Leong dated 1 June 2016 dismissing the plaintiff’s application for specific discovery.
2. The unusual feature of this case and the reason why the appeal was heard so late is that the plaintiff, who is legally aided, does not have a legal certificate for the appeal. He is represented by Mr Patrick Burke on a private basis. Indeed, I must confess this is the first time I have seen, in a legally aided case, the assigned solicitor acting for the client on a private basis.
3. The Director of Legal Aid (“the Director”) has refused to extend the legal certificate to cover the appeal proceedings. An appeal was lodged before the Master against the legal aid refusal, and the Master dismissed the appeal. I have not been provided with the Master’s reasons for dismissing the legal aid appeal but it is obvious to me that he did so because he agreed with the Director that there were no reasonable prospects of success on the appeal.
4. Notwithstanding the contrary opinion of the Director and the Master, Mr Burke has advised his client that he has reasonable grounds of appeal. No doubt it was based on that advice that client instructed Mr Burke to act for him on the appeal on a private basis.
5. The rules permit this to be done. I have done some research in this area, and I find that the legal aid regulations support Mr Burke’s stance that the legal proceedings could be partly legally aided and partly not. There is also a provision in the Legal Aid Ordinance itself, which supports Mr Burke’s position that he can act on a private basis for the legally aided person.
Legal Aid Regulations, Cap. 91A
6. Regulation 5(1) provides that “A certificate may be issued in respect of the whole or a part of – (a) proceedings in a court of first instance; ...” [My emphasis ]. It is implicit from this provision that legal proceedings could be partly legally aided and partly not legally aided.
7. Regulation 6A(e) provides that “The Director may amend a certificate where in his opinion ... it has become desirable for the certificate not to extend to certain of the proceedings in respect of which it was issued; ...” [My emphasis ]. This provision allows the Director to limit the steps that could be taken by the assigned solicitor in the legally aided proceedings.
8. The combined effect of these two provisions is that an assigned solicitor is permitted to act for the aided person on a private basis for certain part of proceedings which is not covered by the legal aid certificate.
9. Examples of this practice can be seen in different contexts:
(a) A respondent may be granted legal aid to defend a divorce proceedings “limited to custody and ancillary relief”. However, the assigned solicitor is permitted to act for the aided person on a private basis to defend the main suit (for example, seeking to amend the grounds for divorce from unreasonable behaviour to separation) provided, of course, that the Director is informed and the Court and the petitioner are made aware that this part of the suit is not legally aided.
(b) Legal aid may be granted to a defendant to defend a damages claim but not extended to cover a counterclaim. The assigned solicitor may act for the aided person on a private basis to pursue a counterclaim so long as the Director, the Court and the other parties are informed.
(c) In criminal cases, legal aid may be granted to defend certain criminal charges but not extended to cover arguments on choice of language and venue of trial. The legal team may act the aided person on a private basis.
Legal Aid Ordinance, Cap. 91
10. Section 22 provides that “… no person who, pursuant to any reference under this Ordinance , makes any investigation or report or gives any opinion or certificate or who acts for an aided person, shall take or agree to take or seek from an aided person any fee, profit or reward (pecuniary or otherwise) in respect thereof” [My emphasis ]. Section 22 is not applicable if the assigned solicitor has instructions to act for an aided person for matters or certain steps in the proceedings which are not covered by the legal aid certificate.
Guidance Notes to Solicitors Handling Civil Cases
11. I refer to the following extract from “Chapter 7 - Guidance Notes to Solicitors Handling Civil Cases” of the Director’s “Manual for Legal Aid Practitioners” at pp.16-17:
“3. Legal Aid Certificate and Assignment
3.1 The assignment of cases to you is made on the condition that you do not have any perceived or actual conflict of interest and it is incumbent on you to return the papers to the Director if such condition could not be fulfilled.
3.2 The Legal Aid Certificate (“the Certificate”) provides the authority for the Director of Legal Aid (“the Director”) to pay counsel and solicitors for acting for an aided person. Solicitors should check the scope of the Certificate. If the Certificate is limited, payment will not be made for work done outside the scope of the certificate. Prior to undertaking any work outside the terms of the Certificate, you must apply to the Director for extension of the Certificate giving all necessary information justifying the extension by using Form X47 which can be downloaded from the website of the Legal Aid Department (www.lad.gov.hk). Solicitors should make timely application for extension of the scope of the Certificate and give the Director sufficient time to raise queries on the continued merits of the case.”
12. Whilst §3.2, which deals with the extension of legal aid, may appear to be of some relevance, it is only applicable to the situation where an extension of the legal aid certificate is being requested by the assigned solicitor and does not cover the scenario where certain steps are to be undertaken on a private basis. As stated above, the Director must be kept informed of any work undertaken on a private basis. Upon being informed, the Director may exercise all his powers in connection with the provision of legal aid, including the power to discharge legal aid where necessary.
The Legal Aid Handbook
13. The following passages from the U.K. Legal Aid Handbook pp.151-152 bear on the point under consideration:
“Certificates for a specific step
If a certificate is issued to cover only a specific step in an action, for example, to purge the assisted person’s contempt, and on completion of that specific step, no further steps in the action are expected, the assisted person’s solicitor should apply promptly, with his client’s agreement, for discharge of the certificate and serve the appropriate notices of discharge.
If further steps in the action are contemplated, the assisted person’s solicitor should apply promptly for an amendment of the certificate. If the amendment is refused, but discharge of the certificate has not been effected or is not yet appropriate, regulation 64 does not then prevent the solicitor from acting privately for his client in the steps for which an amendment was sought and refused.
Certificates not granted in full
If an application for legal aid is only partially granted, for example, an application for legal aid to cover a defence and counterclaim is made but a certificate is granted only to defend, then regulation 64 does not prevent the solicitor from acting privately for his client in that part of the action (the counterclaim) which is not covered by the legal aid certificate. This applies also where an application for legal aid is made to cover defending divorce decree proceedings and representation as to ancillary relief, but legal aid is granted only to cover ancillary relief. Regulation 64 does not prevent the solicitor from acting privately in defending the decree proceedings.
Before acting privately for a client in any steps in an action in which the client is legally aided, his solicitor should first either:
(a) ensure that an appropriate application for legal aid or for an amendment has been made and refused; or
(b) have his client’s consent either:
(i) not to apply for legal aid for an amendment to cover the step or steps; or
(ii) to act prior to the application being determined
and in either case should ensure that he:
(a) has his client’s instructions to act privately;
(b) explains what this means; and
(c) advises his client that the legal aid area office will have to be informed.
Whether a solicitor is instructed to act privately for a client in an action in which the client is legally aided, he should inform the appropriate area office in writing, as soon as possible, explaining the reason. The very fact that an assisted person is also instructing his solicitor privately may be a matter which the area office should take into account when considering whether it is reasonable for the assisted person to continue to receive legal aid. See p. 586 for the solicitors’ professional conduct requirements concerning advice to clients on the availability of legal aid.”
14. It is expressly acknowledged in the U.K. Legal Aid Handbook that an assigned solicitor is not prevented from “acting privately for his client in the steps for which an amendment was sought and refused.”
15. The assigned solicitor’s obligations include the obligation to ensure that he has client's instructions to act on a private basis; the obligation to explain to the client what that means, including explaining to the client the costs implications and the lack of costs protection without legal aid; and the obligation to inform the Legal Aid Department.
16. The court and all parties to the proceedings should also be informed expeditiously by the assigned solicitor that he is conducting a certain step of the proceedings on a private basis and that such step is not covered by the legal aid certificate. The other parties ought to be informed as soon as possible so that they are not under any false impression that any costs that they successfully recover from the aided person would be satisfied from the Legal Aid fund. In this case, the solicitors for the defendants have been well aware that Mr Burke was acting on a private basis in this particular appeal.
Law Society’s Guide to Professional Conduct
17. To complete the review, I refer to §10.06 in Chapter 10 on “Limited Instructions for Appearance in Court” of the “Law Society’s Guide to Professional Conduct” which also supports the proposition that an assigned solicitor can act on a private basis for the aided person:
“10.06 LIMITED INSTRUCTIONS FOR APPEARANCE IN COURT
A solicitor may accept instructions limited to a particular matter or issue in the proceedings, such as an application to adjourn the proceedings. Where a solicitor accepts limited instructions, he shall inform the court before which he has been instructed to appear of the limited nature of his instructions at the first available opportunity after his acceptance of such instructions, and preferably before the solicitor’s appearance.
Commentary
1. Before he accepts limited instructions, the solicitor should fully advise the client of the possible legal and cost consequences.
2. The client should be made aware and the solicitor should appreciate that once he is on the court record he cannot withdraw from representation without the leave of the court.
3. If counsel is also making a limited appearance on the instruction of the solicitor, the solicitor should ensure that counsel appreciates that the court’s consent will be required for withdrawal and it is desirable that he and counsel plan for the contingency of refusal by the court.”
Conflict of Interest
18. Mr Burke’s locus to be here is not in issue. What is in issue is whether or not he has put himself in conflict with his client’s interests. It appears to me that he has put his own personal interest in conflict with his client’s interests. The conflict arises because, at the conclusion of the hearing before him, Master Leong wanted to fix a hearing for Mr Burke to be afforded an opportunity to address him why a wasted costs order should not be made. Later, Master Leong decided that the hearing to consider making a wasted costs order ought to be put on hold until these appeal proceedings were concluded.
19. The fact that the rules permit this peculiar situation of the solicitor acting on a private basis in a legally aided case does not take away the fundamental obligation of the solicitor not put himself in a position of conflict with his own client.
20. When I learned that Mr Burke was acting in the appeal on a private basis, I had written to him to ask whether or not he was acting pro bono for the aided person. He replied in the negative and also stated that the plaintiff knew that any adverse costs orders could be enforced directly against him.
21. When Mr Burke opened the appeal before me, I pressed him on the issue of conflict of interest as follows:
“… Mr Burke, … you are advising your client to pursue this appeal, notwithstanding the fact that [The Director of] Legal Aid considers [that] there are no reasonable grounds of appeal, notwithstanding the fact that the Master, in refusing the appeal from the legal aid refusal, must have been of the same view. … notwithstanding that, you have persisted in advising your client, not only that he has reasonable grounds of appeal, but that he should actually instruct you privately, not on a pro bono basis, instruct you privately to advance this appeal on his behalf, and well knowing that if you should lose the appeal, that he will be personally liable for the costs, including the defendant’s costs of the appeal, which may come out from any damages he may be subsequently awarded, or if he loses the action, might result in him becoming bankrupt.
…
… Very simple, Mr Burke, why would you give him that advice, if not to avoid a wasted costs order? Is this not a direct conflict of interest case?
…
… you have your own personal interest here to avoid a personal wasted costs order, and despite [The Director of] Legal Aid and a Master saying, in effect, that there are no grounds of appeal, you advised the client to instruct you to pursue to appeal?
…
The fact that the rules allow … this peculiar situation of the solicitor acting on a private basis in a legally aided case does not take away the fundamental obligation of the solicitor not put himself in a position of conflict with his own client.”
22. At this point, Mr Burke confirmed to me that he was willing to act on a pro bono basis in the appeal. I then asked Mr Burke to consider, notwithstanding that he was now willing to act pro bono , whether he was still in a position of conflict in that he was exposing his client to the risk of an adverse costs order from an unsuccessful appeal. However, Mr Burke persisted in pursuing this appeal.
The Appeal against the Master’s Order
23. This is a personal injury action commenced by the plaintiff who was employed by the 1st defendant, a subcontractor of the 2nd defendant which was the principal contractor at a construction site at the old Kai Tak Airport. The plaintiff was assigned to install kitchen units in the apartments that had been constructed at the site.
24. There were some glass panes that were stored in the apartment in which the plaintiff was working. They were stored there pending their installation into the window frames of the apartments. In the process of installing the base of a kitchen stove, the plaintiff’s left hand came into contact with the glass panes and he suffered a 3 cm cut to his left index finger, including a 70% cut of one of the two extensor tendons.
25. On these pleaded facts, the issue that arose was whether or not these glass panes were stored in an unsafe place creating a hazard to workers like the plaintiff installing kitchen units in the apartments at the Kai Tak site.
26. Against this background, Mr Burke has sought discovery of numerous documents which are set out in the Appendix.
27. By the time of the hearing before Master Leong, the request had been reduced to some 12 items that were set out in the Appendix. Although reduced, these were very substantial items, with a substantial number of documents requested against each item: -
(1) Item 1 against the 2nd defendant (Contract with Developer);
(2) Item 2.1 against the 2nd defendant (Accident / incident book or reports);
(3) Item 2.3 against the 2nd defendant (Safety management system);
(4) Item 2.4 against the 2nd defendant (Safety Officers);
(5) Item 2.5 against the 2nd defendant (Risk assessments);
(6) Item 4.1 against the 2nd defendant (Statutory report);
(7) Item 4.4 against the 2nd defendant (Witness statements);
(8) Item 5.1 against the 2nd defendant (Other accidents);
(9) Item 6.1 against the 2nd defendant (Plan of the apartment);
(10) Item 6.2 against the 2nd defendant (Documents showing dimensions of glass);
(11) Item 7.1 against the 1st defendant (Contract of employment at the time of accident);
(12) Item 7.5 against the 1st and 2nd defendants (Current wages of 3 comparable workers).
28. There was no controversy about the principles to be applied in an application for specific discovery under Order 24, rules 7 and 8 of the Rules of the High Court, and Master Leong correctly set out those principles in §§61 to 64 of his decision. Cheung JA summarised those principles in Paul’s Model Art Gmbh & Co. KG v. UT Ltd. [2006] 1 HKC 238 at p.247 as follows:
“(1) There is no jurisdiction to make an order under RSC, O.24, r.7, for the production of documents unless
(a) there is sufficient evidence that the documents exist which the other party has not disclosed;
(b) the document or documents relate to matters in issue in the action;
(c) there is sufficient evidence that the document is in the possession, custody or power of the other party.
(2) When it is established that those three prerequisites for jurisdiction do exist, the court has a discretion whether or not to order disclosure.
(3) The order must identify with precision the document or documents or categories of document which are required to be disclosed, for otherwise the person making the list may find himself in serious trouble for swearing to a false affidavit, even though doing his best to give an honest disclosure. (See: Berkeley Administration v. McCelland [1990] FSR 381)”
29. Superimposed on the requirement under Order 24, rule 8, which states that an order for specific discovery may be refused if, in the opinion of the court, the discovery sought was not necessary either for fairly disposing of the cause or matter, or for saving costs, is the additional requirement, since the advent of the Civil Justice Reform, of the need to look closely at costs implications and proportionality.
30. Master Leong, guided by the above principles, decided that the documents listed under the 12 items considered by him were neither relevant nor necessary, and, accordingly, he refused to order specific discovery of the documents that had been sought. The appeal against his decision has been brought in respect of the 8 of the said 12 items, which are set out in the following summary prepared by Mr Burke:
Appeal Item No.
Item No. before Master Leong
Document
Relevance / Existence
Response of Defendants
Ruling of Master Leong
1.
1.1
Contract between Housing Authority and D2
1. Must be a contract
1. D1 – not have
Not relevant / necessary [para. 69]
2.
2.1
Safety / Accident Book
1. Common requirement on sites (page 3 HA plan)
1. D1 – no
?
3.
2.3
Safety Management Plan
1. Statutory requirement
1. D1 – No
Not relevant / necessary [para. 69]
4.
2.4
Qualifications of Safety Staff
1. D’s employ safety staff – not denied
1. D1 – no safety staff
Not relevant / necessary [para. 69]
5.
2.5
Risk Assessments
1. Fundamental basis of current safety schemes – identify the risks and then exclude or adapt for them
1. D1 – now says is none
Not relevant / necessary [para. 69]
6.
4.2
Accident Reports
1. HA have detailed system for reporting
1. D1 – No
Already disclosed [para. 87]
7.
4.4
Statement of Witness
Common practice
1. D1 – none
Not exist [para.70 – 75, 42]
8.
6.1
Plans of the Accident Flat
1. Must have – is being built
1. D1 – not have
Not necessary / relevant [para. 69]
31. I have considered carefully the submissions of Mr Burke as well as the submissions of Mr Dennis Law who appeared for the defendants. I am not satisfied that Master Leong was wrong in his decision. I am required to consider this appeal by way a hearing de novo. Doing so, I come to the same decision as Master Leong did.
32. It is not proportionate to seek and obtain discovery of the construction contract between the Housing Authority and the 2nd defendant in respect of this very large construction project, in a case such as this involving a very simple accident where the only issue is whether or not the glass panes were negligently stored in those premises. For the same reason, I am of the view that it is not proportionate nor necessary, either to fairly dispose of the case or to save costs, to order discovery of any of the other documents sought to be produced, including the following documents being sought that pertain to “Other Accidents”:
“2. Safety at the Construction Site
2.1 Other accidents
1. Safety / accident book
2. Recording incidents / dangerous occurrences/ near misses
…
2.3 All documents relating to the safety management system operated by the Defendant, including:
1. The company safety policy statement
2. Safety plans
3. Minutes of safety committees
4. All documents relating to safety audits or safety reviews
5. All documents relating to safety training to the employees of the Defendant
6. Form 2 & 3 for the period covering 6 months before and after the accident, prepared pursuant to the Factories & Industrial Undertaking (Safety Officers & Safety Supervisors) Regulations, Cap 59 – or similar documents
2.4 All documents relating to the employment of, and qualifications, of safety officers and safety supervisors at the site
2.5 Risk Assessments”
33. Discovery was also sought of the following documents relating to the accident in question:
“4. The Accident
…
4.2 Accident investigation report prepared by or on behalf of the Defendants, including reports prepared pursuant to regulation 15(1) of the Factories & Industrial Undertakings (Safety Officers & Safety Supervisors) Regulations, Cap 59
…
4.4 Statements from witnesses”
34. As Master Leong noted in his decision, the accident report prepared by the Safety Officer has already been disclosed. It was common ground that the plaintiff was working alone at the time and that there were no witnesses to the accident. There was no evidence to support the existence of any statement of any witness that was taken in relation to this accident.
35. I have arrived at this decision in the context of the circumstances of the case where the Form 2 has been produced, and where the accident report in relation to this specific accident has been produced. If I were the trial judge in this simple case, the only document that I could possibly be interested in having before me, from the entire list of the documents that have been sought, would be a risk assessment report on the placing and the storage of glass panes into these apartments pending their installation at a later date. However, I am not satisfied that there is sufficient evidence to establish that a risk assessment report in relation to the work practice of storing glass panes in these apartments was in existence. It is highly unlikely that a risk assessment report would have been produced for such a simple process. It is obvious that there were risk assessment reports in respect of different aspects of the works, including many hazardous works, to be undertaken on this large construction project but these reports have no relevance to the accident which is the subject matter of this action.
36. The accident report in respect of this accident has a layout plan of the apartment in question but this plan does not show any dimensions of the internal rooms and the kitchen. Whilst the plans of the apartment where the accident occurred would have been of assistance to the court, it is clear from the affidavit filed on behalf of the defendants that they are not in possession of any such plans. I am not satisfied that the plaintiff has made out a prima facie case that any such plans are in the possession of the 2nd defendant.
37. It is not proportionate nor necessary, either to fairly dispose of the case or to save costs, to order specific discovery of the very wide scope of documents that were sought. When considered in the context of the simple factual issues raised in this action, it is clear to me that the application for specific discovery of the very wide scope of documents that were sought was oppressive.
38. For these reasons, I dismissed the appeal.
[Submissions on Costs]
39. After hearing further submissions, I awarded costs of the appeal to the 1st and 2nd defendants summarily assessed, by consent, in the sum of $80,000. At this point, Mr Burke indicated that not only was he acting pro bono for the plaintiff but also that he would personally discharge the costs order in favour of 1st and 2nd defendants by paying the sum of $80,000 to them out of his own pocket.
40. I did not make any order as to the costs below as that matter still has to be determined.
41. Before adjourning, I expressed the hope that the parties would quickly settle this straight forward case either by mediation or by negotiation between the solicitors acting for the parties.
(Mohan Bharwaney)
Judge of the Court of First Instance
Mr Patrick Michael Burke, of Burke & Company, for the plaintiff
Mr Dennis S M Law, instructed by William Lee & Associates, for the 1st and 2nd defendants
APPENDIX
“1. The Construction Site
1.1 Contracts
1. Contract between D2 and HK Housing authority
1.2 Statutory notice
1. Notice of
(a) Commencement – with name of every subcontractor
(b) Further information
(c) Change
(d) Completion
of Construction work to Labour Department – form LD 202
2. Notification of establishment of workplace
2. Safety at the Construction Site
2.1 Other accidents
1. Safety / accident book
2. Recording incidents / dangerous occurrences / near misses
2.2 Employees Handbook
2.3 All documents relating to the safety management system operated by the Defendant, including:
1. The company safety policy statement
2. Safety plans
3. Minutes of safety committees
4. All documents relating to safety audits or safety reviews
5. All documents relating to safety training to the employees of the Defendant
6. Form 2 & 3 for the period covering 6 months before and after the accident, prepared pursuant to the Factories & Industrial Undertaking (Safety Officers & Safety Supervisors) Regulations, Cap 59 – or similar documents
2.4 All documents relating to the employment of, and qualifications, of safety officers and safety supervisors at the site
2.5 Risk Assessments
2.6 Method statement for work being done by the Plaintiff at the time of the accident
3. The work being done by the Plaintiff
3.1 Permit to work
3.2 Written instructions given to the Plaintiff / his team of workers
4. The Accident
4.1 Statutory report made under FIU Regulations – Section 17, or Employee’s Compensation Ordinance
4.2 Accident investigation report prepared by or on behalf of the Defendants, including reports prepared pursuant to regulation 15(1) of the Factories & Industrial Undertakings (Safety Officers & Safety Supervisors) Regulations, Cap 59
4.3 Photographs of the accident scene
4.4 Statements from witnesses
5. Previous / subsequent accidents
5.1 Same document as in 4 – for previous / subsequent similar accidents
6. The flat / Glass panes
6.1 Plan of the flat
6.2 Dimensions of glass panes
7. Employment
7.1 Contract of employment between the Plaintiff and the Defendant, or other documents etc. to identify the terms and conditions of employment – including different items / categories of wages and allowances
7.2 Personal records file of the Defendant for the Plaintiff including
1. Leave record
2. Training record
3. Performance appraisal
7.3 All documents relating to payments to the Plaintiff in the period of 12 months prior to the accident:
1. Time card record / daily signing record / computer scanner
2. Monthly pay slips
3. Record of wages paid
4. MPF/ ORSO record
5. Return to IRD
7.4 All documents relating to payments to the Plaintiff following the accident for:
1. Sick leave pay
2. Payment for re-imbursement for medical expenses
3. Payment for or re-imbursement for non-medical expenses
4. MPF records
5. Return to Inland Revenue
7.5 Records of wages paid to person(s) (up to 3 employee’s) currently employed by the Defendant in the same or similar position to that occupied by the Plaintiff, for the last 12 months – with documents to show
1. Their name
2. Their job title
7.6 Records of wages paid to person(s) (up to 3 employee’s) currently employed by the Defendant who have suffered similar injury and disability as the Plaintiff – with documents to show
1. Their name
2. Their job title
3. Their disability / previous accident”