KAO, LEE & YIP (a firm) v. HIGH VIEW PROPERTIES LTD

Civil Appeal Nos.
127 & 128 of 1987

Solicitors – taxation of bill of costs on application of party chargeable – s.67 Legal Practitioners Ordinance – jurisdiction.

A District Court has no jurisdiction to entertain applications under s.67 of the Ordinance and to make Orders under that section (or under ss.65, 66, 68 and 69). This jurisdiction is reserved to the High Court by reason of the definition of the word “Court” in s.2.

IN THE COURT OF APPEAL

1987 No. 127
(Civil)

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JUDGMENT

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Fuad, J.A. (delivering the judgment of the Court):

1. The appeals, which were listed for hearing together, come before this Court with the leave of Deputy Judge Yeung (as he then was) who heard the applications from which the appeals arise in the District Court on 17 August this year.

2. The Appellant in each appeal is the same firm of Solicitors (the “Solicitors”). The Respondents have at least one common director, and they each, as a party chargeable, applied separately to the District Court under s.67 of the Legal Practitioners Ordinance, Cap.159 (“the Ordinance”), for order for the taxation of bills of costs for non-contentious business delivered to them by the Solicitors.

3. The applications were heard together. The learned Deputy Judge granted the Respondents the relief they each sought, and ordered that the two actions instituted by the Solicitors in the District Court for the recovery of costs due to them be stayed pending taxation.

4. In his full and careful “Reasons for Decision”, the Deputy Judge explained the “special circumstances” which he found (see proviso (i) to sub-section (2) of section 67) to justify the orders he made despite the fact that more than 12 months had clasped from the delivery of each bill.

5. Before the hearing of these appeals began we felt it necessary to raise with counsel (neither of whom appeared in the Court below) the question whether the District Court has jurisdiction to make an order under s.67 of the Ordinance.

6. As is stated in Halsbury’s Laws of England (4^th Edition) Vol. 44, para. 178: “ The power of the Supreme Court to order taxation of a solicitors’s bill of costs rests on its original or inherent jurisdiction over its officers and on the jurisdiction under the Solicitors Act 1974.”

7. A district Court does not possess original or inherent jurisdiction over solicitors and one has to see whether the Ordinance or any other statutory provision gives that Court jurisdiction to grant the orders made by the Deputy Judge in these cases.

8. Unfortunately, no one advising any of the parties noticed that the definition section (s.2) of the Ordinance states that “‘Court’ means the High Court”; and so, of course, the point was not brought to the attention of the Deputy Judge.

9. Mr. Poll, for the Appellants, did not wish to submit that the District Court had jurisdiction in the matter. Mr. Mitchell, for the Respondents, contended that s.48 of the District Court Ordinance, Cap.336 (which deals with the Court’s general ancillary jurisdiction) somehow conferred the necessary jurisdiction upon the District Court. We mean no disrespect to his arguments when we content ourselves by saying, merely, that we do not think that s.48 can be prayed in aid.

10. The relevant parts of s. 67 of the Ordinance are in these terms:

“67. (1) On the application, made within 1 month of the delivery of a solicitor’s bill, of the party chargeable therewith the Court shall, without requiring any sum to be paid into court, order that the bill shall be taxed and that no action shall be commenced thereon until the taxation is completed.

(2) If no such application is made within the period mentioned in subsection (1), then, on the application either of the solicitor or of the party chargeable with the bill, the Court may, upon such terms, if any, as it thinks fit (not being terms as to the costs of the taxation), order –

(a) that the bill shall be taxed;

(b) that, until the taxation is completed, no action shall be commenced on the bill, and any action already commenced be stayed:

Provided that –

(i) if 12 months have expired from the delivery of the bill, or if the bill has been paid, or if a verdict has been obtained or a writ of inquiry executed in an action for the recovery of the costs covered thereby, no order shall be made on the application of the party chargeable with the bill except in special circumstances and, if an order is made, it may contain such terms as regards the costs of the taxation as the Court may think fit;

(ii) in no event shall any such order be made after the expiration of 12 months from the payment of the bill.

(3) ………

(4) ………”

11. Our s.67 is drawn from virtually identical provisions which were to be found in s.69 of the repealed Solicitors Act 1957 of the United Kingdom. The only difference is that in subsection (1) of the English section we find “High Court” in place of the word “Court” which occurs in our equivalent subsection.

12. The U.K. Solicitors Act 1957 was repealed and replaced by the Solicitors Act 1974. Provisions similar, in broad outline, but differently worded, to s.69 of the 1957 Act are now contained in s.70 of the 1974 Act.

13. In relation to contentious business in county courts special provision was made in the 1957 Act, and is made in the 1974 Act:

(a) in the 1957 Act, s. 73 was in these terms:

“73. (1) or the purposes of regulating the remuneration of a solicitor in respect of contentious business done by him in a county court, sections fifty-nine to seventy-two of this Act shall have effect subject to the following provisions of this section.

(2) ………

(3) ………

(4) ………”

(b) in the 1974 Act, ss.69 and 74 are as follows:

“69. (1) ……

(2) ……

(3) Where a bill of costs relates wholly or partly to contentious business done in a county court and the amount of the bill does not exceed £1,000, the powers and duties of the High Court under this section and sections 70 and 71 in relation to that bill may be exercised and performed by any county court in which any part of the business was done.”

“74. (1) The remuneration of a solicitor in respect of contentious business done by him in a county court shall be regulated in accordance with sections 59 to 73, and for that purpose those sections shall have effect subject to the following provisions of this section.

(2) ………

(3) ………”

14. However, our Ordinance, even in respect of contentious business, contains no provision on the lines of s.73 of the 1957 Act, or of ss.69 and 74 of the 1974 Act.

15. In view of the definition of “Court”, a District Court has no jurisdiction to act under s.67 of the Ordinance, or under any of the following section: 65, 66, 68 or 69 – compare s.61(3) which contains a special definition of the word “court” for the purposes of ss.60 and 73, and the use of the expression “Any court” in s.70. There is no statutory basis elsewhere for the jurisdiction assumed.

16. There applications were misconceived and the orders for taxation were made without jurisdiction. No consent or waiver by parties can confer jurisdiction upon a court not already vested in it by law. Both sets of proceedings were nullities.

17. It occurs to us that the legislature may wish to consider whether the jurisdiction of a District Court, so greatly enhanced since the Ordinance came into force (and with it an increase in the burden of costs) makes it desirable for suitable provision on the lines of s.69 of the U.K. Act of 1974 to be enacted in Hong Kong.

18. We allow the appeals and set aside the orders for taxation, and with them the orders for a stay of the two actions instituted by the Solicitors.