LOUIS VUITTON MALLETIER AND ANOTHER v. CUVEE XLV FRENCH WINE LTD AND ANOTHER

CACV 404/2019

[2020] HKCA 928

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 404 OF 2019

(ON APPEAL FROM HCA NO. 1900 OF 2013)

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DECISION

ASSESSMENT OF COSTS

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Hon Chu JA giving the decision of the Court:

1.  On 10 August 2020, this Court (Cheung and Chu JJA) handed down our judgment ([2020] HKCA 674) ordering the 2^nd defendant to give security for the plaintiffs’ costs in this appeal in the sum of $700,000 within 30 days from the date of the judgment. The judgment further provided that in the event the 2^nd defendant failed to give security as ordered, this appeal shall stand dismissed out of court without further order and the 2^nd defendant shall pay the plaintiffs the costs of the appeal to be summarily assessed.

2.  Upon the 2^nd defendant failing to provide the security as ordered, this appeal has been dismissed with costs to the plaintiffs against the 2^nd defendant. 

3.  On 23 September 2020, this Court gave directions for the lodging of statement of costs and statement of objection so as to facilitate the summary assessment of costs. 

4.  On 7 October 2020, the plaintiffs filed its statement of costs claiming a total sum of $485,223, of which $16,800 is counsel fee and the balance represents solicitors costs and disbursements.   

5.  On 21 October 2020, the 2^nd defendant filed an affidavit for the purpose of opposing the plaintiffs’ statement of costs.  The focus of the 2^nd defendant’s objections is, however, misplaced.  The objections are directed at the order directing him to give security for the plaintiffs’ costs in this appeal, which we had dealt with in our judgment[1], as well as the judgment of Lok J finding in favour of the plaintiffs.  The 2^nd defendant has made no comment on the amount claimed in the plaintiffs’ statement of costs, which should have been the focus of the statement of objection.

6.  Notwithstanding that, the court has a duty to scrutinise the statement of costs.  At the outset, we wish to point out that a party seeking summary assessment of costs should take note of paragraph 7 of Practice Direction 14.3 which requires the statement of costs to be, as far as possible, in the format of Appendix A to the Practice Direction. For reasons not apparent to us, the plaintiffs’ statement of costs has not followed the prescribed format.  It runs up to eight pages, with details that are both unnecessary and inapt for summary assessment.    

7.  In assessing the quantum of the plaintiffs’ costs, we have taken into account the following:

(1)  The costs are assessed on party-and-party basis such that all costs that are necessary or proper for the attainment of justice or for enforcing or the plaintiffs’ rights will be allowed.  It follows that generally only the fee of one fee earner will be allowed on each item of work.  Further, while some work may be considered as reasonable on solicitor-own-client basis of assessment, they will not be allowed inter-partes on party-and-party assessment, such as attending client or counsel to provide regular updates, or the costs of considering or preparing a possible step in the action that is ultimately not adopted (e.g. reviewing grounds for a respondent’s notice).

(2)  This appeal has a short duration.  The notice of appeal was served and filed on 2 and 3 September 2020 respectively.  Until the dismissal of the appeal in September 2020, the only major step taken by the plaintiffs in the appeal is the application for security for costs which was filed on 10 March 2020 and determined on paper.  The other work carried out in the appeal would be the consideration of the notice of appeal and the amended notice of appeal as well as by the draft index of the appeal bundles proposed by the 2^nd defendant.

(3)  This Court’s observations on the hourly rate of the fee earners, the costs claimed on the security for costs application and the estimated solicitors costs of the appeal made in paragraph 21 of the judgment dated 10 August 2020.

8.  Having regard to the above considerations, and taking a broad brush approach, we have assessed the plaintiffs’ costs in this appeal at $350,000.