ST v. BETTY KWAN AND ANOTHER

HCAL 60/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST

NO 60 OF 2012

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D E C I S I O N  ON  C O S T S

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A. INTRODUCTION

1.  On 8 March 2013, this court handed down its judgment (“the Judgment”) dismissing the judicial review application.

2.  Under section E1 (paragraphs 117-128) of the Judgment, I also gave the reasons for dismissing the applicant’s discovery application (“the subject discovery application”) on 14 December 2012 just before the substantive hearing.  At the end, I indicated at paragraph 128 that, in light of how the subject discovery application was made and its clear lack of merits, I was minded to consider whether I should disallow the applicant’s own costs to be taxed in accordance with legal aid regulations.  I further directed the applicant’s legal representatives to make submissions on this question before I would finally decide whether to do so or not.

3.  This is the hearing of this question.

4.  The applicant is represented by Mr Kat (with Mr Parker).  As I indicated in the Judgment, Mr Kat was not counsel appearing before me in the subject discovery application.  However, he makes it clear at this hearing that he bears responsibility for that application as well, since he had also advised on the subject discovery application.

5.  At the invitation of the court, Mr Edmund Chan for the Director of Legal Aid (“the Director”) has also appeared before me to assist in the matter.  The court is grateful for his assistance.

6.  In essence, Mr Chan submits (which is not disputed by Mr Kat and is accepted by me) that:

(1) The court has jurisdiction to make an order depriving the applicant’s own costs to be taxed in accordance with legal aid regulations[1];

(2) Generally, once the Director has assigned a matter to the assigned lawyers, his supervisory power envisaged under the Legal Aid Ordinance (Cap 91) and relevant regulations is concerned with the grant and continuance, suspension, limitation or revocation of aid. It does not extend to invigilating the performance of the assigned lawyers[2];

(3) Under Regulation 12(6) of the Legal Aid Regulations, where it appears to the aided person’s solicitor necessary for the proper conduct of the proceedings for an act to be done, but that act is either unusual in its nature or involves usually large expenditure, he shall request the Director’s prior approval of that act.  Where such prior approval has been obtained, no question as to the propriety of the act shall be raised on taxation as between solicitor and client; and

(4) The applicant’s solicitors had not asked for any such prior approval from the Director.  However, without commenting on the propriety of the subject discovery application, generally speaking, discovery applications in judicial review are not (for the purposes of legal aid management) of unusual nature within the meaning of Regulation 12(6) and could be regarded as incidental to the proceedings.

7.  With the Director’s above position in mind, I now deal with the costs consideration as follows.

8.  This decision should be read together with the Judgment.  For consistency, unless otherwise stated, I would adopt the same abbreviations herein as used in the Judgment.

B. THE COSTS IN QUESTION

B1. Applicable principles

9.  I accept Mr Kat’s general submissions the intended costs order I was minded to make is one which is akin to a wasted costs order under s 52A(6) of the High Court Ordinance (Cap 4).

10.  Costs is of course a matter of discretion for the court.  The court would consider all the circumstances as a whole of the relevant application before deciding whether or not to make such an order.  These include (non-exhaustively) matters such as whether there has been an improper or unreasonable act or omission, an abuse of process or serious dereliction of duties by the legal representatives involved in bringing and pursuing the relevant application or proceedings, and whether the conduct permits of a reasonable explanation[3].

11.  Before making such an order (given its seriousness in nature), the court must also take into account the interest that there should be “fearless advocacy” under the adversarial system of justice (see s52A(5))[4]. But the court should also be alerted to the distinction (albeit sometimes a fine one) between “fearless advocacy” and running an obviously hopeless case. The former is accepted, but not the latter.

12.  Bearing these principles in mind, I would now look at the present case.

B2. The present case

13.  I agree with Mr Kat that the factors set out in the Judgment in support of the intended costs order can be summarised as follows:

(1) Exceptional lateness in the application (see paragraphs 117 and 128 of the Judgment).

(2) The application was a “surprise application” which was “procedurally wrong” and “improper” (see paragraphs 120-122, and 128 of the Judgment).

(3) The application was clearly without merits and unnecessary (see paragraphs 125-126 and 128 of the Judgment).

14.  It is Mr Kat’s submissions that these factors (or some of them) are not established in showing that there was any or any obvious or clear dereliction of duty or abuse of process by the legal representatives in bringing and pursuing the subject discovery application.  No effective wasted costs order should therefore be made.

15.  I would look at these factors in turn.

B2.1 A late and surprise application

16.  The first and second factors can be considered together.

17.  As rightly submitted by counsel, the primary complaint of impropriety is that the respondents were “taken by surprise” by an application for Classes 1-3 discovery.  At paragraph 120 of the Judgment, I observed as follows (footnote omitted):

“It is important to point out that the documents sought under Classes 1-3 are neither the documents covered under the adjourned parts of the discovery summons nor those which had been sought to be discovered by way of correspondence by the applicant between the adjournment of the summons and the applicant’s restoration of the same. They are only set out in the skeleton in support of the application filed before the restored hearing. It was procedurally wrong and improper for the applicant to seek to ‘slip’ those applications in under the guise of restoring the adjourned discovery summons. This also amounted to a surprise application to the respondent.”

18.  Mr Kat has at this hearing (and in his skeleton) taken me to the chain of correspondences exchanged between the applicant’s solicitors and the Department of Justice for the respondents from 30 May 2010 to 20 November 2012.  Counsel submits that when all these correspondences are looked at properly, it is evident that Classes 1‑3 documents had been sought by the applicant during this period of time, and the respondents were clearly aware of that, although they refused to produce them.

19.  In particular, Mr Kat emphasises that although the wider scope and extent of the documents asked to be discovered under Classes 1‑3 were not set out in the original discovery summons, as the matter developed over the course of time, the Department of Justice well understood that they would be covered as part of the applicant’s discovery application when he sought to restore the hearing of the adjourned original discovery summons[5].

20.  After going through these correspondences, I agree with Mr Kat that it cannot be said that the discovery of Classes 1‑3 documents had not been sought in correspondence by the applicant.  I also accept that the correspondences show that the respondents were aware of the fact that the applicant would seek the discovery of those documents in restoring the hearing of the discovery summons, although the summons had not be so amended with the extended or new classes of documents included in the schedule.

21.  Notwithstanding this, in my view, at the least as a matter of good practice, the applicant should have sought to amend the discovery summons when seeking to restore it, by properly including in it all the documents he had sought to ask for production by way of correspondence. These would have avoided any confusion.

22.  On the other hand, to that extent, the court was incorrect to observe at paragraph 120 of the Judgment that those documents were not sought in the correspondence before the restoration of the discovery summons and that it was a surprise application[6].  That part of the Judgment should thus be so corrected.

23.  On this basis, I agree that the factor of a “surprise application” which amounted to procedural impropriety is not shown.

24.  For lateness, Mr Kat has accepted (rightly so) that as a matter of better practice and on reflection, the applicant should have restored the hearing of the discovery application earlier, instead of leaving it so close to the substantive hearing of the judicial review, in particular in light of the respondents’ clear and consistent stance in refusing in correspondence to disclose the documents as sought.

25.  He however also draws my attention to the fact that, notwithstanding the chasers by the applicant’s solicitors, it was also the Department of Justice’s various requests made in correspondence to ask the applicant to withhold making any applications yet, so as to enable them to obtain instructions.  One of the latest examples of such a request by the Department of Justice is as follows.

26.  Following the letter sent by the applicant’s solicitors (“B&D”) on 8 October 2012, which requested the classes of documents sought at the discovery hearing:

(1) B&D sent a “chaser” on 9 November 2012, seeking to speed up the process and reminding the Department of Justice of the impending date of the substantive hearing.  The B&D letter expressly stated that unless a reply was forthcoming, the summons would be restored;

(2) On 12 November 2012, the Department of Justice replied that the matter “was under active consideration” and asked for time;

(3) By return on the same day, B&D agreed to give some more time for a substantive reply but urged expedition and asked for a response the next day;

(4) On 13 November 2012, the Department of Justice replied and stated that the matter was still “under active consideration” and that they would “endeavour” to provide a substantive reply “within the week”;

(5) B&D wrote again on 20 November 2012 further mentioning the lack of a substantive reply from the respondents, and reiterating that: “Unless we have your substantive reply 12:00 pm tomorrow we will seek to restore the Discovery Summons without further notice, with a view to holding the hearing on the summons before the end of November 2012.”

(6) The Department of Justice sent a substantive reply later on 20 November 2012 to effectively refuse the request.  This was about 6 weeks after that latest request was made on 8 October 2012.

(7) B&D then applied to restore the discovery summons 2 days later on 23 November 2012;

(8) The hearing was then fixed in accordance with both parties’ counsel’s diaries.

27.  In light of the above matters and chronology, I accept Mr Kat’s submissions that, before restoring the discovery summons, it was not wholly unreasonable for the applicant to wait for a substantive response from the Department of Justice in October and November 2012.  I therefore further accept that, for the present purpose of considering costs, there is no clear reprehensible dereliction of duty on the part of the applicant’s legal representatives in restoring the subject discovery application.

B2.2 Merits of the application

28.  In light of my above conclusion in relation to the surprise application and lateness factors, I would be brief on this factor.

29.  Mr Kat has tried to in effect re‑run the submissions (with reference to various authorities on discovery in judicial review applications) in support of the subject discovery application to say why it was not clearly unnecessary and without merits, even though it had been dismissed.

30.  I am not going to repeat Mr Kat’ submissions herein.  Suffice for me to say that for the reasons I have set out in the Judgment at paragraph 125, I am still of the view that the application was clearly without merits.  I therefore do not accept Mr Kat’s submissions under this ground.

31.  However, I am of the view that this factor alone in the circumstances of the present case would not justify the making of the intended costs order.

C. CONCLUSION

32.  For the above reasons, I accept that (notwithstanding the demerits of the application) there are just not sufficient justifications in the circumstances of the present case to make the intended costs order in relation to the subject discovery application.  In this respect, I bear in mind the relevant principles governing the exercise of such discretion set out above.

33.  I will therefore make the following order:

(1) The applicant’s own costs in the subject discovery application be taxed in accordance with legal aid regulations.

(2) The applicant’s own costs for the present hearing be also taxed in accordance with legal aid regulations[7].