TIN WAN TUNG v. WONG SEE YIN AND OTHERS

HCA 167/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

HIGH COURT ACTION NO 167 OF 2011

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HCA 1801/2010

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

HIGH COURT ACTION NO 1801 OF 2010

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(Consolidated by Order of Master S Kwang dated the 4^th day of December 2013)

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D E C I S I O N

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1.  On 29 January 2016, this Court refused the tax review applications brought by the defendants in relation to taxation of plaintiff’s Bills of Costs in HCA167/2011 and HCA1801/2010. This Court also made an order nisi that the defendants shall pay the plaintiff the cost of the taxation review applications for the two bills, the same to be taxed if not agreed.

2.  On the 4 February 2016, the plaintiff’s solicitors wrote to court and sought for summary taxation of their cost for the taxation review.

3.  They submitted that in view of the past history of these proceedings and the way that the defendants have conducted themselves in the taxation proceedings and the taxation review hearings, they now apply to vary the costs order nisi to one for their costs to be summarily assessed with a view to obviate yet another hearing and drawn out taxation process.

4.  They said one of the objectives of Civil Justice Reform is to afford the successful party more expeditious recovery of costs by using summary assessment of costs when possible in interlocutory proceedings in lieu of the conventional order for costs to be taxed.

5.  He referred this Court to the White Book paragraph 62/9A/1, Recommendation 88 of the Working Party on Civil Justice Reform which provides that:

“ ‘The court should, whenever appropriate (whether as a response to an unwarranted application or unwarranted resistance to an application, with a view to saving costs or otherwise), make a summary assessment of costs when disposing of interlocutory applications.’ (Emphasis added)”

HCA 167/2011

6.  In relation to the costs order in HCA167/2011, it was said by the plaintiff’s solicitors that as the plaintiff in that case was legally aided, the plaintiff’s solicitors undertake that their firm would waive any claim for the common fund costs difference from their aided client in respect of the costs of the taxation review.

7.  They submitted that similar orders for summary assessment of costs have been granted by Master K.H. Hui (on 24 July 2015) and Master Chow (on 19 August 2015) upon their undertaking to waive their claim for common fund costs difference against their aided client.

HCA 1801/2010

8.  The plaintiff’s solicitors said that the plaintiff in HCA1801/2010, plaintiff is not legally aided.

9.  In support of this application, plaintiff’s solicitors submitted statement of costs for the two actions’ at $115, 395.50 and $99727.50 respectively.

10.  Subsequent to such application, this Court directed that the application be dealt with on paper and that the defendants shall lodge and serve their submission in reply.

11.  The 1^st defendant acted in person.

12.  He also represented the 2^nd and the 3^rd defendants.

13.  On behalf of the defendants, he objected to the application for variation of the costs order nisi.

14.  He submitted that he had substantial grounds for disputing the Costs of the taxation review claimed by the plaintiffs that cannot be dealt with summarily pursuant to Order 62 rule 9 C(1)(a) of the Rules of High Court.

15.  He criticized the costs claimed by the plaintiff in the statement of costs highly exaggerated and that plaintiff was claiming work done in taxation review when the same work had already been charged by them earlier when the defendants raised similar objections in taxation of bills.

16.  Further he said he disagreed with the decision of this Court on taxation review because it infringed Competition Ordinance when a fixed scale hourly rate was applied during the taxation proceedings and the taxation review hearing.

17.  He said in view of the substantial dispute to the statement of costs, summary assessment is inappropriate.

18.  Mr Wong for the defendants submitted further that he had applied for stay of execution of the costs orders made by the Court and had also lodged appeal against the said costs orders. He said these appeals bear a real prospect of success. 

19.  He said also that according to paragraph 62/9D/1 of the Hong Kong Civil Procedure, taxation of costs shall not take place until the conclusion of the action.

20.  He also said if there was summary assessment of costs, and the defendants paid the costs assessed, then in the event the appeal is successful and the costs order reversed on appeal, it would be difficult for the defendant to recover costs from the plaintiff as the plaintiff in HCA167/2011 is a Comprehensive Social Security Assistance Scheme recipient and plaintiff in HCA1801/2010 is a company with a small share capital.

21.  Mr Wong said if costs are summarily assessed, their right to appeal is affected adversely because the plaintiff threatened to take immediate legal action to enforce the costs order when the appeal is pending.

22.  He said plaintiff is not prejudiced if there is taxation of costs because they will be adequately compensated by interests for the waiting time in between.

23.  He said if he is successful in the pending appeal, then the costs incurred in summary assessment will be wasted.

24.  He submitted further that the costs in question are more than $200,000, and therefore should not normally be summarily assessed.

25.  He said by allowing the costs to be taxed if not agreed, parties can have more time to negotiate.

DECISION

26.  The concern of the plaintiff, having regard to the past conduct of the defendants in taxation hearings and taxation review hearings, that further time and substantial costs would be incurred if the costs of the taxation review hearing awarded in their favour are to be taxed as opposed to being summarily assessed is warranted.

27.  On the other hand, it is clear that the defendants would wish to be heard fully their dispute on the costs claimed by the plaintiff as disclosed in the statement of costs for the two actions previously lodged, both as to the necessity and quantum of these items.

28.  This Court does not agree that the pending appeal or the pending stay of execution application or eagerness of the plaintiff to enforce the costs order or argument that fixed scale charge adopted in the taxation proceedings are in breach of competition laws in Hong Kong, are good grounds for objecting to summary assessment of the costs as suggested by the plaintiff.

29.  It is a fact however that the taxation review hearings took four days.  The total costs claimed are $200,000 odd.

30.  Here, the defendants evince their intention to dispute substantially the basis and the quantum of the costs items in the respective statement of costs.  Having regard to the circumstances of this case, it is, in my view, not appropriate to have the costs of the taxation review hearing summarily assessed. This Court therefore refuses the application to vary the costs order nisi and would make the costs order nisi absolute.