Poon Chi Yan v. Jsi Logistics (Hong Kong) Ltd
Read the full judgment text of DCEC 1769/2012 on BabelCite. This District Court judgment was delivered on 22 March 2018.
1. This is a decision on whether certain costs of the assigned solicitor and counsel in the above case should be disallowed on legal aid taxation.
Cited by 2 cases
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DCEC 1769/2012, DCEC 39/2014 & DCEC 40/2014 (Consolidated) [2018] HKDC 311 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION EMPLOYEES’ COMPENSATION CASE NOS 1769 OF 2012, 39 OF 2014 AND 40 OF 2014 --------------------------------
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--------------------------- DECISION ON COSTS --------------------------- INTRODUCTION 1.This is a decision on whether certain costs of the assigned solicitor and counsel in the above case should be disallowed on legal aid taxation. BACKGROUND 2.In my judgment in the above consolidated action which was handed down on 16 January 2018 (“the Judgment”), I made an order for the assigned solicitor and counsel in this case to show cause, within 28 days from the date thereof, as to why they consider that they should be entitled to their own portion of the legal aid taxed costs after several dates mentioned therein: (see §157 of the Judgment). 3.The last day the assigned solicitor and counsel supposed to make those representations fell on 12 February 2018. 4.Both the assigned solicitor and counsel did not make any submissions to show cause before that date. 5.Instead, on 9 February 2018, Mr Simon Lau, senior legal aid counsel, writing on behalf of the Director of Legal Aid (“DLA”) to the court, stated that they had received a letter from the assigned solicitor on 8 February 2018, informing DLA that they were sending a “mini-bundle” to them for their consideration. No request was made by either the assigned solicitor or counsel to the court for an extension of time to make their representation. However, Mr Lau stated that at the time of writing that letter they still had not received the “mini-bundle” but expected it to reach their department sometime in the following week. They anticipated that written submissions or replies on the part of DLA would be necessary. In view of that, they asked for the court’s indulgence to allow DLA to make written submissions in relation on the costs issue within 14 days from the date of that letter. 6.On 22 February 2018, by way of letter, DLA made written submissions as to its stance on the costs issue. 7.On 23 February 2018, the assigned solicitor, by referring to DLA’s letter dated 22 February 2018 to the court, wrote a letter to the courtin response to the matters raised by DLA. 8.The original intention under the Judgment was that I would fix a hearing to hear oral submissions from the assigned solicitor and counsel, together with a representative from DLA, after they make their representations. However, as the assigned solicitor and counsel did not make any representation to show cause nor had they asked for an extension of time to do so within the time stipulated under the Judgement, strictly speaking, I do not have to consider the contents of their letter dated 23 February 2018 at all. However, since they now have made such representations, albeit in response to DLA rather than addressed to the court, out of fairness to all potential affected parties, I would still take the contents of their written submissions into account when deciding on the issue. 9.Further, having read the written submissions from both the affected parties and in the interests of saving costs and time, I take the view that an oral hearing is not necessary and the matter can be dealt with on paper. DISCUSSION 10.In the letter dated 22 February 2018, DLA sets out the brief chronology relevant to the costs issue of the assigned solicitor and counsel in this case:
11.In view of the conduct of the applicant and the findings made by the court, DLA submits that the applicant had acted improperly in bringing the present proceedings and in the conduct of these proceedings. DLA asks the court to consider exercising its discretion under section 17(3) of the Legal Aid Ordinance, Cap 91 (“the LAO”) and order the applicant to pay all the costs and disbursements of DLA, the assigned legal teams as well as those costs and disbursements incurred by the respondent. 12.Sections 17(3) of the LAO provides as follows:
13.In the letter dated 23 February 2018, the assigned solicitor and counsel, by relying on §§62/8/1 & 62/8D/1 of the Hong Kong Civil Procedure 2018(“HKCP 2018”) (which they had mistakenly cited as “Hong Kong Criminal Procedure 2018”), submit that “the strength and weakness of a case can be more easily seen after cross-examination on Court (sic), but it may not be too obvious before trial.” They invited the court to give them “the benefit of doubt and not to impose further wasted costs order.” Ruling on costs Section 17(3) not appropriate sanction 14.DLA submits that the court has wide power under the Rules of the District Court (“RDC”), practice directions (“PD”) as well as under section 17 of the LAO to rule on costs matters in a legal aided case. DLA submits that section 17 of LAO should be invoked in this case and the costs incurred in this action should be paid by the applicant instead of by the legal aid fund. Given the conduct of the applicant and the findings made by the court in the Judgment, DLA takes the view that the applicant had acted improperly in bringing the legal proceedings and they submit that this is an appropriate case, where in the taxpayers’ interest, all the costs should be paid by the applicant and the legal aid fund. 15.With respect, while I recognize that the court has a wide discretion on matters in relation to costs, I do not agree with DLA’s submissions that the aided person should be ordered to pay costs in this case. 16.First, as it is clear from the Judgment, in my view, the reasons that the applicant’s 3 actions could go as far as to trial lies not so much in the misrepresentations he made to the DLA when he first obtained the legal aid certificate, but in the failure of the monitoring system both on the part of the legal aid counsel in charge of the case and the assigned solicitor and counsel, in particular the latter: (see §124 and §§147-155 of the Judgment). 17.Second, the applicant is a man of straw. He has been unemployed ever since the 3rd Accident and only works as a temporary actor in minor roles whenever such work becomes available. He has no regular income. He lives in a public housing estate with his family. He has no means to satisfy any of the costs of the parties. Thus, any costs order made against the applicant will almost certainly be an “empty” one. 18.Third, if the court were to order the applicant to pay costs of DLA and/or the costs of the assigned solicitor and counsel and/or the other party as specified under s 17 of LAO, it would be most unfair to the respondent or its insurer as they will be deprived of the fruits of their litigation. I am not prepared to do that. 19.Fourth, in any event, if the court were thinking of making any costs order (or in fact any order) which may affect the position of the respondent, under the principles of natural justice, they would have a right to be heard and make representations to the court before any adverse order can be made against them. This is a fundamental right of any party affected by a judgment or decision of the court. It is so trite that I need not cite any authority to support such well known principles. However, if one is required, the leading case of Ridge v Baldwin [1964] AC 40 immediately comes to mind. 20.As I was not thinking of making any orders of such kind in the Judgment, I did not invite the respondent to make any submissions. And I do not see any reason why I should so in this case as I consider that the fault really lies mainly with the assigned solicitor and counsel’s failure to inform and advise DLA of the merits of the case in the light of the changing state of the evidence. As confirmed by Mr Simon Law, the senior legal aid counsel in charge of the 3 assigned cases, this is a continuous duty owed by any assigned solicitor or counsel under regulation 21 of the Legal Aid Regulations, Cap 91A (“LAR”). In fact, reg 21(1)(a) of LAR imposes a positive duty on the assigned solicitor or counsel to report to DLA forthwith of such matters when the aided person “required his case to be conducted unreasonably so as to incur unjustifiable expense or has required unreasonably that the case be continued; ….”. If they are uncertain whether they should continue to act for the aided person, the regulation requires them to report the circumstances to DLA anyway: (see reg 21(2)). 21.In fact, I have been informed by Mr Lau that DLA’s “Guidance Notes to Solicitors/Counsel Handling Civil Cases” contain references to such a duty. Hence, in my view, there was no excuse for the assigned solicitor and counsel in this case for not to report the matters in light of the changing evidence to DLA. 22.In my judgment, the assigned solicitor and counsel had failed to do so despite of the numerous “alarm bells” which should have been ringing loudly and clearly as I had mentioned in the Judgment. 23.In the aforesaid circumstances, I do not consider that I should make an order to make the applicant to pay for the costs in this case under s 17 of LAO as the only party which will suffer if such an order is made will be the respondent. §§ 62/8/1, 62/8D/1 & 62/8A/4 of Hong Kong Civil Procedure 2018 24.The assigned solicitor in his letter to the court dated 23 February 2018 (which was written on behalf of himself and the assigned counsel), cited the following passages which could be found in § 62/8/1 on p 1237 of the HKCP 2018:
25.The above duty extended to counsel as a result of the Civil Justice Reform: see § 62/8D/1 of HKCP 2018. The assigned solicitor cited the following passage from the Final Report of the ‘Working Party on Civil Justice Reform’ which explained the rationale behind the extension of such duty to counsel:
26.Lastly, by relying on § 62/8A/4 of the HKCP 2018, they submit that a “wasted order” should not be made against them as they considered that the strength and weakness of a case more easily been seen after cross-examination in court and may not be too obvious before trial. 27.I have considered these passages in the HKCP 2018 which the assigned solicitor has drawn my attention to. I am familiar with those principles. They contained nothing new. And, in any event, I am not making a “wasted costs” order against them. 28.With respect, in my judgment, what the assigned solicitor and counsel had done or failed to do have gone way beyond “a mere mistake or error or judgment” but represents repeated failures or deliberate turning of a blind eye to the blindingly obvious state of the evidence which showed that they could no longer able to support the pleaded case as I had mentioned in various places in the Judgment. I find that there are gross neglects on their part and they had failed to fulfill their “duty to the court and to realise his duty to aid in promoting his own sphere the cause of justice.”: (Myers v Elman [1940], AC 282; KB Chau & Co (a firm) v China Finance Trust & Investment Corp & Another [1995] 2 HKLR 567, CA). 29.Further, unlike a private case where the clients are free to reject their lawyers’ advice and insist that cases be litigated, we are dealing with a legal aided case here where public funds are used to fight on behalf of the applicant. As assigned solicitor and counsel, not only they owed the court a duty to aid in the administration of justice, they also owed a positive and continuous duty to report to DLA if they have any reason to believe that the aided person has unreasonably insisted that the case be continued. 30.In my view, the assigned solicitor and counsel should have reported the matter to DLA once the liability experts have agreed in the joint expert report that the 1st Accident could not have happened in the way as described by the applicant. Had they done so, I am sure that there would be a very high chance that DLA would consider discharging the applicant’s legal aid certificate. For the 2nd and 3rd Accidents, I am of the view that the assigned solicitor and counsel should have reported to DLA after the discovery of CCTV videos and after having the opportunity to study them that there were great discrepancies between the applicant’s allegations and the actual evidence. Had they done so, I am sure that DLA would have discharged the applicant’s certificates in respect of those 2 actions also. CONCLUSION 31.Based on the analysis of the evidence contained in the Judgment, I am of the view that, in regard to the 1st Accident, the assigned solicitor and counsel should have realized that the applicant’s case had become unarguable after the receipt of the joint liability expert report in November 2016. In regard to the 2nd and 3rd Accidents, I am of the view that it must have become obvious to the assigned solicitor and counsel that, after the discovery of the CCTV records in August 2014, the applicant could not have been telling the truth about those 2 accidents. Regrettably, both the assigned solicitor and counsel did not take the initiative to report the matter to DLA so as to let him decide whether to discharge the legal aid certificate of the applicant or not. Such conduct in my view amounts to a serious dereliction of their duties as assigned lawyers. This has led to a great deal of legal costs being incurred and wasted by the legal aid fund. 32.In the circumstances, I consider that it is only fair that they should not be allowed to recover their own costs for the following periods:
33.I so make the above orders insofar as the assigned solicitors and counsel costs are concerned. The rest of my order on costs contained in §158 of the judgement will stand. 34.I make no order as to costs in respect of this paper application.
Written submissions received from Mr Simon Lau, senior legal aid counsel, for and on behalf of the Director of Legal Aid on 22 February 2018 Written submissions received from Mr Anthony Leung of Leung & Associates for and on behalf of the assigned solicitor and counsel on 23 February 2018 | |||||||||||||||||||||||||||||||||||||||||
Other judgments that cite this case
Further hearings and rulings under DCEC 1769/2012