Winston & Strawn (A Firm) v. Tai Ding Century Ltd and Another

HCA 2402/2015

[2018] HKCFI 2506

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2402 OF 2015

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Before: Deputy High Court Judge Sherrington in Chambers

Date of Hearing: 18 October 2018

Date of Judgment: 21 November 2018

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JUDGMENT

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Procedural background

1.This is the defendants’ appeal from the order of Master J Wong dated 27 February 2018, dismissing the defendants’ summons issued on 7 February 2018 with costs.  As such it was common ground that this was the de novo hearing of the defendants’ summons.

2.By the summons the defendants seek the following relief:

(a) relief from the sanction imposed by paragraph 3 of the order made by Registrar Ho dated 11 May 2017 (the “Unless Order”);

(b) an order for taxation of six of the plaintiff’s bills under section 67 of the Legal Practitioners Ordinances (Cap 159); and  

(c) an order under Order 18, rule 19 of the Rules of the High Court (Cap 4A) (“RHC”) and/or the inherent jurisdiction of the court to strike out the claim against D2.

3.The defendants in their summons also invite the court to determine a question of law under Order 14A RHC which appears to substantially overlap with the striking out application but in the event the defendants did not pursue this head.

4.The trial of these proceedings has been fixed to be heard on 14 – 22 March 2019 with seven days reserved.

5.In summary this case involves a dispute over the invoices raised by the plaintiff in acting for the defendants.  The plaintiff was previously engaged as the law firm acting for D1 and D2 in a number of legal proceedings.  The defendants have failed to pay a total of 16 invoices which amount to HK$10,010,590.80 inclusive of the plaintiff’s fees, counsel’s fees as well as other third party fees.  The plaintiff thereforeclaims against the defendants for the outstanding sum together with interest.   

6.During the course of the hearing the parties reached a measure of agreement in relation to the liability of D1 and I gave final judgement in respect of those bills which it was agreed were now undisputed and in respect of the six which remain in dispute (namely invoice numbered: 2399559, 2407258, 2414429, 2414430, 2421736, and 2448263) ordered their taxation provided that D1 make an interim payment to the plaintiff of 50% of their value within 28 days. On this basis, I ordered the action against D1 be stayed until taxation or further order of the court. I reserved the cost issue for trial.

7.The hearing then proceeded with regard to the position of D2; the plaintiff’s allegation is that she is jointly and severally liable for the accounts in question.  D2 on the other hand seek by their summons to strike out this claim but in order to do so need first to seek relief from the terms of the Unless Order.

The defendants’ application for relief from the Unless Order

8.The relevant paragraph of the Unless Order is paragraph 3 which reads as follows:

“ As the first and second defendants have repeatedly failed to take steps to proceed with the matter it is ordered that unless by 4pm on 1 June 2017 the first and second defendants do takeout all such interlocutory application(s), as may be advised, the first and second defendants be debarred from taking out any interlocutory application(s);”

9.D2’s case is that it should be given relief to bring the applications in the summons because of the incompetence, and indeed gross negligence, of their former solicitors.  Mr Chan’s skeleton argumentsummarized the position by saying that the defendants were never properly advised on, or informed of, procedural requirements in respect of these proceedings, the progress of this action, or any deadlines for taking steps herein.  As a result the defendants had missed a number of deadlines set bythe Court and time extensions had to be sought with cost consequences and the procedural history of this case has put the defendants in a bad light.

10.He also submits that this led to the making of the Unless Orderby Master Ho.He goes further and submits that the defendants were never even advised by their solicitors, and therefore had no knowledge of the Unless Order until after they changed solicitors in December 2017, more than 6 months after the Unless Order was made.  Mr Chan points out that subsequent to the Unless Order being made the defendants’ solicitors madean ill-founded application for Further and Better Particulars of the Statement of Claim and Amended Reply by summons issued on 12 July 2017 which eventually failed and is the subject of Registrar Lung’s decision of 31 August2017 in Winston & Strawn v Hansen International Limited HCA 2402/2015 (31 August 2017).  Mr Chan continues that because of the poor handling of the matter by the defendants’ former solicitors there were other adverse judgments and decisions against them in relation to the other court cases relating to a JV dispute.

11.Mr Chan also submitted with reference to the application for taxation which is no longer an issue, that the plaintiff’s last bill was issued on 28 July 2015 and that since all of the bills were part of the same set of instructions the 12-month period for taxation without the need to show special circumstances under section 67(2) of the Legal Practitioners Ordinance did not expire until 28 July 2016 and furthermore that the defendants were wrongly advised by their solicitors in Mr Chung’s email (dated 14 June 2016) that there was no deadline to proceed for taxation of the plaintiff’s bills and the defendants could go for taxation without the plaintiff’s consent.

12.Even were I to accept Mr Chan’s argument that the time to make an application had not expired by 14 June 2016, I found this argument unconvincing, focusing as it does on the deadline for filing for taxation, not least because there was no evidence before the court that had the advice been to the effect that the deadline was fast approaching an application to tax the bills would have been filed.  Instead I am asked to infer as much when the evidence there is suggests that the defendants had continually failed to avail themselves of the right to tax the plaintiff’s bills, having beenadvised of their entitlement to do so as early as 14 April 2015 in the plaintiff’s letter to the defendants demanding payment of the unpaid invoices.

13.Mr Chan’s application for relief from the terms of the Unless Order relied on the nine factors the court is required to consider under Order 2, rule 5(1) RHC.  There was no dispute that these were the appropriate factors to consider.  In particular Mr Chan addressed the court in his skeleton on whether the failure to comply was intentional, whether there was a good explanation for the failure to comply, whether the failure to comply was caused by the party in default or his legal representatives, and the effect which the granting of relief would have on each party.

14.Mr Chan’s submission was that Order 2, rule 5(f) expressly distinguishes between noncompliance by the party himself and that by his legal representative and he relied on Top One International (China) Property Group Co Ltd v Top One Property Group Ltd [2011] 1 HKLRD 606 where Fok J (as he then was) had this to say at §34(c):

“ Non-compliance is contumelious where it is the result of a litigant’s conscious and deliberate decision to ignore or disobey the court’s order in the absence of any extraneous excuse. Such deliberate conduct may be contrasted, for instance, with cases where the litigant has made a serious effort to comply in good faith but has been unsuccessful through bad luck or incompetence or with cases where the litigant has not complied because of circumstances outside his control (including cases where his solicitor has negligently or otherwise missed the deadline through no fault of the litigant).”

15.Similarly he submitted that in An Zhou & Ors v Zhou Zheng Kuan HCA 241/2010 (30 August 2012) To J said at §27:

“ … Basically, the court considers the reasons for the default, explanation for the delay in applying for relief, whether there was a history of default, whether the sanction is out of line with the consequence of the breach and whether the breach wasintentional and contumelious: see Top One International (China)Property Group Co Ltd vTop One Property Group Ltd [2011] 1HKLRD 606 at 616. Usually the court would have considered the appropriateness of the sanction at the time of making of the unless order. However, circumstances may change. The extent of the breach as it turned out may not be as serious as anticipated and there may be mitigating circumstances. Worth noting is that Order 2, rule 5(f) expressly distinguishes between default caused by the litigant and that caused by his legal representative. The court is inclined to grant relief to a litigant if he has no deliberate feet dragging and the default was caused by his legal representative.”

16.Mr Chan submitted that this passage has been cited with approval in a number of Hong Kong cases including by Deputy High Court Judge Sakhrani in Far East Sourcing Ltd v Man Bond International Ltd HCA 1463/2012 (29 April 2015) at §51.

17.Mr Chan's assertion, and I use the word advisedly, since there was a lack of direct evidence to this effect, was that the defendants’ lack of familiarity with the litigation procedures was such that they were completely misled by their former solicitors even to the extent that they were not made aware of the existence of the May 2017 Unless Order.

18.Indeed Mr Chan went further and said that the former solicitorswere even negligent in failing to inform D2 of a contempt hearing at which she was held in contempt by Chow J.  I will come back to this when I address the plaintiff’s submissions on this point.

19.In any event Mr Chan submitted that the order sought by the summons would have the effect of reducing the scope of the disputes at trial and so was in line with the underlining objectives of the CJR; accordingly the defendants should be granted the relief sought to bring the strike out application.

20.A considerable amount of time was spent on the issue of whether the plaintiff’s bills could be referred for taxation.  For the most part these submissions are irrelevant given the terms of the order I have made in relation to the bills in question.  The plaintiff however submits that the conduct of the defendants in relation to the taxation issue is relevant in the context of the discretion I have to order relief from the Unless Order and I will come to this in due course, noting the relevant submissions of both parties.

The 2^nd defendant’s application to strike out the claim

21.This limb of the application is concerned with who is the plaintiff’s client.  Paragraph 27 of the statement of claim reads as follows:

“ Notwithstanding that the invoices were addressed and sent to First Defendant, which it understood by all parties that the Firstand Second Defendants were jointly and severally liable for the settlement of the Invoices.”

22.The essence of Mr Chan’s submission was that separate and distinct retainers were made respectively with D1 and D2 as evidenced by there being two separate and distinctive engagement agreements dated 25 August 2014: one addressed to D1 covering the JV dispute and the other addressed to D2 covering the libel claims.

23.Mr Chan submitted that either there was a contract with D2 orthere was not and failing evidence of that he alleged that the understanding pleaded in paragraph 27 had no foundation in law.

24.Furthermore he submitted that there was insufficient in terms of the pleading of this alleged understanding, including in the particulars supplied in response to the request for Further and Better Particulars of the understanding, to meet the criteria of an adequate pleading.  Mr Chan referred the court to the well-known provisions on pleadings summarized atpara 18/7 of Hong Kong Civil Procedure (“HKCP”), namely that they mustcontain a statement in summary form of the material facts on which a party relies for his claim or defence but that neither law nor evidence need to be pleaded.  Mr Chan relied in particular on the statement at §3 of para 18/7/5:

“ Whenever any contract or any relation between any persons is tobe implied from a series of letters or conversations, or otherwisefrom a number of circumstances, the proper practice is to allegesuch contract or relation as a fact, and it is only necessary to set out the letters, conversations or circumstances generally and not in detail.”

25.He also relied on the need where an agreement is alleged for the pleading to state the date of the alleged agreement and certain other material details (para 18/12/3 HKCP).  Mr Chan referred me in support ofhis submission to the judgment of Ribeiro PJ in Sinoearn International Ltd v Hyundai–CCECC Joint Venture (2013) 16 HKCFAR 632 at §§27 – 34:

“ … A party must raise all the issues he wishes to raise to be dealt with at the trial. Parties are not entitled to have issues recently thought up dealt with separately and piecemeal. The other party is entitled to know from a clear pleading what is the entire case he has to meet so that he can decide whether particulars should be sought; how he should plead in response; what discovery he is entitled to; what evidence he should adduce to meet it; and what points of law should be taken. …

…

… How could one expect the other side to dispute, or to come ready with evidence to refute, a point that has not been pleaded or even formulated in draft?

Pleadings are not mere formalities.  They impose a necessary discipline and are fundamental to enabling every procedural facet of the adversarial system to operate fairly.”

He also referred the Court to the judgement of Ma CJ in Kwok Chin Wing v 21 Holdings Ltd (2013) 16 HKCFAR 663 at §22:

“ In the present case, much reliance was placed on the Plaintiff’s testimony given in cross-examination to evidence the assertion made before us to the effect that the Rockapetta Group companies accepted a joint and several liability in respectof the Plaintiff’s loans. It is simply not permissible for an issue to be raised in this way: one does not sift through the evidence adduced in a trial in the hope that something was said that can conceivably found a cause of action. Issues, I would reiterate,must be properly pleaded unless for some reason the pleadingshave assumed a less significant role in the proceedings. I would perhaps also observe here that in any event the said passage from the Plaintiff’s testimony at best indicates only a subjective intention on his part. This is not admissible to establish the terms (or even the existence) of an agreement.”

26.Mr Chan’s submission was that the limited pleading in paragraph 27 was insufficient to make D2 personally liable for the plaintiff’s fees.  The fact that D2 was at all material times the sole director of D1 made it natural that she should give instructions on their behalf, but the law was clear that D1 was a separate legal entity.

27.In further support of his argument Mr Chan referred the courtto clause 1 of D1’s engagement letter which provided that D1 would be the plaintiff’s client and also to clause 7 under the heading “Identity of Client” which provided that the plaintiff’s client would be D1 “and not any affiliates of D1.”

28.The fact that in three sets of proceedings, D2 was named personally as the defendant was irrelevant to any consideration of this issuesince in those proceedings Mr Chan’s submission was that she was sued inher capacity as a director of the joint venture company and/or in her capacity as its legal representative.  Mr Chan’s submitted that if the legal expenses for these proceedings were to be borne by D2 personally then the plaintiff would have required her to sign a separate engagement letter which it did not.  

29.Mr Chan’s submission is that the fact that all of the relevant invoices which the plaintiff contends are the joint and several responsibility of D2 were all sent to D1 alone supporting his submission that D2 has no liability for those invoices.

30.Mr Chan also submitted that section 66 of the Legal Practitioners Ordinance (Cap 159) provides that “no action shall be brought to recover any costs due to a solicitor until 1 month after a bill thereof has been delivered” and that the solicitor’s bills “must be delivered to the party to be charged therewith, either personally or by being sent to him … at his place of business, dwelling house ….”

31.The only two invoices (Nos 2414244 and 2415143) issued by the plaintiff in relation to the libel claim for which D2 was liable, were so addressed to her personally and delivered to her home address and both had been settled in full.  All the other invoices were addressed to D1 and sent to its registered office only as is conceded in paragraph 27 of the statement of claim.  His submission was therefore that no bill in respect of alleged costs which the plaintiff sought to recover from D2 in this matter had been delivered to D2 one month before the commencement of the present action so that any action failed for non-compliance with section 66 of the Legal Practitioners Ordinance. Accordingly it was his submission that the action should be dismissed.

32.In conclusion therefore it was Mr Chan's submission that:

(a) the action against D2 does not lie because of failure to comply with section 66 of the Legal Practitioners Ordinance; and

(b) in any event there is no legal basis at all for a claim against D2 and accordingly the claim should be struck out.

33.Mr Chan submitted that it would be wrong of this court not toconsider the merits of the striking out application as part of its consideration of whether to exercise its discretion to grant the relief sought from the Unless Order since if I was minded to strike out the claim it would be in the interests of justice to do so now and save the time and costs of the subsequent trial.

The plaintiff’s response

34.Mr Mok submitted that the present application in so far as it sought taxation of a number of disputed invoices continued to represent delaying tactics by the defendants who have consistently failed to deal promptly with the plaintiff’s invoices by referring them to taxation notwithstanding their clear liability to pay for the services the plaintiff hadprovided.  Whilst it might appear constructive that they were now seekingtaxation in the present summons, it was important to recognize that explicit in their application was a request to stay these proceedings which are listed for trial in March 2019 which would mean yet further delay to the final settlement of this dispute.

35.The fact that the invoices were rendered nearly four years agospeaks for itself.  The plaintiff has not only not been paid, but has actuallybeen out of pocket because of the disbursement it has funded in the meanwhile. There had in Mr Mok’s submission been a conscious decision on the part of the plaintiff not to go to taxation and the conduct of the defendants and their solicitors throughout including in relation to what Mr Mok termed “this eleventh hour application” to seek relief from the Unless Order, made some nine months earlier, militated against this court providing relief.

36.Mr Mok pointed out first that the Unless Order was imposed after the Acting Registrar noted that “the first and second defendants have repeatedly failed to take steps to proceed with the matter”; and secondly, that in Winston & Strawn v Hansen International Limited (unreported, HCA 2402/2015, 31 August 2017) Registrar Lung also marked the court’s disapproval of the defendants’ misconceived application for further and better particulars and of paragraph 11 of the decision, observing that to “require the other party to comply with the way of the requests as framed, knowing such consequences verges upon playing games in the legal proceedings.”

37.The rationale for an Unless Order of this nature was in Mr Mok’s submission clearly explained by Registrar Lung in the present case.  See Winston & Strawn (supra) at §16:

“ At the stage of Case Management Conference, the parties should have obtained counsel’s advice on evidence and the general preparation for the trial.There is simply no reason to allow any party to reserve the position of making further interlocutoryapplications without telling the court what they are. The courtwill therefore impose a deadline, within which all interlocutory applications must be taken out. This order must be obeyed by the respective parties. However, the court always has the discretion to vary its order if there are special or exceptional circumstances not envisaged at the time of the making of the unless order. It will be for the applicant who takes out the application for leave to take out further interlocutory applicationdespite the unless order to convince the court that leave should be given.”

38.In approaching the application for relief whilst there was, as I have said, no dispute between the parties that the court ought to take into account the non-exhaustive factors under Order 2, rule 5 RHC, Mr Mok referred me to the judgment of DHCJ Le Pichon in Miranda Gems (HK) Ltd v Jose Miranda da Costa Junior & ors [2014] 6 HKC 582 at §24 where the learned judge said:

“ Whether relief should be granted in any particular case involvesa balancing exercise, weighing up the relevant factors that arise and their relative strengths.”

39.As I have sought to summarize the defendants seek to lay the blame entirely at the feet of their former solicitors. Mr Mok submitted that this is simply unconvincing if not incredible.  He referred the court to the only chain of correspondence with the solicitors exhibited by the defendants and pointed to the fact that the handling partner of the defendants’ former solicitors actually advised three times that the defendants should go for taxation:

(a) “ In the meantime, we will prepare a draft letter to W&S asking fortaxation of the legal costs instead of going through this litigation.  Will let you have the draft tomorrow”
               (13 June 2016 9:01 am) [III/484]

(b) “ We now attach for your consideration a draft letter to W&S.  The point is: you know that you have to pay; you just disagree with the amount payable; so why bother to go for litigation on liability; let’s just deal with the quantum by asking the court to tax (i.e. to assess) the amount payable”
               (14 June 2016 8:19 am) [III/483]

(c) “ So the ideal situation will be: they agree to proceed with taxation and withdraw the current litigation case”
               (14 June 2016 8:32 pm) [III/482]

40.On this basis Mr Mok submits that it is irrelevant that the defendants were told that there was no deadline to seek taxation.  Instead they were advised to go for taxation which is apparently consistent with the current advice being given to the defendants; hence one of the heads of the present summons.  Thus in his submission regardless of the deadline it was the defendants who made a deliberate and conscious decision not tofollow their former solicitors’ advice.  Indeed he submitted that in placingso much weight on whether there was any deadline to taxation it seemed to suggest that the defendants in fact deliberately decided to delay matters such that they would only go for taxation at the last minute.

41.In any event so far as the right to taxation is concerned Mr Mok pointed out that the defendants were as he put it “indisputedly advised”, of its existence as early as 2015 by letters dated 14 April and 9 July in which the plaintiff’s highlighted that the defendants if they had issues with the invoices “are entitled to apply for taxation of the same”.  They were then by email dated 14 June 2016 from their solicitors, as mentioned above, advised of the right of taxation and indeed were recommended to take this step.

42.Mr Mok submitted that the general attempt to shift all blame to the former solicitors was wholly unconvincing given that the defendants were involved in at least seven sets of High Court actions and so could not be said to be unfamiliar with the court and its processes.

43.In Mr Mok’s submission D2’s evidence that she did not even know of the contempt order made against her and the penalty of HK$500,000 was clearly unbelievable.  I have considerable sympathy with that view given that Chow J in his decision was “satisfied beyond reasonable doubt th[at] [the 2^nd defendant] deliberately, intentionally and voluntarily…acted in breach of the Undertaking and committed a contemptof court.”  High Fashion New Media Corp Ltd v Leong Ma Li (unreported, HCMP 108/2016, 8 August 2017) at §46.

44.Indeed there is no suggestion of any successful appeal or attempt to reverse the learned judge’s decision having been made.  Faced with Chow J’s ruling I find myself bound to approach the evidence and assertions of D2 with the serious circumspection Mr Mok submits is appropriate.

45.Mr Mok’s submission in relation to the strike out application was that while there is no express retainer between the plaintiff and D2 in respect of the Joint Venture disputes, this does not preclude the existence of an implied retainer, given rise to joint and several liability.  He referred me to the well-established principles with regard to implied retainers in HKSAR v Wong Chi Wai (2013) 16 HKCFAR 539 §§39 – 44 where Ribeiro PJ pointed out that the solicitor and client relationship may arise by implication depending on the objective facts as opposed to the subjective understanding of the parties, and more pertinently given the background facts to RP Howard v Woodman Matthews & Co [1983] BCLC 117 where an implied retainer was found to arise in favour of a shareholder where the solicitor acted for the company in circumstances where the solicitor knew that the shareholder, apart from matters such as tax and claims of creditors, was effectively the company.

46.I find therefore that it remains an open question to be decidedat trial whether D2 is jointly and severally liable.  Mr Mok urged upon me the objective circumstances indicating that an implied joint and several retainer arose between the plaintiff on the one hand and D1 and D2 on the other by virtue of the following facts:

(a) Out of the seven proceedings which form the JV Disputes, D2 is a defendant in three of them.  Further, the same facts give rise to the seven proceedings, and D1 and D2’s interest are aligned in relation to them.  P’s work in relation to the JV Disputes goes towards not only D1’s interests, but also D2’s, and D2 was clearly aware of this.  The fact that it was the intention of P and Ds to defend the litigation together and that it was in their common interest to do so is a relevant factorestablishing joint and several liability: Eric Edward Hotung v Ho Yuen Ki HCA 571/2003 (27 November 2008) per DHCJ Mayo at §35.

(b) Instructions to P for the JV Disputes were given by D2, and D2 had communicated with P with regards to the settlement of the invoices pertaining to those disputes.

(c) D2 was indirectly the sole shareholder of D1, as well as the sole director of D1, to the knowledge of P.

The court’s decision

47.Even seeking to give the defendants the benefit of the doubt when considering whether to grant them the relief they seek, I find that against the background of the protracted delay in dealing appropriately with the plaintiff’s invoices over a period extending out nearly four years I cannot accept the argument that any delay or failing on the part of the defendants is down solely to their former solicitors when there is no evidence before the court to suggest this is the case other than mere assertion on behalf of D2 and her counsel.  The allegations made against the former solicitors are so serious that at the very least I would have expected to see a letter of complaint to the solicitor’s firm and their response. The only evidence before the Court of correspondence with the solicitors points, as Mr Mok has submitted, in the opposite direction, namely of pragmatic advice being given and a timely response being provided to a chaser from D2’s husband after only two days.

48.The Statement of Claim was filed on 16 October 2015 has been the subject of a request for further and better particulars and even after the new legal team took over in December 2017 there has been no prior attempt to seek to strike out this claim.

49.I am influenced too in reaching my decision by the conduct of the proceedings even since the change of solicitors.  Whilst I make no criticism of the firm in question, it is as Mr Mok points out, striking how no relief was sought from the Unless Order for the purposes of the proposed directions sought in the Listing Questionnaire filed by the defendants on 15 January 2018 and striking too how there was nothing in that application about a strike out application.

50.When considering the grant of relief I cannot disregard the way the parties have conducted themselves in the litigation to date and so taking account of the present attitude of the defendants I refuse to grant the relief sought in relation to the Unless Order.

51.I turn them to the strike out application although it is not strictly necessary for me to decide this given my finding above.  In doing so I seek also to address the defendants’ submission based on section 66 of the Legal Practitioners Ordinance which provides that “no action shall be brought to recover any costs due to a solicitor until 1 monthafter a bill thereof has been delivered” and that the solicitor’s bills “must bedelivered to the party to be charged therewith, either personally or by being sent to him … at his place of business, dwelling house ….”  Mr Chan submits that the bills were never delivered to D2 and so no action can be brought upon them.

52.At first blush this seems a compelling, if perhaps an unattractive, stance to adopt on the facts of this case but as Cheung J (as he then was) said in Weir & Associates (a firm) v Mowbray-D’Arbela [2005] 3 HKC 341 at §24:

“ … in case I am wrong and there has been non-compliance withthe requirement under s 66(2), that is not the end of the matter.”

The learned judge cited with approval the following remarks of Lord Nolan of the Privy Council in Zuliani v Veira [1994] 1 WLR 1149 as follows:

“ But it by no means follows that an action brought on a bill which fails to satisfy one or more of the statutory requirementsor which contains erroneous items must necessarily be dismissedwithout consideration of the merits. It has long been established that a court, confronted with a defective bill, is entitled to look into all the circumstances of the case and in appropriate cases toallow the solicitor to withdraw the bill and to deliver a fresh one”.

53.In this respect the learned judge refers at §13 to the fact that the dispatch of the bill was not an end of the matter.  He found that the fax addressed to the defendant personally was sent by the solicitors attaching a copy of the bill and that subsequently the solicitors sent a letter in the following terms to the defendant care of her company:

“ We refer to the above invoice which remains outstanding despite our several reminders.

As our invoice was rendered in June last year for services rendered in May 2001 it is well over due.  Unless the same is settled forthwith, we shall have no alternative but to issue legal proceedings against you to recover the same in the event of which you will be liable for court costs and interest in addition to the principal due.”

54.The learned judge says it is clear from this letter that the solicitors were treating the defendant as the person charged with the bill.  It threatened legal proceedings against the defendant personally for the outstanding fees under the bill.  In his judgment that letter put it beyond doubt that at least as from the date of that letter the solicitors regarded the defendant as the person charged with the bill since a copy of the bill was enclosed with the letter.

55.In this case the plaintiffs wrote to D1 to the attention of D2 ona number of occasions in the first half of 2015, making a payment demand and making it clear explicitly that if the fees were not settled the firm would apply to the court for an order that it would cease to act for D1 and D2 in the relevant High Court proceedings and seek to recover the other unpaid legal fees from D1 and D2.

56.In taking account of all of the circumstances including what I say in the preceding paragraph I would, if it had been necessary, have dismissed the application to strike out the case against D2.

57.In the circumstances I make a costs order nisi that the defendants should pay the plaintiff’s costs of this summons.

Mr Michael Lok and Ms Jasmine Cheung, instructed by Winston & Strawn, for the plaintiff

Mr Edward K S Chan SC and Mr Kenny C P Lin, instructed by Myra Li & Co, for the 1^st and 2^nd defendants