Hung Yuet Wan v. Lau Yan Shing t/a Shing Hing Eng and Another

HCPI 1011/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PERSONAL INJURIES ACTION NO. 1011 OF 2005

______________________

BETWEEN

______________________

Coram : Master Levy in Chambers

Date of Paper Disposal : 25 January 2008

Date of Order : 25 January 2008

______________________

J U D G M E N T

______________________

Introduction

1.This matter concerns a preliminary point regarding the scale of costs arising from the Plaintiff’s bill of costs prepared in pursuance of Order 62 rule 10(2) of the Rules of the High Court. 

2.The Plaintiff brought a personal injury claim against the Defendants from damages she sustained during work.  On 11 June 2007, the Plaintiff accepted the payment into court in the sum of $460,000.  It is not in dispute that the total damages the Plaintiff had recovered (even when including the sum of $177,433.40 for periodical payment the Plaintiff had received) fall within the jurisdiction of the District Court.  Hence, the arguments.

3.The preliminary argument was initially fixed for an oral hearing.  When it is clear during the hearing that the time allotted was grossly insufficient, I adjourned, with the consent of the parties, the arguments to be disposed of on paper.

4.Parties have both filed further written submissions.

Issues

5.The principal contention concerns a legal argument on whether under Order 62 rule 10(2), the Plaintiff, having accepted money paid into court, would be automatically entitled to taxed costs on High Court scale and that the court has no jurisdiction to order costs to be taxed on any other basis.

6.Should I decide that I have such a jurisdiction, I would be required to consider the appropriate scale of costs.

Discussion on the Principal Issue

7.The Plaintiff’s solicitor submitted that under Order 62 rule 10(2) I have no discretion to direct costs taxed in any basis other than on High Court scale.  He relies on these authorities: Cho Ho Kuen v Yu Kowk Wah [2001] 3 HKC566; Ngai Chu Sing v Chan Wai Ho (unrep.) DCPI 547 of 2003 (H.H. Lok, 2 November 2006) and Wellegant Development Ltd. Trading as Tak Shing Manufactory v Fine Telecom Ltd. Trading as Remington Co. [2007] 2 HKC 427.

8.The Defendant’s solicitor contends that the court has unfettered discretion on scale of costs.  He refers to three authorities: Wong Lan and Cheung So Kuen, the personal representatives of Pan Kar Ping, deceased v Hong Chang Construction Transportation Engineering Co. Ltd & Ano. (unrep.) HCPI 973 of 2005 (Fung J, 25 May 2007), Lai Ki v B + B Construction Co. Ltd. & ors. (unrep.) HCPI 63 of 2001 (Seagroatt J, 24 June 2003) and Wong Chi Ho Jacky v Poon Yuk Shan (unrep.) HCPI 910 of 2002 (Deputy High Court Judge Jat, SC, 7 May 2004).

Discussion on the Principal Issue

9.I note that there are currently two seemingly conflicting decisions of the first instance, both of which are binding on me.  In Wellegant Development (ibid.), Deputy High Court Judge L. Chan took the view that a plaintiff’s automatic entitlement to taxed costs under Order 62 rule 10(2) can only means costs “taxed in accordance with O 62 of the Rules of High Court and not any other order in these rules or in the Rules of the District Court” (see para. 50).

10.On the other hand, Fung J in Wong Lan (ibid.) held that the party accepting payment in under Order 62 rule 10(2) is not automatically entitled to costs taxed on High Court scale, and that the court has discretion to tax costs on District Court scale.

11.After having considered all the authorities and the very help written submissions of the parties, I am inclined to defer to the view of Fung J., and am in agreement with him that a court’s discretion regarding the basis of the costs is unfettered.  I note that in Order 62 rule 2(4), the court has wide discretion in deciding the extent the costs are to be paid.  In my view, under Order 62 rule 10(2), the only automatic entitlement of the party accepting payment in is the entitlement to have the costs taxed without an order of the court, which will be required in most cases (see Order 62 rule 3(1)).  However, such party does not have an absolute entitlement to taxed costs on the High Court scale only.

Discussion of the second issue – whether reasonable prospect of recovering damages within the High Court jurisdiction

12.The Plaintiff’s solicitor submitted that the Plaintiff’s damages (inclusive of interest) recoverable should be in the sum of about $1,300,000.  In giving allowance for 20% deduction for contributory negligence, deduction of $177,443 for the periodical payment received and a further allowance of 20% for litigation risk, the solicitor submits that the amount the Plaintiff would likely receive is $694,000.  Hence, it is submitted that it is reasonable for the Plaintiff to accept the Payment In.

13.The Defendants’ solicitor contends that the Plaintiff has grossly inflated her damages when the action was commenced.  The Defendants argue that the Plaintiff had only suffered rather minor injuries from the slip.  She was only diagnosed of having suffered from left wrist injury with no fracture.  Further the medical evidence shows that the Plaintiff had pre-existing condition of her carpal tunnel syndrome, which has likely attributed to her persistent pain.  The psychiatric evidence also shows that that the Plaintiff might be able to resume pre-accident job if suitable treatment was received.  Hence, it is contended that the quantum of $400,000 claimed for PSLA is grossly unachievable, and that the realistic sum should only be in the region of $150,000 to $300,000. 

14.As for the claim for loss of earnings, the Defendants submitted that the Plaintiff had no salary record to support her assertion that she earned $9,900 per month as she had only worked for the 1^st Defendant for 8 days before the accident, having only earned a total of $2,240.  As for the future loss of earnings, the Defendants dispute that a multiplier of 8 adopted by the Plaintiff is appropriate, and submit that 7 should be appropriate.

15.In summary, the Defendants calculate the damages (after having deducted the periodical payment of $177,443) to be within the range of $444,452 to $752,722.  The Defendants therefore submit that applying the test laid down in Lai Ki v B + B (ibid.), the Plaintiff has no reasonable prospect of obtaining an award in excess of the District Court jurisdiction of $1 million at the time of the commencement of the action.

Discussion on the second issue

16.In this case, the Plaintiff was 51 on the notional date of trial in April 2006.  She slipped on a slope while working in a construction site and sustained a wrist injury of tenderness and swelling.  In view of the long-standing pre-existing condition of her carpal tunnel syndrome, the pain she has been suffering is most likely due to the existing condition rather than to the injury.  I agree with the Defendants that the injury is minor and there is little prospect that she would be able to recover damages of $400,000 for PSLA.

17.In light of the evidence showing the Plaintiff’s short history of employment as well as the nature of her injury, I consider that the Plaintiff has very little prospect of recovering loss of earnings in the amount of about $950,000 as claimed in her Statement of Damages.

18.Applying the test laid down in Lai Ki v B + B (ibid.), I come to the view that the Plaintiff has no reasonable prospect of recovering an amount exceeding the District Court scale.

19.I thus see no reason whey she should be allowed to have her costs taxed on High Court scale.

Conclusion

20.The Plaintiff’s costs should be taxed on District Court scale.  I make a costs order nisi that there should be no order to costs in respect of this preliminary point and the Plaintiff’s own costs be taxed in accordance with the Legal Aid Regulations.