Super Strategy Investments Ltd and Another v. Kao, Lee & Yip (A Firm)

HCMP 1752/2007

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1752 OF 2007

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BETWEEN

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Before: Hon Saunders J in Chambers

Date of Hearing: 17 June 2008

Date of Decision: 19 June 2008

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D E C I S I O N

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The application:

1.By this originating summons, the plaintiffs seek, pursuant to s 65 Legal Practitioners Ordinance, Cap 59, (LPO), an order that the defendant firm, (the solicitors), deliver a bill of costs for its fees and disbursements in respect of the sale by the plaintiffs, jointly with others, of a property known as Henredon Court, in Shouson Hill Road Hong Kong, (Henredon Court).  Ancillary orders as to the nature of the bill of costs are also sought.

2.The plaintiffs now say that the circumstances are such that they are entitled to summary judgment, and an order now that a bill of costs be delivered.

The factual background:

3.Although there are factual disputes between the parties, the following factual circumstances, relevant to the issue of the requirement, if ordered by the court, to deliver a bill of costs, are not in dispute.

4.Henredon Court is a group of lowrise houses in Shouson Hill Road.  In around September 2006, a number of the owners met together with a view to renovating the building.  They found that a major renovation of the building was required which would be very expensive.  One of the occupants, Mr John Wan, consulted a partner in the solicitors firm, Mr John Davison, whom he had previously instructed in various matters and in whom he had confidence.

5.Mr Wan sought, and was given advice by Mr Davison in respect of a proposal to sell Henredon Court en bloc, a proposal that would require the agreement of all the individual owners of the properties.  Mr Davison indicated that the solicitors would be able to act as solicitors in the sale.

6.At the instigation of Mr Wan, and with the advice and assistance of Mr Davison, 10 of the owners of Henredon Court agreed to market their properties, not individually, but as a group of 10 houses to be sold together in one lot.

7.On 30 March 2007, a written document, (the Owners Agreement), prepared by Mr Davison, was signed between the 10 owners, as to the terms upon which the 10 owners would market the property.  The solicitors, although having prepared the Owners Agreement, were not a party to it.

8.The Owners Agreement provided for the appointment of the solicitors as the solicitors for the vendors in the transaction.  Midland Realty International Ltd, (Midland) were appointed estate agents in the transaction.  Midland’s fees and solicitors fees were dealt with in clause 1(g), (h) & (j) of the Owners Agreement, the relevant portions of which are in the following terms:

“(g)    Subject to sub-clause (i) of this clause, all costs and disbursements payable to the Appointed Solicitors in relation to the preparation of this Agreement and in relation to the sale of the Properties (“the Appointed Solicitors’ Costs and Disbursements”) shall be borne by the Owners in accordance with the Relevant Percentage set out in the Fourth Schedule hereto provided that if the offer to purchase the Properties referred to in clause 1 (b) hereof is not accepted by all the Owners, the amount of the Appointed Solicitors’ Costs and Disbursements shall not exceed a sum of HK$250,000.

(h)     …….The Appointed Agent’s Commission shall be an amount equivalent to 1% of the Purchase Price minus the Appointed Solicitors’ Costs and Disbursements.  The Owners agree that if the offer to purchase the Properties referred to in clause 1(b) hereof is not accepted by all the Owners, the Owners shall pay a sum to the Appointed Estate Agent an amount equivalent to the total amounts of the out-of-pocket expenses incurred by the Appointed Estate Agent in relation to the sale of the Properties subject to a maximum of HK$200,000.  Such sum shall be borne by the Owners in accordance with the Relevant Percentage set out in the Fourth Schedule hereto.

(j)      For the avoidance of doubt, all Owners are required to pay the Appointed Solicitors’ Costs on Disbursements in the manner provided in this Agreement irrespective whether or not they also appoint their own solicitors to advise them in relation to this Agreement for the sale of the Properties……”

9.On 15 June 2007, the joint sale of 10 units to a purchaser, Novel Joy Group Ltd, was completed at a purchase price of $710 million.  The conditions of sale contained a somewhat unusual provision in the following terms:

“On completion, apart from the balance of the Purchase Price and other monies payable by the Purchaser to the Vendor, the Purchaser shall pay to the Vendor’s Solicitors an additional sum equivalent to 1% of the Purchase Price to reimburse the Vendor the professional and consultants costs and expenses incurred or to be incurred by the Vendor in relation to the tender and the sale of the Property including but not limited to all legal costs and expenses and estate agent’s commission.”

Thus, a further sum of $7.1 million was paid by the purchaser to the solicitors on the completion of the sale, that some being required to be applied on payment of costs and expenses in relation to the sale.

10.The solicitors acknowledge that they were retained as solicitors by the joint group of owners, and that they acted as solicitors in the transaction, and undertook the required legal work in relation to the sale of Henredon Court.

11.Between 12 June 2007 and 14 June 2007, just prior to the date for completion, the two plaintiffs, and two other unit owners, each wrote to Mr Davison, asserting that there had been no agreement as to costs in the event of a successful sale, and requiring the solicitors to furnish them with a legal bill for their costs and disbursements on the sale, that bill to be supplied by 20 June 2007.  There was no response to the four letters.

12.Over a month later, and more than a month after completion, there was still no response from Mr Davison. 

13.On 24 July 2007, the two plaintiffs again wrote to Mr Davison, again demanding a bill of costs.  On 27 July 2007, the solicitors replied in the following terms:

“The correct position is that by an agreement made between our firm and Mr John Wan on behalf of the owners concerned on 25^th of January 2007 (“the said agreement”) it was agreed as follows:-

1.      In consideration of our firm agreeing to provide consultancy services to the owners in connection with the sale of the Properties (particulars of which are set out in Paragraph 2 below), we shall be entitled to receive a consultancy fee equivalent to 0.65% of the purchase price of the Properties (“the Agreed Fee”).

2.      Our consultancy services include:-

(1)     advising on the method of selling of the Properties and what that required of the owners;

(2)     working with Mr John Wan and the owners’ committee on terms of the owners’ agreement, how to document that agreement and advising the means to make that binding;

(3)     explaining and assisting the owners to work through the terms of the owners’ agreement and to negotiate with each other and doing all necessary drafting and arranging engrossment and execution of the owners’ agreement;

(4)     recommending the terms of tender and drafting the tender documents (including formal agreement for sale by the owners and assignment) and obtaining the owners’ agreement of the tender documents including assisting them to negotiate with each other;

(5)     recommending a list of developers to be invited to tender;

(6)     issuing the tender; checking of all owners’ titles and dealing with the tenderers’ requisitions on title;

(7)     receiving the tenders and opening them in front of the owners;

(8)     advising on how to deal with the tenders including questions of conformity and non-conformity;

(9)     advising and assisting in post-tender negotiations with tenderers and dealing with any legal matters raised by the successful tenderer at post-tender stage; and

(10)   arranging for execution of agreements for sale and purchase; negotiating terms of licences from successful tenderer for those owners who wish to remain in possession after completion; dealing with all completion matters including later handing over of possession for those owners who remained in possession; acting as a stakeholder for various funds at various times and disbursing all relevant funds.

Pursuant to the said agreement, we have duly rendered out services, and the sale and purchase of the Properties were completed on 15 June 2007.”

14.The letter went on to assert that the solicitors considered themselves entitled to deduct, from the sum of $7.1 million paid in addition to the purchase price for costs and expenses, the sum of $4,615,000, equivalent to 0.65% of the total purchase price therefrom as and for the “Agreed Fee” payable to them.

15.The solicitors have not, and say that they do not, intend to render a bill in respect of the legal services provided by them in relation to the sale of Henredon Court.  They apparently take the view that they will be adequately compensated by the payment of the sum of $4,615,000 for what Mr Davison describes as “property consultancy services”, and not legal services.

16.It is to be noted that notwithstanding the assertion in the solicitors’ letter that the agreement for the payment of consultancy services was reached on 25 January 2007, and despite provision being made in the Owners Agreement for the payment of “the Appointed Solicitors Costs and Disbursements”, and a fixed fee in the event of the transaction not proceeding, there was no provision in the Owners Agreement relating to the Agreed Fee.

17.A dispute has now arisen between the parties as to whether such an agreement was in fact reached.  The sum of $7.1 million remains held by the defendant solicitors, in the client account, on interest-bearing deposit.

18.Now, the plaintiffs make application to the court for an order that a bill of costs be delivered.

The relevant legislation:

19.The LPO, in s 65(1), contains the following provision:

“The jurisdiction of the Court to make orders for the delivery by a solicitor of a bill of costs…..is hereby declared to extend to cases in which no business has been done by him in the Court.”  (Irrelevant words omitted)

20.Also relevant is s 56 LPO, which permits a solicitor to make an agreement for remuneration for non-contentious business.  The section provides:

“(1)    Whether or not any rules made under section 74 are in force, a solicitor and his client may, either before or after or in the course of the transaction of any non-contentious business by the solicitor, make an agreement as to the remuneration of the solicitor in respect thereof.

(2)     the agreement may provide for the remuneration of the solicitor by gross sum, or by commission or percentage or by salary, or otherwise, and it may be made on terms that the amount of the remuneration therein stipulated for either shall or shall not include all or any disbursements made by the solicitor in respect of searches, plans, travelling, stamps, fees or other matters.

(3)     The agreement shall be in writing and signed by the person to be bound thereby or his agent in that behalf.”

21.The definition of “non-contentious business” is contained in s 2 in the following terms:

“ ‘non-contentious business’ includes any business connected with sales, purchases, leases, mortgages and other matters of conveyancing;”

The issue:

22.It is necessary to remember in the consideration of this case that the primary relief sought by the plaintiffs is simply an order that the solicitors deliver to the plaintiffs a bill of costs for the legal costs and disbursements in respect of the joint sale of the 10 units at Henredon Court.

23.I am satisfied that the sole issue in this case, the resolution of which will determine whether or not an order should be made under s 65 LPO, is whether or not the work undertaken by the solicitors falls within the definition of “non-contentious business”.  If the answer is “yes” it must follow that a bill of costs must be delivered.

Discussion:

24.The provisions of s 65 LPO are declaratory in nature, and relate to business done otherwise than in the Court.  Prior to the passing of legislation equivalent to s 65, the power of the Court to direct a solicitor to render a bill of costs in respect of contentious business could not have been in doubt.  The power undoubtedly arose, if not in legislation, from the jurisdiction of the Court over the conduct its officers, solicitors, in relation to contentious business conducted before the Court.  The enactment of s 65 LPO clarifies the power of the Court in relation to business done otherwise than in the Court, otherwise known as “non-contentious business”.

25.When an application is made under s 65 LPO for an order that a solicitor deliver a bill of costs in relation to non-contentious matters, the power of the court to make that order is limited by the extent of the definition of the expression “non-contentious business”.  First, the solicitor must have been retained as a solicitor, second, the work contained in the deal must fall within the definition of the expression “non-contentious business”.

26.First, there is no dispute whatsoever that the solicitors were retained as solicitors in connection with the sale of Henredon Court.

27.In the present case there is not, and cannot be, any dispute as to the nature of the work undertaken by the solicitors.  In his 4^th affidavit, Mr Davison sets out, in paragraphs 5-46, over 9 ½ pages of the affidavit, the work that was undertaken by the solicitors.  Mr Sussex does not in any way dispute those paragraphs in so far as they reflect the nature of the work undertaken by the solicitors.  While there may ultimately be an issue as to the extent of that work, there is no dispute at all as to the nature of the work that was undertaken.

28.In order to determine whether or not the solicitors are obliged to deliver a bill, the question is whether or not the work, the nature of which has been described by Mr Davison, falls within the definition of “non-contentious” business.

29.On numerous occasions in the course of argument I invited Ms Eu to identify within, those 41 paragraphs, over 9 ½ pages, which work she asserted was not work within that definition, that is, work which could not be described as “business connected with sales”.  Other than a general assertion that all of the work described in those paragraphs did not fall within that definition, an assertion that is palpably wrong, Ms Eu was quite unable to identify specifically any aspect of the work which did not fall within that expression.

30.The definition of “business” in the Shorter Oxford English Dictionary is: “the object of concern or activity”.  The expression “connected with” was interpreted, in the normal sense as synonymous with “ancillary to” in Charman v WOC Offshore BV, (Unreported, The Times, October 27, 1992, see Stroud’s judicial dictionary, 6^th ed, p487). 

31.There is no doubt at all that the activities described by Mr Davison, in his 41 paragraphs, were all ancillary to a particular object of concern or activity, namely the sale of Henredon Court.  In my view it is simply beyond argument that the whole of the work described by Mr Davison falls within the expression “business connected with sales”. 

32.The error into which Mr Davison has fallen is demonstrated in paragraph 4 of his 4^th affidavit where he sets out what he considers to be the issues in the proceedings.  Mr Davison describes the second issue arising in the proceedings in the following terms:

“Whether the nature of the services rendered by (the solicitors) to the Vendor was “simply legal services” or they also include property consultant work;”

33.That is simply not an issue in these proceedings.  What is in issue is whether the work undertaken by the solicitors constituted “business connected with sales”.  The definition of “non-contentious business” in Hong Kong makes no distinction between what might be labelled “simply legal services”, on the one hand, and other, non-legal work, that may be labelled “property consultant work”, “consultancy services”, or any other equivalent label. 

34.The argument may have merit in the United Kingdom where the equivalent definition of non-contentious business is in quite different terms.  The Solicitors Act 1974 (UK) defines “non-contentious business” in this way:

“ ‘Non-contentious business’ means any business done as a solicitor or which is not contentious business as defined in the Solicitors Act 1974.”

The existence in the UK definition of the words, “as a solicitor”, may open the path to a contention that the work contemplated by the definition is limited to the work of a solicitor, work which may be labelled “simply legal services”, as distinct from other services he may provide, applying ancillary skills gained by him during the course of this practice.

35.The Hong Kong definition, on the other hand, specifically omits the words “as a solicitor”.  I am confident that that was a deliberate omission by the drafter of the legislation. 

36.In the course of the practice of a commercial or conveyancing solicitor, the solicitor inevitably gains knowledge and experience of both the commercial and real estate worlds that extends beyond the knowledge required to provide pure legal services in relation to commercial conveyancing matters Undoubtedly, people consult particular solicitors because of that additional experience, as well as for their experience in providing pure legal services.

37.In Hong Kong, solicitors may give that type of commercial advice, being advice beyond the scope of pure legal advice, in relation to real estate matters, without fear of falling into the net of the Estate Agents Ordinance, Cap 510, (EAO).  Mr Sussex correctly pointed me to the definition of “estate agency work”, and that of “estate agent” in the EAO, which are in the following terms:

““estate agency work”, subject to subsection (3), means any work done in the course of business for a client-

(a)     being work done in relation to the introduction to the client of a third person who wishes to acquire or dispose of a property, or the negotiations for the acquisition or disposition of the property by the clients; or

(b)     being work done, after the introduction in the course of that business to the client of a third person who wishes to acquire or dispose of the property or the negotiation in the course of that business for the acquisition or disposition of the property by the client, in relation to the acquisition or disposition, as the case may be, of the property by the client;

“estate agent”, subject to subsection (3), means a person who in the course of a business (whether or not he carries on that conveniently or any other business) does estate agency work;”

38.In respect of the practice of a commercial conveyancing solicitor, the experience which he gains, and which is sought by his clients, will plainly from time to time be liable to fall within the definition of “estate agency work”, thus potentially rendering the solicitor liable to be labelled an “estate agent”.  Certainly, some at least of the work undertaken by Mr Davison and the solicitors would easily fall within the definition of a “estate agency work”.  As I understand Mr Davison’s position all of the work is set out in his letter of 27 July 2007, does not constitute “simple legal services” but is instead “property consultancy work”.  I accept, as does Mr Sussex, that at least some of that work may be labelled “property consultancy work”.  It is plainly arguable that much of that work falls within the definition of “estate agency work”.

39.A solicitor who undertakes such work is not subject to the regime of the EAO.  By s 2(2)(b) of the EAO nothing in that Ordinance applies to anything done:

“in the course of his practising his profession by a solicitor,….. or by any person employed by him and acting in furtherance of that course;” (irrelevant words omitted)

40.I am satisfied that it is right that work undertaken by a solicitor which may be described as property consultancy work, as distinct from pure legal work, in circumstances where the solicitor has been retained as a solicitor to undertake pure legal work, ought to be subject to the regime of the LPO. 

41.The right to act as a solicitor carries with it certain privileges.  For example, obviously, the right of appearance in certain courts.  Further privileges are contained in Part V LPO.  These privileges include a monopoly on the preparation of instruments relating to immovable property, (conveyancing), or legal proceedings, (s 47).  If such a monopoly is to be granted to solicitors, it is only right that the public should have available to them the protections contained within the LPO.

42.The important fact which renders the solicitors subject to the provisions of s 65(1) LPO, and the obligation to render a bill of costs if ordered by the Court, is the undeniable fact that they were retained as solicitors to act for the vendors of Herendon Court. 

43.This may be seen from the old decision in Allen v Aldridge (1844) 5 Beav 400.  In that case the issue was whether the fees of the steward of a Manor, who was a solicitor, but acted only on the character of a steward, were taxable under the then English equivalent of the LPO.  The headnote accurately sets out the essence of the decision:

“The statute does not authorise the taxation of every pecuniary demand or bill of a solicitor, for every species of employment in which he may happen to be engaged.

A bill may be taxed though no part of the business was transacted in any Court of law or Equity, but such business must be connected with the profession of an attorney or solicitor: -- business in which the attorney or solicitor was employed because he was an attorney or solicitor, or in which he would not have been employed if he had not been an attorney or solicitor, or if the relation of attorney or solicitor and client had not subsisted between him and his employer.” (the emphasis is mine).

44.In simple terms, the solicitor was not required to render a bill, because he had not been retained as a solicitor.  The corollary must apply. Had he been retained as a solicitor to the Manor, and as well, because he was that solicitor, was required to perform services as a steward, he would have been obliged to render a bill for his services as a steward, as well as a solicitor. 

45.In the present case the solicitors were retained as solicitors by the vendors of Henredon Court, apparently in part because of Mr Davison’s apparent property or commercial skills.  The consequence of the fact that they were retained as solicitors to undertake business in connection with the sale means that all of the work they undertook in connection with the sale of Henredon Court, whether purely legal, or falling under the labels “property consultancy services”, “consultancy services”, or “estate agency work”, must be subject to the obligation in s 65(1), to render a bill if ordered.

46.As well as contending that the work undertaken by the solicitors did not fall within the scope of non-contentious business, Ms Eu mounted five further arguments in opposition.

47.First, it is contended that there is a sufficient factual dispute between the parties that there ought to be an order pursuant to O 28 r 8, that the Originating Summons be continued as if begun by writ, in order that those factual disputes may be resolved.  An appropriate summons has been filed.

48.I reject the argument.  While there may be a factual dispute about the extent of the work that was done, there is no dispute at all as to the nature of the work that has been done.  Mr Davison’s assertions as to the nature of the work done are accepted in their entirety by the plaintiffs and not disputed.  Here again it is necessary to remember that the issue raised by the Originating Summons is merely whether the plaintiffs are entitled to have a bill delivered.  That issue turns on whether or not the nature of the work undertaken falls within the definition of non-contentious business.  Any other factual disputes are irrelevant to the order sought.

49.Second, it is contended that it would be wrong to reach a final conclusion on the case in advance of a proper determination of the facts by way of a trial.

50.Again, I reject the argument.  There are simply no facts relevant to the order sought which require to be determined.  The defendants’ only evidence on the single relevant point is accepted.

51.I have carefully considered the numerous cases put to me by Ms Eu, in which the courts, at all levels, have cautioned against the danger of deciding cases on preliminary points, prior to the determination of facts.  In the particular circumstances of this case, there being no relevant factual dispute, these principles are inapplicable.

52.Next, it was contended that a determination that a bill must be delivered would have consequences adverse to the solicitors, in particular that it would deprive them of the argument that they are entitled to recover under the “Agreed Fee” arrangement, notwithstanding the absence of a record of the agreement, in writing, signed by the owners of Henredon Court, as required by s 56(1) LPO.

53.While that may be a consequence of my finding that a bill must be delivered, it is not a basis to refuse to order the delivery of the bill.  It must be an inevitable consequence of the conclusion that the whole of the work undertaken by the solicitors falls within the definition of non-contentious business, that that work is subject to the regime of the LPO.  It is a necessary consequence of that conclusion that if an agreed fee is to be charged, the agreements must be in writing, and signed by the person to be bound thereby. 

54.The solicitors had ample opportunity to include the fee agreement in the Owners Agreement.  They made provision for their ordinary solicitors costs and disbursements, and for a fixed fee in the event that the matter did not proceed.  If they chose not to include the agreement made in respect of a percentage of the additional sum to be paid by the purchasers, they must live by the consequences of that decision.

55.It would not be right to refuse the plaintiffs a remedy to which they are lawfully entitled, in order to artificially give the solicitors a right to claim a sum which may be very much larger than the fees they are entitled to charge as solicitors.  In this respect it must be remembered that they are perfectly entitled to charge a proper fee in respect all of the non-contentious business undertaken by them.  In Hong Kong that will include work which might otherwise be labelled “property consultancy services”.  Of course it is a necessary corollary that any bill rendered may be subject to taxation.

56.Next, it was contended that the solicitors would suffer serious prejudice, because they would be deprived of cross-examination and discovery as to a matter of right.  The solicitors contend that there is a relevant issue as to whether the sale was concluded by way of private treaty or tender.  The argument was made that the EAO prohibits an individual from carrying out estate agency work if they were not a licensed estate agent.  The argument was that the solicitors relied upon a “tender” exception provided in s 2(3)(a) of the EAO.

57.As Mr Sussex correctly pointed out, there is simply no need to determine whether the sale was a private sale or tender to determine whether or not the solicitors were excepted from the provisions of the EAO.  They are excepted in terms in s 2(3)(b), whether the sale was a private sale or tender, (see paragraphs 30-34 above).  It is simply irrelevant to this case whether the sale was by tender, private sale or otherwise.

58.Consequently no issue arises upon which there needs to be cross-examination or discovery.

59.Finally, Ms Eu relied upon the decision in Re Remnant (1849) 11 Beav 603, to contend that work undertaken, other than solicitors work, did not fall within the meaning of non-contentious business.  In that case the court held that in a bill of costs rendered by a solicitor, certain items would be disallowed on the ground that such costs were not made in pursuance of the professional duty undertaken by the solicitor.

60.Again the submission must fail.  Its falsity may be seen from the way in which the question was framed by Ms Eu in her skeleton argument.  The submission repeats the error made by Mr Davison.  It was in the following terms:

“The crucial question still is what exactly were the services rendered by (the solicitors) to the Owners and whether such services were made pursuant to their professional duty as solicitors and whether (the solicitors) performed property consultant work in addition to solicitors work.” (Ms Eu’s emphasis)

61.The simple answer to this proposition is that set out in paragraphs 32-33 above.  The law in Hong Kong does not entitle a solicitor, when retained to act in relation to a sale, to separate his “solicitors work” undertaken in his professional capacity, from any other work undertaken by him, connected with the sale, when rendering a bill of  costs.

Conclusions:

62.It follows from the foregoing reasoning, that the plaintiffs are entitled to an order in terms of paragraph 1 of the Amended Originating Summons that the solicitors deliver a bill of costs for its legal costs and disbursements in respect of the joint sale of Henredon Court.  There will be an order accordingly.  The bill must be delivered within 28 days of the date of this judgment.

The scope of the bill to be delivered:

63.The Originating Summons, as originally filed, merely sought an order for the delivery of the bill of costs in respect of the joint sale of Henredon Court.  Subsequently it was amended, the plaintiffs’ solicitors anticipating that unless there be a declaration that all work connected to the sale, irrespective of the label given to it by the solicitors, be included in the bill, the solicitors might prepare a bill restricted to “solicitors work”, and take separate steps in respect of work they chose to label “consultancy services”.

64.It follows from the conclusions that I have reached that the bill to be delivered must cover all work undertaken by the solicitors in connection to the sale of Henredon Court, whether that work is styled “solicitors work”, “property consultancy services”, “consultancy services” or anything else.  So long as the work was undertaken in connection with the sale of Henredon Court, it must be included in the bill.

65.There must also therefore be an order in terms of paragraphs 2 and 3 of the Amended Originating Summons.

Can the solicitors make a claim on the alleged “Agreed Fee” agreement:

66.The Amended Originating Summons also seeks a declaration in the following terms:

“There be a declaration that save and except such costs and disbursements set out in the bill of costs to be delivered by the Defendant pursuant to paragraphs 1 and 3 above, the Defendant is not entitled to demand recover claim or sue for, whether by way of legal proceedings or otherwise any costs or disbursement dual or allegedly due from the Plaintiffs to the Defendant for any business of whatever descriptions done by Defendant in connection with the Sale of the Properties.”

67.Mr Sussex submitted that this declaration could be made without the court needing to proceed to find whether or not there was any such agreement.  That was, he said, because even if there was an agreement, the requirement that agreement for an agreed fee, in this case 0.65% of the purchase price, permitted in respect of non-contentious business by s 56(1) LPO, to be in writing and signed by the plaintiffs pursuant to s 56(3) LPO, simply could not be met.  That he says must be a complete answer to any claim for the Agreed Fee.

68.Ms Eu argued that the declaration should not be made as it had not been determined whether or not there was an agreement as claimed by the solicitors.  She further argued that it was not determined whether there was a separate arrangement in respect of consultancy services.

69.I am satisfied that Mr Sussex is right.  I proceed on the assumption that the Agreed Fee agreement was made as contended by the solicitors, and having regard to my finding that the work undertaken pursuant to that agreement was non-contentious business.  The absence of a record of the agreement in writing, and the signature of the plaintiffs, being the persons to be bound by the agreement, or their agent in that behalf, provides a complete answer to any claim that may be made by the solicitors to recover any sum due pursuant to the agreement.  Even if there was a separate agreement for consultancy services, in this case those services are so plainly non-contentious business on the part of a solicitor retained to act in a sale, that the fact that there might be a separate agreement for that fee is simply irrelevant.

70.I am satisfied that the plaintiffs are entitled to a declaration in terms of paragraph 4 of the Amended Originating Summons.  There will be an order accordingly.  That order clearly does not in any way prevent the solicitors from recovering any amount properly due to them pursuant to the bill of costs ordered to be delivered.

Costs:

71.The plaintiffs have succeeded in all respects.  There will be an order nisi that they are entitled to the costs of the proceedings, on a party and party basis, with a certificate for two counsel.

Mr Charles Sussex SC, leading Mr Anson K M Wong, instructed by Messrs Iu, Lai & Li for the Plaintiffs

Ms Audrey Eu SC, leading Ms Elsie Yiu, instructed by Messrs Ho, Tse & Wai, for the Defendant,