Case Document

100%Judiciary

DCCJ 2422/2013

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 2422 OF 2013

(TRANSFERRED FROM SMALL CLAIMS TRIBUNAL

CLAIM NO 34870 of 2012)

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BETWEEN
	WALLBANCK BROTHERS SECURITIES (HONG KONG) LIMITED	Plaintiff
and
	EMILY TSE	1st Defendant
	JUDITH YUEN	2nd Defendant
	STEPHEN TISDALL	3rd Defendant
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Before: Deputy District Judge Mak in Chambers

Date of Hearing: 21 February 2014

Date of Decision: 14 March 2014

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DECISION

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Introduction

1.This is an appeal by the plaintiff against the Master’s costs order made on 3 January 2014.

Background

2.The plaintiff originally filed a claim against the 3 defendants at the Small Claims Tribunal. The defendants are respectively the assistant manager, associate director and senior director of the Licensing Department of the Securities and Futures Commission.

3.The Small Claims Tribunal transferred the case to the District Court on 19 June 2013.

4.At the District Court, the plaintiff filed a statement of claim consisting of 18 pages with an annexure consisting of 13 pages on 26 August 2013.

5.By a summons dated 16 September 2013, the defendants applied for further and better particulars of the statement of claim.

6.On 28 November 2013, the learned Master ordered the plaintiff to serve an answer to the request for further and particulars.

7.The learned Master also ordered the plaintiff to pay the costs of and occasioned by the defendants to be summarily assessed. The learned Master directed the defendants to file and serve a statement of costs and the plaintiff to file and serve a list of objections respectively for the purpose of summary assessment.

8.On 3 January 2014, the learned Master assessed the defendants’ costs summarily and ordered that plaintiff to pay the defendants costs in the sum of HK$105,030.

9.It is this order that the plaintiff is appealing against. In effect, the plaintiff is appealing against the quantum of the costs order.

Legal principles

10.In relation to an appeal as to costs only, Sakhrani J in Paul Y-ITC construction Limited v Kin Shing Co Ltd [1999] 1 HKC 511 said at 515 that “such application should not be allowed unless it can be shown that the order made by the master was unreasonable or erred in law, ie, if he either failed to take into account proper matters or took into account matters that should not have been taken into account.”

11.Tang J (as he then was) in Tang Ka Hung & ors v Wan Kin Chung Daniel & ors HCCW726/2002 (unreported, 29 July 2004) held that the approach to this kind of appeal should be no different from other interlocutory appeals. At paragraphs 3 and 4, he said the following-

“3. ... In other words, the principles which govern this appeal are those stated by Lord Atkin in Evans v Bartlam [1937] AC 473. In the words of Lord Atkin at pages 478:-

“ ... His own discretion (referring to the judge’s discretion) is intended by the rules to determine the parties’ right, and he is entitled to exercise it as though the matter came before him for the first time. He will, of course, give the weight it deserves to the previous decision of the master, but he is in no way bound by it ...”

4. On an appeal against the quantum of fees allowed by a taxing master, the master’s view, in my opinion, deserves more than the usual weight. After all, they deal with taxation on a regular basis.”

12.In Poon Shu Fan v Wong Tin Yan [2012] 5 HKLRD 512, the Court of Appeal held that as in an ordinary taxation, under O 62 r 28(2) of the Rules of the High Court (Cap 4A) (the RHC), in a summary assessment, party-and-party costs were allowed only if they were “necessary or proper” for the attainment of justice or for enforcing or defending the rights of the receiving party. Pursuant to Practice Direction 14.3, the court adopted a broad-brush approach to ensure the final figure assessed was not disproportionate and/or unreasonable having regard to the nature and circumstances of the application or matter and the underlying objectives stated in O 1A of the RHC, even if there was no challenge to individual items.

Discussion

13.On 28 November 2013, the learned Master made the following costs order:-

“The Plaintiff do pay the costs of and occasioned by the Defendants to be summarily assessed. The Defendants do file and serve a Statement of Costs within 7 days hereof and the Plaintiff to respond with a List of Objections within 14 days thereafter, if so advised.”

14.No Certificate for Counsel was granted.

15.Paragraph 2(3)(i) of Part II of Schedule 1 of Order 62 of the Rules of the District Court (“RDC”) provides that:-

“(3) No costs shall be allowed in respect of counsel appearing before the court unless –

...

(i) The court has certified the attendance of counsel as being

proper in the circumstances of the case.”

16.In assessing the costs of the defendants summarily, the learned Master had allowed the fee of counsel in the sum of $50,000.

17.In the absence of a Certificate for Counsel, the fee of counsel should not have been allowed.

18.Paragraph 2 (3A) of Part II of Schedule 1 of Order 62 of RDC provides that:-

“(3A) Where a party appearing by counsel is awarded costs, but the costs of employing counsel are not allowed, the taxing master may, on taxation, allow such costs as may have been allowed if the party had appeared by a solicitor and not by counsel.”

19.In the circumstances, the costs of a solicitor appearing at the hearing should have been allowed instead.

20.According to the statement of costs produced by the defendants’ solicitors, there are two handling solicitors. Mr Brian William Gilchrist was admitted in Hong Kong in 1995, Miss Li Sharon Siu Yen was admitted in Hong Kong in 2009.

21.In view of the complexity of the matters raised in the statement of claim, I take the view that Mr Gilchrist who is more senior and experienced is the appropriate solicitor to argue the application. His hourly rate is allowed at $2,600.

22.The plaintiff complained that an hour was wasted on an issue raised by the defendants as to whether or not Mr Phil Chan could appear as an advocate for the plaintiff. At the substantive hearing of the argument, the legal representative of the defendants is entitled to raise any preliminary issue which he or she thinks is relevant. At the hearing, the learned Master did hear and deal with the issue. I do not think time was wasted.

23.The hearing lasted for 3.5 hours. Mr Gilchrist’s costs are allowed at $9,100.

24.Having substituted the costs of Mr Gilchrist in the place of counsel’s fee, the overall costs are in the sum of $64,130.

25.As the learned Master deals with taxation matters on a regular basis, the exercise of his discretion in relation to the other items of the statement of costs should be given more than the usual weight. I do not think the assessment of the learned Master in respect of the other items should be disturbed.

26.Looking at the overall picture, in my view, the figure at paragraph 24 is proportionate and reasonable having regard to the nature and complexity of the application.

Conclusion and order

27.In the result, the appeal is allowed to the extent that the assessed costs of the learned Master are reduced by $40,900 ($50,000 - $9,100). Therefore, the costs of the defendants are allowed at $64,130.

Costs

28.Costs shall follow the event. I make an order nisi that the defendants shall pay the plaintiff costs of this appeal. The order nisishall become absolute unless an application is made to vary the same within 14 days.

29.For the purpose of summary assessment of costs, I direct the plaintiff to file and serve a statement of costs within 21 days. The defendants shall file and serve a list of objection (if any) within 7 days thereafter.