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Accurate Contractors & Renovators Co Ltd v Messrs Wong & Lawyers

Judgment Cited authorities 10 Cited in Precedent Map Related
Vincent
JurisdictionHong Kong
Judgment Date26 March 2024
Neutral Citation[2024] HKCFI 820
Subject MatterMiscellaneous Proceedings
Judgement NumberHCMP66/2023
Year2023
HCMP66/2023 ACCURATE CONTRACTORS & RENOVATORS CO LTD v. MESSRS WONG & LAWYERS

HCMP 66/2023

[2024] HKCFI 820

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 66 OF 2023

________________

IN THE MATTER OF Section 67 of Legal Practitioners Ordinance, Cap 159 and Order 106, rule 2 and rule 5 of the rules of the High Court, Cap 4A
and
IN THE MATTER of WONG & LAWYERS, Solicitors (a firm of solicitors practicing laws in the Hong Kong Special Administrative Region)

________________

BETWEEN
ACCURATE CONTRACTORS & RENOVATORS CO LTD Plaintiff
and
MESSRS WONG & LAWYERS Defendant

________________

Before: Deputy High Court Judge Jat SC in Court
Date of Hearing: 8 March 2024
Date of Judgment: 26 March 2024

________________

J U D G M E N T

________________

Introduction

1. By Originating Summons issued on 13 January 2023, the Plaintiff (“ACR”) seeks an order for taxation of 3 bills issued by its former solicitors (“W&L”) dated 10 July 2014, 17 September 2014 and 12 May 2015 respectively pursuant to s.67 of the Legal Practitioners Ordinance, Cap 159 (“LPO”).

2. W&L oppose the application on a number of grounds. The main ground is that the application is an abuse of process and should be dismissed for that reason. Failing that, it is argued that this Court should in exercise of its discretion under LPO s.67(2) refuse to order taxation. Finally, in the event that taxation is ordered, the same should be on terms that ACR should bear the costs of the Originating Summons.

The Undisputed Factual Background

3. The material background facts are not in dispute. W&L were ACR’s solicitors in handling an arbitration in which ACR was the claimant. For present purposes, it is unnecessary to go into the details of the arbitration. What is pertinent to note is that ACR signed a written retainer letter with W&L dated 15 August 2013. ACR contends that the retainer governing the solicitor-client relationship was partly in writing (ie. the retainer letter) and partly oral. W&L dispute the existence of any alleged oral agreement or terms that are contrary to the express terms of the retainer letter. As will be explained presently, it is unnecessary to go into that dispute to resolve this application.

4. The arbitration commenced in August 2013 and took a number of years to complete. Eventually it was concluded in ACR’s favour in December 2021. W&L issued a total of 7 bills to ACR between July 2014 and January 2022, and ACR made a number of payments to W&L. The details of the 7 bills (“Bill 1” to “Bill 7”) and ACR’s payments are set out in a Table entitled “Summary of the Plaintiff’s Payments to the Defendant” in paragraph 12 of the First Affirmation of Mr Chan Chun Yuen (“Mr Chan”, a director of ACR) filed on behalf of ACR in support of the Originating Summons. It would be convenient to reproduce the Table:

5. What one would immediate note from the Table is that the 3 bills in question, ie. Bills 1 to 3, were issued in July 2014 to May 2015 totalling HK$889,788 (including disbursements), and that ACR had made a number of payments to W&L totalling HK$950,000 from February 2014 to April 2018.

6. The last bill, ie. Bill 7, was issued on 25 January 2022. On 16 February 2022, ACR applied by Originating Summons in HCMP 217/2022 seeking taxation of Bills 3, Bill 4, Bill 6 and Bill 7.[1] Bills 1 and 2 were not included in HCMP 217/2022. Mr Chan explained why that was the case in his First Affirmation filed in HCMP 217/2022:

“12. I was legally advised that since I have raised this application for taxation within 28 days of the delivery of Bill 6 and Bill 7, I may apply to have the bill taxed as of right, and no term or condition will be imposed.

13. I was also legally advised that if a bill has been paid and more than 12 months have elapsed, there shall be no order for taxation. Referring to the Plaintiff’s internal accounting report in “CCY-1”, I accept that Bill 1 and Bill 2 were paid well over 12 months ago and I cannot refer these bills to taxation.”

7. ACR’s accounting report in exhibit “CCY-1” confirmed that payments up to 7 January 2016 had been made to pay Bill 1 and Bill 2, as set out in the Table.

8. W&L accepted that ACR was entitled to have Bill 4, Bill 6 and Bill 7 taxed, but not Bill 3 which W&L considered had been paid more than 12 months before. ACR’s solicitors accepted that. By a Consent Summons dated 3 August 2022, ACR and W&L applied jointly to refer Bill 4, Bill 6 and Bill 7 to taxation. On 4 August 2022, Master Lai raised a number of requisitions to the parties, asking:

“How will the parties propose to deal with other applications in the Originating Summons ie. … and the fee note dated 12/5/2015 referred to in paragraph 2 [ie. Bill 3]?”

9. A hearing took place before Master Lai on 5 August 2022. At the hearing, counsel appearing for ACR (not counsel for ACR before me) confirmed that ACR would not pursue taxation of Bill 3. This was recorded in the order made by Master Lai dated 5 August 2022, paragraphs 2 and 5 of which provide as follows:

“1. The Defendant’s Fee Note dated 21 June 2017 [ie. Bill 4], Fee Note No B3641 dated 24 January 2022 [ie. Bill 6] and Fee Note No. B3643 dated 25 January 2022 [ie. Bill 7] are to be taxed by Taxing Master;

5. Upon the Plaintiff’s confirmation that it does not pursue other matters raised in the Originating Summons, the court makes no order as to other items of the Originating Summons;”

10. On 18 November 2022, after ACR changed solicitors and when there was an unless order against ACR for filing its List of Objections by 14 December 2022, ACR took out a summons seeking to amend the Originating Summons to add a claim for taxation of Bill 1, Bill 2 and Bill 3, and to extend the time for filing and serving its List of Objections to 28 days after disposal of the amendment application or, if leave to amend is refused, the disposal of the application.

11. Naturally W&L objected strongly to what they considered to be a volte-face on ACR’s part and an attempt to delay the taxation process. By letter dated 22 November 2022, W&L responded to ACR’s summons to amend as follows:

“Re: HCMP 217 of 2022

We refer to your letter dated 18 November 2022 enclosing your client’s Summons filed on 18 November 2022 (“Summons”).

In the Originating Summons filed on 16 February 2022 (“OS”), your client applied for, amongst others, the taxation of our fee notes dated 12 May 2015, 21 June 2017, 24 January 2022 and 25 January 2022 (i.e. Bill 3, Bill 4, Bill 6 and Bill 7 as referred to in your client’s supporting affirmation). The OS has already been disposed of by the Order of Master Lai dated 5 August 2022 with no order as to costs. Under the same Order, Bill 4, Bill 6 and Bill 7 are to be taxed by Taxing Master. By consent, your client shall file and serve its List of Objections by 4:00 pm of 14 December 2022 on an “unless order” basis.

In the circumstances, we consider that:

1. Your client’s application for taxation of Bill 3 under the OS has already been disposed of;

2. If your client intends to apply for taxation of our fee notes dated 10 July 2014 and 17 September 2014 (i.e. Bill 1 and Bill 2 as referred to in your client’s supporting affirmation), your client shall make a fresh application instead of amending the OS;

3. In any event, your client’s application for amendment of the OS or new application for taxation of Bill 1, Bill 2 and Bill 3, if any, shall not be a ground for seeking extension of time for filing and serving the List of Objections concerning Bill 4, Bill 6 and Bill 7.

We therefore will oppose the Summons with costs.”

12. Faced with W&L’s objections, ACR withdrew the application for leave to amend the Originating Summons. ACR then issued the Originating Summons in the present case seeking taxation of Bill 1, Bill 2 and Bill 3. Mr Chan filed an affirmation in support of this application, paragraph 8 of which deposed as follows:

“8. The reason why Bill 1 and Bill 2 were not covered, and Bill 3 was not pursued under HCMP 217/2022 was that they were all issued more than 12 months prior to the commencement of HCMP 217/2022 and were all treated by the Defendant as having been settled from payments made by the Plaintiff. The Plaintiff was originally under the impression that the Subject Bills [ie. Bill 1, Bill 2 and Bill 3] were not referrable to taxation in such circumstances, but has since realized that they are still referrable to taxation if they were not interim final bills. The Plaintiff therefore makes this application to refer the Subject Bills to taxation as they were in fact not interim final bills and there exist special circumstances which justify such referral.”

13. Mr Chan’s affirmation, which ran to 39 pages excluding exhibits, deposed in considerable detail what “special circumstances” were relied upon. In particular, it is alleged that there was an oral agreement on fees made between him and Mr K O Wong, the sole proprietor of W&L, to the effect that: (a) ACR would pay up to HK$1 million of W&L’s fees by actual payment, (b) for any part of W&L’s fees which is over and above HK$1 million, the same would be settled through costs which W&L might recover for ACR from the other party to the arbitration, (c) if the aggregate of the actual payments made by ACR and the recovered costs was to exceed W&L’s fees, the excess would belong to ACR but W&L would absorb any shortfall, and (d) ACR was to pay up to HK$1 million for disbursements to be incurred during the course of the arbitration. Mr Chan also deposed to his version of W&L’s...

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