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Wong Kar Gee Mimi v K C Ho & Fong (A Firm)

Judgment Cited authorities 3 Cited in Precedent Map Related
Vincent
Judgment Date20 May 2015
Year2015
Judgement NumberHCMP61/2014
Subject MatterMiscellaneous Proceedings
CourtHigh Court (Hong Kong)
HCMP61/2014 WONG KAR GEE MIMI v. K C HO & FONG (a firm)

HCMP 61/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 61 OF 2014

________________________

IN THE MATTER of the Legal Practitioners Ordinance (Cap 159)
and
IN THE MATTER of Order 106 of the Rules of the High Court (Cap 4)
and
IN THE MATTER of K C HO & FONG (a firm)

________________________

BETWEEN

WONG KAR GEE MIMI Plaintiff
and
K C HO & FONG (a firm) Defendant
_________________________
Before : Master M Wong in Chambers
Date of Hearing : 4 May 2015
Date of Handing Down of Decision : 20 May 2015

_____________

DECISION
_____________

BACKGROUND

1. By Originating Summons dated 11 January 2014, the plaintiff applies for an order that all the bills of fees, charges and disbursements delivered to the plaintiff by the defendant in all causes and matters wherein the defendant had acted for the plaintiff be referred to taxing master for taxation.

2. There are all together 11 bills in question, namely:-

(1) Bill No. JH56700-B001 dated 8 October 2012 for $201,045.00 (“Bill 1”);

(2) Bill No. JH56700-B002 dated 10 December 2012 for $543,500.00 (“Bill 2”);

(3) Bill No. JH56700-B003 dated 8 March 2013 for $539,000.00 (“Bill 3”);

(4) Bill No. JH56700-B004 dated 17 April 2013 for $954,806.64 (“Bill 4”);

(5) Bill No. JH56700-B005 dated 7 May 2013 for $658,692.00 (“Bill 5”);

(6) Bill No. JH56700-B006 dated 30 May 2013 for $1,532,352.50 (“Bill 6”);

(7) Bill No. JH56700-B007 dated 3 June 2013 for $438,536.60 (“Bill 7”);

(8) Bill No. JH56700-B008 dated 4 July 2013 for $2,342,437.00 (“Bill 8”);

(9) Bill No. JH56700-B009 dated 30 September 2013 for $1,315,300.00 (“Bill 9”);

(10) Bill No. JH56700-B010 dated 15 October 2013 for $35,000.00 (“Bill 10”); and

(11) Bill No. JH56700-B011 dated 31 October 2013 for $95,000.00 (“Bill 11”).

3. The defendant conceded at the call-over hearing on 29 April 2014 that Bill 6, Bill 8, Bill 9 and Bill 10 should be taxed, but disagrees to refer the remaining 7 bills to taxing master for taxation.

4. The defendant also took out a summons dated 24 July 2014 to ask for an order that the plaintiff do make: (1) payment into court in the sum of $2,311,626.10 being the total outstanding sum of Bill 6, Bill 8, Bill 9 and Bill 10; and (2) interim payment of Bill 11 in the sum of $95,000.00.

5. The plaintiff’s application is made pursuant to section 67 of the Legal Practitioners Ordinance, Cap 159, which sets out the circumstances where the court may order a solicitor’s bill to be taxed. The relevant provisions of section 67 read as follows:-

“(1) On the application, made within 1 month of the delivery of a solicitor's bill or a foreign lawyer's bill, of the party chargeable therewith the Court shall, without requiring any sum to be paid into court, order that the bill shall be taxed and that no action shall be commenced thereon until the taxation is completed.

(2) If no such application is made with in the period mentioned in subsection (1), then, on the application of the solicitor or the foreign lawyer or of the party chargeable with the bill, the Court may, upon such terms, if any, as it thinks fit (not being terms as to the costs of the taxation), order-

(a) that the bill shall be taxed;

(b) that, until the taxation is completed, no action shall be commenced on the bill, and any action already commenced be stayed:

Provided that-

(i) if 12 months have expired from the delivery of the bill, or if the bill has been paid, or if a verdict has been obtained or a writ of inquiry executed in an action for the recovery of the costs covered thereby, no order shall be made on the application of the party chargeable with the bill except in special circumstances and, if an order is made, it may contain such terms as regards the costs of the taxation as the Court may think fit;

(ii) if the bill has been paid, no order under this subsection shall be made where the application for the order is made after the expiration of 12 months from the date of payment of the bill.”

6. The effect of section 67 was succinctly summarized by Recorder Jat SC in Re Miller Peart [2007] 3 HKLRD 125 as follows:-

“64. It is clear that the statutory scheme under s.67 is that:

64.1 within one month of the delivery of the solicitor’s bill, the client may apply to have the bill taxed as of right, and no term or condition will be imposed: s.67(1);

64.2 if the client does not apply for taxation within one month since the delivery of the bill, either the solicitor or the client may apply for taxation and the court may so order and impose any terms as it may think fit except terms as to the costs of the taxation: s.67(2);

64.3 if 12 months or more have elapsed since the delivery of the bill or if the bill has been paid, the client must show special circumstances to justify his application for taxation and the court may impose any terms including terms as regards the costs of the taxation: s.67(2)(i).”

7. Thus, as summarized above, section 67 stipulates 3 scenarios in which the court may order a solicitor’s bill to be taxed. These three scenarios were referred to by Recorder Ho SC in Lee Chi Enterprises Company Limited v K C Ho & Fong, HCMP 61/2007, as “the first, second and third regimes”. The plaintiff uses the same reference for these 3 scenarios.

8. For cases falling under the second regime (ie where the solicitor’s client did not apply for taxation within one month of the delivery of the solicitor’s bill), it is not disputed that, subject to any terms that may be imposed, the court will generally be inclined to order taxation, although the court does retain a general discretion to refuse taxation in an appropriate case (see Lee Chi Enterprises Company Limited, supra).

9. For cases falling under the third regime (ie when 12 months have expired from the delivery of the bill, or when the bill has been paid), it is not disputed that the client will have to show special circumstances to justify the application for taxation.

10. However, there is a further scenario under section 67(2)(b)(ii) of the Legal Practitioners Ordinance in which no order for taxation should be made at all, namely where the bill has been paid and the application for taxation is made after the expiration of 12 months from the date of payment of the bill. I shall refer this scenario as the fourth regime.

11. The plaintiff submits that the 7 disputed bills can be divided into four groups based on their respective dates/payment status as follows:-.

Group 1: Bill 1 & Bill 2

Group 2: Bill 4 & Bill 5

Group 3: Bill 3 & Bill 7

Group 4: Bill 11

12. I shall deal with these bills according to the grouping made by the plaintiff as discussed below.

GROUP 1: BILL 1 & BILL 2

13. There is no dispute that the plaintiff’s Originating Summons was taken out over 12 months after Bill 1 and Bill 2 were issued. The plaintiff’s position is that Bill 1 to Bill 9 formed a series of interim bills which culminated in Bill 10 (being the final bill). The plaintiff only received Bill 10 on 16 October 2013. This is consistent with the terms of the retainer between the plaintiff and the defendant, ie the defendant would send the plaintiff their bill of services on an “interim basis”.

14. Whether a bill formed part of a series of interim bills or whether it was delivered as a separate final bill is a question of fact. As held by DHCJ To (as he then was) in Chin Yuk Lun Francis v Messrs Lo & Lo (a firm), HCMP 1142/2005:-

“The second question is a question of fact. There are two elements here. The solicitor has to deliver that bill intending it to be a final bill and it is also intended and understood by the client to be a final bill. This question has to be answered by looking at the intention of the solicitor and the client, their conduct, the reaction of the client upon receipt of the bill and the form the bill took. No assistance could be derived from any decided case.”

15. The plaintiff submits that the forms of Bill 1 and Bill 2 are highly indicative of the fact that they were interim bills given that they were each marked as an “interim bill” by the defendant. The plaintiff further submits that a clear way to distinguish “interim bills” from “final bills” is that interim bills refer to requests for payment of money on account (see Hong Kong Civil Procedure 2015, para 62/App/61).

16. It is the plaintiff’s evidence that she deposited costs on account with the defendant because she was repeatedly pressed to do so by the defendant, and she wanted to ensure that her client account with the defendant did not have a negative balance, as well as to ensure that the defendant would focus their attention on the appeal in CACV 197/2012 rather than disputing with her over payment of legal fees.

17. Thus, the plaintiff submits that she had merely deposited costs on account which was then utilized by the defendant to set off Bill 1 and Bill 2. There is no evidence that she had authorized the specific payment of these bills via setting off such costs on account. The plaintiff does not consider such deduction to constitute “payments”, but rather only as an alteration to the costs on account maintained with the defendant.

18. As such, the plaintiff contends that the court should allow these two bills to be taxed as long as the plaintiff can demonstrate that special circumstances exist (which will be discussed below).

19. I do not accept the plaintiff’s submissions in this regard. The retainer between the plaintiff and the defendant has a clear term to the effect that the purpose of the costs on account is to settle such disbursements and interim...

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