As reported in Industry Insights for the September 2017 edition of the Hong Kong Lawyer (“Solicitor and Own Client Costs”), on a review of a taxing master’s certificate, pursuant to RHC O. 62, r. 35, a judge saw fit to disallow the costs of a second partner’s time following a “solicitor and own client taxation”. The sole ground for discounting the second partner’s time with respect to the disputed items of costs was a so-called “duplication of work”, notwithstanding that four barristers had also assisted with the case.
An appeal as of right was heard in Lam & Lai (Solicitors) v Ho Chun Yan Albert  HKCA 83 and for some the costs outcome may appear fairer. The Court of Appeal allowed the solicitors’ appeal and varied the judge’s taxation review so as to allow the costs of one partner and the costs of a “notional” junior solicitor (equivalent to half of the costs of a partner) on the taxation of the sixty-four items disputed in the solicitors’ bill.
Having regard to the complexity and importance of the underlying court proceedings, out of which the costs dispute arose, the Court of Appeal considered that the judge had erred in simply taxing off the costs of one of the two partners without considering other justifiable options – such as (for example) allowing a senior solicitor to be assisted by a junior solicitor. Therefore, the Court of Appeal felt justified in exercising the court’s discretion afresh.
Of equal interest is the Court of Appeal’s confirmation that Hong Kong law did not follow a more recent English approach regarding a judge’s powers on reviewing a taxing master’s certificate under the equivalent of RHC O. 62, r. 35. Therefore, a judge’s review of a taxing master’s certificate pursuant to this provision was not a hearing de novo and he or she did not have an unfettered discretion.
Rather, the judge should only interfere with the decision of the taxing master in limited circumstances; for example, where it could be shown that the taxing master had erred in principle or had made a mistake of law (Chan Yin Na v Union Medical Centre Ltd, HCPI No. 804 of 2003, 5 August 2011, approved). While the Court of Appeal saw fit to interfere with the exercise of the judge’s discretion the judge had not applied the wrong law.
For those familiar with matters of costs in court proceedings, the Court of Appeal’s reasoning will make sense. While in matters of costs there are winners and losers, overall taxing masters are usually better placed to deal with costs disputes. By comparison, some judges may lack the necessary current experience to deal with the matter of taxation of costs as a hearing de novo; that experience is not necessarily made-up for by dealing with summary assessments of costs (Chan Yin Na, at para. 24).
As the Vice-President of the Court of Appeal states in his judgment in Lam & Lai (at para. 7):
“It is not the practice of the court to list a review before a judge for the same length as the taxation before the taxing master. Expensive and lengthy taxation processes (including review and appeal) is another form of satellite litigation which should be avoided if the utility is not high”.