Hong Kong Personal Injury Brief - October 2021 edition

Recent cases suggest courts may be cracking down more on unmeritorious claimants and their solicitors who assist them to pursue hopeless litigation. In April’s PI Brief we referred to a judgment of HHJ Andrew Li (HHJ Li) where a personal costs order was made against claimant solicitors for pursuing a hopeless claim. HHJ Li has continued to utilise this costs sanction in the following decisions.

In Ma Ching Wang (a minor) v Choy Yee Lim DCPI 2229/2017, the proceedings was settled just before the case was warned for assessment but HHJ Li requested the parties to attend the hearing to explain why a simple traffic accident case took almost 7 years from date of accident and 4 years after the issue of proceedings before it was set down for trial. It was accepted by the Court that delays were mainly caused by the claimant and although no costs sanction was made against them on this occasion, HHJ Li categorically stated that unjustified delays by either party will not be condoned by the court.  If such delays are caused by the inaction and/or lack of effort on the part of the parties’ legal representatives to comply with the orders, then in appropriate cases, the court will request the legal representatives to show cause as to why the costs caused by the delays or non-compliance should not be borne by them personally and on an indemnity basis. The court would allow sufficient time and space for parties to achieve settlements without going to trial, but the court is not prepared to allow a simple and straightforward personal injury claim to “run wild and go unchecked and let the parties dictate their own timetables by seeking repeated adjournments to the CLR hearings without any valid reasons or grounds at all”.

In Ho Yuk Yee v The Secretary for Justice for and on behalf of Food and Environmental Hygiene Department DCPI 1052/2018, a personal costs order was made by HHJ Li against the same solicitors in the preceding case, for failing to inform the court and the other side well before the case was set down in the running list that the plaintiff had suffered a stroke and was unable to communicate verbally.  During the pre-trial review (PTR) hearing, it was revealed that the plaintiff had suffered the stroke some 2 years ago but such fact was never disclosed by the plaintiff’s solicitors when they should have known that her physical condition would clearly have a direct bearing on how the trial was to be conducted and the length of trial. The Court found that as unacceptable conduct and a failure on the part of the plaintiff’s solicitors. All the costs wasted (which would include the costs of the PTR and the adjournment of the trial) should be borne by the plaintiff’s solicitors personally and on an indemnity basis.

Shortly thereafter, HHJ Li made another costs order to be borne personally by the solicitor responsible on an indemnity basis but this time, the order was made against the defendant’s solicitor - Lo King Hung v Eternal Richest Limited DCPI 1134/2019. It was found that there had been some extraordinary delays caused by the inaction of the defendant including failure to serve its witness statement, answer to RSOD and agreeing draft trial bundle indices. Further, the defendant’s solicitor completely ignored the correspondence from the Plaintiff’s solicitors for over 7 months without any valid justification, resulting in an unreasonable delay for almost 20 months. The court said these are all unacceptable conducts on the part of a solicitor who conducts personal injury litigation. By completely ignoring the other side’s correspondence and the court’s Orders, not only it shows a lack of professional courtesy to his opponent, it also shows a lack of respect to the court. All the costs wasted by the plaintiff from November 2019 to July 20121 was to be borne by the defendant solicitors personally and on an indemnity basis.

By contrast, Marlene Ng J declined to make a wasted costs order against plaintiff solicitors when they tried to appeal a taxed costs award with no substantive merit instead of following the correct review procedure – Liu Hui Hong v Fong Wai Meng HCPI 390/2015. The defendants had argued that plaintiff solicitors had a hopeless case and should not have dragged on proceedings for 9 months after taxation had ended and with no legal aid certificate for the appeal. However, Ng J disagreed and found that the plaintiff solicitor’s conduct did not amount to misconduct and/or abuse of process even if they had seemingly inflated their bill of costs as there was no suggestion or evidence that the plaintiff solicitors had breached the indemnity principle, ie claiming more costs than it had incurred.

While courts seem more willing to order wasted costs order against solicitors personally, the hurdle is quite high.  As observed by Ng J, there must be “prima facie impropriety in say, putting forward on behalf of their clients less than honest claims when they knew their clients had no funds to support the litigation or to deal with costs upon failure, and/or helping their clients to keep up a façade of proceeding with the legal procedures well knowing they would not go ahead”. Defendant solicitors should also take note of HHJ Li’s comments in Lo King Hung and ensure timely compliance with court orders and procedural steps to avoid any costs orders being made against them personally.