Norman George & Associates v Minister of Health [2007] CKHC 14; HC (21 June 2007)

IN THE HIGH COURT OF THE COOK ISLANDS
HELD AT RAROTONGA

BETWEEN

NORMAN GEORGE & ASSOCIATES P.C.
a duly registered Professional Corporate Entity,
whose registered office is at Avarua,
Rarotonga.
Plaintiff

AND

THE MINISTER OF HEALTH
of Avarua, Rarotonga
First Defendant

AND

THE SECRETARY OF HEALTH
of Avarua, Rarotonga
Second Defendant

Mr. Vakalalabure for Plaintiff
Mr. Mitchell (Solicitor-General) for Defendants
Date: 21 June 2007

DECISION OF WESTON J

1. This is a decision in my capacity as a taxing officer under the delegated authority of the Chief Justice. The Chief Justice set out that process in a minute dated 29 March 2007. Subsequently, Nicholson J gave some directions and pursuant to those Mr. Vakalalabure has provided his client's affidavit of documents. Counsel advises me that this is a copy of the complete file held by the Plaintiff entity, Norman George and Associates P.C. On a number of occasions, when I enquired if further documents existed, Mr. Vakalalabure advised me that this was, as he understood it, the complete file.

2. I discussed with counsel at the outset how this hearing might proceed and the consensus reached was that, in my capacity as a taxing officer, I should hear submissions from the Solicitor-General and then from Mr. Vakalalabure in response. If necessary, the Solicitor-General would then reply.

3. I advised Mr. Vakalalabure that his client, Mr. George, was entitled to be present. I was advised that he did not seek to be present and was content for Mr. Vakalalabure to conduct the matter on his behalf and in his absence.

4. I am grateful to counsel for the assistance they have provided me.

5. I take, as my starting point, a passage from the UK Supreme Court practice that Mr. Vakalalabure helpfully provided. In that extract it is said: "the test to be applied on the taxation of costs, whether on the standard or indemnity basis, is that of reasonableness." In Francis v Francis and Dickinson, it was held that the correct viewpoint to be taken by the taxing officer, in considering whether any step was reasonable, is that of a sensible solicitor considering what, in light of his then knowledge, was reasonable in the interests of his client.

6. In addressing this matter I have already given a ruling on the admissibility of certain materials, in particular, a report prepared by the Public Expenditure Review Committee and an opinion prepared by Mr. McFadzien. I have allowed those materials to be put before me and I have considered them. I believe, though, that the report of the Public Expenditure Review Committee goes further than my jurisdiction. While I do need to look at the extent of Mr. George's instructions, what he did and how he billed them, it is not my job to see whether he carried out his work as a reasonable and competent solicitor. My job, rather, is to look at whether he has billed reasonably in relation to his instructions.

7. Mr. George was instructed by a letter dated 6 June 2005 and it seems he was then given various materials received from the complainant. These materials are quite bulky and detailed in terms of the medical issues discussed in them. They are not easy to read, particularly to someone who is not familiar with the medical terminology.

8. Mr. George read those materials and on the 16^th of June he acknowledged receipt of them. He asked to be paid $10,000 in advance and he also asked to be put in funds to the extent of $30,000, it seems with a view to effect any settlement. I think it is important to note that in his letter of instructions, Mr. George was told that his job was to endeavor to settle the complaint and that is ultimately what he set out to do.

9. On or about the 20^th of June, Mr. George was given a copy of an opinion prepared by Mr. Hodgson QC, a very experienced medico-legal expert in New Zealand. Mr. Hodgson set out a useful opinion and Mr. George was obviously reliant upon that when he prepared his initial letter of offer on the 22^nd of June. There were then a number of letters to and fro which culminated on the 7^th of October in a letter of offer which was accepted. The terms of the settlement were recorded in a deed of the 19^th of October.

10. Mr. George then issued a bill for $40,000. As Mr. Mitchell says, there is an uncanny relationship between that figure and the figure of $40,000 which Mr. George initially sought to have paid to him. I should say though that he was only paid the sum of $10,000 with his request for the $30,000 declined.

11. Mr. George, at the direction of Nicholson J, prepared a schedule of his time records. Mr. Vakalalabure advised me that this was prepared by him in response to the Court's direction. It does not follow from a series of discretely kept time sheets but, rather, was put together after the event by reference to the file and Mr. George's diary.

12. This shows a total of 142.5 hours worked on the case. I have been through this in detail by reference to the file. I have heard submissions on this from Mr. Mitchell and Mr. Vakalalabure has also addressed me on it as best he can bearing in mind the limited materials on the file.

13. I am satisfied that the amount of hours set out here is overstated. Mr. Vakalalabure made the valid point that the difficult nature of the subject matter addressed would have required some time to consider those materials. I agree, but it seems to me that Mr. George spent about 45 hours reading his initial instructions and a series of appendices that were attached. On the 17^th of June for example, he said he studied three appendices and spent approximately 10 hours doing so. But those appendices total only 6 pages and in my respectful view would not have taken 10 hours to study. A similar sort of analysis could be undertaken at virtually every step.

14. I then raised with Mr. Vakalalabure an entry made in mid July 2005 where 24 hours was claimed to have been spent liaising with overseas lawyers. Mr. Vakalalabure advised me there was nothing on his file that would assist me in understanding what occurred at that time. I have read a letter prepared by Mr. Tony Robinson dated 9 June 2007 where he refers to a discussion that he had with Mr. George, that is somewhat inconsistent with what Mr. George sets out in his time records. I asked Mr. Vakalalabure to address me in relation to Mr. Robinson's letter and he gave me what assistance he could. Nevertheless I am satisfied that the claim for 24 hours at this time is also overstated.

15. It is impossible for me to set an actual time that I believe should have been spent on this file. I think that 142.5 hours is considerably overstated but I am reluctant to set some replacement time. I bear in mind that my job is to decide what is a reasonable fee. A time basis is not the only basis upon which fees are set. One needs to look at the nature of the instructions, the difficulty of them, the complexity of the matters, the seniority of the practitioner required and many other factors like that. Ultimately the correct level of the fee is a matter of judgment and impression. I have had regard to what Mr. Robinson charged his client for undertaking his side of the matter. I have had regard to what Mr. McFadzien says would have been an appropriate level of fee. Both of these experienced lawyers indicate a fee range of somewhere around the $5000-$7000 range.

16. I have given consideration to what the PERC report says and its criticisms of Mr. George. Although it is not my area to enter into, I do not want it to be thought that I have adopted those criticisms or been influenced by them without exercising my own judgment as to what Mr. George did and didn't do. As I said, he accepted instructions to settle a proceeding and that is what he did. He is being criticized for that but I do not see it as my job to repeat or examine the criticism. Again, I repeat, my job is to ascertain what is a reasonable fee.

17. In all the circumstances, I believe a reasonable fee would be $10,000 plus VAT making a total of $12500. I do not allow any separate sum on account of disbursements because there are no records before me that would show me what those disbursements are. I do not want to be thought to say that I disbelieve Mr. George's claim in relation to disbursements but simply that I have no materials before me upon which I can rely. It is for that reason that I have not allowed any separate figure on account of disbursements.

18. Costs are reserved. The parties are to provide memoranda if there is no agreement on costs.

Judge