Sen v Vandhana [2011] FJHC 800; HBC185.2008 (7 December 2011)

IN THE HIGH COURT OF FIJI AT SUVA
CIVIL JURISDICTION

CIVIL ACTION NO. HBC 185 of 2008

BETWEEN:

UDAY RAJ SEN f/n Bir Sen, as Attorney for SARAS WATI of Flat 12, Cakabau Apartments, Suva in the Republic of Fiji Islands, General Manger Business Development and Lending.
PLAINTIFF

AND:

MANISHA VANDHANA f/n Satya Nand) of 24 Burerua Rd, Raiwaqa, Suva in the Republic of Fiji Islands, Dentist.
1st DEFENDANT

AND:

PREM LATA NARAYAN (f/n Deo Narayan) t/as PREM NARAYAN, a law firm of Module 2A, Level 2, Provident Plaza One, Ellery Street, Suva in the Republic of Fiji Islands, Solicitor.
2nd DEFENDANT

BEFORE: Master Deepthi Amaratunga

COUNSEL: Mr. R. Naidu of Naidu Law for the Plaintiff
Mr. P. Narayan and Ms. Basawaqa A. of Munro Leys for the 1st Defendant and the 2nd Defendant

Date of Hearing: 21st November, 2011
Date of Ruling: 07th December, 2011

Decision
SECOND DEFENDANT'S TAXATION OF BILL OF COSTS

1. INTRODUCTION
   

1. This is the taxation of a bill of costs filed on 22 May 2006 for $3,311.72.
   
2. The Second Defendant is a lawyer who practices as a legal practitioner and 1st Defendant who ran a business venture for dental surgery with partnership with the Plaintiff, deposited money of the said joint venture in the solicitor's trust account after the relationship between the partners were strained.
   
3. The Plaintiff filed an action against the 1st and 2nd Defendant, but later withdrew the whole action subject to an order of the cost to be agreed and if not to be taxed. This order was made on 23rd February,2011
   
4. The Court made an Order of the court on costs made on 23 February 2009 was as follows:
   

'By consent leave is granted to the Plaintiff to discontinue the action against the Second Defendant with costs if not agreed to be taxed.'

5. The relevant law in such an instance is found in Order 62 rule 12(1) which sate where the order is silent as to the basis of the cost the cost has to be calculated on standard basis.
   

Order 62 r 12 (1) of the High Court Rules of 1988 states as follows:

On a taxation of costs on the standard basis there shall be allowed a reasonable amount in respect of all costs reasonable incurred and any doubts which the taxing officer may have as to whether the costs were reasonable incurred or were reasonable in amount and may be resolved in favour of the paying party; and in these rules the term "the standard basis" in relation to the taxation of costs shall be construed accordingly. (emphasis is added)

6. In Vitiana Timbers (Fiji) Limited v Danzas AEI Limited HBC 327 of 2007, the court has considered what "reasonable" meant. It was cited the case of Francis v Francis and Dickinson [1955] 3 All ER 836 "a reasonable step is that of a sensible solicitor considering in his knowledge what was reasonable for his client". The test is what the court thinks reasonable and not the actual cost as in the indemnity cost.
   
7. Further the phrase "necessarily incurred" was considered by the High Court, in Shah v Fiji Islands Revenue and Customs Authority and anr HBJ 42 of 2001, 11 May 2006 where he cited Smith v Buller [1875] EQ 473, Sir Malins VC at 475 stated:
   

I think he ought not bear more than the necessary costs. I adhere to the rule, which has already been laid down, that the costs chargeable under a taxation between party and party are all that are necessary to enable the adverse party to conduct the litigation, and no more. Any charges merely for conducting litigation more conveniently may be called luxuries, and must be paid by the party incurring it. The Plaintiff, is the attacking party and has failed, and he must therefore pay all charges which are necessary to the litigation.

8. The Second Defendant is first defendant's solicitor and ought not to have been included as a defendant in these proceedings merely because of the fact that she had deposited money given by her client which were part of the proceeds of the partnership where the Plaintiff and 1st Defendants were the estranged partners, at that time.
   
9. This action against the Second Defendant was not withdrawn until 23 February 2009. The action was filled on 28th May, 2008 and the 2nd Defendant state that all the claims listed below are therefore reasonable and necessarily incurred to allow the Second Defendant to defend herself in these proceedings, but the Plaintiff for obvious reasons object to all the claims except the fees paid for disbursements, filing ect.
   
10. Looking closely to the said claims for cost, some of the claims are not necessarily incurred and some of them are exaggerated so while considering the objection by the Plaintiff I have exercised my discretion in terms of the Order 62 rule 13 read with gazette notification of 7th July, 2006 ( Schedule 1 of Legal Practitioners Act 1997) and it should also be noted where there is a doubt as to the reasonableness it has to be decided in favour of the paying party, namely the Plaintiff in this case, and accordingly the some of the costs claimed are rejected or reduced.
    
11. It is also noted that standard cost has a higher and lower scales and the determinant factors in lower and higher scales are contained in Order 62 rule 13 and they are as follows
    
    1. The complexity of the item or the cause or matter in which it arises and the difficulty or novelty of the questions involved.
       
    2. The skill, specialized knowledge and responsibility required of and the time and labour expended by the solicitor
       
    100. The number and importances in which the business involved is transacted
         
    4. The place and circumstances in which the business involved is transacted
       
    5. The importance of the cause or matter to the client
       
    6. Where money or property is involved, its amount or value.
       
    7. Any other fees and allowance payable to the solicitor in respect of other items in the same cause or matter, but only where work done in relation to those items has reduced the work which would otherwise have been necessary in relation to the item in question.
       

Considering the facts and circumstances of this case the above factors (a) to (g) it is decided to measure at lower scale considering the scope of the action and the circumstances relating to it.

12. The Plaintiff has taken objection to the Second Defendant's Bill and these are noted in the table below with and order of the court at the last column.
    

Item	Particulars	Costs claimed	Disburse-ments	Objection By Plaintiff	Second Defendant's Reply to the said objections	The relevant item in scale of costs –standard basis O62.r13 And taxed costs and reasons.
1	Nehla Basawaiya Telephone attendance on Prem Narayan re: service of court documents on 29 May 2008 (5 units)	$100.00		Grossly excessive	Prospective client calling to say that they have been served with writ and summons returnable on 17 June 2009 – necessary for conduct of litigation	Item 40 in the Schedule 1 The amount is excessive and should be reduced to $50 as this is the first encounter between the two in relation to this action.
2	Telephone attendance on Prem Narayan as Plaintiff asking for Business	$60.00		Grossly excessive	Reasonable to obtain advice if solicitor engaged as the summons sought return	40 The amount is excessive and should be reduced to
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
	records on 2 June 2008 (3 units)				of hard copies.	$10
3.	Diary dates of Summons (Order 43) and due date for Acknowledgment of service in the Master Diary and set up of Electronic Calendar on 4 June 2008 (3 units)	$20.00		Totally unrealistic and unsustainable. It is not necessary to set up an electronic calendar. Item should not be taxed.	Litigation is time-driven if reminders and calendar not set-up – possibility of missing out on crucial dates.	40 NOT ALLOWED This is not reasonably require for professional charges
4.	Taking instructions to defend Second Defendant, preparing Acknowledgment of Service for Second Defendant on 4 June 2008, filing Acknowledgement of Service in the Suva High Court and Service on Naidu Law on 6 June 2008 (5 units)	$125.00	11.25 (filing fees)	Not an objective assessment of time it would take a reasonably competent solicitor to prepare an acknowledgment of service	Claim made under item 4(a) at higher scale. Necessary step in conduct of litigation	4(a) The filling fees of 11.25 is allowed without change. But the cost of $125 is reduced to $75 as the cost is measured at lower scale
5.	Review email	$80.00		Not	Correspondence	40 The charge
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
	from Second Defendant and reply to Second Defendant on 5 June 2008 (4 units)			reasonably incurred. Alternatively charge is excessive.	from client reasonably incurred to seek advice	claim is excessive and only $20 was allowed for 5 & 6 taken together.
6.	Telephone attendance on Second Defendant on updates on 7 June 2008 (5 units)	$100.00		This is not reasonably incurred. Unnecessary cost. Alternatively, the charge is grossly excessive. There has been unnecessary e-mail exchange and telephone attendance	Refer above	40 See above.
7.	Review email from Second Defendant's proposed letter to Naidu Law on 10 June 2009 (2 units)	$40.00		Inappropriate claim. There are too many emails being sent and received. Review of Second	Claim relevant to the orders sought in summons	40 Item is taken together with 8 below and taxed at $10 as reasonably incurred.
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
				Defendants letter to Naidu Law was unnecessary
8.	Telephone attendance on Second Defendant on 10 June 2009 (5 units)	$100.00		Grossly excessive	Claim relevant to the orders sought in summons	40 See the 7 above.
9.	Meeting with Second Defendant on 11 June 2009 (4 units)	$125.00		Grossly excessive, Second Defendant seems to have been corresponding with her solicitors by phone or email on a regular basis-refer items 1,2,5,6,7 and 8.	Cost reasonably incurred to discuss the dissolution and other issues.	40 Excessive and taxed at $25
10.	Review Plaintiff's Statement of Claim on 11 June 2008 (2 units)	$20.00		Unnecessary – part of items of 4 and 14.	Reasonable to peruse a statement of claim upon receiving it.	40. This item is taken together with 11 below and taxed at $20
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
11.	Review email from Second Defendant and telephone attendance with Second Defendant on 11 June 2008 (4 units)	$40.00		Cost has been improperly incurred. There has been too many emails being sent and received and too many telephone attendances	Necessary expenses in discussing Statement of Claim	40 See the 10 above.
12	Research case law and authorities which can establish whether claim can be made using a Power of Attorney on 12 and 13 June 2008 (11 units)	$150.00		This cost is unsustainable and has been unreasonably incurred. Part of item 14.	Research necessary to ensure issues can be concisely presented to court – necessary for conduct off litigation	40 The amount is allowed as legal research is essential in any kind of action and $150 is allowed.
13.	Nehla Basawaiya Attending Court on 17 June 2008 (7 units)	$80.00		Summons listed for first call/mention. Master gave directions only.	Claim is at scale. Matter is listed for first call with Plaintiff required to specify records sought	27 The amount is excessive and only $40 was allowed at lower scale.
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
				Amount claimed is grossly excessive. Maximum $50 can be allowed.
14.	Drafting Defence on 23 June 2008, forwarding Defence to Second Defendant for her review on 24 June 2008, telephone attendance on Second Defendant, finalizing Defence on 25 June 2008, filing Defence in the High Court Registry and service of Defence on Naidu Law on 25 June 2008 (14 units)	$250.00	$56.25 (filing fees)	Cost has been unreasonably incurred. There was no need to prepare and file Statement of Defence at this stage since there was an interlocutory application (Summons) filed by the Plaintiff which was pending before the court. Second defendant	Claim is under scale Statement of Defence due 25 June 2008. Under the High Court Rules if a Statement of Defence not filed within the time specified there is potential for default judgment being entered.	7 At lower scale the amount is $75 and the filing fee is allowed for $56.25
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
				should have waited until the hearing and determination of the Plaintiff's Summons. Maximum sum that can be claimed is $200.
15.	Nehla Basawaiya Draft letter to Naidu Law on 24 June 2008 and forward to Second Defendant for her comments, review edits from Second Defendant on 2 July 2008 (10 units)	$120.00		Cost inappropriately claimed. Naidu Law did not receive such letter. No basis set out why letter drafted.		40 At the hearing this claim was dropped hence disallowed with consent of the parties.
16.	Diary next court attendance on 18 August 2008 and note timetable orders in the Master Diary on 25 June 2008 (3 units)	$20.00		Sum claimed is grossly excessive. Clerical job	Important to note dates for next appearance and action items for purpose of litigation.	40 Not reasonably incurred and disallowed.
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
17.	Letter to Second Defendant enclosing a sealed copy of the Statement of Defence on 25 June 2008 (2 units)	$40.00		Unnecessary expense. There was no need to do a covering letter in order to serve the statement of defence. This is not the practice.	Important to communicate with client and for client to have sealed copies for records.	40 Excessive and only $5 allowed.
18.	Diary court matter on 29 July 2008 in the Master Diary, High Court Registry re-list matter, on 4 July 2008 (2 units)	$20.00		Sum claimed grossly excessive. Clerical job.	Important to note dates for next appearance and action items for purpose of litigation.	40 Disallowed as not reasonably incurred
19.	Telephone attendance with Second Defendant on 7 July 2008 (2 units)	$20.00		Unnecessary expense. There has been too many telephone attendances between the second defendant and her solicitor.	Necessary expense to keep client informed on progress	40 Excessive and $5 allowed.
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
20.	Reviewing Plaintiff's Supplementary Affidavit on 16 July 2008 and telephone attendance with Second Defendant on 16 July 2008 (6 units)	$100.00		Sum claimed is grossly execessive	Sum claimed is reasonable in the circumstances	40 Excessive and only $20 is considered as reasonably incurred.
21.	Drafting Affidavit in Reply of Second Defendant on 30 July 2008, email draft Affidavit in Reply to Second Defendant on 31 July 2008, telephone attendances with Second Defendant on 1 and 9 September 2008, edits to the Affidavits in Reply of Prem Narayan's on 9 September 2008, edit Affidavit in Reply on 9	$150.00	$56.25 (filing fees)	Sum claimed is grossly excessive. Unnecessary / excessive telephone attendance than required. Claim for editions/amendments is unsuitable. The affidavit in reply is only about 2 pages long with annexures. Standard affidavit in reply, nothing	The sum claimed is reasonable given the amount of work involved to finalise the affidavit in reply.	40 Allowed without reduction $150 and filing fee of 56.25
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
	September 2008, telephone attendance with Second Defendant on 11 September 2008, filing Affidavit in Reply in the High Court and service on Naidu Law on 12 September 2008 (10 units)			complex.
22.	Instructions to Tomasi Tuitoga attend Court on 18 August 2008 (2 units)	$20.00		Not reasonably incurred. Inappropriately claimed. Part of item 23	Reasonably incurred – Important to ensure that any counsel appearing on a matter is fully briefed.	40 Disallowed as not reasonably incurred
23.	Attending Court and preparing file note of Court Attendance of 18 August 2008 (10 units)	$80.00		Sum claimed is grossly excessive. Case was listed for mention on 18 August 2008 before Master.	Claim is per scale.	27 At lower scale the amount is $40
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
				Defendants were given time to file affidavit in reply. Nothing complex. Maximum sum that can be allowed is $50 per hour
24.	Update Master Diary of next call date on 15 September 2008 and timetable orders, on 18 August 2008 (3 units)	$20.00		Sum claimed is grossly excessive. Clerical job	Important to note dates for next appearance and action items for purpose of litigation.	40 Disallowed as not reasonably incurred
25.	Letter to Prem Narayan enclosing Affidavit in Reply on 12 September 2008 (2 units)	$20.00		Repetition of item 21. Second defendant has seen this affidavit, Not necessary to do covering letter to the first (second)	Important to communicate with client and for client to have sealed copies for records.	40 Disallowed as not reasonably incurred
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
				defendant and send file copy of affidavit in reply to first defendant, Cost has been unreasonably incurred.
26.	Nehla Basawaiya Attending Court on 15 September 2008 (5 units)	$80.00		Unnecessary expense. Case was adjourned to 15 Sept 08 because Defendants had failed to file their affidavits within time and they were given further time to do and this resulted in further attendance.	At this mention Plaintiff sought time to consider the affidavits filed in reply.	27 At lower scale the value is $40
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
27.	Diary next court) attendance for 1 October 2008 in the Master Diary, on 15 September 2008 (2 units	$20.00		Unnecessary expense as a result of item 26 above	Important to note dates for next appearance and action items for purpose of litigation.	40 Disallowed as not reasonably incurred
28.	Telephone attendance on Prem Narayan re: Plaintiff wishes to withdraw action on 18 September 2008 (2 units)	$20.00		Sum claimed is grossly excessive	Claim in	40 Only $10 is allowed as reasonably incurred.
29.	On 30 September 2008, sent instructions to Feizal Haniff to attend Court on 1 October 2008 (2 units)	$20.00		This is not reasonably incurred. Inappropriately claimed. Part of item 30.	Reasonable incurred-Important to ensure that any counsel appearing on a matter is fully briefed.	40 Claim is refused as not reasonably incurred
30.	Attend Court on 1 October 2008 and prepare file note of court attendances (5 units)	$80.00		Sum claimed is grossly excessive. Case listed for mention on 1 October 2008	Claim is at scale	27 At lower scale the amount is taxed as $40
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
				before Master as directions given for the filing of affidavits. Nothing complex. Maximum sum that can be allowed for this is $50 per hour.
31.	Diary next court attendance for 31 October 2008 and timetable orders in the Master Diary on 3 October 2008 (3 units)	$20.00		Clerical job. Sum claimed is grossly excessive	Important to note dates for next appearance and action items for purpose of litigation.	40 Disallowed as not reasonably incurred
32.	Reviewing letter dated 22 October 2008 from Naidu Law re: withdrawing of action (2 units)	$20.00		Sum claimed is grossly excessive.	Reasonably claim	40 Item 32 and 33 taken together and taxed as $20
33.	Draft Second Defendant's response to Naidu Law's letter of 22	$100.00		Sum claimed is grossly excessive in light of	Claim reasonably made.	40 See above.
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
	October 2008 and forward the same to Naidu Law on 30 October 2008 (5 units)			the work performed. It would take about 5 mins to prepare such a letter. Nothing complex.
34.	Attending Court on 31 October 2008 and preparing court attendance report (7 units)	$80.00		Sum claimed is grossly excessive. Case was listed for mention only before the Master was made for compliance of directions. Nothing complex. Maximum sum that can be allowed for this is $50.00.	Claim is at scale.	27 At lower scale taxed at $40
35.	Diary court attendance for 23 February 2009 in the	$20.00		Clerical job. Sum claimed is grossly	Important to note dates for next appearance	40. Disallowed as it is not reasonably
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
	Master Diary, on 3 November 2008 (2 units)			excessive	and action items for purpose of litigation.	incurred
36.	Review letter from Naidu Law dated 4 November 2008, forward the sane o Second Defendant with our response (2 units)	$20.00		Clerical job. Sum claimed is grossly excessive. Simple 3 sentence letter from Naidu law Nothing Complex.	Claim reasonable to obtain instructions	40 Only $5 is considered reasonable.
37.	Discussions with Second Defendant on contents of letter from Naidu Law of 4 November 2008 (2 units)	$20.00		Sum claimed is grossly excessive	Claim is reasonable	40 Item 37 and 38 taken together and taxed at $20
38.	Review letter from Naidu Law dated 11 November 2008 and forward the same to Second Defendant (2 units)	$20.00		Simple letter from Naidu Law.		See above
39.	Drafting Second Defendant's	$100.00		Sum claimed is grossly	Claim reasonable	40 Item 39 and
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
	response to Naidu Law's letter of 11 November 2008 and forwarding the same to Naidu Law on 19 February 2009 (5 units)			excessive. Time taken for this task seems to be excessive. Nothing complex in nature.		40 taken together and taxed at $20
40.	Instructions to Tomasi Tuitoga to attend Court on 23 February 2009 (2 units)	$20.00		This is not reasonably incurred. Inappropriately claimed. Part of item 41.	Important to ensure that any counsel appearing on a matter is fully briefed – reasonable in the circumstances for make claim.	40 See above item 39
41.	Attending Court on 23 February 2009 and preparing file note of court attendances (7 units)	$80.00		to be done. Case was listed for mention only before the Master. Action withdrawn against second defendant by consent. Nothing		27 Lower scale taxed at $40
Item	Particulars	Costs	Disburse-ments	Objection	Second Defendant's Reply	The relevant item in scale of costs –standard basis O62.r13
				complex. Maximum allowed for this is $80.00
42.	Instructions for taxation of costs between Plaintiff and Second Defendant inclusive of all services from instructions to completion	$200.00		Sum claimed is grossly excessive in light of the work that was required.	Claim at scale.	31 Lower scale taxed at $100
	TOTAL	$2,820.00		$123.75		$1,030

2. CONCLUSION
   

13. The filing fees and other disbursements amounting to $123.75 is not disputed and in any event they are allowed as reasonably incurred fees as they are mandatory fees of the court. The taxed cost as reasonably incurred reduced to $1,030 from the claim of $2,820 as I have not allowed entirety of the all the claims as costs, and have also reduced it accordingly as any doubt as to the reasonableness has to be in the favour of the Plaintiff in terms of the Order 62 rule 13.
    

100. FINAL ORDER
     

1. Second defendant's taxed cost is $1030 + $123,75 = $1153.75
   
2. The above cost to be paid within 21 days by the Plaintiff to the 2nd Defendant.
   

Dated at Suva this 7th day of December, 2011.

Mr. Deepthi Amaratunga
Master of the High Court
Suva