Hwang Shu Fen v National Bank of Solomon Islands Ltd [2011] SBHC 157; HCSI-CC 304 of 2011 (7 December 2011)

IN THE HIGH COURT OF SOLOMON ISLANDS.
(Faukona J).

Civil Case No. 304 of 2011.

BETWEEN:

HWANG SHU FEN
First Claimant

AND:

YUNG HUANG FISHERY COMPANY LIMITED
Second Claimant

AND:

SOLGREEN ENTERPRISES LIMITED
Third Claimant

AND:

NATIONAL BANK OF SOLOMON ISLANDS LIMITED
First Defendant

AND:

ATTORNEY-GENERAL
Second Defendant
(Representing the Registrar General and the Registrar of Titles).

Date of Hearing: 1st December 2011.
Date of Ruling: 7th December 2011.

Ms M.Bird for the Claimants.
Mr J. Katahanas for the First Defendant.
Mr S. Banuve for the Second Defendant

DECISION ON AWARD OF COSTS

Faukona J: This application was filed on 5th August, 2011. It is an application for grant of leave, that the claimants to file fresh proceedings against the First and Second Defendants. It was thought appropriate to institute this application following the High Court dismissal of a claim in Civil Case No. 364 of 2008, on 5th May, 2011.

In that case the Court ruled that the claim discloses no reasonable cause of action against the Defendants; and that the First Claimant has no standing to bring proceedings on behalf of the Second Claimant for the same subject matter.

2. It can be noted that the parties in Civil Case No 364 of 2008 are the same as parties in this case except for Xu and Nagasawa being omitted and Solgreen became one of the Claimants in this case.

3. On the appointed date the Court is supposed to hear three applications, one from the Claimants for leave, and two cross applications from the Defendants in opposing the application for leave. At the time the Court seated to proceed Ms Bird for the Claimants withdrew the application for leave following instructions received. Withdrawal of the application for leave makes it inappropriate to proceed to hear the cross applications by the Defendants. It is agreed that the issue left is about costs which has to be awarded to the First Defendant.

4. The issue is whether the Court is to award costs on standard basis or on indemnity basis.

5. Mrs Bird submits that Costs be awarded on standard basis. Mr Katahanas refuted and submits that costs be awarded on indemnity basis.

6. In determining appropriate cost to be awarded, Court has to analyse facts lead up to this case and the law as well.

Indemnity Costs against Claimants.

7. The materials reveal that there are number of civil suits involving the same parties litigating the same issues previously. Those proceedings contain common relevant issues which have been colour coded for ease of cross reference in the schedule. Not only had that, but pages 39 and 84 of Mr Corcoran sworn statement enlisted other cases which has common claim. In majority of those cases they are either fail, withdrawn or dismissed by consent after resistance were made.

8. From the schedule and colour code, it is notable that the allegations and issues raise or determine, made reference to the allegation in the current action. For the same reason Chetwynd J has stated in his decision in Civil Case no. 364 of 2008. On the overall, it does not reflect good standing on behalf of the Claimants in the current litigation. This application seeks to reopen the above case which had already been struck out for want of proper pleadings.

9. Undoubtedly the attitude manifested, either misunderstanding, or ignorant of the law. The First Claimant by joining the rest of the Claimants to apply for leave is a clean show of persistent behaviour to commence vexatious proceedings that disclose no reasonable cause of action. That has to be accounted for in particular, where an order has been made by this Court under Rule 20.24 declaring the Claimants or majority of them as vexations litigants in Civil Case No. 207 of 2010, on 2nd August 2011. As such bringing these proceedings can only be done with credible evidence; otherwise it would be a further abuse of process. In the case of Becker v Teale[1] the Court said,

"In any view, the jurisdiction which is given by that section to a judge in chambers to give leave for the institution or continuance of proceedings by a vexatious litigant is a jurisdiction which should be very carefully and sparingly exercised. Ex hypothesi the litigant has already "habitually and persistently and without any reasonable ground instituted vexatious legal proceeding"; and I think that there is a high onus cast on such a litigant when he or she applies to a judge for the leave mentioned in the section".

We all, unfortunately, knew what ingenuity vexatious litigants can from time to time display in, if I may say the expression, cooking up imaginary claims and pursuing futile appeals. The Court should be satisfied, before giving leave, that there is a case of some real substance to be argued"

10. Now this application is discontinued. It demonstrated that there is no prospect of success for a number of reasons. Firstly that the application failed to comply with vexatious order. Secondly it attempts to relitigate the issues which had already been determined. Thirdly it base on material which is hearsay, and I refer to the First Claimant sworn statement. To persist and attempt to relitigate the same issue again is a further abuse of process. The Claimants knew they were seeking to reopen the same case with the same claim which was already determined against them in CC No. 364 of 2008; on 5th May 2011. Nevertheless they have brought this application for leave. And the material produce to support the application fall short of what is expected of them as genuine litigants. Therefore the Claimants are hereby ordered to pay costs on indemnity bases pursuant to Rule 24.12 (с) because they deliberately and without good cause engaged in conduct that resulted in increased costs by the Second Defendant.

Indemnity Costs against Legal Practitioner

11. Rules 24.32(b) and 24.33 empowers the High Court to order a legal practitioner to pay costs incurred by a party because of the practitioners mis conduct. By logic and expectation a legal practitioner should not assist and brought to Court a litigation where prosecution of a claim is an abuse of process. A legal practitioner owes a duty to the Court. Should the counsel fail the misconduct is actionable by the opposing party. In the case of Ochard v Seeboard,[2] the Court said in paragraphs D, E, F, G and H;

"When I inquired what rights the Solicitor would have against Counsel, I was referred to the judgment of Lord Denning M.R in Kelley v London Transport Executive [1982] 1 W.L.R 1055:

"Over the week end I looked at the authorities in this matter. As a result, the principle is clear that a solicitor is under a duty not only to his own clients who is legally aided, but also to the unassisted party who is not legally aided. If the Solicitor fails in that duty, the unassisted party is at liberty to call him before the Court and the Court can make an order that he is to make good any loss or expenses to the unassisted party. It is not confined to legally aided cases but to all cases an order to make the Solicitor pay costs of the other side. Lord Hatherley L.C said in re Jones (1870) L.R Ch.app.497, that Solicitors must "not only perform their duty towards their own clients, but also towards all those against whom they are concerned and that care should be taken to see that the litigation is the bona fide litigation of the Client who instructs the solicitor and not a litigation carried on altogether on the Solicitor's account. This principle affirmed by the House of Lords in Myers v Elman (1940) A.G. 282, 290 where Viscourt Mayhem said: These cases did not depend on disgraceful or dishonourable conduct by the Solicitor, but on mere negligence of serious character, the result of which has to occasion useless costs to the other parties".

"These are the duties of Solicitors who act for legally aided clients. They must enquire carefully into the claim made by their own legally aided client so as to see that it is well-founded and justified-so much so that they would have advised him to bring it on his own name if he had enough means to do so – with all the risks that failure would entail. They must consider also the position of the other side. They must not take any advantage of the fact that their own client is legally aided and so not able to pay any costs. They must not use legal aid as means to extort a settlement from the other side. They must remember the position of the defendant that he is bound to incur a lot of costs to fight the case".

12. In addition Kabui J in the case of Andrew v National Insurance[3] adopted the principles in a passage in the case of Myers v Elman, in paragraph 2, which outline the issue of duty of court and finally ended up describing the failure of the conduct of the solicitor. It states;

"The underlying principle is that the Court has a right and a duty to supervise the conduct of its solicitors, and visit with penalties any conduct of a solicitor which of such a nature as to tend to defeat justice in the vary cause in which he is engaged professionally,. The matter complained of need not be criminal. It need not involve peculation or dishonesty. A mere mistake or error of judgment is not generally sufficient, but a gross neglect or inaccuracy in a matter which it is a solicitor's duty to ascertain with accuracy may suffice"

"It is impossible to enumerate the various contingencies which may call into operation the exercise of this jurisdiction. The term "professional misconduct" has often been used to describe the ground on which the Court acts. It would perhaps be more accurate to describe it as conduct which involves a failure on the part of a solicitor to fulfil his duty to the Court and to realise his duty to aid in promoting his own sphere, the cause of Justice. This summary procedure may often be invoked to save the expenses of an action".

13. It does not end there, the case of Edwards v Edwards[4], also refer to a paragraph in Myers v Elman[5] which their Law Lords agreed and said on page 12, paragraph 4;

"It is there made clear that the jurisdiction is one that the Court by virtue of its inherent powers exercises over Solicitors in their capacity of officers of the Court. The relevant duty of the solicitor covers all those against whom they are concerned. It is a duty owned to the Court to conduct litigation before it with due propriety. The conduct complained of must before it attracts the above jurisdiction, be such as to involve a failure on the part of judgment, or any negligent conduct that involve unnecessary cost would suffice".

14. It appears Ms Bird has represented the Claimants in almost every previous proceeding. In spite of that, she continued initiate this action which has no or substantially no chance of success. That may constitute misconduct attracting an order under Rules 24.32 (b) and 24.33.

15. In this case she submits that she has new evidence to relitigate Civil Case No. 364 of 2011. Unfortunately that Case had been strike out by this Court on 5th May 2011.

16. Whilst Ms Bird may have a duty to represent her client to her best ability, even in bad cases, she must also aware that she has a duty not to mislead the Court, and ought to know the Claimants obligation as to the vexatious litigant order. By lending her name yet to further proceedings has caused NBSI to incur unnecessary legal costs.

17. There has been no evidence to indicate persistent by Ms Bird's client against her instruction in bringing this proceeding. Such would have assisted the Court in assessing when exercising its discretion.

18. In any event, I have decided that the case against Ms Bird has made out and cost be awarded against her on indemnity basis.

Orders.

1. That the Claimants and the Claimant' Counsel, Ms Maelyn Bird jointly and severally pay;

(a) the First Defendant's costs of and in connection with this Application and Application for Leave on an indemnity basis within 14 days of agreement or assessment;

(b) the First Defendant's interest on any costs agreed or assessed pursuant to paragraph 10(a) at the rate of five per centum (5%) per annum from the date of the determination of the First Defendant's Cross Application until payment.

The Court.

---

^[1] [1971] 1 WLR 1475 at 1476.
^[2] [1987] 2 WLR 102, 105 to 107 of.
^[3] [2001] SBHC 19; HC-CC 245 of 1997 (23 March 2001).
^[4] [1958]P.235,247,248.
^[5] Ibid