LEE CHEUNG LAU v. THOMAS LEE HOK LAU AND OTHERS

LEE CHEUNG LAU v. THOMAS LEE HOK LAU AND OTHERS

The court concluded the Liquidators' decision to settle the Petitioner's costs for HK$1,483,156.80 was manifestly unreasonable because the claimed time and fees were disproportionate and unsupported by the work required; accordingly the court intervened, referred the assessment of the Petitioner's costs to taxation, directed disclosure and limited recovery of certain liquidators' affidavit costs to 15%.

Citation
[2021] HKCFI 1386
Parties
Petitioner: Lee Cheung Lau; 1st Respondent: Thomas Lee Hok Lau; 2nd Respondent: Lee Tung Lau; 3rd Respondent (company in Liquidation): Quality Denim Limited; 4th Respondent: New Denim Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
20 May 2021
Case Number
HCCW289/2012
Procedural Posture
Companies Winding Up Proceedings / Interlocutory Application (taxation of Costs and Directions)
Outcome
Liquidators' decision found manifestly unreasonable; assessment of Petitioner's costs referred to taxation with procedural directions; limited allowance for part of liquidators' affidavit costs.
Legal Topics
Liquidators' Discretion, Taxation of Costs, Shareholder Disputes, Manifestly Unreasonable Standard, Duties of Officers of the Court
Source Language
EN
Company Law Insolvency Costs Civil Procedure Liquidators' Discretion Taxation of Costs Shareholder Disputes Manifestly Unreasonable Standard +1 more

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Parties

Lee Cheung Lau

Petitioner

Thomas Lee Hok Lau

1st Respondent

Lee Tung Lau

2nd Respondent

Quality Denim Limited

3rd Respondent (company in Liquidation)

New Denim Limited

4th Respondent

Procedural Posture

Companies Winding Up Proceedings / Interlocutory Application (taxation of Costs and Directions)

Legal Issues

  1. 1 Whether the liquidators' decision to agree the Petitioner's costs was manifestly unreasonable
  2. 2 Whether the court should order taxation of the Petitioner's costs and permit the 1st Respondent to conduct the taxation
  3. 3 Whether the liquidators failed to apply relevant legal principles or give proper weight to factual matters when agreeing costs

Ratio Decidendi

The court concluded the Liquidators' decision to settle the Petitioner's costs for HK$1,483,156.80 was manifestly unreasonable because the claimed time and fees were disproportionate and unsupported by the work required; accordingly the court intervened, referred the assessment of the Petitioner's costs to taxation, directed disclosure and limited recovery of certain liquidators' affidavit costs to 15%.

Court Disposition

Liquidators' decision found manifestly unreasonable; assessment of Petitioner's costs referred to taxation with procedural directions; limited allowance for part of liquidators' affidavit costs.

Orders

  • The assessment of the Petitioner’s costs be referred to taxation.
  • The Liquidators shall provide to the 1st Respondent a copy of the Schedule of costs.