CHEUNG TAK MAN DESMOND AND ANOTHER v. LAM SIU SUN DENNIS AND ANOTHER

CHEUNG TAK MAN DESMOND AND ANOTHER v. LAM SIU SUN DENNIS AND ANOTHER

The court held that by agreeing the cessation date and signing the cessation notice the partners incurred clear obligations under Law Society directions to cooperate in winding up (transfer of client funds, relocation/storage of files, provision of accounting and HR records and surrender of premises). Lam and Lee were insufficiently proactive and unreasonably obstructive; Cheung and Chiu were justified to commence proceedings and seek interlocutory relief, and accordingly costs of the action (including the summons and its hearing) were awarded to Cheung and Chiu, taxed if not agreed with certificate for two counsel.

Citation
[2020] HKCFI 381
Parties
1st Plaintiff: Cheung Tak Man Desmond; 2nd Plaintiff: Chiu Sze Wai Wilfred; 1st Defendant: Lam Siu Sun Dennis; 2nd Defendant: Lee Moses
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
2 April 2020
Case Number
HCA262/2019
Procedural Posture
Civil Action for Interlocutory Injunction and Ancillary Relief in Context of Partnership Winding Up and Solicitors' Cessation of Practice / Decision on Costs After Interlocutory Application Disposed by Undertakings; Hearing on Costs
Outcome
Costs awarded to plaintiffs (Cheung and Chiu). Interlocutory matters disposed by undertakings given by defendants; substantive proceedings stayed save for enforcement and costs.
Legal Topics
Cessation of Practice, Cessation Agents, Transfer of Client Funds, Storage and Relocation of Files, Vacant Possession of Premises, Duties of Partners to Cooperate, Undertakings, Costs Orders
Source Language
EN
Partnership Law Regulation of Solicitors' Practice Civil Procedure Equity and Injunctions Professional Conduct Cessation of Practice Cessation Agents Transfer of Client Funds +5 more

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Parties

Cheung Tak Man Desmond

1st Plaintiff

Chiu Sze Wai Wilfred

2nd Plaintiff

Lam Siu Sun Dennis

1st Defendant

Lee Moses

2nd Defendant

Procedural Posture

Civil Action for Interlocutory Injunction and Ancillary Relief in Context of Partnership Winding Up and Solicitors' Cessation of Practice / Decision on Costs After Interlocutory Application Disposed by Undertakings; Hearing on Costs

Legal Issues

  1. 1 Whether partners owed reciprocal duties to take necessary steps to effect cessation of practice and enable cessation agents to act
  2. 2 Whether plaintiffs were justified in commencing interlocutory proceedings and seeking injunctive relief given defendants' conduct
  3. 3 Whether defendants' conduct caused unnecessary litigation and thus costs should be awarded to plaintiffs

Ratio Decidendi

The court held that by agreeing the cessation date and signing the cessation notice the partners incurred clear obligations under Law Society directions to cooperate in winding up (transfer of client funds, relocation/storage of files, provision of accounting and HR records and surrender of premises). Lam and Lee were insufficiently proactive and unreasonably obstructive; Cheung and Chiu were justified to commence proceedings and seek interlocutory relief, and accordingly costs of the action (including the summons and its hearing) were awarded to Cheung and Chiu, taxed if not agreed with certificate for two counsel.

Court Disposition

Costs awarded to plaintiffs (Cheung and Chiu). Interlocutory matters disposed by undertakings given by defendants; substantive proceedings stayed save for enforcement and costs.

Orders

  • Cheung and Chiu to have the costs of this action including the summons and the hearing of the summons
  • Costs to be taxed if not agreed with certificate for two counsel