TANG WAI LEUNG v. TANG WAI CHO

TANG WAI LEUNG v. TANG WAI CHO

The court held that set-off was not available in the present circumstances because the taxed costs in favour of the legally aided party were beneficially held by the Director under LAO (s18A and s19A) and no written direction from the Director or a court order under s18A(4) permitted set-off; the beneficiaries of the competing costs orders differed (DLA v Leung), DLA had already been paid for the period covered by legal aid, and therefore there was no ground to set aside the statutory demand. The court nonetheless recognised that the court retains discretion under s18A(4) to order set-off in appropriate cases.

Citation
TANG WAI LEUNG v. TANG WAI CHO
Parties
Applicant (creditor Issuing Statutory Demand): Tang Wai Cho; Respondent (applicant to Set Aside Statutory Demand): Tang Wai Leung
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
2 March 2017
Case Number
HCSD7/2016
Procedural Posture
Application to Set Aside Statutory Demand (bankruptcy Related) / Chambers Hearing (not Open to the Public)
Outcome
application to set aside the statutory demand dismissed; declaration granted that Leung is not entitled to set off his costs against Cho/DLA's costs
Legal Topics
Set Off, First Charge, Statutory Demand, Legal Aid Ordinance, Regulation 9(6 A), Rule 48(5)(a) Bankruptcy Rules
Source Language
EN
Legal Aid Bankruptcy Civil Procedure Costs Equity Set Off First Charge Statutory Demand +3 more

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Parties

Tang Wai Cho

Applicant (creditor Issuing Statutory Demand)

Tang Wai Leung

Respondent (applicant to Set Aside Statutory Demand)

Procedural Posture

Application to Set Aside Statutory Demand (bankruptcy Related) / Chambers Hearing (not Open to the Public)

Legal Issues

  1. 1 Whether set-off of costs between a legally aided person and a non-aided person is permissible under the Legal Aid Ordinance and Bankruptcy Rules
  2. 2 Whether the Director of Legal Aid's statutory first charge and payment/discharge provisions preclude court-ordered set-off or private settlement set-off without the Director's consent

Ratio Decidendi

The court held that set-off was not available in the present circumstances because the taxed costs in favour of the legally aided party were beneficially held by the Director under LAO (s18A and s19A) and no written direction from the Director or a court order under s18A(4) permitted set-off; the beneficiaries of the competing costs orders differed (DLA v Leung), DLA had already been paid for the period covered by legal aid, and therefore there was no ground to set aside the statutory demand. The court nonetheless recognised that the court retains discretion under s18A(4) to order set-off in appropriate cases.

Court Disposition

application to set aside the statutory demand dismissed; declaration granted that Leung is not entitled to set off his costs against Cho/DLA's costs

Orders

  • Application to set aside statutory demand dismissed
  • Declaration granted in terms of Cho's summons that Leung is not entitled to set off his costs against Cho/DLA's costs