(i)

Rules 8, 8A to 8D and 32C - Wasted Costs

The draft amendments have taken into account Practice Direction 14.5 entitled "Application for Wasted Costs Order under Order 62 rule 8", which came into effect on 1 March 2005.

(ii)

Rules 9A to 9C - Summary assessment of costs

As presently drafted, these new rules do not apply to and in relation to a party who is an aided person within the meaning of section 2 of the Legal Aid Ordinance (Cap. 91). The Steering Committee proposed that, notwithstanding that a party is on legal aid, summary assessment of costs should apply to him subject to certain conditions laid down in the new Rules 9B and 9C.

(iii)

Rule 13(1A) - Powers of Chief Judicial Clerks to tax costs

It is proposed that the Chief Judicial Clerk should have the power to tax costs if the amount of the bill of costs does not exceed the sum of $200,000 (currently $100,000).

(iv)

Rules 21(4) and 32B - Taxing fees

Taxing fees will be levied on the amount claimed in the bill of costs. There will be no refund after taxation. The receiving party will only receive reimbursement of taxing fees from the paying party based on the amount allowed.

(v)

Rule 22 - Consequences for delay in filing bill of costs

The Steering Committee considered that the objective of CJR to ensure that a case is to be dealt with as expeditiously as is reasonably practicable and to facilitate settlement of disputes should be extended to taxation of costs as well. The Steering Committee proposes that taxation proceedings should be commenced within 3 months (see Rule 22(1)) of the costs order (currently it is one month) to enable parties to have more time to negotiate for settlement. If a receiving party delays in submitting the bill, the paying party can apply for an order that unless the receiving party commences taxation proceedings within a specified period or the amount due is agreed between the parties, the costs order shall be wholly discharged. The taxing master may make such an order subject to such conditions as he deems fit. Under the current Rule 22(3), in the event of undue delay, a taxing master is empowered to disallow any item contained in the bill of costs. It is considered that a taxing master should not have the power arbitrarily to disallow an item. Instead, it is suggested that he should have the power to make a global deduction of the bill. Hence, the existing Rule 22(3) is amended to permit a taxing master to disallow any part of the costs awarded. Further, the power to disallow interest will also ensure that taxation is proceeded with expeditiously (see new Rule 22(4)).

(vi)

Rule 22(5) - Limitation Period for Applications for Taxation

Currently, there is no limitation period for applications for taxation. (Compare this to taxation of criminal bills. The limitation period is 3 months from the date of the costs order unless extended by the taxing authority: rules 6 and 9 of the Costs in Criminal Cases Rules.) Whilst accepting that bills of costs in civil cases may be more complex, there is no justification for leaving taxation of a costs order outstanding indefinitely. The Steering Committee therefore proposes a limitation period of 2 years as suggested in Rule 22(5)(a) for application for taxation.

(vii)

First Schedule - Fees to Counsel

Paragraph 2(3) of Part II in the First Schedule to Order 62 is amended to read as follows -

"(3) No costs shall be allowed in respect of counsel appearing before a master in chambers, or of more counsel than one appearing before a master in open court or a judge or the Court of Appeal, unless the master or judge or the Court of Appeal, as the case may be, has certified the attendance as being proper in the circumstances of the case."

It is not the intention of the reform to affect the present position on rights of audience of the profession. The purpose of the amendment is to avoid argument on taxation as to entitlement of counsel's fees.

(viii)

First and Second Schedules

The Steering Committee considers that the scale costs laid down in the First Schedule needs review. Further, the fixed costs laid down in the Second Schedule are grossly inadequate. Views are invited as to the deletion or addition of categories of such costs and the appropriate quantum.