Wong Foong Chai v Lin Kuo Hao

• Jurisdiction: Singapore
• Judge: Andrew Phang Boon Leong JC
• Judgment Date: 26 April 2005
• Neutral Citation: [2005] SGHC 77
• Date: 26 April 2005
• Subject Matter: Sections 111, 113 Legal Profession Act (Cap 161, 2001 Rev Ed),Whether s 18(3) Motor Vehicles (Third-Party Risks and Compensation) Act operating as overriding statutory provision,Whether agreement should be upheld by court,Rules of court,Section 4(3) Evidence Act (Cap 97, 1997 Rev Ed), s 18(3) Motor Vehicles (Third-Party Risks and Compensation) Act (Cap 189, 2000 Rev Ed), O 59 r 28(2)(b) Rules of Court (Cap 322, R 5, 2004 Rev Ed),Bill of costs,Legal Profession,Civil Procedure,Whether presumption under O 59 r 28(2)(b) Rules of Court conclusive,Traffic accident case,Agreement between solicitor and client for amount of costs,Contentious business agreement
• Docket Number: Bill of Costs No 265 of 2004
• Published date: 28 April 2005
• Defendant Counsel: Chan Wang Ho (Insolvency and Public Trustee's Office)
• Court: High Court (Singapore)
• Plaintiff Counsel: Ganesh S Ramanathan and Renuka Chettiar (Karuppan Chettiar and Partners)

26 April 2005

Andrew Phang Boon Leong JC:

Introduction

1 Traffic accidents are an unfortunate fact of (especially) urban life. Singapore is no exception. They generate not only human pain and anguish but legal issues as well. Cases, both civil and criminal, often come before the courts. This is inevitable, indeed, necessary. There is a weighty public element involved. This public element is clearly present when it is decided to prosecute offenders under, for example, the Road Traffic Act (Cap 276, 2004 Rev Ed) or even the Penal Code (Cap 224, 1985 Rev Ed). It is also present in civil claims, although the primary area of law (principally with regard to tortious negligence) involves, on the face of things, individual claims and, hence, individual rights. This is due to the widespread nature of traffic accidents themselves. Other issues, besides liability between and amongst the parties, arise as a result. One such instance is the regulation of lawyers’ fees, albeit, as we shall see, with a “light touch”. This, as we shall also see, constitutes the crux of the present decision.

2 In so far as the issue of the regulation of lawyers’ fees is concerned, it is important to note at the outset that the law is almost invariably about balance. Whilst lawyers perform an important, even laudable, function and ought therefore to be remunerated adequately for their efforts, as already alluded to above, the sheer number of traffic accidents introduces a not insignificant measure of public policy into the entire equation.

3 To this end, the Singapore Parliament enacted s 18 of the Motor Vehicles (Third-Party Risks and Compensation) Act (Cap 189, 2000 Rev Ed) (“the MVA”). This provision aids in ensuring that lawyers’ remuneration in the context of traffic accident cases is fair not only to the lawyer but also (and more importantly) to the client.

Section 18 of the Motor Vehicles (Third-Party Risks and Compensation) Act

4 Because s 18 of the MVA is not only the focus of the present decision but must also be read as well as interpreted in its entire context, it is presently set out in full, as follows:

Prohibition of solicitation in respect of claims

18.—(1) No person shall, directly or indirectly, solicit instructions or authority to act on behalf of any other person in respect of the making or commencement of any claim or action for damages for the death of or bodily injury to any person arising out of the use of a motor vehicle or in respect of the negotiation, compromise or settlement of that claim or action.

(2) No person, other than a public officer or an advocate and solicitor properly acting in the course of his profession, shall, directly or indirectly, for personal gain make or commence or cause to be made or commenced on behalf of any other person any claim or action for damages for the death of or bodily injury to any person arising out of the use of a motor vehicle or negotiate, settle or compromise that claim or action when made or commenced.

(3) Notwithstanding the provisions of any other written law, a public officer or an advocate and solicitor, acting in respect of the matters referred to in subsection (2), shall not receive or accept any payment of money for so acting other than —

(a) such costs as are agreed between him and the Public Trustee;

(b) taxed costs, in default of such agreement with the Public Trustee; or

(c) such costs as the Public Trustee may determine to be the costs of the public officer or advocate and solicitor, if the public officer or advocate and solicitor fails to begin proceedings for taxation of costs within 3 months after the relevant date unless before that time the public officer or the advocate and solicitor has agreed with the Public Trustee on costs.

(4) Subsection (3) shall not apply to a public officer or an advocate and solicitor claiming costs in respect of a judgment or settlement for a sum not exceeding the relevant amount.

(5) For the purposes of subsection (3) (c), “relevant date” means —

(a) the date the Public Trustee accepts or the court approves the payment referred to in section 6, as the case may be; or

(b) the date the judgment of the court referred to in section 9 (1) is given,

as the case may be.

(6) Any person who contravenes this section shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $1,000 or to imprisonment for a term not exceeding 12 months or to both.

(7) Any agreement to pay any money other than the costs referred to in subsection (3) (a), (b) or (c) to any person for work done or to be done or services rendered or to be rendered in respect of the matters referred to in subsection (1) or (2) shall be void.

(8) Any money paid under subsection (7), shall be recoverable by action brought in a court by the person who has paid it.

(9) Where it is shown that any money other than costs referred to in subsection (3) (a), (b) or (c) has been paid to any clerk employed by an advocate and solicitor for work done or to be done or services rendered or to be rendered in respect of the matters referred to in subsection (1) or (2), it shall be presumed in, and for the purposes of, any action against the advocate and solicitor that the money was received by the clerk on behalf of the advocate and solicitor and the money shall be recoverable from the advocate and solicitor.

5 As we shall see, the Public Trustee’s role also figures prominently in the issues that follow. In this respect, s 19 of the MVA is also relevant and reads as follows:

Public Trustee may appear in court

19. The Public Trustee shall have the right to appear and be heard in a court in any proceedings under this Act or in relation to any claim or action for damages for the death or bodily injury of any person arising out of the use of a motor vehicle.

The issues stated

6 The crucial issue in the present decision turns on a construction of s 18 in general and s 18(3) in particular of the MVA (the relevant provisions are reproduced at [4] above). What, in particular, is the effect of s 18 in relation to the presumption under O 59 r 28(2)(b) of the Rules of Court (Cap 322, R 5, 2004 Rev Ed) (reproduced at [13] below)?

7 However, before proceeding to analyse the key issues as well as points of law which are the focus of the present decision, it would be appropriate to set out briefly the specific context of this case.

8 The present proceedings arose, in fact, in the context of a relatively typical case. Indeed, as an even cursory perusal of the main provision in this case itself (s 18(3)) will reveal, this particular subsection deals, inter alia, with the costs recoverable by an advocate and solicitor in so far as claims involving death or bodily injury arising out of the use of motor vehicles are concerned. As I have pointed out right at the outset, such claims are – unfortunately – very commonplace in the Singapore context.

9 Indeed, this case involved precisely a claim arising out of a traffic accident involving a motor vehicle. The plaintiff was travelling as a pillion rider on a motorcycle ridden by the defendant and was injured as a result of a collision between the said motorcycle and a motor car. After the matter had been resolved (which involved interlocutory judgment against the defendant, followed by the assessment of damages), there remained the issue of costs. The plaintiff had in fact engaged her own counsel, who is the applicant in the present proceedings. Unfortunately, the applicant and the Public Trustee were unable to agree as to the costs between solicitor and client. If they had (under s 18(3)(a)), that would have been, in my view, the best or most ideal outcome. Costs were therefore sent before an assistant registrar for taxation pursuant to s 18(3)(b) (there being no issue of timing which would have triggered the operation of s 18(3)(c)). The learned assistant registrar fixed costs for Section 1 of the applicant’s bill of costs in favour of the applicant at $15,000. The applicant was dissatisfied with the order and hence applied for its review. That was the precise issue before me in the present proceedings.

10 Counsel for the Public Trustee in fact vigorously opposed any revision upwards of the costs fixed by the assistant registrar. On the contrary, he was of the view that they were in fact too high. He also tendered specific arguments as to why I should dismiss the application. I turn, however, to arguments by counsel for the applicant first. I will then set out the arguments by counsel for the Public Trustee before proceeding to analyse all these arguments as well as to express my decision.

11 I only pause to add that although the factual matrix was exceedingly straightforward, the various arguments made were extremely significant – if only because claims under the MVA are (and this is one occasion when repetition is in fact in order) all too common and, hence, a pronouncement on the general legal position is appropriate.

Counsel’s arguments

The applicant’s arguments

12 This case related to a situation of costs as between solicitor and client. Not surprisingly, therefore, the applicant’s main argument centred around O 59 of the Rules of Court in general (which deals directly with the situation of solicitor-client costs) and r 28(2)(b) thereof in particular.

13 In addition to this particular provision, I now set out, further, O 59 r 28(1) as well as O 59 r 28(2)(a) and (c), in order to place the first-mentioned provision in its general context:

28.—(1) This Rule applies to every taxation of a solicitors’ bill of costs to his own client.

(2) On a taxation to which this Rule applies, costs shall be taxed on the indemnity basis but shall be presumed —

(a) to have been reasonably incurred if they were incurred with the express or implied approval of the client;

(b) to have been reasonable in amount if their amount was, expressly or impliedly, approved by the client; and

(c) to have been unreasonably incurred if, in the...