[1983 J.J. 43]
OFFICIAL SOLICITOR v. CLORE and OTHERS
ROYAL COURT (Crill, Deputy Bailiff): 7th July, 1983
Civil Procedure—costs—English lawyers’ costs—if case necessarily relates to application of English principles of common law or legal matters outside Jersey domestic issues, proper to seek advice of English lawyers and recover their fees as costs
Civil Procedure—costs—indemnity basis—award on full indemnity basis includes all costs except those unreasonably incurred or of unreasonable amount—party in whose favour order made to be given benefit of doubt as to reasonableness
Civil Procedure—costs—jurisdiction to fix scale fees—scale of fees to be fixed by Superior Number of Royal Court under Loi (1939) sur les honoraires des Avocats et des Écrivains—Greffier to make allocation within scale prescribed
J.G.P. Wheeler for the plaintiff;
F.C. Hamon for the first defendant.
1983 J.J. 44
CRILL, DEPUTY BAILIFF: In brief, the background to this matter stems from the death of Sir Charles Clore, who died on July 26th, 1979, in England leaving two wills: one dealing with his Monegasque property and the other with all his other property. By the Monegasque will, the deceased appointed Mr. Nathan Meyohas as testamentary executor and left all his property in Monaco to his daughter, Mrs. Vivien Duffield. By the other will, which has been called the general will, the deceased appointed Mr. Meyohas, Mr. George Coulon Karlweis and Mr. Joseph Kasierer to be his executors and gave all his property outside Monaco to the trustees of a settlement made by him on February 20th, 1979, to be held by them upon the trusts of that settlement. The trustees of that settlement were, originally, Stype Trustees (Jersey) Limited, Mr. Meyohas, Mr. Karlweis and Mr. Kasierer, but Mr. Karlweis has now retired as a trustee. There is a substantial potential claim to capital transfer tax raised by the Commissioners of Inland Revenue in England. The issues are complicated and involve, inter alia, matters of domicile and private international law. Actions have been instituted in England, Jersey and Monaco. In Jersey, a number of injunctions, which have been varied from time to time, are in force as well as three caveats at the instance of Mr. Alan Clore, the son of the deceased, Mr. Meyohas and Mr. Kasierer.
1983 J.J. 45
It is not necessary for me to go into details of the proceedings in England or Jersey, but it suffices to say that on the 22nd April, 1982, the High Court in England granted Letters of Administration ad bona colligenda to the Official Solicitor. The Official Solicitor is, as is well known, an independent officer of the Supreme Court. Contrary to the popular belief that is held in some quarters, he is not an instrument of the Inland Revenue nor of the Government. The injunctions and caveats in Jersey were, and still are, capable of being lifted by consent. It follows that if they were, then a grant of probate could issue to the executors, once it was established where Sir Charles Clore had died domiciled. Since a large part of the estate consists of money sent to Jersey after his death but arising from a transaction entered into before that event and which, if still physically in England, might be subject to claims by the Inland Revenue, the Official Solicitor had a duty to protect the assets until the main issues between the parties had been settled. Whilst there is no question of the Courts in this jurisdiction enforcing a penal or fiscal law of another jurisdiction, that is not to say that protection should not be afforded in this case for the conservation of the assets until the issues of domicile have been settled. I refer to the Official Solicitor’s “duty” because I have read his affidavit of the 10th January, 1983, in which he refers to the “forceful comments” of the Court of Appeal “as to the energy with which I should pursue my duties”. The case was Inland Rev. Commrs. v. Stype Invs. (Jersey) Ltd. ([1982] Ch. 456; [1982] 3 All E.R. 419; [1982] STC 625; (1982), 126 Sol. Jo. 497).
I have little doubt that the advent of the Official Solicitor on the Jersey scene, notwithstanding his independent status to which I have alluded, caused great anxiety to the parties to the actions in this jurisdiction. On the 16th August, 1982, he obtained an Order of Justice from the learned Bailiff. He appears to have been advised that if, as I have said, all the parties to the Jersey action settled their differences, the lodging of a caveat to prevent a grant of probate to the personal representatives of the deceased would be an insufficient safeguard. This overlooks the consequences of inter-meddling in an estate. At any rate, it is clear that a great number of important legal issues could have arisen
1983 J.J. 46
as a result of his Order of Justice. That a limited part of the Order of Justice was in fact dealt with on the 30th September, 1982, does not, it seems to me, mean that the defendants to this present action were not obliged, after the service of the Order of Justice and in view of its contents, to treat it, so to speak, as being at large.
On the date I have mentioned, the 30th September, the Court discharged the contingent interim injunctions sought by the Official Solicitor, discharged Mr. Karlweis from the action, made the Attorney General, at his request, a party to the action, placed the remaining matters on the pending list and ordered that the Official Solicitor should pay the costs of the other parties “of and incidental to this day’s hearing on a full indemnity basis”. At the hearing, Advocate Cridland for the Official Solicitor disclosed that, contrary to what the Official Solicitor in his affidavit disclosed and believed, it was then thought that a caveat would suffice and he had indeed lodged one.
In accordance with the order of the Court for costs, Advocate Hamon’s firm submitted a bill of £15,434.10 which includes disbursements by his firm to a London firm of Solicitors, Messrs. Allen & Overy, of £3,500, and £3,600 to English Counsel. It included also a disbursement of £200 to Advocate Michel, who had advised on the law of “saisie conservatoire”. In the course of the present hearing this amount was agreed (by Advocate J. Wheeler on behalf of the Official Solicitor) as being properly incurred. The bill opens with an entry of the 22nd August, as follows:– “Attendance upon the Viscount when Order of Justice is served; perusing same, transmitting copies thereof to instructing solicitors and bespeaking instructions”. It closes with an entry for the 30th September and covers the hearing on that day. From those entries I infer that in the original actions Mr. Hamon’s firm had been instructed by Messrs. Allen & Overy—indeed Mr. Hamon confirmed that that was so. It seems to me that, prima facie, the bill was incurred by reason of the launching of the Order of Justice by the Official Solicitor. Nevertheless, I have to consider whether the words “of and incidental to” could include matters which were not argued on the 30th September.
1983 J.J. 47
Mr. Wheeler submitted that since the issue was scaled down to the question of the lifting of the interim contingent injunctions and the rest of the matters were placed on the pending list, as indeed they were, only a proportion of the total costs submitted should be allowed. Further, none of Messrs. Allen & Overy’s fees and English Counsel’s fees should be admitted.
I was not asked to examine Mr. Hamon’s firm’s bill in detail. There were three matters upon which counsel agreed I should be asked to rule. First, what was the extent of an order for costs on a full indemnity basis. Second, did the words in the order of the 30th September “of and incidental to this day’s hearing” limit such order. And, third, did the judgment in Re Crane ((1960), 1 P.D. 186; 1959–63 T.D. 74, unreported) reported in the Table des Décisions prevent the Court from admitting Messrs. Allen & Overy’s fees and those of English Counsel.
As regards the first matter, both counsel accepted that the proper test should be that laid down by Sir Robert Megarry V.-C. in EMI Records Ltd. v. Ian Cameron Wallace Ltd., [1983] Ch. 59; [1982] 2 All E.R. 980. This was that, in cases of an order for costs on an indemnity basis, all costs were to be included except those unreasonably incurred or of an unreasonable amount. Mr. Wheeler limited his submission to the first limb. Furthermore, that case decided that in considering whether any costs were unreasonable, the party in whose favour the order was made—in this case, the defendants—was to be given the benefit of any doubt. Formerly, the distinction between types of costs in Jersey was limited to two sorts—“frais répétables” and “frais non-répétables”, or recoverable and irrecoverable costs; the equivalent in English being, I believe, costs as between party and party and those between solicitor and client.
In at least three cases, the Royal Court has awarded costs on a full indemnity basis. I don’t think that the addition of the word “full” adds much to an order for costs on an indemnity basis except perhaps to give support to the ruling in the
EMI case which, as I have said, is that the receiving party will be given the benefit of any doubt. The order for costs in
Blacklock v.
Perrier & Labesse,
1980 J.J. 197, on a solicitor/client basis was, I think, an attempt to return to what was
1983 J.J. 48
believed to be the equivalent of an order for “frais nonrépétables”, which in effect is an order for costs on an indemnity basis.
Unlike England, we have no rules about the approach to be adopted in taxing costs. Rule 8/7 of the Royal Court Rules, 1982, is as follows:
“TAXATION OF COSTS
8/7. The Greffier shall have power to tax—
(a) the costs of or arising out of any cause or matter in any division of the Court;
(b) any other costs the taxation of which is directed by order of the Court.”
That Rule omits either the scales to be allowed or the matters to be taken into account in applying them. The practice has grown up of the Greffier drawing up scales of costs in contentious matters and having them approved by the Superior Number of the Royal Court. However, there is statutory provision for the Royal Court to fix the scale of Advocates’ and Solicitors’ charges. That Law is the ‘Loi (1939) sur les honoraires des Avocats et des Ecrivains’. Article 1(1) of that Law is in the following terms:
“ARTICLE 1
(1) La Cour Royale, assemblée en Corps, aura le pouvoir de fixer un Tarif des Honoraires que les Avocats et les Ecrivains de la Cour Royale auront le droit de percevoir pour leurs services professionels de quelque nature que ce soit, et de modifier ledit Tarif lorsqu’elle le jugera nécessaire”.
In my opinion the Rules governing the taxing of costs which I have cited cannot and do not delegate to the Greffier the duty prescribed by that Law (although described as a “power”) to be carried out by the Superior Number of the Royal Court. What the Rules do, however, is to leave with the Greffier a discretion about the extent of the costs to be allowed but not, I believe, the scales to be followed unless these have been authorised by the Superior Number of the Royal Court. The 1939 Law is explicit and in my opinion should be observed until changed by the States. Rules of Court cannot alter any substantive Law. The
1983 J.J. 49
Greffier has no power to fix the scale of fees without reference to the Superior Number of the Royal Court—his only power is, as I have said, to allocate them.
Both counsel based their submissions as to the extent of an order for costs on an indemnity basis on the Rules of the Supreme Court (the White Book) and in particular Order 62, Rule 29/1, upon which the judgment in the EMI case was based. It cannot be said too often that unless there is a comparable law or rule in Jersey, the White Book is no authority but only a guide and even if the rules are comparable it can never be binding upon this Court. The extension of Rule 29/1, which provides for taxation of a solicitor’s bill to his own client for contentious work (apart from legal aid cases) to include an order for costs on an indemnity basis seems to me, if I may say so, both sensible and fair.
The power to award costs is vested in the Bailiff (or Deputy Bailiff) by Article 17 of the Royal Court (Jersey) Law, 1948. It is unlimited. It might be said that the power to award costs includes the method by which those costs are to be taxed but I would be prepared to accept that that question has been delegated at least in part to the Judicial Greffier by Rule 8/7. I repeat, however, the scale which is to be applied has to be laid down by the Superior Number, particularly as an award on an indemnity basis may well bring in the scale of charges as between an Advocate, or an “Ecrivain”, and his client. I am, therefore, prepared to rule, and I do so, that where costs are ordered on a full indemnity basis, all costs shall be allowed except those which are unreasonably incurred or are of an unreasonable amount. In my opinion, in this case, costs should be properly allowable from the institution of the Order of Justice of the Official Solicitor up to and inclusive of the hearing on September 30th (see In re Gibson’s Settlement Trusts, Mellors v. Gibson, [1981] 1 Ch. 179; [1981] 1 All E.R. 233). I am satisfied that the items I have read in Messrs. Crill, Cubitt-Sowden & Tomes’ bill relate to issues raised by the Official Solicitor and should properly be included as being “of and incidental to this day's hearing”. Nevertheless, in the course of the hearing I was told that the Greffier had been in the habit recently of allowing charges at the rate of £60 an hour for an Advocate’s time. It may well be that that is a proper figure but I
1983 J.J. 50
repeat that the scale of remuneration should be fixed by the Royal Court. I am, therefore, referring the question of the rate of remuneration claimed by Messrs. Crill, Cubitt-Sowden & Tomes, of £60 and £45 for an Advocate and a person “non diplômé” respectively, to the Superior Number for its consideration under the 1939 Law.
There remains the question of the Crane case. If I were to take a narrow view of that case, I have little doubt that I would rule that both Messrs. Allen & Overy’s and English Counsel’s fees should be disallowed. The judgment in the Crane case includes this passage:—
“Persons who have not been sworn as ‘avocats’ under the ‘Lois sur l’Admission au Barreau’ or admitted to practise as ‘ecrivains’ under the ‘Loi sur l’Admission des Ecrivains’ cannot be regarded by the Court as qualified to advise on the laws and customs of Jersey. Held that no order with regard to costs made by the Royal Court in proceedings relating to an estate can be deemed to include costs or disbursements incurred by any of the parties in instructing English solicitors and English Counsel.”
I was referred also to a decision of the Judicial Greffier in taxing costs in Jersey Precision Engr. Co. Ltd. v. Jersey Tufting Co. Ltd. (Jud. Greff., February 6th, 1974, unreported). There the Greffier followed the Crane decision fully. I believe, nevertheless, that I am able to distinguish the Crane case from the present proceedings in a number of ways. First, although the Clore matter does relate to an estate, the issues in the Crane case, although also concerning an estate, were clearly what I might properly call Jersey domestic issues, that is to say, the question of whether the testator, Sir Edmund Crane, had exceeded his testamentary powers. There was no doubt—and it was not disputed—that he had died domiciled in Jersey and therefore was subject to the law of Jersey on succession. In this case, however, the question of domicile is by no means clear and indeed is one of the principal matters in dispute. Again, as I have already said, there is the question of private international law. The Royal Court has consistently said that its duty in considering the law applicable to any particular case before it is first of all to see if there is any established Jersey law which should be applied. If there is not,
1983 J.J. 51
then it casts its net in the widest possible way to see what law is the nearest applicable one which could be fairly applied. Issues of domicile and private international law are the very kind of matters upon which the Jersey Courts for several years now have looked outside the Island and have grafted on to the common law of Jersey certain principles of the English Common Law dealing with these two matters. Thus in this case it is perfectly proper in my opinion for the parties, be they in Jersey, be they in the United Kingdom, to approach the matter on the basis as to what the law would be if the Courts of Jersey were to apply the English common law. In such a case I cannot see that it is unreasonable to seek the best advice obtainable and, subject to the Greffier being satisfied that the scale of Messrs. Allen & Overy’s charges and also counsel’s fees are reasonable, and I have no reason to doubt that they are not, they should be allowed.
In short, therefore, subject to the Superior Number of the Royal Court adjudicating on the scale of advocates’ charges and persons “non diplômé” in contentious matters, I would allow the bill as presented (subject to what I have said above) to be taxed at the amounts claimed. Since this is the first time that the Royal Court has been asked to give a ruling on these matters, I propose to make no order as to the costs, which will be in the cause.
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