Are you Ofay (Au Fait) with taxation in Bermuda? More costs guidance from the Registrar of the Supreme Court

I have previously written a blogpost about the new Registrar’s approach to the taxation of costs on an inter-party basis in Bermuda litigation.

Further guidance is now available in the Registrar’s Ruling dated 1 May 2017, in the case of Capital Partners Securities v Sturgeon Central Asia Balance Fund [2017] SC Bda 32 Com.

The Ruling is worth reading for a number of reasons (for those with an interest in such esoteric matters), in that:

  • the procedural history of the case appears to have been unnecessarily complicated and convoluted, involving many more lawyers and attorneys on the part of the Plaintiff than one might ordinarily expect;
  • 50% of the Plaintiff’s claim for costs related to the costs of foreign lawyers, being BVI-registered or Cayman-registered lawyers working in Hong Kong (although apparently seeking to offer some form of Bermuda legal advice or Bermuda legal services, and potentially also some level of Japanese legal advice). The Registrar appears to have disallowed a significant part of these costs, although the precise level of recovery is hard to ascertain, from the manner in which her judgment was framed. Indeed, the Registrar appears to have taken the unusual course of leaving it to the Bermuda lawyers and the BVI/Cayman lawyers to decide amongst themselves how certain of their costs should be divided (when the issue, surely, must be for the litigating party to decide what to do with its costs recovery, assuming that its lawyers have been engaged in accordance with the indemnity principle);
  • the Plaintiff’s claim for costs was apparently 4 times higher than the costs incurred by the Defendant, although the Registrar placed very limited weight on this fact in her assessment of the reasonableness of the Plaintiff’s costs;
  • having carried out a detailed assessment of various line items in dispute, the Registrar double-checked herself by reference to an overall review of the issue of proportionality. She noted, in particular, that the Plaintiff’s claim for costs was, in general terms, disproportionate, but that her disallowances resulted in the recovery being reasonable (and therefore in her view, proportionate);
  • the Registrar, once again, applied a fairly rigorous test to the issue of ‘legal research’ time on the part of senior litigation fee-earners, who should be ‘ofay’ (au fait?) with the relevant law and practice.

 

 

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