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Preterit: Lascelles C.J. and Middleton and Wood Renton JJ.
ATTORNEY-GENERAL v. SAIBO.
118—D. C. Kandy, 218.
Taxation of costs—Fees charged by Crown Counsel should be allowedthough no fee was specially paid for the ■ case—Civil Procedure Code,s. 208, applies to the Crown.
The fees of Crown Counsel should he allowed on taxation, in caseswhere costs are decreed to the Crown.
Even though the salary paid to Crown Counsel covers the per-formance of other duties than advocacy,' a . fair proportion ofthe salary paid may be regarded as an expense " necessarilyincurred ” on account of each litigation in which Crown Counselreceiving the salary appears.
The Crown is bound by section 268 of the Civil Procedure Code.
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fjl HE facts appear in the judgment.
Walter Pereira, JET.C., S.-G. (with him Akbar, (7.(7.), for theAttorney-General.—The Crown has to pay salaries to the CrownCounsel and to the Law Officers for securing their services inCrown cases. The salaries paid stand in the place of fees. It hasbeen held in England that a solicitor can be remunerated by salaryfor contentious as well as non-contentious business (see Galloway v.Corporation of London1), and that the client can recover usualcost from his opponent in litigation, unless the letter can show that suchcosts would exceed the amount of the salary. Henderson v. MerthyrTydvil Urban District Council,a Annual Practice (1912) 639.
Le Mesurier v. The Attorney-General3 is not applicable to the factsof this case* The fees recovered at the time of the decision of thatcase went to Crown Counsel, but now the Crown pays enhancedsalaries to the Crown Counsel, and appropriates all the fees recoveredfrom its opponents. Wendt J. in Le Mesurier v. The Attorney-General3 did not see any objection to the fees of Crown Counselbeing taxed if the fees went to the Crown, and not directly into thepocket of the counsel engaged in the case. The Supreme Courtdid not wish to encourage the system of “ payment by results,’*but that objection cannot be raised now.
Section 208 of the Civil -Procedure Code does not bind the Crown.A statute does not bind the Crown unless it is therein expressly sostated, or unless it appears to have that effect by necessary impli-cation. See Palaniappa Chetty v. Ismail SeidikfTkeAttorney-Generalv. Constable et at.* So that even if the expenses were not actuallyincurred by the Crown, the Crown is entitled to recover the costs.But in this case the Crown did, as a matter of fact, incur expenses,as the salary wa3 paid to Crown Counsel for appearing in cases.
H. A. Jayewardene, for the respondent.—Section 208 of the CivilProcedure Code defines the term “ costs no expense that is notnecessarily incurred by a party can be said to be costs. Appearingin this case did not add to the expenses of the Crown. The CrownCounsel would get the same salary whether they appeared in thiscase or not. The Attorney-General is in the same position as anordinary litigant under the Code. He can only recover moneysthat he has actually expended for this case. See judgment ofMiddleton J. in Le Mesurier v. The Attorney-General.3
[Wood Benton J.—Is not the salary of Crown Counsel paid forthe purpose of appearing in these cases? Is it not an expense“ necessarily incurred ” for this case?] The items in dispute cannot
i L. R. 4 Eg. 90.* 0308) 10 N. L. R. 07.
* (1900) 1 Q. B. 434.« (1902) 5 N. L. R. $22.
* (1879) 4 Ex. Div. 172.
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IMS. be said to be necessarily incurred, as they were not spend by theAttorney. Crown for this. case. In Henderson v. Merthyr Tydvil Urban District^ounc^1 *ke Judges were not hampered by the definition of costsin section 208 of our Code.
[Lascelles C.J.—Is section 208 intended to be an exhaustivedefinition of “ costs ”? The word used is include.] The words ofthe section taken as a whole show that the definition is an exhaustiveone. The rule of the Supreme Court as to taxation of costs requiresa receipt of the advocate before his fees are taxed. No exceptionwas made in favour of Crown Counsel.
Walter Pereira, K.G., 8.-0., in. reply.—The word “ include ” insection 208 shows that the definition is not exhaustive. SeeLudovici v. Nicholas Appu.*
Cur. adv. vult.
March 13, i912: Lascelles C.J.—
This appeal raises the question whether the fees of Crown Counselshould be allowed on taxation in cases where costs are decreed tothe Crown. The Begistrar in the present case disallowed thefollowing items in the bill of costs submitted for taxation by theCrown Proctor, namely:—
Brief for Crown Counsel………21
Mr. Walter Pereira, K.C……….. 106
The Attorney-General being dissatisfied with the disallowance ofthese items, the matter is now referred to this Court for decision inreview of the Begistrar’s taxation.
The position of Crown Counsel as regards fees in cases where costsare decreed in favour of the Crown appears to be as follows. Beforethe decision in he Mesurier v. The Attorney-General,* it appears tohave been the invariable practice to allow on taxation the fees ofthe Attorney-General. Solicitor-General, and Crown Counsel, butthis practice never received judicial recognition. These officersup to the date when their salaries were adjusted on a sterling scale,■were allowed to retain their fees when recovered. From that datethe officers of the Attorney-General’s Department who were inreceipt of a sterling salary were prohibited by General Orders ofGovernment from retaining any fees paid in respect of their services;and their fees, if allowed, are payable into the Public Treasury.In he Mesurier v. The Attorney-General* the Crown Counsel, withrespect to whose fees the dispute arose, was not paid in sterling,and so was entitled to retain any fees which might have been
i (1900) 1 Q. B. 434.* (1900) 4 N. L. B. 12.
» (1908) 20 N. L. R. 67.
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allowed him. The Court in that case disallowed the Crown Counsel’s IBIS*fees principally on the ground that the Attorney-General in that
case had disbursed nothing, and had incurred no debt for fees toCrown Counsel, and that, therefore, the fees claimed by Crown
Counsel were not " expenses necessarily incurred on account
of the action ” within the meaning of section 208 of the Civil Pro-cedure Code. But it is clear from the judgment of Wendt J. thatthe Court was also influenced by considerations of public policy;that it had in view the mischief which might result, from a systemunder which Crown Counsel received fees only if they were success-ful. The judgment of the learned Judge contained the followingpassage:—
Analteration inthe destination of thesefees,when recovered,
mightperhaps haveobviated the objection totheirallowance. I do
not see that any exception could be taken to the practice of the Crownpaying yearly salaries to counsel for doing its work in Court, and itwouldbe reasonableenough that the Crown,whensuccessful, should
recoup itself by recovering from its opponent a fair fee for the workdone. But in such a case the fee must go to the Crown, and not directlyinto the pocket of vhe advocate engaged in the case.
The question came up again in the District Court of Colombo(D. C. Colombo, 28,832) at a date when Crown Counsels bad beenplaced on a sterling salary; and their fees, if recovered, would havebeen paid into the Treasury, as is the case now, and would not havebeen retained by the individual Crown Counsel. In that case thelearned District Judge held that the Crown was entitled to recoverthe fees from the defendant, this decision being based partly onthe passage which I have cited from the judgment of Wendt J. inLe Mesurier v. The Attorney-General.1
The present appeal is based upon two grounds. The first pointfor consideration is whether the Crown is bound by section 208 ofthe Civil Procedure Code. It is material to notice the nature ofthis section. It enumerates the different headings of expenditurewhich are included in the denomination ‘‘ costs,” so that wheneverany question arises as to what expenses are included in the term“ costs,” the matter may be determined by reference to section 208.
■“ The Interpretation Ordinance, 1901,” by section 14, providesthat no enactment shall in any manner affect the right of the Crownunless it is therein expressly stated, or unless it appears by necessaryimplication, that the Crown is bound thereby; and there can be nodoubt but that the Crown in Ceylon, as in England, may takeadvantage of statutes though not named. But do these principlesof constitutional law really help the appellant? If it could beshown that prior to the enactment of the Civil Procedure Codethe Crown was entitled as of right to have these costs allowed, itmight well be argued that the pre-existing right of the Crown was
» (ISOfl) JO N. L. B. 67.
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IMS. not affected by the enaetment of section 208 of the Code. Int,a — ^ Palaniappa Ghetty v. Ismail Seidik,' for example, it was held thatC.J. before the enactment of the Civil Procedure Code creditors wereAttorney allowed-to intervene for concurrence or preference without being inQmeralv. possession of decrees, and that the enactment of section 852 of theSaibo 0ode, which required intervening creditors to be in possession ofjudgments, did not affect the pre-existing right of the Crown tointervene without a decree. But the present case is essentiallydifferent. There is no question of any prerogative or pre-existingright of the Crown being affected. The Attorney-General repre-senting the Crown sets in motion the machinery provided by theCode for the taxation of costs, but he contends in effect that he isnot bound by the section of the Code which enumerates and definesthe different kinds of expendture which are included in the term“ costs.” In effect he contends that the term “ costs ” means onething with reference to the Crown and another thing in referenceto an ordinary suitor. I do not think that this proposition istenable. When the Crown descends into the arena and appliesto have its costs taxed, I think that the Crown must be taken tohave submitted to the enactment by l_.h the taxation of costsis regulated. I am therefore of opinion that the question underconsideration must be determined on the footing that section 208of the Civil Procedure Code is applicable. The other question isthus, whether the items which have L ~en disallowed are expensesnecessarily incurred by the Crown. If the matter had been resIntegra, I should have felt little difficulty in answering the questionin the affirmative,'in view of the decision in Henderson v. MerthyrTydvil Urban District Council,* which does not appear to havebeen considered in Le Mesurier v. The Attorney-General.* In thatcase a district council engaged as their clerk a solicitor, who was tohe paid an annual salary of £400 for his services both in litigationand in other respects. The question arose under section 5 of theSolicitors’ Act, which provides that where there is an agreementbetween solicitor and client for payment of a lump sum for thewhole of the solicitor’s services, the client “ shall not be entitledto recover from any other person, under any order, for the paymentof any costs which are the subject of such agreement more than theamount payable by the client to his own solicitor.” The Registrarin that case had disallowed an item of £11. 12s. Id. in the solicitor’sbill of costs, on the ground that the work had been already paid forby means of the solicitor’s salary of £400.- It was held that theRegistrar was wrong; that a certain proportion of the £400 mustbe taken to have been paid in respect of the charge of £11. 12s. Id.;and that it must be assumed, until the contrary was shown, that£400 was a proper sum to be paid to the solicitor for his whole I
I (1902) 5 N. L. R. m.* (1900) 1 Q. B. 434.
1 (1908) 10 N. L. JJ. 67.
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services, and that the £11. 12s. 7d. was a proper sum to be paid him 1912.for this part of the work. “ The District Council,” said Channell J.,
44 must therefore be presumed to be paying their solicitor £11. 12s. Id.
out of the 400 for the very work.” The learned Judge also observed
that cases ” such as this frequently arise, and I believe that they arealways dealt with in the High Court in the way I have mentioned.” SaiboThe principle on which this case was decided appears to zhe to solve thedifficulties which prevented this Court in Le Mesurier v. The Attorney•
General1 from holding that a Crown Counsel's fees in a case where theCrown Counsel did not receive any particular fee for appearing inthe action were 44 expenses necessarily incurred by either party' onaccount of the action. ” That such costs are ** necMsarily incurred ”cannot be doubted, for the Crown must appear in such actionsand the Crown must pay the counsel whom it employs. But werethey incurred ** on account of the action ”? It is contended withsome plausibility that they were not so incurred, because the salaryof the Crown Counsel would have been the same if he had notappeared in this action. The decision in Henderson v. MerthyrTydvil Urban District Council2 seem to me to answer the questionin the affirmative. A certain proportion of the Crown Counsel’ssalary must be taken, until the contrary is shown, to have beenpaid for his services in this action. It is true that the decision inHenderson v. Merthyr Tydvil Urban District Council* was a decisionunder sections 4 and 5 of the Solicitor's Act, 1870, but it is nonethe less in point in the present case. These sections empowersolicitors to enter into agreements for the amount and manner ofpayment of the whole or any part of their services, and providethat the solicitor cannot recover as costs more than he gets underthe agreement. With regard to the power to make such agreementsthere is no question. The right of the Crown to pay its lawyers bymeans of fixed salaries is indisputable. But the question whethera proportion of a solicitor's annual salary is attributable to the costsof any particular action, which was the main question in Hendersonv. Merthyr Tydvil Urban District Council ,a is in principle thesame as that which arises in the present case. For the abovereasons I am of opinion that the fees in the case are expensesnecessarily incurred on account of the action within the meaning ofsection 208 of the Code.
There is one other point for consideration. On September 23,
1895, the Judges of this Court issued directions to the [Registrar,said to be based on a Minute dated September 1, 1895, which hasnot been traced, that no advocate's fees be allowed oh taxationunless a receipt signed by the advocate is produced by the taxingofficer. If the view which I take is correct, namely, that CrownCounsels are paid by‘means their salary for each case in whichthey appear for the Crown, there can be no objection to their givingi (2908) 20 N. L. R. 67.* (2900) 1 Q. fi. 434.
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1918. the receipt required by these directions. For the above reasonsLasceu.es * am of opinion that the appeal should be allowed with costs, andC.J. the disputed items remitted to the Registrar for allowance unlessthey are open to objection on other grounds.
Saibo Middleton J.—
This was an application to review the taxation of a bill of costsby the Registrar of this Court. It appears that the Registrar hasdisallowed, amongst other items in the bill, the fees claimed forCrown Counsel, and it is the disallowance of these fees that has beenbrought up for review. At the present time Crown Counsel arepaid salaries in sterling by the Government, and I understand thatthese salaries are intended to cover, not only the performance ofall advisory duties, but also the performance of the duties of an•
advocate in the Courts upon any contentious business in which theGovernment may be engaged. It is contended for the Attorney -General, mainly on the authority of Henderson v. Merthyr TydvilUrban District Council,1 that he is entitled, on behalf of the Crown,on a successful trial, in which the Crown has been awarded costsagainst its opponent, to have allowed to him fair and reasonableBums to be paid to the Crown, as representing the fees which theCrown would have been compelled to pay to counsel if its contentiouswork were not done by salaried officials.
The real question to be decided here, in my opinion, is whetherthe sums claimed can be considered under section 208 of the CivilProcedure Code to be expenses necessarily incurred by the Crownon account of the action. If so, I think the Attorney-Generalshould succeed in review. There is no question that some indefiniteportion of Crown Counsel’s salary must be considered as an expensenecessarily incurred by the Crown with reference to that fractionof Crown Counsel’s time which he devoted to this case. The Crownhere has, therefore, necessarily incurred indefinite expenses inrespect to thjp action. Do these fees claimed fairly represent thoseindefinite expenses so necessarily incurred? I think that it • mayfairly and reasonably be said that the fees ordinarily allowed underthe rules as to costs do approximately represent such expenses,unless it can be shown that they will give the Crown more thanthe indemnity it is entitled to. If this be so, then I .tbink theymight reasonably come within the terms of section 208, and onthe authority of the case relied on by the Attorney-General he isentitled to succeed. In the case of Le Mesurier v. The Attorney-General* I thought that the fees claimed for Crown Counsel, whichhad not been, and could not have been, paid to them by Government,unless recovered by the unsuccessful litigant, did not fall withinthe provision of section 208. It is observable that at the time ofthat case the Crown’s custom was only to pay Crown Counsel in the
> (1900) !>• R. 1 Q. B. 434.
* 0908) 10 N. L. B. 67.
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event oi the recovery of the fees they claimed from the unsuccessfuladversary of the Crown, and it was fairly argued by me that theCrown really incurred no expenses on account of actions for counsels’fees in contentious business, aa its agreement with its counsel wasthat they were only paid -dot such, work when recovery was obtainedfrom the other side. .
The reasoning, however; 6f Channel J. in Henderson v. MerthyrTydvil Urban District Council (ubi s-upra), which was not cited tous during the argument of Zie Mesurier v. The Attorney-General,1 leadsme to thijlk that the dictum of Mr. Justice Wendt at page 69 ofthe latter base'was a proper modification of the view I expressed atpage 72, which, however, dfd not affect that case on its facts.
On the question-of the prerogative of the Crown, I am not aware, as Isaid at the argument, that the Crown has a peculiar privilege as regardscosts which, it might claim, could not be restricted by section 208.
I would, therefore, allow the application in review with costs, ifthe fees claimed.'represeht .as. approximately as possible the indefiniteexpenses incurred try the ■CitfSTSj'in' that behalf, and if there be noother good reasons for their disallowance. .
Wood Bejtogn J.—•
I do not’think that the point that we h.ave to decide in the presentcase is covered by the authority of the decision of the SupremeCourt in he Mesurier v. The Attorney-General.1 It was there heldthat where the Attorney-General employs Crown Counsel to appearon behalf of the Crown, and disburses nothing, and incurs no debtby way of fees, he is not entitled to charge the opposite party suchfees as he might reasonably have had to pay for the services of aprivate advocate had he chosen to engage one. The fees claimedin Le Mesurier v. The Attorney-General1 would, if recovered, havebeen psud to the Crown Counsel who had appeared on behalf of theAttorney-General, whereas here, 'if recoverable, they are payableto the Crown itself. Wendt J. dealt obiter with the very point nowbefore us ifi the following language:—
Thealteration inthe destination of thesefees,when recovered,
mightperhaps • haveobviated the 'objection totheirallowance. I do
not see that any exception ’could be taken to the practice • of the Crownpaying yearly sables to counsel for doing its work in Court; and itwouldbe reasonableenough that the Crown,whensuccessful, should
recoup itself by recovering from its opponent a fair fee for the workdone. Bnt in snch a case the fee must go to the Crown, and notdirectly into the pocket of the advocate engaged in the case.
My brother Middleton was not prepared to take this view, on theground that, even under the circumstances which it contemplated,the salary of Crown Counsel Would be paid in any event, and thatas it covered the performance of a ntmber of other duties, it couldHot be regarded, within the, meaning, of section 208 of the Civil
* lU08) -ta W. L. B. 67.
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Procedure Code, as an expense “ necessarily incurred ” on accountof any particular litigation.
1 refer to these obiter dicta merely for the purpose of showing thatnothing was actually decided in Le Mesurier v. The Attorney-General,'adverse to the position assumed by the Crown here, and, indeed,that the present contention of the Crown had the support of one ofthe learned Judges by whom that case was decided. On the whole,1 am of opinion that the view suggested by Wendt- J. in Le Mesurierv. The Attorney-General1 was right. It is necessary that the interestsof the Crown should be represented in civil proceedings in whichit is concerned. It is necessary also that the Crown should payfor the services of the advocates who represent it. Where suchpayment is made by an annual salary, even if that salary coversthe performance of other duties than advocacy, a fair proportion ofthe salary paid may, I think, be regarded as an expense “ necessarilyincurred ” on account of each litigation in which the Crown Counselreceiving the salary appears. That view was taken by Channeland Bucknill JJ. in Henderson v. Merthyr Tydvil Urban DistrictCouncil.* It was there held that where a solicitor is employed atan annual salary, covering a considerable variety of duties besidesappearance in Court, the unsuccessful party was liable to pay thesolicitor’s bill of costs, of which part was claimed in respect of hisservices as solicitor in the action. The decision in that case did notturn oh any special English legislation. The rule laid down, whichChannel J. describes as being in accordance with the well-settledpractice of the taxing officers in the High Court, was one of principle.The ratio decidendi was that, under the circumstances of the case, aproportion of the salary paid to the solicitor should be attributedto the particular litigation in which the point arose, unless the respon-dent showed that the result would be to give the employer more thanan idemnity for the loss of his services while employed in the suit.
'* If the litigation, ” said Channel J., “ had been of an expensivecharacter, such as a suit in the House of Lords, and the profit-costshad exceeded the salary, it is apparent that the appellants couldnot have recovered all the costs without getting more than theypaid the solicitor, and in that case no doubt the agreement mightbe urged in diminution of the costs.”
Although it is unnecessary to decide the point, I desire to addthat I do not agree with the learned Solicitor-General’s alternativecontention that section 208 of the Civil Procedure Code is notbinding on the Crown. It seems to me that when the Crown comesinto Court as a successful litigant and asks taxations of its bill ofcosts, it must be taken to have submitted to the rules of practiceprescribed for the exercise of that branch of the jurisdiction of theCourts to which it appeals.
. » (1900) 1 Q. B. 434.
‘ (1998) 10 N. L. R. 67.
ATTORNEY -GENERAL v. SAIBO