Solicitors are responsible for the acts or omissions of their Costs Draftsmen – or are they?

Posted by Michelle Barron on 17th July, 2018 in Opinion and categorised in .

There are a couple of major points which arise from the recent decision of Gempride Limited -v- Jagrit Bamrah & Lawlords of London Ltd [2018] EWCA Civ 1367 in terms of the implications/obligations upon the fee earner signing the Bill of Costs/Replies and regarding the service level expectation and the liability of your costs draftsmen.

By way of brief background this was a detailed assessment arising out of a personal injury claim. As is the norm, the bill of costs was prepared by a costs draftsman and thereafter certified by the solicitor as to its accuracy.  On assessment, it transpired that the Bill did in fact claim hourly rates more than those that had been provided for in their retainer.   In their signed Replies to the points of dispute, the Solicitor stated that that before the event insurance (BTE) was not available.  In fact, BTE was available on certain terms.

There then ensued a long and costly battle through the Courts.   It is notable that the claimant was also a solicitor who represented herself through her firm for a time during the claim.

At first instance, in the Senior Court Costs Office (SCCO), the Master determined that there had been misconduct (CPR 44.11) in certifying the bill and replies and limited part of the claimant’s bill to the litigant in person rate.

On first appeal, this decision was reversed by HHJ Mitchell on the basis that inter alia, the claimant’s costs draftsman was responsible and not the solicitor.

HHJ Mitchell’s conclusions were rejected by the Court of Appeal.  Hickinbottom and Davis LJJ held that the solicitor was responsible for the actions of the Costs Draftsman under the law of agency.   They concluded that the Solicitor; Miss Bamrah had been reckless and held that there was unreasonable or improper behaviour. They applied a sanction of disallowing 50% of profit costs in the bill of costs for the damages claim.

This judgment therefore firmly reasserts that it is the solicitor’s responsibility for the detailed assessment process. Solicitors are accountable for the actions of Costs Draftsmen.   The accuracy of the bill of Costs and Replies to points of dispute MUST be taken more seriously and MUST be correct from the start – or risk sanction.

Before any Bill is signed and certified, ideally you will have received detailed advice from your instructed Costs Draftsmen and thereafter the fee earner with conduct would check the Bill/Replies.  Your nominated Costs Draftsman should make provision within the Bill and Statement of Costs on assessment for the time spent doing this, reinforcing the doctrine that the signing and certifying of a Bill of Costs is “not an empty gesture” (Bailey -v- IBC Vehicles).

However, it is our view at Burcher Jennings that in signing the Bill of Costs/Replies, the Solicitors or other fee earners should be able to rely on detailed advice provided by their Costs Draftsman.  We believe that our clients are entitled to have high expectations as to the level of expertise and advice, in addition to quality service levels, from their instructed Costs Draftsman. As such, it should be automatic for the external provider to provide detailed advice, at a minimum, on retainer issues, issues generally arising from the case, work which is at risk, along with the reasons why.

It is important to know that not all Costs Draftsmen are the same.   Did you know that individual qualified Costs Lawyers are regulated by the Costs Lawyers Standards Board (CLSB)?  We have several qualified and regulated Costs Lawyers at Burcher Jennings.  It is a requirement of membership of the CLSB that all Costs Lawyers are qualified, have a minimum level of professional indemnity insurance, that they have to undertake 12 hours CPD per year and have a complaints handling procedure.

Also, since 2011, if you have a Costs Lawyer practising certificate, Costs Lawyers are afforded the rights to conduct certain reserved legal activities under the Legal Services Act 2007.

By building upon your relationship with your external Costs Lawyers this will:

  1. assist fee earners
  2. provide early detection of internal procedural issues, thus improving systems and results and minimising risk exposure on assessment
  3. increase confidence from a management level as to correct certification

At Burcher Jennings we pride ourselves on our service level to our clients and our commitment to support our client firms in navigating these difficult waters, thus building on the continued strength and viability of their firms.  We provide detailed advice on all areas of concern, including retainer issues, as a matter of course.

We look forward to continuing to work with our existing and meeting new clients to demonstrate how we differentiate ourselves from the rest.

Small enough to be bespoke – large enough to cope!

This article was written by Victoria Morrison-Hughes is head of Burcher Jennings’ Manchester office and joined the firm in early 2016. A qualified Costs Lawyer with a degree in accountancy and finance, coupled with extensive experience working as a lawyer in high street practice provides Victoria with unique insight into both the operational and technical demands of a legal business. Her main areas of expertise include commercial litigation, clinical negligence, catastrophic injury, Court of Protection and solicitor & own client disputes together with Costs management and negotiations.  Victoria’s primary focus is on providing excellent client care and service where her priority rests on quality and ensuring clients receive a bespoke service.