Client wins appeal over costs of s70 assessment

A law firm has been ordered to pay the costs of a detailed assessment of a bill of costs it had issued because it failed to provide a breakdown of the bill when first requested, and it should have directed the litigant to the procedure under section 64 of the Solicitors Act 1974, which would have avoided the section 70 detailed assessment.

According to a Lawtel report of Parissis v Matthias Gentle Page Hassan, this was an appeal against an order requiring the firm’s client to pay the costs of the detailed assessment.

The firm had sent him its bill in general terms, with no breakdown of the time spent or the time period covered. The bill noted that the client could be entitled to have the charges reviewed by way of detailed assessment under section 70. The client asked for a breakdown but did not get a reply and so, acting in person, commenced section 70 proceedings.

The master ordered a detailed assessment and that the firm provide the breakdown, which it did on the last possible day. When he had seen the breakdown, the client agreed to pay the entire bill, with interest. The master ordered the client to pay the costs of the detailed assessment because there were no special circumstances taking the matter outside of the normal rule in section 70(9); there had not been a lack of specific information in the bill as the client had felt he had sufficient information to justify a detailed assessment; the appellant should have acted under section 64 rather than section 70.

According to Lawtel, on appeal Mr Justice Morris said the finding of special circumstances was a value judgment, requiring a comparison against a run-of-the-mill case to which the default rule under section 70(9) would apply. ‘Special’ meant out of the ordinary course, not ‘exceptional’.

The report continued: “The court accepted that, in the circumstances, section 70 had been the wrong route to take. The question was whether the appellant should bear the consequences of that error. The court concluded that the master had erred. The bill of costs had not contained any detail regarding the hours or time period worked. He had failed to take into account that a breakdown had expressly been sought, and that the appellant had received no reply for six months.

“The proceedings could have been avoided. The master had erred in ascribing to the appellant a belief that he had had sufficient information to bring about a detailed assessment: it was plain that the appellant had not so believed. Although a litigant in person was in principle no different from a represented party, the master should not have ascribed a belief in the sufficiency of information simply because the appellant had started the proceedings.

“At that time, the appellant had not been aware of section 64: the court and Senior Courts Costs Office rules did not draw it to his attention, nor did the respondent, whose bill of costs referred only to section 70. In concluding that the appellant bore the responsibility of choosing the wrong procedure, the master had failed to take into account the relevant facts.”

Morris J concluded that the master’s overriding conclusion was flawed: he had erred in principle, taken into account irrelevant considerations and failed to take into account relevant ones. Thus the case was not run-of-the-mill and warranted departing from section 70(9).

This post was posted in ACL e-Bulletin

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Costs News
Published date
27 Jan 2017

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