The High Court has overturned a costs judge’s decision that a company which brought a private prosecution did not need to instruct London solicitors.
Mr Justice Lane also found that the judge had been wrong to compare the solicitors’ costs with what the Crown Prosecution Service’s (CPS) costs would have been.
The claimant firm of letting agents in Fuseon Ltd v Senior Courts Costs Office and The Lord Chancellor [2020] EWHC 126 (Admin) brought a private prosecution against one of its directors after the police declined to investigate, citing austerity. Being unable to find a local firm of solicitors in Lancashire to do it, fellow director Mr Laycock instructed London firm Edmonds Marshall McMahon (EMM), which specialises in such cases.
The prosecution was successful, leading to the co-director being sentenced to three years’ imprisonment. HHJ Knowles QC ordered “that a payment be made to the prosecution out of central funds in respect of prosecution costs, including the cost of the investigation, and that the sum to be paid shall be determined”. The Crown Court had been told that the claimant’s costs were £428,000 including VAT.
The determining officer allowed the claimant £150,000 plus VAT, increased to £200,000 after a re-determination. Master Rowley at the SCCO dismissed its appeal and declined to certify points of principle of general importance so as to enable an appeal to the High Court.
The claimant sought to reverse the refusal to certify pursuant to the inherent jurisdiction of the High Court. It argued that Master Rowley (pictured) wrongly upheld the delegated officer’s decision that EMM’s London charging rates and travel expenses were not the appropriate yardstick; and in applying the so-called Singh reduction, the claimant’s recoverable costs should be reduced by reference to the costs of the CPS, had it conducted the prosecution.
Lane J summarised the Singh reduction as arising from “the necessity of standing back from the total hours claimed on each class of work done to assess whether globally it was reasonable”.
The claimant submitted that the errors had a more general significance because, if allowed to stand, they undermined the intention of Parliament to protect the position of those who bring private prosecutions, particularly where, as here, the police refused to become involved, owing to a lack of resources.
In reaching his decision, Lane J described the “constitutional position” of private prosecutions as an “important backdrop”
On hourly rates, Lane J found that Master Rowley wrongly asked himself whether there were, in the local area, firms containing the likes of former public prosecutors that would have had no difficulty in bringing the prosecution. Rather, he should have asked if the claimant “acted reasonably” in instructing EMM.
As a result, Master Rowley rejected the evidence of EMM lawyer Ashley Fairbrother that countered the designated officer’s finding that Manchester and Liverpool were capable of providing a pool of large and experienced firms and that many significant local firms of solicitors offered a private prosecution service. “In so doing, he committed the legal error of not having regard to relevant evidence,” said Lane J.
The judge continued: “Even on the basis of Mr Laycock’s 2018 witness statement, read with the evidence of Mr Fairbrother, the answer to the question that should have been posed was, I find, plain. Mr Laycock had done everything that could reasonably be expected of a person in his position. He had made enquiries of his solicitors. He researched the matter online and did not find firms offering private prosecution services for fraud, who were more local than EMM.
“Mr Laycock’s 2019 witness statement contains a more detailed description of his search for a suitable solicitor, in response to the master’s attempt to justify the designated officer’s decision on rates on the basis that firms offering criminal defence services can mount private prosecutions. There is, however, nothing whatsoever to suggest that Mr Laycock knew or ought to have known about that possibility.
“In any event, it must be doubtful whether the master’s assumption is soundly based. The duties on prosecutors are, in significant respects, different from and more onerous than those placed on defence teams. It is, accordingly, unsurprising that Mr Laycock’s 2019 witness statement records that defence solicitors he contacted were unwilling or unable to assist him.”
On the Singh discount, Lane J found “a lack of clarity” in Master Rowley’s decision, adding that the Court of Appeal authorities were “incompatible” with the designated officer’s decision to introduce the CPS as a comparator for the purposes of applying the Singh discount. The judge said: “On the facts of this case, the relevant market could not be said to involve any comparison with the CPS.”
He also found that the way in which the CPS was used as a comparator “inevitably involved the application of hindsight, which is not permitted in an exercise of this kind”.
The claimant “rightly” did not contend that the Singh reduction could play no part in the assessment of costs of private prosecutors, and it could not be said, as a matter of law, that it would always necessarily be wrong to look at CPS costs, when determining the amount of costs to be awarded to a private prosecutor. “If an individual resolves to embark on a private prosecution with no regard to whether the state is willing and able to prosecute, a comparison with the CPS might be legitimate. That, however, was not the position in the present case.”
Lane J concluded that these legal errors caused “very substantial prejudice” to the claimant, which has had to take out a loan to fund the costs not recovered. “Furthermore, not to disturb the decisions in this case would risk the perpetuation of an erroneous approach to the award of costs in private prosecutions, which in turn risks damaging the position of private prosecutions in the constitutional framework. In particular, private prosecutions would be in danger of becoming the preserve of those with deep pockets.
“In the light of my findings, it is evident that there would be a real injustice if the decisions remain undisturbed. I therefore quash the substantive decision of the master and his decision not to certify a point of principle of general importance. I remit the matter to the [SCCO] for reconsideration, in the light of this judgment.”
Rupert Cohen (instructed by Edmonds Marshall McMahon) for the claimant, Riccardo Calzavara (instructed by Government Legal Department) for the first defendant and Richard Boyle (instructed by Government Legal Department) for the second defendant.