Costs Lawyers and the Question of the False Economy
Winston Churchill once said, “Sometimes doing your best is not good enough. Sometimes you must do what is required.” I was reminded of this challenging quote when reading about the case of Jago -v-Whitbread via Gordon Exall’s Civil Litigation Brief. If there were ever a case that demonstrated the need to employ experienced costs lawyers – rather than to wing it and ‘do your best’ - it is this one. You may be thinking “well of course he would say that,” but read on and I think you’ll most likely agree.
Six figure costs
The story begins at the end of a personal injury claim by Vivienne Jago against her former employers, which had been settled for £41,035.75. Eight days after the settlement had been agreed, the claimant’s solicitors submitted their bill – an eye watering £101,677.21. According to the approved judgment, “that bill included inter alia an uplift or success fee of twenty per cent claimed on solicitors’ fees in the sum of £13,918.93, various small disbursements in the total sum of £537.”The bill also included, as part of the solicitors’ profit costs, two and a half hours claimed for what was described as ‘preparing and checking the statement of costs.’
Conduct issues can be costly
When the bill was received, a process of gradually whittling it down began, starting with the defendant’s solicitors’ request for disclosure of the Conditional Fee Arrangement (CFA). The response? “Our client was not subject to a CFA in regards to this matter.” Which obviously begged the question, why was there a success fee of 20% in the bill if no CFA was in place. Despite this obvious, glaring error it took another two versions of the bill before the success fee was removed. But removed it was, and as a result of that and various other conduct issues on the claimant’s solicitors part, the bill was reduced to £55,393.19. A further line-by-line assessment, followed by the setting off of the costs of assessment which were awarded to the defendant, resulted in a much slimmed down net sum of £2,515.60 out of a final revised bill of £55,393.19. Quite a dramatic reduction.
Sometimes doing your best is not good enough
The question here is clearly ‘how did this happen?’ The claimant’s solicitors decided to plead inexperience and lack of resources, identifying themselves as a small high street firm without the means to employ experienced costs lawyers. Instead, the firm used a trainee legal executive to do the bills, who made a statement in which he said he was “doing his best.” But Master Whalan was unimpressed. He said, “The claimant’s solicitors have been guilty of conduct that can be described properly as both improper and/or unreasonable.” He referenced Bailey v. IBC Vehicles Limited  All ER D 113 or 3 All ER 570 in which Lord Justice Henry underlined the importance of ensuring the bill of costs is correct – and the responsibility that places on the solicitor signing it. He noted that the claimant would be entitled to reclaim the cost of instructing costs lawyers to prepare the bill as part of the bill itself and in any event they had included the trainee legal executives’ time for preparing the bill at £110. So, for more or less the same cost they could have employed experienced costs lawyers to do the bill and saved a lot of heartache.
Given the butchery of the claimant solicitor’s bill, and the time and expense spent on the whole sorry scenario, this case perfectly highlights the risks inherent in not using experienced costs professionals. Regardless of efforts made and resources available, certain standards must be met - as Winston would have said, it’s about doing “what is required.” And in the ever more complex costs landscape that increasingly means professional costs lawyer support.