Warren v Hill Dickinson LLP [2019] EWHC B1 (Costs) (23 January 2019)
Can a Solicitor obtain an interim payment on a statute bill being disputed by their own client in circumstances where they have applied for assessment within one month of delivery of the bill? Master Leonard has found they can.
The Proceedings
The Claimant had instructed Ms Hanna Basha, a solicitor, first at Carter-Ruck, subsequently at PSB Law LLP and, until the end of January 2016, at the Defendant firm. The Defendant acted on his behalf in proceedings for breach of contract against boxer Ricky Burns and for defamation again Mr. Burns’ manager, Alex Morrison, under conditional fee agreements.
On 29 February 2016 and 8 March 2016, the Defendant rendered four bills totalling £922,890.03, which incorporated both the costs of the Defendant and its predecessor firm, PSB Law LLP.
The Claimant issued an application for detailed assessment within a month of delivery of the bills, a dispute having arisen as to whether the CFAs had been validly assigned from his previous solicitors and whether there had been a “win” under the terms of those CFAs so as to entitle the Defendant to payment.
Master Leonard found for the Defendant in respect of both of the preliminary issues and the matter was directed towards a full Detailed Assessment hearing. On 6 July 2018, the Defendant applied for an interim costs certificate in the sum of £636,583.83.
The Relevant Rules
The issue that arose was whether the court had jurisdiction to order an interim payment under CPR 47, which governs procedure for the detailed assessment of costs awarded between parties to litigation. The extent to which this Rule applies to assessments between Solicitor and Client was disputed, with the Defendant relying on CPR 47.16 and the Claimant opposing its application to solicitor-own client assessments and relying on S.70(1) of the Act.
Pursuant to S.70(1) of the Solicitors Act 1974, where an application is made for assessment within one month from delivery of the bill, the High Court shall “without requiring any sum to be paid into court” order that the bill be assessed and that no action be commenced on the bill until the assessment is completed.
CPR 47.16 provides:
“The court may at any time after the receiving party has filed a request for a detailed assessment hearing… issue an interim costs certificate for such sum as it considers appropriate…”
The relevant Rules governing assessments between solicitor and client are found in CPR 46. CPR 46 PD 6.18 provides:
“If, in the course of a detailed assessment hearing of a solicitor’s bill to that solicitor’s client, it appears to the court that in any event the solicitor will be liable in connection with that bill to pay money to the client, it may issue an interim certificate specifying an amount which in its opinion is payable by the solicitor to the client.”
However, CPR 46 contained no other reference to interim payments pending completion of the detailed assessment. The old Costs Practice Direction, which was replaced in April 2013, previously made reference to the power to issue interim costs certificates, however this had been omitted from the new CPR 46 and Practice Direction.
Master Leonard’s Judgment
Having considered the relevant rules, Master Leonard was of the view that S.70(1) of the Solicitors Act did not prohibit the issue of an interim costs certificate in detailed assessment proceedings between a solicitor and client, on the basis that S.70(1) of the Act was dealing with an application for an order for assessment and not the detailed assessment proceedings. Master Leonard was of the view the two were separate, self-contained proceedings.
Furthermore, Master Leonard found that at least parts I, V and VII of CPR 47 and the corresponding parts of Practice Direction 47 apply to solicitor/client detailed assessments, except in so far as they are inconsistent with CPR 46, Practice Direction 46 or the primary statutory provisions governing solicitor/client assessments.
Master Leonard found CPR 47.16 was not inconsistent with CPR 46. His view was that, as long as the receiving party in a solicitor/client assessment could be identified, and that receiving party had filed a request for a detailed assessment hearing under CPR 46.10(5), then that receiving party could apply for an interim costs certificate under CPR 47.16.
In any event, Master Leonard also noted the application of CPR 25.1(1)(k), which deals with interim payments generally, is not expressly confined to proceedings under CPR Part 7.
In the matter before him, Master Leonard found the Defendant was the receiving party and had filed a request for detailed assessment and therefore he was entitled to issue an interim costs certificate, albeit he ultimately awarded less than the Defendant sought.
This is good news for Solicitors, who often face a lengthy period prior to detailed assessment of their statute bills without funds from a former client who may not even be disputing the entirety of the claim for costs.
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