The defendant costs specialists

Posts by Simon Gibbs

Legal costs in property damage claims

By on Oct 6, 2017 | 4 comments

One of the areas of costs I deal with arises from property damage claims; typically following fire, flood or tree root damage. Although these claims are usually pursued in the name of the owner of the damaged property, in reality these are subrogated claimed being brought by the insurer of the property owner and seeking to recover the money they have already paid to the property owner to make good the damage done. Unsurprisingly, the claimants’ insurers tend to instruct the firms of solicitors they already have working relationships with.  Many of these claims are brought with the benefit of conditional fee agreements.  There is often something rather tricksy about this whole process.  These are claims that traditionally would have been resolved between the loss adjusters for the respective insurance companies with no legal costs incurred in the process.  Instructing solicitors from the outset simply adds an unnecessary layer of costs to the process. Nevertheless, given the solicitors instructed are usually insurer panel firms – familiar with the inflated costs claims presented by claimants’ solicitors in personal injury claims – one might hope that they would adopt a more sensible approach when submitting their own costs claims in these property damage claims. If only. In my experience, insurer panel solicitors are often the guiltiest of submitting grossly inflated, and barely plausible, claims for costs in these property damage cases.  I have yet to decide whether this is due to: Deliberate dishonesty having found themselves on the end of a positive costs order and therefore trying to milk the other side for whatever they can get away with; or Evidence of spectacular inefficiency in the handling of relatively routine claims. Either way, it does not seem the ideal way to promote the firms in question.  If I was an insurer faced with these grossly excessive claims for costs from these firms, I would never dream of placing them on my own panel in the future.  I would assume that if they charged me even half as much on a solicitor/own client basis that they would still be overcharging me by at least...

Read More

Guidance on costs budgeting

By on Oct 2, 2017 | 1 comment

Gordon Exall’s Civil Litigation Brief is simultaneously invaluable reading for all civil litigators and an example of what is currently wrong with the law. The advent of the interweb, legal blogs and online resources such as BAILII, produces a continuous stream of new “reported” decisions on a daily basis totally unimaginable even 20 years ago. On an application for relief from sanctions, for example, advocates are rarely content to simply address the court on the wording of the rule and the Mitchell/Denton guidance.  The temptation now is for each party to produce a bundle of authorities on the point with each seeking to apply or distinguish the various decisions to the facts of the current case. The issue of costs budgeting is no exception to the problem of proliferating “authorities”.  Gordon Exall has put together an invaluable list of decisions on the issue of costs budgeting.  Whether this trend should really be encouraged is, perhaps, a moot point.  Nevertheless, in an age where one can virtually guarantee an opponent will seek to produce numerous authorities on any given issue, one must be prepared to fight fire with...

Read More

Cleaning up costs draftsmen’s mistakes

By on Aug 29, 2017 | 0 comments

At some stage, most experienced lawyers are instructed to try to sort out the mess that another lawyer has created.  Over the past couple of months I have twice been instructed to clear up problems created by defective retainers. On both occasions, the source of the problem was firms of solicitors who have traditionally undertaken defendant insurer work but had looked to move into dealing with some claimant matters.  They had wished to undertake this work on a CFA or CCFA basis but lacked previous experience of running cases with these funding models. In the first case, they had attempted to draft the relevant retainer documents themselves (and inadvertently created an unlawful hybrid DBA).  Such are the dangers of dabbling in something one is not an expert in. In the second case, a CCFA had been set up between a firm of solicitors and a claims management company (CMC).  The solicitors had sensibly, you might think, instructed a costs draftsman to undertake this work.  The firm instructed appears to have been a very well known costs firm.  I say this because the name of the firm appears twice in the body of the CCFA notwithstanding the fact that they are not a party to the agreement and where there is nothing in the agreement to suggest they will undertake any work in connection with the handling of the claims. The agreement itself is so badly drafted that is it difficult to determine how the various clauses operate in practice or, indeed, how certain aspects of the agreement were even intended to operate. Time does not allow me to list all the shortcomings with the agreement, but these key ones that stand out, and it is a remarkable drafting achievement for so much to have gone wrong in a relatively short document: Combined with the individual CFA each claimant was expected to enter into, the agreement was an unlawful hybrid DBA. The overall success fee payable to the solicitors would exceed the 25% cap on general damages and damages for pecuniary loss, other than future pecuniary loss. The CCFA creates an unlawful referral fee arrangement between the solicitors and the CMC. There is a breach of the indemnity principle. The...

Read More

Dividing Bills of Costs where multiple defendants

By on Aug 23, 2017 | 1 comment

I have a case where a claim was brought against two Defendants.  The claim succeeded against both Defendants. The matter was subject to a Costs Management Order with the Claimant having a single approved costs budget in respect of costs concerning both Defendants (with no apportionment between work concerning one Defendant or the other). The final costs order was simply that: “The Defendants shall pay the Claimant’s costs of the action” (ie the Defendants are jointly and severally liable for the Claimant’s costs, with no apportionment between work concerning one Defendant or the other). What therefore possessed the Claimant’s costs draftsman to prepare the Bill of Costs such that for each relevant phase the Bill is split into three separate parts: one for “generic costs” that related to the work concerning both Defendants and two further parts that include the work specific to each Defendant? The Bill therefore consists of 41 different parts when it only required 15.  The task of comparing the costs claimed to the approved budget has been made more time consuming than necessary, as has preparation of the Points of Dispute and any subsequent detailed assessment hearing. True it is that PD 47 para.5.8(5) requires: “Where the bill covers costs payable under an order or orders under which there are different paying parties the bill must be divided into parts so as to deal separately with the costs payable by each paying party.” However, that is clearly not applicable where, as here, the costs that each of the Defendants are required to pay are...

Read More

Good reason to depart from costs budget

By on Aug 18, 2017 | 6 comments

n Harrison v University Hospitals Coventry & Warwickshire NHS Trust [2017] EWCA Civ 792 the Court of Appeal confirmed that a court, on detailed assessment, would not depart upwards or downwards from the last agreed or approved budget unless there was a good reason to do so.  The battle has now moved on to the issue of what constitutes a “good reason”. An interesting decision on this issue comes in the case of RNB v London Borough of Newham [2017] EWHC B15 (Costs). Deputy Master Campbell decided that there was a “good reason” where the hourly rates claimed in the agreed/approved budget were in excess of the reasonable hourly rates as determined as part of the detailed assessment process. This decision is contrary to my understanding as to the judicial training for costs budgeting.  The rules expressly state (at PD3E para.7.3): “The court’s approval will relate only to the total figures for budgeted costs of each phase of the proceedings, although in the course of its review the court may have regard to the constituent elements of each total figure.” and (at PD3E para.7.10): “The making of a costs management order under rule 3.15 concerns the totals allowed for each phase of the budget. It is not the role of the court in the cost management hearing to fix or approve the hourly rates claimed in the budget. The underlying detail in the budget for each phase used by the party to calculate the totals claimed is provided for reference purposes only to assist the court in fixing a budget.” It was generally understood that the purpose of these provisions was to set a globally reasonable and proportionate figure for each phase of a case.  It was not to dictate how the work for that phase would then be undertaken. For example, a budget might include 10 hours at £300 per hour by a Grade A fee earner for the witness statement phase, equating to a total of £3,000.  If that figure is agreed/approved for the phase, it is then entirely a matter for that party as to whether the work is actually done by a Grade A fee earner in 10 hours, or by a Grade D fee earner charging £150 per...

Read More