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Second fee earner attending conference

Posted by on 4th September 2018 in detailed assessment | 4 comments

Of the various costs building wheezes that some claimant firms engage in, having a second (or third) junior fee earner attend conferences with Counsel, to take notes, is one of the classics.

When this issue arises at detailed assessment, I know at least one costs judge who confirms that, when he was a practising solicitor, he would often have a trainee solicitor attend conferences to take notes but would not dream of charging for this work as it was primarily for the benefit of the trainee as part of their training process.  It was not chargeable work.

The usual justification advanced by claimant solicitors for having the junior fee earner attend to take a note is that this enables the main fee earner to properly engage in the conference itself.  This is predicated on the notion that a Grade A fee earner cannot be expected to both follow what is going on in the conference and also make a note of what is being said.  This, of course, is usually in the context of conferences that are largely Counsel led.  This argument tends to be rather undermined when it is being made to a costs judge at detailed assessment who is managing to keep a detailed contemporaneous note of the submissions being made, asking probing questions of the advocates as the matter progresses and able to make comprehensive ex tempore judgements on complex points of law at the drop of a hat.  But then, you cannot expect fee earners claiming up to £450 an hour to be able to walk and chew gum at the same time.

If only the problem stopped there.

I have had two recent cases where the time claimed by the junior fee earner writing up a note of the conference, in addition to the time claimed in attendance, massively exceeded the length of the conference itself.

In one, a total of 3 hours 30 minutes was claimed drafting the note of a conference that only lasted 1 hour 12 minutes.

In the other, a total of 6 hours was claimed by two fee earners preparing a conference attendance note of a conference that only lasted 3 hours 36 minutes.

Unless the time is being claimed for typing-out verbatim, with two fingers, everything that was said at the conference, how is it possible for more time to be spent on the note than was spent at the conference itself?

At what stage in the evolution of the modern law firm did solicitors first come to believe it was acceptable to advance such claims?

Most Outstanding Legal Costs Litigation Firm 2018 – London

Posted by on 8th August 2018 in Legal Costs | 0 comments

The first problem with the vanity legal awards industry is that they are often ridiculously wide in the nature of the awards they seek to distribute, to the extent to which the awards are meaningless (even if they were distributed on merit).

For example, Wealth & Finance INTL magazine previously awarded Gibbs Wyatt Stone ‘Most Outstanding Law Firm of 2016, the UK’.  I would not argue with the outstanding nature of the work we undertake but modesty does call even me to question whether a niche costs firm can ever seriously be considered the best law firm in the whole country (even if only for 2016).

Alternatively, they give “awards” that are not remotely appropriate to the firm in question (eg we have been offered “Asset Manager of the Year – North America”).  You might think they would take a little more trouble to find out what kind of a firm they are contacting before sending the email out.

Fair play then to Acquisition International magazine for awarding Gibbs Wyatt Stone ‘Most Outstanding Legal Costs Litigation Firm 2018 – London’.  This at least shows they have the sense to consider the nature of the work undertaken by the firm before sending out a targeted email.  I am not sure it is sufficient to persuade me to sign up to one of their packages to promote winning this “prestigious” award, such as:

The Exclusive Package – 1,450 GBP – (Limited spaces available)

– Supporting image and headline on the front cover of the magazine

– A 4-page editorial inclusion in the first 20 pages

– 3 hard copies of the edition your inclusion appears in

– Your inclusion replicated on the homepage of our website

– Your inclusion in the monthly newsletter, for 3 months

– A 3-month web banner

– 3 bespoke crystal trophies

– A personalized digital logo for use in your own marketing

– High-resolution PDF copies of your inclusion

These online only magazines are clearly not read by anybody (other than other reward recipients wanting to read their own self-written glowing testimonials).      

It is clear from the contents of this magazine, by way of example only, that there are legal and financial firms across the globe prepared to part with good money for these meaningless vanity awards whose sole purpose, presumably, is to persuade potential clients that these are a mark of quality.  How depressing.

Court of Appeal guidance on proportionality

Posted by on 1st August 2018 in proportionality | 0 comments

In a speech given earlier in the year, Lord Justice Jackson recognised that the profession was becoming “impatient” for guidance on the proportionality test from the Court of Appeal.  He concluded:

“The remedy lies in their own hands. The Court of Appeal can only decide the cases which come before it.”

In May v Wavell Group Plc, an appeal at County Court level, a judge reached the questionable conclusion that the wording of the rule that reads:

“Costs which are disproportionate in amount may be disallowed or reduced even if they were reasonably or necessarily incurred”

should be interpreted to mean (I paraphrase here):

“Costs which are disproportionate in amount may be disallowed or reduced even if they were reasonably or necessarily incurred but not by a very substantial amount”

Unsurprisingly, permission was sought to appeal this to the Court of Appeal.

The Court of Appeal refused permission.

You couldn’t make it up.

Late acceptance by defendant of Part 36 offer

Posted by on 24th July 2018 in fixed fees | 0 comments

Hailsham Chambers has reported on the Court of Appeal decision in the appeal of Hislop v Perde [2018] EWCA Civ 1726.

This concerns the correct approach where a defendant accepts a claimant’s Part 36 offer after expiry of the 21 day period.  Many claimants have argued that the claimant should be entitled to recover indemnity costs from the expiry of the relevant period, just as they would if the case had gone to trial and the same result had been achieved.   This argument has been particularly attractive to claimants where fixed costs apply, as an order for indemnity costs will allow the claimant to recover more than fixed costs.

The Court of Appeal has now decided in that there is no presumption in favour of indemnity costs on late acceptance of a claimant’s Part 36 offer; and (b) that where this occurs in fixed costs cases the recoverable costs are those defined by section IIIA of Part 45, and the general jurisdiction as to costs in CPR36.13 has no role to play, meaning there is no place for assessed costs.

The only way out of the fixed costs regime in such a case is to argue under Part 45.29J that there are exceptional circumstances making it appropriate for the Claimant to recover more than fixed costs. The judge was, however clear that late acceptance of a Part 36 offer should not create a presumption that exceptional circumstances were present: A long delay with no explanation may well be sufficient to trigger r.45.29J; a short delay with a reasonable explanation will not.

 

Additional work and proportionality

Posted by on 20th July 2018 in Uncategorised | 0 comments

The Senior Costs Judge Master Gordon-Saker prefaced his recent decision on proportionality, in Various Claimants (In Wave 1 of the Mirror Newspapers Hacking Litigation) v MGN Ltd [2018] EWHC B13 (Costs), with the warning:

“this judgment should not be taken as any attempt at providing guidance. I say that because I know that anything said about proportionality, at whatever judicial level, is subjected to anxious scrutiny. First this is not a judgment of the Court of Appeal. Secondly the circumstances which give rise to this judgment are very unusual.”

That said, the decision does highlight one aspect of the proportionality test that merits consideration.

Of the various factors the Court must take into account when considering proportionality is:

“any additional work generated by the conduct of the paying party”

The Master summarised his conclusions as follows:

“62. Contrary to the Claimants’ submission, it seems to me that the conduct relied on must be conduct in the litigation rather than the conduct which gave rise to the cause of action. The conduct which caused the wrong will be compensated in damages or other relief. In my view the purpose of r.44.3(5)(d) is to enable the court to take into account that the costs may have been increased because work which would not ordinarily have been required has been required by the way in which the opponent has fought the claim.

63. It also seems to me that the conduct relied on does not need to be misconduct. Had that been intended misconduct could easily have been substituted in the rule for conduct.

64. In the event in my judgment there was no additional work caused by the conduct of the Defendant. That the Defendant chose to deny liability until 6 months before trial did not cause additional work. It caused the claim and the work involved in the claim. If a failure to concede by the party who eventually loses is considered of itself to cause additional work, this factor would apply in every case which did not settle within the relevant pre-action protocol period.

65. The Defendant fought these claims vigorously and did not concede liability at the earliest opportunity. As a consequence it will have to pay a greater sum in costs than if it had not fought the claims so vigorously or had conceded liability earlier. However I am not persuaded that this stance or the matters listed in the Claimant’s written submissions caused additional work in relation to the individual claims.”

(This decision appears to be broadly consistent with the approach taken by Master Rowley in May & Anor v Wavell Group Plc & Anor [2016] EWHC B16 (Costs) at paragraphs 20-24.)

This is an important issue and one where the wording of the rule is not very helpful.  The Master is correct that the rule does not use the word “misconduct” and it would be wrong to place so high a test on the provision.  On the other hand, “conduct” is, on the face of it, broad enough to cover anything the paying party does; which would include, for example, disputing liability.  (It is not, for example, worded as “unreasonable or improper conduct” as per CPR 44.11(1)(b)).  However, the Master here treated that as being too low a test.

The Master appears to have interpreted the rule as being designed to catch matters that fall somewhere between the inevitable costs that need to be incurred in light of the fact an opponent has brought/defended the claim and actual misconduct (although additional work caused by misconduct would also clearly be caught by the rule).  Presumably this “additional work” would cover such issues as work generated by delay in a party complying with orders, unnecessarily long or irrelevant witness statements being served by the other side or the wasted costs of experts due to a failure to attend medical appointments.

It will be interesting to see if this approach is followed by the higher courts.

 

Hourly rates for personal injury work

Posted by on 16th July 2018 in hourly rates | 3 comments

Although those working in legal costs tend to get very excited about the latest obscure technical challenge, it is the routine areas of dispute that have the greatest impact on the largest number of cases.  A costs judge allowing an hourly rate of 20% more or less than anticipated will usually completely throw any offers made.

One of the particular problem areas surrounding costs law has always been the issue of what hourly rates are appropriate for solicitors undertaking personal injury work who are based in the geographical location which is termed “City of London” (ie postcodes beginning EC1, EC2, EC3 and EC4).

The starting point (despite what some maintain) is always to look at the Guideline Hourly Rates for summary assessment.  The last published rates (2010) for Grade A fee earners gave the following for different bands:

City of London                                   £409

Central London                                 £317

Outer London                                    £229-267

Band 1 (eg Manchester Central)    £217

Band 2/3 (eg Luton)                        £198

(The explanation given for the range of figures for Outer London is that “these ranges go some way towards reflecting the wide range of work types transacted in these areas”.)

It can immediately be seen that there is a vast difference between the Guideline Rates for City and Band 2.  Some of this difference will be due to the average differences in overheads (principally dictated by property prices/rent and wages), but this clearly does not begin to explain the full difference.

The answer was to be found as far back as Senior Costs Judge Master Hurst’s decision in King v Telegraph Group Ltd [2005] EWHC 90015 (Costs):

“City rates for City solicitors are recoverable where the City solicitor is undertaking City work, which is normally heavy commercial or corporate work.”

Although this answers the question as to whether City rates should automatically be applied to personal injury work undertaken by firms based in the City, it does take the matter much further as to what rate should instead be allowed.

The recent decision of Mr Justice Goss, on appeal from a costs judge, in JXA v Kettering General Hospital NHS Foundation Trust [2018] EWHC 1747 (QB) provides some further guidance.

The case itself concerned a cerebral palsy clinical negligence claim.  Liability was agreed on a 90/10 split in favour of the Claimant.  Damages are not capable of being resolved for many years.  The claimant’s mother and litigation friend “selected a senior partner in Fieldfisher LLP, based in the City of London, as a result of a search on the internet and by reason of [the partner’s] highly regarded expertise in clinical negligence claims”.  Although it was not in issue that the partner “was and is an acknowledged leader in the field”, there is nothing in the judgment to suggest the claimant’s mother’s views were arrived at by anything other than an internet search.

It was also common ground “that this was high value complex litigation of considerable importance to the claimant” and that the value of the claim will run into millions of pounds, potentially £20 million.

The hourly rates had been claimed at:

£380 to 31 March 2013 then rising at the rate of £10 pa every 31 March up to £420 to 16 November for a Grade A partner.

£270 for a Grade C solicitor from 1 January 2017.

£150 rising at £10 pa to £190 over the same period for a Grade D trainee/paralegal.

The original costs judge had referred to the claim as being one of “substantial value, clearly at the very highest end of importance to the claimant and as being an exceptionally complicated case”.  He concluded:

“Taking all of those factors into account, and with regards to the guidance in the White Book with respect to consideration of comparable firms doing comparable work, I don’t find that I need to make any ruling as to what location is appropriate. The ruling must be in relation to what rates are appropriate, based on comparable firms doing comparable work, and in relation to the submissions that have been helpfully made by both advocates today.”

He allowed rates as follows:

£350 for a Grade A partner.

£200 for a Grade C assistant solicitor.

£150 for a Grade D trainee/paralegal.

Upon being pressed for his reasons he added:

“I take into account the location of the claimant as a starting point, and I look at comparable firms doing comparable work. In terms of the theoretical locality as a starting point I would consider firms within the Outer London area to be a reasonable point at which the claimant could have looked at firms well outside of their area, but, of course, I am aware myself of firms, for example, in Nottingham or Manchester or other legal centres which the claimant, I think, could have reasonably gone to as well. I accept that there will be a consequent effect on travel time as a result of that, but in terms of a locality, I take a theoretical locality as Outer London, but as I am guided by the White Book I can take into account comparable firms doing comparable work, and that will account for firms around the country, including within the location of your instructing solicitors’ firm.”

The focus of the Claimant’s appeal was that the Master did not answer the question as to whether it was reasonable to instruct the particular solicitor instructed and so his decision as to whether the charging rate was reasonable was flawed.  It was also argued that he failed to properly consider the effect of inflation on the claimed hourly rates between year ending 31 March 2013 and 16 November 2017.

The appeal court accepted the main criticism and concluded:

“I am satisfied that the Master did not directly address the first question as he should and decided whether the choice of [solicitor] was objectively reasonable in the circumstances. When pressed, he implied it was (or may have been) an unreasonable choice, indicating that he took a theoretical locality of Outer London but, guided as he was by the White Book, he then went on to say that he could ‘take into account comparable firms doing comparable work, and that will account for firms around the country, including within the location of Fieldfisher LLP.’”

However, the legitimacy of that challenge did not undermine the conclusion reached as to the appropriate rates to allow.  The appeal judge was clearly influenced by the views of another costs judge who was sitting with him as an assessor.  He concluded:

“In the event of allowing the appeal, I was invited to determine what cost rates would be reasonable for firms practising in the same area. In this regard I have been greatly assisted by the knowledge and experience of the Costs Judge sitting with me. Her expertise and experience as to the firms engaged in this type of case both in London and nationally has guided me in the conclusion to which I have come. The Master had a broad discretion in this regard, applying CPR44.4. I am satisfied on all relevant facts and applying appropriate considerations that the rates determined by the Master fell within the reasonable band of decisions open to him, notwithstanding his failure to answer clearly the first question in the required two stage process.”

Although there is always a danger of trying to clinically dissect a decision of this nature, which was arrived at on broad-brush principles based primarily on the experience of the original costs judge and the costs judge on appeal, I would suggest that what was ultimately allowed, in reality, for a firm in the City undertaking personal injury (here the most complex type of clinical negligence) does broadly mirror Outer London Guideline Hourly Rates (as last published in 2010) with the equivalent of approximately a 100% “B” Factor profit element.

The Outer London Guideline Hourly Rates for Grade A fee earners are £229-267.  These figures are based on a notional 50% “B” Factor profit element.  Taking the top of the range (£267) as being reasonable, given the complexities of the case and expertise of the solicitor, would give an “a” Factor of £178.  Allowing a 100% “B” Factor as representing something towards the very top of what might be allowed for this type of litigation (being recognised as being exceptionally complex and clearly being potentially at the very top end of value for PI claims) would give a figure of £356 (approximately the £350 allowed).  (On this crude cross-check, the uplifts for the Grade C and D were somewhat lower.)

This analysis does not allow for any inflationary uplift since the last published rates of 2010.  The appeal judgment simply records the arguments:

“[the costs judge had] a claim for an incremental year on year raising of the rates charged. He took account of the guideline rates for the summary assessment of costs. On behalf of the claimant it is emphasised that these rates are for significantly less complex cases and no more than guidelines, and are rates set in 2010 and take no account of subsequent inflation. The defendant answers by referring to the absence of any evidence justifying the incremental annual increase or the impact of inflation on this market over the period in question, the refusal by the Master of the Rolls in July 2014 to adjust the hourly rates following the proposals of the CJC Cost Committee’s Report of May 2014 (which proposed a reduction in City rates) and submits that it would be wholly wrong for the Master to have transposed a back-calculated approach or adopted a general inflationary approach.”

There was certainly no criticism in the judgment of the costs judge for taking into account Guideline Hourly Rates.

Ultimately, it is not surprising that (working backwards) the starting point for the hourly rates was in line with Outer London rates rather than City rates.  The overheads of undertaking such work are unlikely to be materially different for a firm operating in the City compared to one in Outer London.  A few years ago, on the subject of whether PI work should attract City rates, Jacques Hughes, one of the readers of this blog, commented:

“The argument is just silly. PI and commercial work inhabit fundamentally different markets, and PI lawyers delude themselves if they think otherwise. Compare a top-notch PI practice like Irwin Mitchell to a real City firm and ask: does the PI firm have a 24 hr secretarial service? Does it have a 24/7/365 reprographics department capable of handling, say, 20 million pages a year? Do staff have to be paid to work all hours in order to liaise with NYC and Hong Kong? Does it have a library of 10,000 volumes plus, with subscriptions to all major Commonwealth and American law reports and journals? Does the PI firm have to run a recruitment drive targeted at the best candidates at Oxbridge and equivalents in the US & Australia, paying trainees 50K plus packages? Do middling assistants expect salaries in the 150K + bracket? Are international travel and worldwide offices a major PI overhead? The answer to all of these questions is consistent, obvious, and negative. City rates for PI work is a nothing more than a mirthless joke.”

Costs & Fees Encyclopaedia 2018-19

Posted by on 27th June 2018 in Uncategorised | 0 comments

The Costs & Fees Encyclopaedia continues to expand year-by-year and the 2018-19 Edition runs to 551 pages.  (It rather optimistically describes itself as “portable” and suitable for a briefcase.  It is plainly a desktop reference guide.)

Pages 1-96 consist of the relevant costs provisions of the CPR and Practice Directions.

Pages 97-102 provides J-Code “cheat sheets”.

Pages 103-104 deals with fixed costs for solicitors and public authority deputies in Court of Protection work.

Pages 105-106 contain the Guideline Hourly Rates for Summary Assessment.

Pages 107-121 consist of the Civil Legal Aid (Remuneration) Rates: Extracts from the Civil Legal Aid (Remuneration) Regulations 2013.

Pages 125-223 deals with Costs in Criminal Proceedings and includes:

  • Extract from National Taxing Team Guidelines
  • Extracts from the Criminal Legal Aid (Remuneration) Regulations 2013
  • Criminal Defence Service (Very High Cost Cases) (Funding)
  • Witness Allowances in Criminal Proceedings
  • Criminal Procedure Rules 2015, Part 45: Costs
  • Costs Out of Central Funds
  • Inter Partes Costs in Criminal Proceedings
  • Practice Direction (Costs in Criminal Proceedings) 2015

Pages 225-226 includes Motor Mileage rates, VAT rates and IPT rates.

Pages 229-436 covers an electric mix including:

  • Civil Proceedings Fees Order 2008
  • Conditional Fee Agreements Order 2013
  • Consular Fees Order 2012
  • Coroners Allowances, Fees and Expenses Regulations 2013
  • Court of Protection Fees Order 2007
  • Crown Office Fees Order 2013
  • Damages-Based Agreement Regulations 2013
  • Ecclesiastical Judges, Legal Officers and Others (Fees) Order 2017
  • Family Proceedings Fees Order 2008
  • First-tier Tribunal (Immigration and Asylum Chamber) Fees Order 2011
  • First-tier Tribunal (Property Chamber) Fees Order 2013
  • Gender Recognition (Application Fees) Order 2006
  • Immigration and Nationality (Cost Recovery Fees) Regulations 2014
  • Immigration and Nationality (Fees) Order 2016
  • Immigration and Nationality (Fees) Regulations 2018
  • Insolvency Proceedings (Fees) Order 2016
  • Insolvency Practitioners and Insolvency Services Account (Fees) Order 2003
  • Land Charges Fees Rules 1990
  • Land Registration Fee Order 2013
  • Legal Officers (Annual Fees) Order 2017
  • Legal Services Act 2007 (Claims Management Complaints) (Fees) Regulations 2014
  • Magistrates Courts Fees Order 2008
  • Non-Contentious Probate Fees Order 2004
  • Oath Fees Order
  • Offers to Settle in Civil Proceedings Order 2013
  • Public Guardian (Fees etc) Regulations 2007
  • Public Record Office (Fees) Regulations 2017
  • Supreme Court Fees Order 2009
  • Upper Tribunal (Lands Chamber) Fees Order 2009

Pages 451-520 contain various case summaries from Costs Law Reports divided by topic.  This is the one section I continue to struggle to see the value of (see previous review),

Pages 523-549 contain the SRA Code of Conduct 2011.

Pages 550-551 contain a list of relevant court forms.

The price, a modest £75.

Naming wrong defendant in CFA

Posted by on 25th June 2018 in Uncategorised | 0 comments

One of the long running battle grounds in costs litigation concerns the consequences of naming the wrong opponent in a conditional fee agreement.  Because this is ultimately a contractual issue, it remains just as relevant today as under the now revoked Conditional Fee Agreement Regulations.  Paying parties argue that no costs are recoverable where the incorrect opponent is named in the CFA.  I have argued the point both successfully (Hailey v Assurance Mutuelle des Motards) and unsuccessfully (Brierley v Prescott).

In Engeham v London and Quadrant Housing Trust & Another [2015] EWCA Civ 1530 the Court of Appeal, without hearing argument on the issue, accepted that costs could not be recovered from a party different to the one named in the CFA.

The Court of Appeal has now revisited the issue in Malone v Birmingham Community NHS Trust [2018] EWCA Civ 1376.  Here, the CFA stated, under the heading “What is covered by this agreement”:

“All work conducted on your behalf following your instructions provided on [sic] regarding your claim against Home Office for damages for personal injury suffered in 2010.”

In the event, the claim succeeded against Birmingham Community NHS Trust, rather than the Home Office.  At first instance and on the initial appeal, the Defendant successfully argued no costs were payable.  On the facts of the case, the Court of Appeal allowed the appeal.  The Court accepted that the reference to “Home Office” was descriptive of the instructions received rather than of the work to be done. It related to past instructions rather than future work.

Although the Claimant was successful on the particular facts of the case, the decision does little to stop challenges in very similar situations.  The Court of Appeal’s commentary on HHJ Stewart QC’s decision in Law v Liverpool City Council [2005] EWHC 90020 (Costs) is as important as the Malone decision itself:

“In that case the CFA was stated to cover: ‘Your claim against Liverpool City Council for damages for personal injury suffered on 26th March 2003’. Proceedings were brought against the Council as the occupier of the property where the injury was suffered and a defence was served. Subsequently the Council stated that the property had been transferred shortly prior to the accident to a housing association, which was then added as a second defendant. The claim continued against both defendants and was settled by them, with both defendants acknowledging liability in principle for costs, subject to any points about the CFA. The housing association contended that as the CFA had never been varied to include it, there was no CFA in relation to the claim against it.

HHJ Stewart QC held that the claim against the housing association was not covered by the CFA. His stated starting point was that a CFA which covers a claim against one defendant cannot be construed to encompass a claim against another defendant. He said that the fact that parties are often added to claims should be dealt with by careful drafting of the CFA or by appropriate amendments.

There are a number of obvious differences between that case and the present one. In particular: (i) the wording used was more specific and restrictive – ‘Your claim against Liverpool City Council…’; (ii) there was no apparent careless drafting; (iii) the Council was an appropriate defendant; (iv) the Council remained a defendant up to and including settlement. It is also to be noted that the argument that the wording used was meant to be merely descriptive rather than prescriptive does not appear to have been raised. HHJ Stewart QC’s starting point bypassed that issue. In any event, little assistance is to be derived on issues of construction such as this from different cases, on different facts, involving materially different wording.”

The impact of this decision is likely to increase, rather than decrease, the level of satellite litigation generated where the incorrect opponent is named in a CFA.  The decision gives significant encouragement to paying parties that such a challenge may fall into the Law v Liverpool City Council category whilst offering a glimmer of hope to receiving parties that the full factual matrix will be found to be favourable to them.

Serving an electronic bill of costs

Posted by on 13th April 2018 in detailed assessment | 4 comments

We now have compulsory electronic bills of costs.  What we do not have are up to date rules relating to service.

PD 47 para.5.A4, dealing with transitional provisional provisions, makes it clear that the new electronic bill must itself must be served:

“Where a bill of costs otherwise falls within paragraph 5.1(a) but work was done both before and after the Transition Date, a party may serve and file either a paper bill or an electronic bill in respect of work done before that date and must serve and file an electronic bill in respect of work done after that date.”

Although the balance of the rules could be much clear, it is clearly the case that this will apply to all bills that are electronic (ie it is the electronic bill itself that must be served).

The difficulty that arises is that the Practice Direction 6A, that deals with service generally, is very restrictive when it comes to electronic service.

“4.1  Subject to the provisions of rule 6.23(5) and (6), where a document is to be served by fax or other electronic means –

(1) the party who is to be served or the solicitor acting for that party must previously have indicated in writing to the party serving –

(a) that the party to be served or the solicitor is willing to accept service by fax or other electronic means; and

(b) the fax number, e-mail address or other electronic identification to which it must be sent; and

(2) the following are to be taken as sufficient written indications for the purposes of paragraph 4.1(1) –

(a) a fax number set out on the writing paper of the solicitor acting for the party to be served;

(b) an e-mail address set out on the writing paper of the solicitor acting for the party to be served but only where it is stated that the e-mail address may be used for service; or

(c) a fax number, e-mail address or electronic identification set out on a statement of case or a response to a claim filed with the court.

 4.2  Where a party intends to serve a document by electronic means (other than by fax) that party must first ask the party who is to be served whether there are any limitations to the recipient’s agreement to accept service by such means (for example, the format in which documents are to be sent and the maximum size of attachments that may be received).

 4.3  Where a document is served by electronic means, the party serving the document need not in addition send or deliver a hard copy.”

Service of the electronic bill is compulsory but PD 6A para.4.1(1)(a) requires previous written permission from the other side before you can serve electronically.  How can you serve electronically if permission has not been given?

PD 47 para.5.A2 provides a link to the format that an electronic bill may be in but PD 6A para.4.2 appears to allow the other side to dictate the format of an electronic document.

PD 6A para.4.3 states that when serving electronically it is not necessary to also serve a hard copy.  This is directly contradicted by PD 47 para.5.1A which requires a hard copy in addition to the electronic version.

If service needs to be both electronic and in hard copy form, what date do you use for calculating deemed service (which will be different for an emailed document and the copy sent by post/DX)?

There was talk about updating the rules relating to electronic service generally, but it would have been nice if this had happened before electronic bills were made compulsory.

Filing electronic bill of costs

Posted by on 6th April 2018 in detailed assessment | 6 comments

The new electronic bill of costs is now upon us and it already causing confusion at the most basic level.

Costs Lawyer magazine reports ACL council member Claire Green, who has paid a key role in the development of the new bill and as been running the ACL’s training courses on the new bill, warning:

“the new bill will ‘change the whole ethos and environment we’re working in’ and too many people seem unaware of what’s coming – as one small example, you now have to serve the bill on the court at the same time you serve it on the other party.”

This would be a surprising development if true.

Previously, detailed assessment proceedings were commenced by serving the bill on the paying party.  It was not, at that point, filed with the court.  Points of Dispute were served in response, but not filed.  Optional Replies were then served, but not filed.  It was only if, and when, a request was made to the court for detailed assessment that the various documents (and bill) were filed.

It would therefore be odd if the rules had now been changed so that the courts were to be bombarded with 1000’s of bills (both hard copy and electronically) at a stage of the assessment process where they have no involvement or interest and where most matters will settle without the need for any input from the court.

The problem is caused by the wording of PD 47 para.5.1A:

Whenever electronic bills are served or filed at the court, they must also be served or filed in hard copy, in a manageable paper format as shown in the pdf version of Precedent S.  A copy of the full electronic spreadsheet version must at the same time be provided to the paying party and filed at the court by e-mail or other electronic means.”

The first sentence appears tolerably clear:

  1. When an electronic bill is served it must be served both electronically and in hard copy; and
  2. When an electronic bill is filed it must be filed both electronically and in hard copy.

The second sentence is a clear as mud and is clearly the cause of the confusion.

I believe the correct position is set out in Cook on Costs 2018:

“The electronic bill of costs cannot be fully printed out on paper.  A summary version only will have been served in hard copy on the paying party.  The full version will have been sent electronically.  When requesting a hearing date, the summary paper version will need to be lodged with the N258 in the usual way together with the various other accompanying documents as described above.  At the time of writing, the only court email address currently available is the SCCO’s, namely sccoebills@hmcts.gsi.gov.uk.”

This appears to mirror the current position (other than the fact that service/filing must also be electronic).

Further support comes from Senior Costs Judge Gordon-Saker, speaking at the Law Society Commercial Litigation Conference on 16 October 2017, who confirmed that the bill will be emailed to the court at the same time as lodging papers for assessment, together with the paper version.

Poorly drafted rules are the least of the problems to come.