Hourly rates: G v Kingston upon Hull City Council
Following on from my recent post about the role of Guideline Hourly Rates in detailed assessment hearings comes the decision in G (by her mother and litigation friend M) v Kingston upon Hull City Council (Kingston upon Hull County Court, 18/09/13).
Costs Lawyer Jon William’s always excellent costs blog provides a more detailed analysis but here are some of the key passages from the judgment:
“This costs appeal allows this court to set out the principles to be applied by District Judges (usually acting as Costs Judges) when determining a detailed assessment of costs as opposed to a summary assessment by a trial judge. One critical issue has been addressed – is there a material difference between the two?
A detailed assessment is not a scientific process, neither is it a process which will produce a necessarily right or wrong answer. A multiplicity of different methods for establishing the appropriate hourly rates has flourished. At the heart of this appeal is the question of relevance of the guideline rates. The range of possibilities varies from following those rates slavishly; to ignoring them altogether. There are clearly many shades in between those two extremes. Whilst they are described as “guidelines” for “summary” rather than detailed assessment, it is nevertheless commonplace on both summary and detailed assessments for courts to be referred to the guidelines. This is often on the basis that they should be uplifted (on the receiving party’s submission); disregarded entirely (receiving party); or followed (a common submission from a paying party in response to a Bill claiming higher rates than those in the Guidelines). However it is put, it is a matter for the court’s discretion. The seven factors in CPR 44.5(3) will be relevant; but the weight afforded to each factor is a matter for the wide discretion of the costs judge.
As we shall come to explain the guidelines are an extremely useful tool for detailed assessments, but they are not to assume an enhanced status beyond a useful starting place or cross-reference point. We emphasize at once that a detailed assessment requires the exercise of judgment as we hereafter set out.
We disagree with Mr Bacon, however, when he submits that the guidelines have no relevance whatsoever on detailed assessments. Having carefully considered the authorities referred to we take the view that it is not wrong in principle at all, and is entirely appropriate, for the guidelines to be referred to during a detailed assessment and/or for them to be used as a starting point or crosscheck. It seems to us that, to the extent that the authorities cited make any criticism in respect of the use of the guidelines, such criticism is aimed at slavishly following or adhering to them without a considered reference to the CPR 44.5(3) factors. Indeed it is difficult to see how hourly rates can be properly assessed in a vacuum without at least some starting, or reference, point. If Mr Bacon’s contention is right it is difficult to see why there is a requirement for the status of the fee earner to be included on the Bill. There must be some starting point for the consideration of the appropriate hourly rate and we are satisfied that the authorities do not criticise reference per se being made to the guideline rates subject to the provisos mentioned above. However whilst the District Judge in this case did in fact allow a rate in excess of what he found to be Miss Coulson’s grade, this was only on the “robustly applied” grade and, in our view, he fell into error in specifically excluding expertise from his consideration. Expertise is synonymous with skill, which is one of the factors to be taken into account in 44.5(3)(e). In our view he was plainly wrong to exclude that factor from his assessment of the hourly rate.”