Counsel’s brief fee where case settles early – Hankin v Barrington

There used to be a very old rule whereby counsel was entitled to their full brief fee once the brief had been delivered even if the case settled before the date fixed for the hearing. This is no longer the case. A recent example of the correct approach is to be found in the decision of Deputy Master Campbell in Hankin v Barrington & Ors [2021] EWHC B1 (Costs). Where a case settled early there would “need to be a re-negotiation between counsel’s clerk and instructing solicitors”.

A brief fee of £125,000 plus VAT has been agreed by the Claimant’s solicitors with their Leading Counsel in respect of a matter listed for a 13 day trial. The claim concerned a severe head injury pleaded at over £3 million with liability and quantum in dispute.

The trial was listed to commence on 15 March 2021. The brief was delivered to Leading Counsel on 22 February 2021. The claim settled by way of mediation on 24 February 2021 (although the Consent Order was not approved until 2 March 2021).

£15,000, of the £125,000, was attributed to Leading Counsel’s fees for attending the mediation. This amount was not disputed by the Defendant paying party. The balance of £110,000 was claimed in full as the brief fee.

The matter had been subject to a cost management order. At the detailed assessment, the Claimant conceded (in what was described by the Deputy Master as a “sensible concession”) that the fact of the matter had settled pre-trial amounted to a “good reason” under CPR 3.18(b) to depart downwards from the last approved budget.

The brief fee had been calculated, at least in part, on Leading Counsel’s hourly rate of £550. The Deputy Master was of the view that such a rate was “higher than that allowed for these types of catastrophic injury cases which come before the Costs Judges” and was “too high”. The deputy Master decided that the starting point as to what would have been a reasonable brief fee was £75,000.

The Deputy Master then decided what further reduction should be made to that amount to reflect the fact that the trial did not take place. The Deputy Master was of the view that it was unlikely that much time at all would have been spent on trial preparation prior to the matter settling given Leading Counsel would have been getting ready for the mediation. The correct starting point, in the Deputy Master’s view, was that the brief fee should be reduced by 50% to £37,500 plus VAT to reflect the early settlement.

A further issue arose in that there was evidence before the Court that Leading Counsel had been able to undertake some alternative paid work for the period that had been booked for the trial. The evidence was that the earnings for this period amounted to £11,000. The Deputy Master approached this issue on the basis that much of this work would represent Leading Counsel properly attempting to “mitigate his loss” for the fact that the trial had not proceeded. He attributed £10,000 of these earnings to such “mitigation”. He therefore deducted this further figure of £10,000 from the £37,500 to leave a total payable by the Defendant of £27,500 plus VAT.