Is a receiving party required to provide a breakdown between the cost of an expert report and the costs of a medical reporting organisation (“MRO”) approached to provide the report, or is it permissible for the receiving party to submit a bill which simply includes the fee charged by the MRO to provide the medical report?
This is not a new issue. As far back as 2002 His Honour Judge Cook (of Cook on Costs fame), sitting in the Kingston upon Thames County Court, in Stringer v Copley, concluded:
“there is no principle which precludes the fees of a medical agency being recoverable between the parties, provided it is demonstrated that their charges do not exceed the reasonable and proportionate costs of the work if it had been done by the solicitors.
…
whilst there is much to commend the use of medical agencies, it is important that their invoices (or ‘fee notes’) should distinguish between the medical fee and their own charges, the latter being sufficiently particularised to enable the cost officer to be satisfied they do not exceed the reasonable and proportionate cost of the solicitors doing the work.”
The previous Senior Costs Judge, Master Hurst, endorsed this view in Claims Direct Test Cases Tranche 2 Issues [2003] EWHC 9005 (Costs).
Notwithstanding this clear guidance, MROs have been incredibly reluctant to comply and the courts have often done little to enforce any such requirement.
This issue is not going away and the tide seems to be turning in favour of paying parties.
The following three cases, interestingly, all concern the same MRO, namely Premex Services Ltd.
So far as detailed assessment is concerned, the key provision is found at PD 47 dealing with the documents that must be served on the paying party when commencing detailed assessment proceedings. PD 47 para.5.2(c) requires service of:
“copies of the fee notes of counsel and of any expert in respect of fees claimed in the bill”
In Northampton General Hospital NHS Trust v Hoskin (County Court at Manchester, 22/5/23), HHJ Bird was considering an application, made by the paying party, requiring the receiving party to provide a breakdown of the invoice issued by Premex showing how much related to the medical expert’s fees and how much related to the services provided by Premex. He concluded:
“I am satisfied that it is clear that PD 47 imposes a duty on the receiving party to provide the fee note of any expert instructed and, where such costs are claimed details of the costs of any MRO. Premex is not an expert. Its invoice cannot be described in any sensible way as a fee note and is in any event not the fee note of the expert.”
As such, he proceeded to make an Unless Order requiring a breakdown to be provided, in default of which the relevant items in the bill would be assessed at zero.
The current Senior Costs Judge, Gordon-Saker, reached the same conclusion in CXR v Dome Holdings Ltd (SCCO, 14/8/23):
“the comments of the late His Honour Judge Cooke and the reasoning of His Honour Judge Bird are the more compelling. First, the Practice Direction requires the fee notes of the expert and, second, in the absence of a breakdown of the fees of the expert and the agency, it is impossible to do the exercise which His Honour Judge Cooke suggested in Stringer: of deciding whether those fees are more or less than the solicitor would have charged for doing the same work.
Accordingly, subject to submissions, I would require the claimant to provide a breakdown of the fee notes issued by Premex so as to show the separate fees of the expert and the agency.”
The more recent decision of HHJ Saggerson (County Court at Central London, 8/3/24) in Aminu-Edu v Esure Insurance Company Ltd dealt with this issue in a slightly different context. The matter had commenced in the MOJ Portal and was subject to fixed costs. As such, the detailed assessment process was not applicable. The receiving party had applied for determination of their fixed costs and disbursements pursuant to CPR 36.20(11) (as it then was). Independently, the paying party had made a Part 18 application seeking a breakdown of the medical fee.
Premex sought to refuse the request on the basis of “commercial sensitivity”. This went nowhere:
“I did not hear any submissions on ‘commercial sensitivity’. There is nothing in it. The commissioning party and the paying party, in my judgment, are entitled to know how much the doctor is charging and how much the agency is charging. If transparency drives down prices by generating competition, so much the better.”
The argument often deployed by Claimant solicitors is that they are unable to provide a breakdown as this information is not within their control. It is in the control of the MRO who are not a party to the action. Again, this went nowhere:
“The Claimant (or her advisers) can use agencies that are prepared to be transparent rather than those who are not. Alternatively, the work can be done in-house as it always was.”
HHJ Saggerson ordered that a breakdown be provided failing which the disbursement would be reduced from £2,916 down to £900.
It appears that no appeal was pursued in respect of any of these judgments. One can only speculate as to why Premex decided not to pursue an appeal. (The Hoskin case had been listed to be heard by the Court of Appeal but the appeal was apparently abandoned.) HHJ Saggerson had commented that: “The unavoidable suspicion is that the absence of transparency indicates that the agencies have something to hide”. The failure to appeal these decisions does little to alleviate that suspicion.
