A challenge to a costs lawyer’s delegation of work to unqualified colleagues has failed, with a judge saying that to rule otherwise would make their work for members of the public “impossible”.
This decision of Master Leonard in the Senior Courts Costs Office follows on from his ruling last year, in which the claimant – represented by Checkmylegalfees.com – successfully applied for delivery of a statute bill from his former solicitors, Oxfordshire firm Brethertons.
The judge also criticised Brethertons for failing to show Kerry-Anne Moore, a costs lawyer and director at Checkmylegalfees, “the same professional courtesy as a solicitor would expect” given her status as a regulated person.
Master Leonard handed down a second ruling last week assessing the costs of the application.
Brethertons argued that it should not have to pay the costs of two costs draftsmen and a litigation executive who assisted Ms Moore on the basis that the Legal Services Act 2007 prohibited her from delegating either a right of audience or the conduct of litigation to others.
Co-director Mark Carlisle, an experienced costs draftsman, undertook some advocacy, played a “broad advisory role” and engaged in correspondence with the defendant, the other costs draftsman prepared a draft bill of costs, and the litigation executive played a “fairly typical grade D supporting role”, preparing indices, bundles and so on.
Master Leonard found that the delegation arguments “miss the point”, as most of the work undertaken by the team did not constitute reserved activity, and in so far as it did, the relevant persons undertook it as exempt persons, as defined by the 2007 Act.
It was accepted for the purposes of the hearing that bill drafting was a reserved activity. Master Leonard found that the costs of drafting the bill were recoverable in principle because it was done under Ms Moore’s supervision and instruction.
However, the work was premature, as the judge had not ordered a detailed assessment, and so the costs were disallowed
The work of both Mr Carlisle – other than advocacy – and the litigation executive did not constitute reserved work and so again the costs were recoverable in principle.
However, the judge disallowed much of their time, finding Mr Carlisle’s work “duplicative” and the executive’s “largely administrative in nature”.
In relation to Mr Carlisle’s advocacy, Master Leonard said he had granted a right of audience, making him an exempt person. This meant his costs of preparation for and attending the hearing were recoverable in principle.
In concluding, Master Leonard said: “It has been necessary for me, in a reserved judgement which attracted a degree of interest among costs professionals, to identify significant shortcomings in the defendant’s conduct both toward its former client and his properly authorised costs lawyer.
“The application itself was hard fought, the defendant taking a robust stance and defending its position with sophisticated arguments which I ultimately found to be insupportable. The claimant was given no choice but to see the matter through.
“Much trouble and expense could have been avoided had the defendant delivered a bill when it was asked to do so.
“The defendant’s submissions on the costs of the application themselves furnish an example of the robust approach to which I refer. On proper analysis, they have no real merit. To accept them would have been to render Ms Moore’s working life, in practical terms, impossible.”
Ms Moore said: “This is an important decision for those costs lawyers who act direct for members of the public. It enables us to function in a sensible and pragmatic manner in the same way that solicitors do, drawing when appropriate on the experience and abilities of other members of the costs profession and the wider legal profession who are not authorised to deal with matters direct.
“It means that our clients can be assured of the best possible service, giving them full access to specialist advice in respect of legal fees, without worrying that the costs will not ultimately be recoverable.”
Erica Bedford of Kings Chambers in Manchester, who represented the claimant at the hearing, added: “Whilst this helpful guidance necessarily grapples with an involved question of authorisation under the Legal Services Act 2007, within it Master Leonard has delivered a healthy dose of business common sense by his timely reminder that no costs lawyer is an island.”
Claire Green, chair of the Association of Costs Lawyers, said: “Master Leonard has firmly dismissed this attempt to undermine the work of costs lawyers, who play a vital role in ensuring that the costs regime works smoothly and fairly.
“We are independent, regulated lawyers, with the attendant benefits and responsibilities that such status brings. This ruling should halt in their tracks what the judge called ‘arid technical objections’ to the recovery of the costs of our work.”