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Costs judges reject claims for files by claimants wanting to challenge solicitors’ deductions

Files: Fear of satellite litigation

The Senior Courts Costs Office has refused separate attempts to obtain copies of law firms’ client files by another firm that describes itself as the country’s “leading experts in fighting unfair compensation deductions”.

Both costs judges observed the large and increasing number of these types of claims over the past year as a result of law firms now deducting costs from clients’ damages.

In Green & Ors v SGI Legal LLP [2017] EWHC B27 (Costs) [1], before Master Leonard, and Hanley v JC & A Solicitors Ltd [2017] EWHC B28 (Costs) [2], before Master James, the claims were made by Leeds firm JG Solicitors, whose website says: “If you’ve already received compensation for an accident but didn’t get paid the full amount, we can help you get your money back.”

The status quo, said Master James, was that such applications almost invariably led to an order for the production of the documents that belonged to the former client upon payment of a fee, but not an order for documents that did not belong to them.

There was no binding decided case in which solicitors have been ordered to hand over papers over which they have proprietorial rights, she continued.

Dismissing the application, Master James said: “I am concerned… by the floodgates that would likely be opened by a ruling that solicitors can be ordered to hand over their complete file in circumstances such as these; such a move would foreseeably instil considerable satellite litigation and I am not persuaded that this would be a positive step.”

Master Leonard addressed the issues “in some detail in the hope that doing so may help to reduce the scope of future disputes”.

He said it was for the claimants to show that they were entitled, as of right, “to receive copies of another person’s property, even on agreeing to pay the proper cost of supplying it”.

He continued: “If one person writes a letter to another, keeping a copy, it is not self-evident that the recipient can require another copy on demand, even on agreeing to pay for it.

“The mere fact that the defendants were formerly the claimants’ solicitors does not seem to me to change that. Nor does the fact that such letters are, by definition, not confidential as between the parties…

“The question is to my mind not whether there is authority to the effect that the claimants are not entitled to receive copies of the defendant’s property, but whether there is authority to the effect that they are.”

While the claimants said they limited their application to three categories of documents which they said were created for their benefit – funding documents, all correspondence sent to the claimants, and all invoices – Master Leonard said the purpose of creating documents for the client’s benefit was fulfilled when those documents are given to the client.

Supplying extra copies was another matter. “A client who wishes to challenge a solicitor’s charges, but who has nonetheless lost or destroyed the key documents upon which that challenge is based, will obviously be at a disadvantage. It does not follow that the solicitor has any obligation to compensate for that.

“Nor will a client’s inability to supply the required documents with an application for detailed assessment in itself invalidate the application.”

The master also suggested that the claimants’ claim to a freestanding right to obtain copies of the defendant’s property attempted to bypass the pre-action disclosure provisions at CPR 31.16.

“Finally, bearing in mind that the application has been narrowed down to incorporate only copies of documents which in the normal course of dealings will already have been supplied to the claimants, I do have concerns about the fact that I have seen no evidence that any consideration has been given as to the extent to which those documents are already in the claimants’ possession…

“It does not seem to me to be appropriate that the parties should incur substantial costs on a demand for documents where that need has not been properly considered and clearly established.”