No reduction to Counsel’s Brief fee on late settlement of a Case

Allison Green, Costs Consultant

Allison Green, Costs Consultant at PIC reports on the case of Cartwright & Amin v. Devoy-Williams.

 

The case of Hugh Cartwright & Amin v Mr David Devoy-Williams and Mrs Anjana Devoy-Williams [2018] EWHC 1692 (QB) was heard on appeal from the Senior Courts Costs Office before the Hon. Justice Mrs Nicola Davies DBE sitting with an assessor. The appeal was in respect of a number of decisions made by Master Rowley in the course of a detailed assessment hearing which took place on 26 January and 08 February 2017. In this article we look at the Court’s decision to in relation to Counsel’s brief fee.

By way of background the appellant is a firm of solicitors and the respondents are barristers and property developers, who are the appellant’s former clients.

The appellant undertook legal work for the respondents in respect of their property development business and submitted bills for the work done which amounted to £19,830 excluding VAT and disbursements. The appellant agreed that its fees could be assessed, and in order, it is said, to save the respondents the costs of that assessment, the appellant made an open offer to accept £14,873.10 as against the outstanding sum of £19,276.50 (Pre-Action Offer). The respondents rejected the offer and denied liability. They denied the existence of a retainer with the appellant and alleged that the appellant’s bills were illegal, that the appellant had breached the Solicitors Code of Conduct, that the appellant had unlawfully terminated the relationship in breach of contract and that no costs were payable for the work done.

The appellant issued proceedings against the respondents for their outstanding costs and disbursements in the sum of £19,276.50. The respondents entered a Defence and Counter-Claim for the return of monies held on account of costs on the basis that no lawful retainer or contract was entered into; alternatively, the appellant had unlawfully terminated the retainer. The respondents instituted separate proceedings in the Central London County Court to pursue their negligence claim.

In the original fee recovery proceedings, the respondents raised an issue as to the court’s jurisdiction. A hearing to determine jurisdiction was listed for 08 January 2016 with the trial listed for 12 January 2016. At mediation on 07 January 2016, Terms of Settlement were agreed between the parties with the respondents agreeing to pay the appellant’s costs subject to a detailed assessment. A bill was served by the appellant and it was these costs which were assessed by Master Rowley and subject to appeal.

Of particular relevance is the decision in relation to Counsel’s Brief Fee. The brief fee claimed was £6,500.00. The Master allowed £3,000.00 to include £500.00 for jurisdictional issues. Mrs Justice Nicola Davies stated “The Master’s reasoning on this point is less than easy to discern.” Master Rowley stated that if this was a claim between the solicitor and the client for a brief fee, the figure of £6,500 being preparation and first day of hearing would be a sum which would be reasonably payable by the client. However, because the client here was the solicitor, there were two points to be made. The barrister having been instructed previously was at a lower fee, but equally the mediation time claimed by the solicitors suggested that the matter had concluded by the end of the afternoon. This was the point at which Counsel should have been informed that the case had settled and not at 10:30pm as seemed to have happened. Therefore it did not seem reasonable for all of Counsel’s fees to be paid by the Defendant. Master Rowley stated “No doubt at least some of the preparation could have been avoided and counsel could have done something else the next day…as far as an abated brief is concerned, because it settled the previous afternoon, I am going to allow £3,000 which is effectively the previous brief fee with £500 for jurisdictional issues which Mr Munroe was entirely aware of.”

Paragraph 21 of the decision states

“It is the appellant’s case that the brief fee was for a two day trial plus a half-day jurisdiction hearing. The work to be done by the barrister did not materially change because his client was a solicitor. The reference to the previous hearing was in respect of a different barrister and a different hearing with different arguments. The mediation did not in fact end until 10.30pm the night before the jurisdiction hearing. The brief fee was agreed and payable by 4.30pm. Until the settlement was concluded counsel could not be stood down. In the context of a case where many points were being taken no counsel would ever be stood down until a final settlement was reached. The decision to reduce the fee was wrong, particularly so in relying on the fact that counsel could have done something else.”

The respondents contended that when the Master was correctly making the point that although the parties were formerly in a solicitor and client relationship, this was not a Solicitor’s Act assessment. He used the correct test on the standard basis and properly took into account that the mediation substantially ended on the previous afternoon.

Paragraph 23 concluded:

“In the context of this “high temperature” litigation the case was not settled until it was finally settled, which was not until 10.30pm on the night before the jurisdiction hearing. Counsel’s brief fee had been incurred. No counsel properly observing his or her duty would stop working on this case until he or she had been informed of a final settlement. All the preparation work had been done.” Further “the Master erred in finding that the brief could have been cancelled on the previous afternoon and that some of the preparation could have been avoided. The Master originally accepted that the fee per se was reasonable but reduced it for reasons which do not stand up to scrutiny.” Whether or not Counsel could find something else to do was not relevant to the brief fee which was payable on a brief properly delivered. “There were no good grounds to reduce the brief fee.” This Ground of Appeal therefore succeeded both as to “the exercise of discretion and to the sum claimed.”

The case is useful for those whose who have instructed Counsel and the case settles close to a hearing or whilst in the midst of substantive work (i.e. an Advice from Counsel), as it highlights that it can be reasonable to recover such a fee where all of the preparatory work had already been done. This will be case specific and will largely depend upon the facts of the case. The headline point for practitioners is the need to inform Counsel as the earliest possible opportunity. If this is late on the eve of Trial then as long as it justifiable then it follows that Counsel’s fee ought to be recoverable in principle. If Counsel is informed unreasonably late then you could be on the hook for a short-fall.

PIC can assist by ensuring that case specific points are addressed in the Bill of Costs and Narrative detailing the work carried out in order to assist with maximising recovery of costs.

If you would like to contact Allison with any queries relating to this article or to arrange a training session at your firm, please click here

Allison Green – 04.10.18

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