High Court Confirms Binding Nature of Ombudsman-Brokered Cost Agreements.
Olukoya v Riverbrooke Solicitors Ltd [2023] EWHC 2771 (SCCO)
This recent decision from the High Court affirms the enforceability of cost agreements brokered through the Legal Ombudsman, highlighting crucial implications for both solicitors and clients regarding final billing and dispute resolution.
Background of the case:
The claimant, Ms. Olukoya, sought assessment of a substantial legal bill issued by Riverbrooke Solicitors, arguing that an “Informal Resolution” previously reached with the Legal Ombudsman limited her liability to a lower, agreed amount. The resolution required Riverbrooke to issue a “full and final” bill, which was paid by the claimant. However, almost three years later, Riverbrooke issued a revised bill for significantly higher costs, claiming additional sums. The court assessed whether the original Ombudsman-brokered agreement was binding and if Riverbrooke could legally issue a revised bill without court permission.
Summary and how this will affect the client:
The court ruled in favour of Ms. Olukoya, holding that the Informal Resolution was indeed a binding contract that limited Riverbrooke’s claim to the amount specified in 2020. The ruling also emphasised that a solicitor cannot unilaterally amend a final bill to claim higher fees without court authorisation, even in cases where they believe further costs are justified.
For clients, this judgment reinforces the value and security of Ombudsman resolutions, providing assurance that agreed fee limitations will be upheld. For solicitors, the decision underscores the importance of clear, accurate, and transparent billing practices—especially when an Ombudsman settlement is involved, as such agreements may restrict future billing claims.
How can PIC assist?
PIC’s expert Costs Lawyers can help solicitors navigate complex cost assessments to explore resolutions. We offer:
Thorough reviews of cost agreements to ensure compliance.
Guidance on preparing statutory bills that align with binding agreements to prevent future disputes.
Support in seeking court permissions where revising a final bill may be necessary, ensuring all processes follow legal requirements.
Rebecca Humble, Costs Lawyer
07.11.2024