Ians Top Ten Tips – Number 3, Neat Files
Ian Moxon, Costs Lawyer
Neat files generate higher costs recovery than messy files – fact!
I would say that, averaged over a large number of personal injury firms and fee earners, properly kept files generate half as much again in costs than poorly kept files. Indeed, if I had the time to collate figures from the thousands of costs claims I have worked on over the years, I am certain I could prove that to be a valid theory. Moreover, it takes no legal knowledge whatsoever to keep your file in the correct way and, indeed, there are numerous Senior Solicitors out there, with huge legal ability, whose costs recovery is a fraction of what it could be, simply because their files are a mess.
When it comes to the detailed assessment of costs, the way in which you have kept your file will have a direct bearing on the amount of costs recovered. That is because, firstly, your Costs Draftsman will rely on your file in order to prepare the Bill of Costs and secondly, the Judge assessing costs will wish to look at your file of papers (or documents from it) as contemporaneous evidence to help him decide what costs to allow. Judges assessing costs will not look at computer time print out because those are open to abuse (by fee earners who are struggling to make their target) and because they provide little or no detail of the work done. A Costs Draftsman preparing a Bill of Costs might make reference to your computerised time record, but he will know that, should the matter proceed to a detailed assessment, the Judge will wish to see the file and not the computer print-out – hence the file always takes precedence over the print-out.
So what do Costs Draftsmen look for in a neat file?
Attendance Notes
Think of Attendance Notes as the individual Invoice for each task. Each time you do a piece of work, charge for it by preparing an Attendance Note. The detail contained in each Attendance Note will then be accepted by the Judge assessing costs as contemporaneous evidence of the work you did (and nothing else will be good enough).
It does not matter if you dictate, type your own or use the back of old envelopes and a fountain pen – it is the manual recording of your time on file that counts. And, the more Attendance Notes you produce, the more time will find its way into your Bills of Costs and, consequently, your costs recovery will increase. Don’t be worried to record time for tasks which might not be chargeable either; your Costs Draftsman will know what can be recovered and what cannot – leave that to him. Also, always record the time it has actually taken you to do the task – don’t compare yourself to anyone else; if a task takes you forever, then record your time accordingly. Even a 6 minute Attendance Note will be worth around £20.00 to most fee earners and quite a bit more to others. Imagine losing a £20.00 note out of your pocket – you’d be gutted. Now consider why you often don’t bother making Attendance Notes. Are you too busy to pick a £20.00 note off the floor of the office – what’s the difference?
Funding Folder
As well as separate folders for the evidence, it is essential to keep certain costs documentation separate and safe from the rest of the papers.
If the written retainer your client signed is not on file (in a world where clients believe that they will not have to pay you anything) then you will face a very uphill battle to prove that in fact your client has any liability to pay your costs – and, therefore, the Indemnity Principle will not be met and your costs recovery will be zero. Likewise, there will be many other funding related documents that may be required for production in the detailed assessment proceedings, loss of which could end the claim for costs or a large part of it. Those essential documents should be kept safe in a separate folder, ready to be produced as proof at the detailed assessment. As alluded to above, loss of those documents could easily mean that years of work go unremunerated.
Disbursement Folder
There are two essential elements needed in the recovery of your disbursement outlays. Firstly, you need to keep a clear record of disbursements incurred and paid (because in years time there will be no chance of you remembering). Most Solicitors have a computerised list of disbursements, but far better is a manually updated paper list.
The second essential for your disbursements folder are copies of the various fee notes gathered throughout the course of the case. You cannot have too many copies of a particular fee note, but if one cannot be produced to justify a particular disbursement claimed in a Bill of Costs it will be disputed and probably disallowed. Keep the Disbursement List and the copy vouchers safe inside the Disbursements Folder (not randomly in the correspondence file and other folders). Experts will always be kinder to your clients if you pay them promptly. Always insist that Counsel provides you with an updated fee note after each new piece of work they do for you.
Paperless Files
Paperless files also have their difficulties. The problem with paperless files tends to be the loss of essential documentation such as Conditional Fee Agreements, ATE insurance certificates, Notices of Funding, disbursement vouchers and letters in. The loss of essential documentation is often due to paper copies not being scanned properly, or at all, and saved onto the Solicitor’s case management system. Hand written notes and messages, which might carry chargeable time, often also don’t get scanned (but they would be available if the file was paper). By all means have a paperless office, but also make sure that everything that would be on a paper file is saved somewhere and can be printed off as evidence for the detailed assessment hearing.
J-codes
The very numerous changes (reforms?) that have come off the back of LJ Jackson’s report, include the idea that inter partes costs can be billed automatically. Now if I had a pound for every rubbish costs reform idea thought up by someone outside of the business, I’d have quite a lot of money.
The idea behind J-codes is that, by recording your time spent under the various costs budgeting phases (but in a rather more complex way), Bills and Budgets can be produced automatically and at almost no cost (and of course, they cannot because even quite minor costs billing issues prevent that). However, recording your time, on your computer time printout, under each of the costs budget heading is actually very useful when it comes to budget management.
There are various fancy software programmes out there which will do this for you, but most seem overly complex and too expensive. Most Solicitors already have all they need and by simply adapting the time codes you already use (or adding a further simple set), you can achieve the same benefits at no additional cost to your firm. When your time is recorded, on your computer record, under the costs budget phases, it is then a quick and simple job for your Costs Draftsman to count up the units under each phase and prepare Legal Project Management Reports (short, low cost, reports telling you how much you have spent under each phase of the Costs Budget so far and how much you have left to spend).
General Neatness
I can tell, just by looking at a bundle of papers, how much the costs will be. I often don’t even need a cursory glance through the file or to feel the weight of papers. If a file looks like a bundle of old newspapers I know that the costs recovery will be a faction of what it could have been if the file was properly kept (amongst other problems, there will be hardly any Attendance Notes and more costs issues than I can poke a stick at) and, worse still, I bet the conduct of the file will probably have been terrible as well. Some files I receive are perfect (looking like the papers have been ironed and squared up with a ruler along the edge) and it is those fee earners who are making all the money.
Some Solicitors have asked me for an honest appraisal of their files and I have done that – only too happy in the knowledge that what helps them, will help me. Would you like me to appraise your files?