WASTED COSTS: CLAIMANT SOLICITORS AT IT
I have on many occasions criticised the conduct of insurance companies and their lawyers in personal injury matters. This is not a one way street and claimant solicitors do not always cover themselves in glory as the case below shows.
In Brown v Haven Insurance Company Ltd, Unreported, 7 January 2016, Leeds County Court
the court ordered solicitors who had signed a Statement of Truth on a Schedule of Damages which included an incorrect claim for physiotherapy charges to pay costs under the court’s wasted costs jurisdiction and to pay those wasted costs on the indemnity basis.
The solicitors had persisted in the claim for physiotherapy charges even after this item was challenged by the defendant in its counter schedule and it only became clear at trial that in fact no physiotherapy had taken place.
The court referred to the requirements of Practice Direction 22.3.8 in relation to legal representatives signing the Statements of Truth and found that the solicitor did not have specific instructions to sign the Statement of Truth and did not have the client’s authority so to do and had not provided the client with the necessary explanation required by that Practice Direction.
Rather the firm’s procedure was to get a general Form of Authority from the client and to then sign any documents that they considered to be appropriate and then notifying the client after this had been done.
The judge said:-
“This is a case where whatever costs were wasted must be paid. It is also a case where I express grave reservations of the practice of a practice of solicitors in possibly putting too much pressure on employees or alternatively not supervising employees properly and in this case a solicitor ignoring the grave importance of the consequences of a statement of truth signed by a solicitor when clearly there was no authority to do it and in any event what was being signed was manifestly incorrect.”
This was a personal injury claim which included a claim for prospective physiotherapy charges of £880.00 but the claimant stated in evidence that he was suffering from no symptoms and had no wish to pursue a claim.
Here the solicitors had been running a medical agency and the judge had this to say:-
“If solicitors dabble in running medical agencies as well, they should be completely transparent, not use it as a way of increasing costs, a bit like, as I said earlier, miscellaneous expenses often claimed, seldom proved or, if they are proved, in my experience – and although I am a deputy district judge now, I have 20 years’ experience as a district judge – in my experience never often proved more than £15 or £20, and it is a very sad reflection of the state of affairs of litigation.”
The medical report had been commissioned by Bollin Legal Associates through LMS Legal Services and Bollin Legal Associates was purchased by Amanda Cunliffe Solicitors in 2015. All three businesses operated from the same premises.
On the same day as the Medical Report was prepared a pro-forma invoice for physiotherapy sessions was produced and the number of sessions exceeded the number recommended by the Medical Report. The report recommended five or six but the invoice was generated for eight sessions.
At paragraphs 13 and 14 the judge said this:-
“13. A witness statement was filed by Miss Nkochi-Nwankwo, a solicitor employed by Amanda Cunliffe. That was dated the 24th July. She set out the change of ownership and the fact that Bollin was purchased. She also told me in her witness statement that there was “no relationship between Bollin and Lawyers Medical Services other than their business working relationship and the fact they traded from the same building but in separate office space. Amanda Cunliffe also trades from the same building as Lawyers Medical Services but again from different office space. One of the directors of Amanda Cunliffe, namely Christopher Jones, is also a director of Lawyers Medical Agency and two of the shareholders” – we know not how many there are – “of Amanda Cunliffe, namely Jones and Ainsworth, are also shareholders of the company that owns Lawyers Medical Services. That company is called Westongate Associates”.
- There is certainly clearly a financial relationship between Lawyers Medical Services, Lawyers Medical Agency and Amanda Cunliffe Solicitors. The connection between Amanda Cunliffe Solicitors and Bollin Associates is that the former purchased the latter and employees, including Miss Nkochi-Nwankwo who appears before me today, transferred with them.”
During questions about costs the judge said that he noticed that Miss Nkochi-Nwankwo was described as a solicitor for Bollin Legal and asked “Why was I not told that the Chief Executive of Bollin Legal was none other than Amanda Cunliffe?”
The judge also said:-
“It really is outrageous that I should be treated… the court should be treated in this way.”
The judge ordered the claimant’s solicitors to pay the defendant’s wasted costs and the cost of the hearing assessed in the total sum of £2,131.92 and on the indemnity basis.
The judge said to counsel representing Amanda Cunliffe Solicitors that he should “have been fully briefed on the intricacies of the inter-weavings of these companies based in Macclesfield.”
The judge also said:
“22. It is quite clear that there was no such authority [to sign a Statement of Truth] and no such explanation and I am driven to the conclusion that the practice of this company, Amanda Cunliffe Solicitors, is not routinely to check before solicitors sign statements of truth. It is not difficult to write to the client, saying, “Dear Mr, Lord”, (or whatever you like to call yourself), “Brown”, “Here is a statement which we are required to file at court. Please confirm that it is true”. If the client then signs it as true, then some of the responsibility is taken off the solicitor although if the solicitor knows that what he or she is asking the client to sign is not true, then there would be a complicity in what is clearly – and I have to use the word – “perjury”, either “perjury” or “forgery”. It is a very, very serious matter.”
At paragraph 27 the judge said:-
“27… This is a case where a claim for physiotherapy charges which is inflated from the beginning is made without proper concern for arranging the physiotherapy at all. It is done on the basis of an invoice. Nothing is done to sort out the physiotherapy. Comments are made about it in the witness statement which is actually signed after the six months prognosis is complete and the witness statement says, “I am happy to settle my claim on the basis of the six months prognosis”, which means by that stage the physiotherapy was totally unnecessary.
- The 6 April, what I can only describe as a false statement of truth is signed. The claimants are put on notice in May by a counter schedule and still do nothing about it and still include details of it in the trial bundle and until queried at trial it appears still to be a live claim.”
At paragraph 25 the judge said:-
“25. Miss Nkochi-Nwankwo went on to say, “There are occasions where sometimes there might be a case where physiotherapy payments are received when the physiotherapy has not, in fact, been received. As a general rule we would ensure we administered the payment of that but we may pay money to the client if so instructed, otherwise we would make the payment but we would only” – she qualified that later – “make the payment to the client if the physio had, in fact, been done”.”
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