Kerry Underwood

CHALLENGES TO SOLICITORS’ BILLS BY CLIENT: KEY HIGH COURT DECISION

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In Hanley v JC & A Solicitors and Green v SGI Legal LLP [2018] EWHC 2592(QB).

the Queen’s Bench Division, on appeal from the Senior Courts Costs Office, held that the court had no power to order a solicitor to make and supply to her or his client, or former client, copies of documents which are the property of the solicitor, even if the client/former client was prepared to pay reasonable costs for that tasks.

The court held that it neither had any inherent jurisdiction in its capacity as a court supervising officers of the court, nor under section 68 of the Solicitors Act 1974.

Thus the High Court upheld the decisions of the Senior Courts Costs Office in each of these cases and overruled the decisions in

 

Swain v JC & A Ltd [2018] EWHC B3 (Costs) ; and

The Mortgage Business PLC and others v Taggart [2014] NICh 14

 

a decision of the High Court in Northern Ireland.

 

These cases are parts of a body of cases involving low value personal injury claims funded by Conditional Fee Agreements, and which have attracted significant judicial attention.

 

Section 68 of the Solicitors Act 1974 provides:

 

“(1) the jurisdiction of the High Court to make orders for the delivery by a solicitor of a bill of costs, and for the delivery up of, or otherwise in relation to, any documents in his possession, custody or power, is hereby declared to extend to cases in which no business has been done by him in the High Court.”

 

Here, in each case, the clients/former clients retained the solicitors in relation to the recovery of compensation for injuries sustained in a road traffic accident and the retainer was a Conditional Fee Agreement entered into after recoverability and limiting the solicitors’ recovery of their success fee to the statutory maximum of 25% of the relevant damages recovered.

Upon settlement of each claim that total percentage, and the After-the-Event premium in addition, was deducted.

In each case the clients instructed fresh solicitors for the initial purpose of obtaining advice on whether to exercise their right to a detailed assessment of the solicitors’ fees pursuant to section 70 of the Solicitors Act 1974 which allows the High Court to make an order for assessment of the solicitor’s bill by the court.

Although the specific facts of the request for documents varies, in the Hanley case JC & A offered to supply copies of documents belonging to them for a fee of £644, based on 4 hours’ work at £161 an hour, and the former clients refused to pay that sum.

In the other case the solicitors refused to supply any documents belonging to themselves.

The case sets out the authorities in detail, both in relation to the Solicitors Act 1974 and the court’s inherent jurisdiction over solicitors in their capacity as officers of the court.

The court held that it had no jurisdiction to make orders under the inherent jurisdiction and/or section 68 of the Solicitors Act 1974 in respect of documents which are the property of the solicitors.

It said that, as a matter of principle, an order for delivery up or otherwise in relation to property belonging to another must have an explicit legal basis.

The powers in section 68 are derived from the inherent jurisdiction of the court, and not from the Solicitors Act itself.

The section simply extends the reach of the jurisdiction to cases in which no business has been done in the High Court.

It reflects the provisions of successive statutes governing solicitors.

Thus the scope of the jurisdiction is to be identified from case law, rather than interpretation of the statute itself.

Here, the High Court found that case law gave no authority for the proposition that the court has a discretion under its inherent jurisdiction to order up delivery of, or make other orders in respect of documents, which belong to the solicitor.

If the document and its contents are the property of the solicitor, which the solicitor is entitled to retain, then there is no basis for circumvention of that proprietary right by some other form of order.

The court referred, with approval, to the publication by the Law Society – “Who owns the file?”

These critical requirements of ownership cannot be overcome by reference to section 68, or the overall purpose of Part III of the Solicitors Act 1974, nor by analogy with the pre-disclosure provisions of CPR 31.6, nor with the court’s powers on a section 70 application, nor with the rationale of the required ingredients of a Statute Bill or the requirements of Practice Direction 46, paragraph 6.4.

The inherent jurisdiction of the court does not provide a form of pre-action disclosure of documents belonging to the solicitor.

In so far as the Law Society’s letter of 28 June 2018 says otherwise, then it is wrong, as are the decisions in Swain and Taggart.

 

I am grateful to JC & A Solicitors, both for supplying me with the judgment, and for successfully protecting the legal profession.

 

Comment      

A helpful and practical decision which it is hoped will end these fishing expeditions and applications.

It is another example of the Superior Courts fighting desperately to preserve a legal and justice system on the point of disintegration.

 

 

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Written by kerryunderwood

October 3, 2018 at 10:20 am

Posted in Uncategorized

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