Richard Slade and Company Solicitors v Mr Jugmohan Boodia and Another (Respondents/Claimants)
| Jurisdiction | England & Wales |
| Judge | Mrs Justice Slade |
| Judgment Date | 31 October 2017 |
| Neutral Citation | [2017] EWHC 2699 (QB) |
| Docket Number | Case No: QB/2017/0126 |
| Court | Queen's Bench Division |
| Date | 31 October 2017 |
[2017] EWHC 2699 (QB)
Mrs Justice Slade DBE
Case No: QB/2017/0126
Claim No: JJ1606313
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ON APPEAL FROM
THE SENIOR COURTS COSTS OFFICE
Master James
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Bacon QC (instructed by Richard Slade and Company Solicitors) for the Appellant/Defendant
Mr Dunne (instructed by W Davies Solicitors) for the Respondents/Claimants
Hearing date: 11 th July 2017
Judgment Approved
Richard Slade and Company Solicitors ('the Defendant') appeals from the decision of Master James dated 17 March 2017 on a preliminary issue in a claim by Mr and Mrs Boodia ('the Claimants') for assessment of invoices submitted by their solicitor, the Defendant. By a retainer entered into on 30 January 2013 the Claimants engaged the Defendant to act for them in litigation concerning a right of way. The Defendant submitted 61 bills to the Claimants; 43 for solicitor's fees only and 18 for disbursements only. The Claimants terminated the retainer with the Defendant and instructed other solicitors in November 2016. The Claimants failed to pay the Defendant's final four invoices in the sum of £26,041.38. By a claim form dated 17 November 2016 the Claimants sought assessment of all 61 invoices pursuant to Solicitors Act 1974 ('the Act') Section 70(1). The Defendant contended that those invoices which were rendered more than one year before 17 November 2016 could not be assessed pursuant to Section 70 of the Act as each such invoice was a statute bill and the time for the Claimant to make an application in respect of each such bill ran from the date of the bill and had expired.
Master James ordered that there be a hearing to determine whether:
"by virtue of them being final for the period covered by them only insofar as they relate to profit costs, the bills raised by the Defendant to the Claimants as set out in the claim form constitute interim statute bills under Part III of the Solicitors Act 1974, and if they are not such interim statute bills whether they are capable of being treated as a series of on account bills culminating in a statute bill, dated as per the last in the series."
The question of whether the retainer permitted the rendering of interim statute bills was an issue before Master James. By paragraph 2 of her judgment, the Master recognised that the agreement in the retainer was 'somewhat ambiguous between payments on account monthly and [statute] bills monthly'. She noted that the retainer referred to a Solicitors Act assessment and a complaints procedure. Master James held that she 'would be reluctant to make a finding of a fatal flaw in the retainer'. The Master held 'it does seem to me that the retainer does what it needs to do or has potential to do what it needs to do'. The Claimants' point had been that the retainer did not provide for interim statute bills. This argument was rejected. The Master went on to observe at paragraph 3 'The Claimants' second point, however, is a much stronger point…'.
The second point raised by the Claimants was that the 61 invoices were not interim statute bills. None of them included both a charge for profit costs and for disbursements. Master James observed that in this case the Defendant was raising what he thought were interim statute bills with separate bills at later dates for disbursements. The Claimants contended that a bill which does not include all liabilities for the period it covers is not a final bill for that period. The bills rendered by the Defendant were not final bills for the period which they covered because not all costs were included in them.
Master James held that 'costs' which are the subject of interim statutory bills include fees, disbursements and expenses. In so concluding the Master referred to the definition of 'costs' in the CPR but observed 'a lot of concepts have been codified into the White Book but they existed for years before that.' The Master accepted the contention on behalf of the Claimants that to be a bill of costs within the meaning of the Solicitors Act 1974 Section 70, the bill must include both profit costs and disbursements for the period covered by the bill. As the individual 61 bills did not contain both profit costs and disbursements for the period they covered, Master James held that they were not interim statute bills.
As a fall back position both parties invited Master James to find that there was a Chamberlain Bill ( Chamberlain v Boodle King [1982] 3 AER 188). The Master accepted the submission of the Claimants that the bills were delivered as part of a running account in respect of one piece of work and that the time for the clients to request assessment ran from the date of delivery of the final bill. The Master agreed with the Claimants' position that finding a series of interim statute bills at the points at which the disbursements were final was too difficult. The amount of costs due in respect of a particular period would be too difficult to calculate.
The relevant statutory provisions
"67. Inclusion of disbursements in bill of costs.
A solicitor's bill of costs may include costs payable in discharge of a liability properly incurred by him on behalf of the party to be charged with the bill (including counsel's fees) notwithstanding that those costs have not been paid before the delivery of the bill to that party; but those costs—
(a) shall be described in the bill as not then paid; and
(b) if the bill is [assessed], shall not be allowed by the [costs officer] unless they are paid before the [assessment] is completed."
"69.—Action to recover solicitor's costs.
(1) Subject to the provisions of this Act, no action shall be brought to recover any costs due to a solicitor before the expiration of one month from the date on which a bill of those costs is delivered in accordance with the requirements mentioned in subsection (2); but if there is probable cause for believing that the party chargeable with the costs—
(a) is about to quit England and Wales, to become bankrupt or to compound with his creditors, or
(b) is about to do any other act which would tend to prevent or delay the solicitor obtaining payment,
the High Court may, notwithstanding that one month has not expired from the delivery of the bill, order that the solicitor be at liberty to commence an action to recover his costs and may order that those costs be [assessed].
(2) The requirements referred to in subsection (1) are that the bill must be–
…
(2F) A bill which is delivered as mentioned in subsection (2C)(c) is to be treated as having been delivered on the first working day after the day on which it was sent (unless the contrary is proved)."
"70.—[Assessment] 1 on application of party chargeable or solicitor.
(1) Where before the expiration of one month from the delivery of a solicitor's bill an application is made by the party chargeable with the bill, the High Court shall, without requiring any sum to be paid into court, order that the bill be [assessed] and that no action be commenced on the bill until the [assessment] is completed.
(2) Where no such application is made before the expiration of the period mentioned in subsection (1), then, on an application being made by the solicitor or, subject to subsections (3) and (4), by the party chargeable with the bill, the court may on such terms, if any, as it thinks fit (not being terms as to the costs of the [assessment]), order—
(a) that the bill be [assessed]; and
(b) that no action be commenced on the bill, and that any action already commenced be stayed, until the [assessment] is completed.
(3) Where an application under subsection (2) is made by the party chargeable with the bill—
(a) after the expiration of 12 months from the delivery of the bill, or
(b) after a judgment has been obtained for the recovery of the costs covered by the bill, or
(c) after the bill has been paid, but before the expiration of 12 months from the payment of the bill,
no order shall be made except in special circumstances and, if an order is made, it may contain such terms as regards the costs of the [assessment] as the court may think fit.
(4) The power to order [assessment] conferred by subsection (2) shall not be exercisable on an application made by the party chargeable with the bill after the expiration of 12 months from the payment of the bill.
(5) An order for the [assessment] of a bill made on an application under this section by the party chargeable with the bill shall, if he so requests, be an order for the [assessment] of the profit costs covered by the bill.
(6) Subject to subsection (5), the court may under this section order the [assessment] of all the costs, or of the profit costs, or of the costs other than profit costs and, where part of the costs is not to be [assessed], may allow an action to be commenced or to be continued for that part of the costs.
…
(12) In this section "profit costs" means costs other than counsel's fees or costs paid or payable in the discharge of a liability incurred by the solicitor on behalf of the party chargeable, and the reference in subsection (9) to the fraction of the amount [of the reduction in the bill] shall be taken, where the [assessment] concerns only part of the costs covered by the bill, as a reference to that fraction of the amount of those costs which is being [assessed]."
The Grounds of Appeal
Ground 1
By Ground 1 it was contended that:
"The Master wrongly held that the terms of retainer were 'somewhat ambiguous' and that there was no entitlement on the part of the Appellant to render interim statute bills. The terms of the retainer were clear; there was an express agreed term permitting the Appellant to...
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