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‘A bill must contain sufficient information to enable the client to obtain advice as to its detailed assessment.’

Sitting in the High Court (Senior Courts Costs Office) Master Gordon-Saker has given a stark warning to solicitors that when billing, clients should be given sufficient information to enable them to take advice on whether or not to seek assessment under the Solicitors Act.

In the case of Dr Rahimian & Scandia Care Ltd -v- Allan Janes LLP [2016] EWHC B18 (Costs) the Claimant sought an order that the Defendant firm of solicitors deliver up a final statute bill in relation to work done in litigation. This was as a result of the Claimant's concerns as to the overall costs he had been charged, and subsequently paid, which totalled £76,153.14 despite having been given an estimate of costs at the outset of the litigation that was in the region of £15,000 – £25,000.

Out of the twenty-two invoices rendered only three contained a detailed description of the work undertaken. The final invoice was marked "final" rather than interim and was rendered on the 23rd July 2014.

On the 23rd July 2015 the Claimant's new solicitors issued Part 8 proceedings against the Defendant seeking a detailed assessment of the bills of costs however those proceedings were not served within 4 months and were discontinued before a hearing.

The current proceedings brought on behalf of the Claimant by Deep Blue Costs, seeking an order for the delivery of a final bill, were issued on the 12th February 2016. Since the proceedings were issued more than 12 months after payment of the final invoices the court did not have power to order assessment of those invoices (s70 Solicitors Act).

The Claimant had to establish that the invoices rendered were not "bills" for the purpose of the Solicitors Act 1974.

Paragraphs 30 to 33 of the judgment seem to be the most important: -

30."A bill must contain sufficient information to enable the client to obtain advice as to its detailed assessment. In Ralph Hume Garry v Gwillim [2003] 1WLR 510, the Court of Appeal considered whether a series of bills submitted by the claimants to the defendant complied with section 69 of the Solicitors Act 1974. Ward LJ summarised the authorities:

63 I accept the principle expressed in Lord Campbell CJ's judgment in Cook v Gillard 1 E & B 26 , 36–37 that:

the defendant who undertakes to prove that the bill is not a bona fide compliance with the Act cannot found an objection upon want of information in the bill, if it appears that he is already in possession of that information … a client has no ground of objection to a bill who is in possession of all the information that can be reasonably wanted for the consulting on taxation.

In Eversheds v Osman [2000] 1 Costs LR 54 , 61–63 Nourse LJ posed this test in not dissimilar terms, viz: is the client unable to judge as to the justice of the amount of the fees which are charged?

64 Thus I would accept the proper principle to be that there must be something in the written bill to indicate the ambit of the work but that inadequacies of description of the work done may be redressed by accompanying documents (as in Eversheds v Osman where it was doubtful whether the bill on the face of it would have been sufficient) or by other information already in the possession of the client. That, it seems to me, would serve the purpose of the Act to give the client the knowledge he reasonably needs in order to decide whether to insist on taxation. If the solicitor satisfies that then the bill is one bone fide complying with the Act.

70 This review of the legislation and the case law leads me to conclude that the burden on the client under section 69(2) of the Solicitors Act 1974 to establish that a bill for a gross sum in contentious business will not be a bill "bona fide complying with this Act" is satisfied if the client shows: (i) that there is no sufficient narrative in the bill to identify what it is he is being charged for, and (ii) that he does not have sufficient knowledge from other documents in his possession or from what he has been told reasonably to take advice whether or not to apply for that bill to be taxed. The sufficiency of the narrative and the sufficiency of his knowledge will vary from case to case, and the more he knows, the less the bill may need to spell it out for him. The interests of justice require that the balance be struck between protection of the client's right to seek taxation and of the solicitor's right to recover not being defeated by opportunistic resort to technicality.

31.Of the 22 invoices delivered in the present case, only the last 3 contained any information about the work that had been done. The last 3 invoices did not contain any details of the work done in the periods covered by the first 19 invoices.

32.If one were to view the 22 invoices as constituting one final bill delivered on 22nd July 2014, in my view, without more, that bill did not contain sufficient information, or indeed any information, of the work done between 8th September 2011 and 28th February 2014 so as to constitute a bill complying with the 1974 Act.

33.Did the Claimants have sufficient knowledge from other information in their possession to take advice on whether or not to seek detailed assessment? There is nothing to suggest that they did at the time that they received the Defendants' last invoice. Dr Rahimian described the Defendants' billing as confusing. It is clear that the Claimants were concerned about the Defendants' charges at the time that the retainer was determined in July 2014 to the extent that Dr Rahimian intended "to continue his complaint" as indicated in the email from Ms Gomes to Mr Harriman dated 21st July 2014 timed at 14:36. But there is nothing to suggest that they had the necessary information before 15th August 2014 when the Defendants' files were transferred to their directly-instructed counsel. I get that date from the email from Mr Harriman to Mr Carlisle dated 24th November 2015."

In this case the client had been presented with a series of what can only be described as 'confusing' interim bills as the case progressed. Had the court found that any of them were interim statute bills, or that they should be treated as a series of bills culminating in a final statute bill dated as per the last of the series, then the client would have been out of time for assessment.

Rightly, the Master held that the "final" bill did not, on its own, or together with the other 21 bills, contain sufficient narrative to explain what work had been done. The bill could not be regarded as a "final" bill under the Act and the Defendant was ordered to deliver a final bill. This means that on receipt of the final bill the Claimant can then seek an assessment of those costs.

So what can be learned from the decision?

The main message is that if legal practitioners want to get paid they will have to explain what they have done for it!

Secondly is the common misconception that a bill is a final bill simply by virtue of calling itself one. The Master in the present case found that despite the fact that the final invoice was marked "final" it contained insufficient information for it to be a final statute bill.

Thirdly and finally there is no implied right for a solicitor to deliver interim bills (see also Vlamaki v Sookias & Sookias [2015] 6 Costs LR 827). If a solicitor wants to deliver interim bills in litigation there has to be an express agreement.




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Another plaudit for our London Office
Judge rejects inadequate costs bills

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