Fixed Fees on All Fast Track Cases

The proposals for fixed fees in all fast track PI cases have now been made public. The MOJ's proposals can be found here [MOJ PROPOSALS].

The proposals in respect of the amounts of fixed costs that will apply outside the portals are particularly harsh, although there will be an escape clause (see the reference to "+20%") which will probably be based on the current CPR 45.12 provision for exceeding predictive costs in RTA cases. The question is will the new rule require exceptional circumstances (as now), in which case forget it, or just circumstances that justify a departure (in which case, chaos will ensue and the whole scheme will collapse in a quivering heap of costs lawyers and irate District Judges).

Interest under a Final Costs Certificate

In a recent case costs due following part 36 acceptance were agreed in an all inclusive sum very close to assessment, and a Final Costs Certifiate was sealed showing (with the full agreement of the opponent) the correct net amount, so that subject to payment on day 14 the interest would match up with the agreed sum. The opponent then tried to pay the net sum only, and to claim that their liability was discharged. Our advice follows - 

What an infuriating and devious opponent!

If this continues, we should give her chapter and verse, which is –

The award of costs being a “deemed order” upon acceptance of a part 36 offer (CPR 36.10), the entitlement to interest arises under CPR 44.12 (2), which says –

“Interest payable pursuant to section 17 of the Judgments Act 1838² or section 74 of the County Courts Act 1984³ on the costs deemed to have been ordered under paragraph (1) shall begin to run from the date on which the event which gave rise to the entitlement to costs occurred.”

Interest therefore runs on the amount of the substantive costs from 19^th July 2011.

s.74 (3) CCA 1984 provides that –

“The payment of interest due under subsection (1) shall be enforceable as a sum payable under the judgment or order”

The amount of interest is set at 8% by The County Courts (Interest on Judgment Debts) Order 1991.

Notwithstanding that there was also an express agreement as to the fully inclusive amount (which one would hope that an Officer of the Court would consider herself bound by), the liability, scope and amount of interest that we have sought are all set by the Civil Procedure Rules, or by other primary or secondary legislation.

In short, it doesn’t really matter what argument she comes up with - the Final Costs Certificate (and the interest that accrues under it) are enforceable as a judgment debt and your client can simply send in the Bailiffs.

Update as at 15/10/12 - after three weeks of attempted evasion, interest was paid in full.

Cancellation of Contracts made in a Consumer’s Home or Place of Work etc Regulations 2008

Hurley -v- Maruki : A recent decision in which a CFA was rendered unenforceable due to the failure of a CFA signed away from the office to contain notice of right to cancel (redirects to article on Simon Gibbs excellent costs blog).

Absurdity in and of Costs Negotiations

For a number of years I have been on what I think may have  been a sole crusade to reduce the cost of costs negotiations and try and instil some sense in defendant negotiators by being ultra reasonable. All we want is a reasonable amount for a job well done - we don't incite costs war! So, when the defendant raises the highly erudite objection that goes "you've claimed 5 routine communications to get two sets of hospital notes, we offer 4", I like to say to respond by saying "well.......here are the five letters and calls, which one of them do you think we did for the sheer joy of it?". I do the same for all of the objections that they have raised. There's no genuine issue of privilege because the main litigation is over and done with, and I think rather than the spirit of openness supposedly enshrined in the CPR, many people in reality like to keep their cards close to their chest for pure bloody mindedness, to remind us all of why we ditched old style "taxations" which were bedevilled by last minute ambushes,  and in some cases so that the less scrupulous amongst the legal fraternity can attempt to recover much more than their work was in reality worth.

Obviously this is all subject to client agreement and there are a few safeguards before papers can be released;  my standard practice is to ask my opponent for an undertaking that - 

1. They will not use the documents for any purpose other than assessment / negotiation of costs
2. They will not release the documents or any part of them to their client or any other third party
3. They will not take or retain either physical or electronic copies, and
4. They will return any hard copies to me post hearing

What I want is to ensure that the documents are used to ease the assessment process and nothing more. I do not want Mr.Smith's comment that his former employers were a bunch of thieving crooks to end up in the hands of his former employers, who then take it out on Mr.Smith's wife and children. Or similar. All sorts of potential disasters.

If they accept that they can have a full copy of the papers and (massively radical idea coming here) the claimant and defendant's advisers can between them arrive at a relatively inexpensive joint opinion as to a reasonable level of costs. If there is a disagreement, the precise dispute can be pin-pointed down to individual document level and the court asked for a decision before everyone has set the "costs of assessment" juggernaut rolling down the hill, belching clouds of generic PODs and Replies, heading for a  rather messy head on collision with the judiciary at large. 

So what is the problem?

None really. Except that today I have been told by a defendant costs specialist that the undertakings are "onerous" and "absurd". 

Onerous? Not sure that the person concerned has actually looked up the definition of the word. How badly must you have to want to copy something for an undertaking not to copy it to be "onerous"? Is there a call for a self-help group?

As for "absurd", you have my profuse apologies. On reflection, and having given it very considerable thought, I agree that reducing the costs of assessment for those with a vested interest in ensuring that they continue to spiral could, I suppose, be seen as an absurdity. Massively high assessment costs have certainly helped to ensure that we all have a long, prosperous and most of all certain future ahead of us!

Having a Pop

Following on from the earlier entry on the LSC's approach to assessment of expert's fees (http://kjccosts.blogspot.co.uk/2012/10/lsc-approach-to-assessment-of-experts.html), in which to paraphrase we ended up effectively getting £24 per hour for a massively experienced clin neg specialist doing a very diligent job, we decided to take the next step up the slightly wobbly LSC appellate step-ladder. Oh what naive fools!

I am sure that the good old Legal Aid Board at some point back in the 80s or 90s had a "Crystal Mark" from the Plain English Campaign. I may be wrong. Certainly the colour coded certificates were quite straight forward. Anyway, as far as I can tell the LSC is no longer a holder. Here, perhaps, is why....

The Appeal is not an Appeal. It is not a Review.

It is an "Application to certify a Point of Principle of General Importance" or, a "PoP". 

But what is a POP you ask? POPs are "statements which seek to clarify a costs assessment principle or interpret a contractual assessment provision". Obviously. With me so far? Good. Keep up.

And the procedure is thus, as described in the Focus magazine from August 2005 -

"If you are unhappy with the decision of a Costs Committee then you can, within 21 days, apply to another Costs Committee for certification of a POP. This is effectively the permission stage and even if  the Costs Committee certify the POP it has no effect on the underlying assessment nor is it binding under the Contract. In order for the POP to have effect it has to be certified by the Costs Appeals Committee"

So, Think of Committe 1 as a "Popstop" (they really should have consulted me about the descriptions!). If Committee 1 certify your POP they do not do the obvious and decent thing and pass it on to Committee 2 themselves. You get 21 days in which to possibly forget to do that, and you must invite Committee 2 to certify it for a second time. I suspect that if you do not meet the time limits you remain for ever in a limbo. Your pop is half way there but has no teeth. Like Coldplay.

And of course the Committee may or may not certify. You could find yourself with a popflop.

Successful POPs will appear in the POP manual, the latest edition of which is available here - http://legalservices.gov.uk/docs/cls_main/point-of-_principle-manual.pdf. All 154 fun pages of it.

Curiously POP CLA15, which is now nearly 17 years old, seems to pretty much cover the point that we are raising here. It says that if you get prior authority for a disbursement , that does not place a ceiling on the fee. Even if the amount eventually paid out is more, it can be allowed as long as it is reasonable. And that really just emphasises the regulations, which say that (apart from in terms of instructing Leading Counsel) prior authority really has no effect on assessment. If the disbursement is reasonable it should be allowed in any event.

So, to back track to the circumstances of this particular appeal (I refuse to do any more pops), our experts' fees were reduced on grounds that "they had not been subjected to the scrutiny of the prior authority procedure". That does not sit well with CLA15 or with the regulations.

Our proposed points of principle are as follows - 

POP1

Failure to obtain prior authority under regulation 60 or 61 CLA(G)R 1989  is not a factor that should be taken into account on assessment in determining the reasonableness of the fee, either as to principle or as to quantum; if the fee was reasonably incurred and is reasonable in amount it should be allowed whether or not prior authority was sought.

POP2

Where (in a case to which prescribed experts’ rates does not apply) an appropriately qualified expert is instructed and in all other respects his fee appears reasonable, failure to approach similar experts for a fee comparison is not a factor that should be taken into account on assessment in determining the reasonableness of the fee, either as to principle or as to quantum; if the fee was reasonably incurred and is reasonable in amount it should be allowed whether or not any comparator quotes were obtained.

Both appear to me to be reasonable. Bearing in mind that POP1 really just re-states what the rules have said since 1989 I would hope it will not cause controversy.

You have to wonder though whether this system, in which by the way there are no provisions whatsoever for recovering your appeal costs, and which seems to be specially designed to sap the will to proceed in cases that are already making massive losses, really is giving any real incentive for good lawyers to provide proper access to justice.