PI solicitors who simply ignore the contractual terms and deduct 25% of damages come what may must be brought to account.
The Gazette’s news report on the decision by Master James in Hanley v JC & A Solicitors seems to have provoked a rather animated response from the profession, with suggestions that work of this sort – assisting clients in the exercise of their rights under the Solicitors Act 1974 – is ‘satellite litigation’ and that the business model of firms like mine, checkmylegalfees.com, are somehow ‘unsavoury’.
This is surprising, not only because the absolute right to have fees determined by a court is one that has been enshrined in primary legislation since 1843 and has escaped this sort of criticism for the past 175 years, but also because the legal profession undeniably has the upper hand in these cases. Not only are costs assessed on the indemnity basis – meaning that doubt is resolved in favour of the solicitor – but in order for a client to ‘win’ on any assessment under the act, they have to demonstrate not only that they have been overcharged, but that they have been overcharged by 25% or more.
So, solicitors who bill in accordance with the legislation and the accounts rules, and who charge a reasonable amount, have nothing whatsoever to fear from this sort of scrutiny. If on every case we received a reasonable bill that was in accordance with the charging arrangements, then our business would die very quickly. That is far from the case however, and to suggest that unsophisticated clients who have not been billed appropriately should waive their absolute statutory right and go through internal complaints procedures or the ombudsman, rather than seeking expert assistance in negotiating what is undoubtedly a complex and arcane area of the law, is simply insupportable.
The amount in real money terms is immaterial in my view. Checkmylegalfees.com represents clients of all sorts and in respect of costs arising from all legal disciplines, from RTA portal cases involving just hundreds of pounds through divorce and probate to complex commercial cases involving hundreds of thousands. If it seems to us that any of those clients have been overcharged by more than 25% then we are proud to fight hard for their statutory right to have the costs determined by the court. If a client has had £500 deducted from £2,000 compensation when the contractual terms say that it should have been £250, should the client just grin and bear it? Is that really the way the profession wants to be perceived?
I do not want to comment in too much detail on Master James’ decision in Hanley, as it may yet go further, and there are a number of similar cases in which judgment is pending or are yet to be heard. I do not believe, however that a different decision by Master James in this case would have opened floodgates, unless of course there are large numbers of personal injury solicitors whose billing arrangements are insupportable, or who simply ignore the contractual terms and deduct 25% of damages come what may. If that is the case then there are floodgates that need to be opened so that the overcharging can be rooted out.
Mark Carlisle is director of costs recovery firm checkmylegalfees.com.