The highly contentious issue of costs challenges took yet another twist this week when a judge ruled that a firm should hand over files to a former client.
Sitting in the Senior Courts Costs Office, Master Brown granted an order for delivery of documents in the possession of a law firm, allowing its former client the chance to contest its costs. The decision apparently goes against those in recent similar cases and could give fresh impetus to those seeking to challenge solicitors’ deductions.
In Swain v J C & A Ltd, RTA victim Philip Swain demanded greater disclosure of documents relevant to his case after north-west firm JC & A Limited deducted almost £900 from his agreed damages of £2,800. The settlement was made after liability was admitted, with the claimant solicitors charging an hourly rate of £250 and deducting almost £200 in respect of an ATE premium.
Swain, represented by costs draftsman Mark Carlisle, instructed by Leeds firm JG Solicitors, sought production of a letter to the ATE provider and disclosure of four schedules which dealt with matters such as fees and expenses.
Lawyers for Swain argued he had a proprietary right to the original copies held by JC & A, and that in any event the court had the power to order provision of copies of the documents sought.
JC & A said the application for disclosure was ‘merely a fishing expedition’ – echoing a similar argument advanced on another occasion in the same court – and was disproportionate: the firm had the right to make deductions from the claimant’s damages and had complied with regulations.
Master Brown said the court did have discretion to order the provision of copies of the documents sought ‘whether or not a proprietary right in the relevant documents has been established’. He doubted whether many clients would appreciate the need to retain documents provided in the course of their claim, and said it was clear they were now at a ‘significant disadvantage’ without them.
Brown added that there was a particular need to consider the status of the fee earner who worked on Swain’s case, suggesting the £250 rate was more suited to a substantially higher-grade fee earner in a significantly more complex and higher-value matter.
The judge acknowledged the prospect of satellite litigation brought by disgruntled clients, but added that ‘transparency will improve the prospect that any dispute as to the defendant’s costs can be resolved without the need for the court’s further intervention’.