The Court of Appeal has ruled that a law firm representing itself in proceedings did not count as a litigant in person for the assessment of recoverable costs.
In Halborg v EMW Law LLP, Sir Terence Etherton, master of the rolls, said commercial firm EMW Law LLP was not a litigant in person as defined in civil procedure rules and could recover higher costs.
The judge said the principle established in 1884 in The London Scottish Benefit Society v Chorley, Crawford and Chester still stood. In that case the Court of Appeal held that solicitors who successfully defended proceedings in person were entitled on taxation to the same costs as if they had employed a solicitor and were not restricted to out-of-pocket expenses or other costs allowed to non-solicitors.
The Senior Courts Costs Office ruled in November 2014 that EMW was owed £17,600 in costs for work on an agent’s retainer on behalf of sole practitioner Scott Halborg. Halborg had been involved in proceedings against an architect over allegations of professional negligence, breach of contract, misrepresentation and fraud.
EMW had issued proceedings against Halborg the previous year for a detailed assessment of its costs. Following the ruling, Halborg appealed on several grounds, including that the judge, Master Campbell, had wrongly refused to treat EMW as a litigant in person and to limit its recoverable costs accordingly.
On appeal, lawyers for Halborg attempted to argue that the rules barred EMW from recovering full costs.
In one section of the rules, CPR 46.5, litigants in person are allowed to recover two-thirds of the amount that would have been allowed had they been represented. For the purposes of this rule, a litigant in person includes any company or corporation acting without a legal representative, or a solicitor who acts in person (except where any such person is represented by a firm in which that person is a partner).
Etherton cited Lord Justice Chadwick, who ruled in Malkinson v Trim (2002) that a solicitor defendant’s costs were recoverable even though the defendant did not personally expend his own time and skill in defending the claim.
Halborg’s lawyers argued the Chorley principle gives solicitors an unfair advantage and is an anachronism. But Etherton said it was a pragmatic approach which is upheld in the latest civil procedure rules. Just because EMW was not acting through any form of legal representative did not mean it was ‘acting without a legal representative’, he added, saying that interpretation would produce an ‘anomalous and indeed absurd result’.