Conduct and service

Conduct and service

Remuneration certificate waivers

The normal rules applying to a client's right to require his solicitors to obtain a remuneration certificate are that the client has to pay half of the profit costs as shown in the bill, all the VAT and all the disbursements that the firm has paid on behalf of the client.

In addition, the certificate must be requested within one month of the client receiving from the solicitors notice of his rights to require a remuneration certificate or, if no notice is given, within three months of receiving the bill.

In practice, most firms normally endorse the requisite notice on the bill itself.

However, in exceptional circumstances an application for a waiver of those requirements will be considered.

These circumstances would include, for example, where the solicitors have given an estimate of costs that is then substantially exceeded, where the solicitor is the subject of disciplinary proceedings or intervention, where the solicitor already holds adequate security for his costs or when no costs information has been given to the client.

The position is governed by article 11 of the Solicitors (Non-Contentious Business) Remuneration Order 1994.

The Law Society's remuneration certificates department received a request for a waiver from a client after the solicitors, engaged in a redundancy matter, had sent initial costs information to their client setting out their hourly charging rate and charging practices.

About two weeks later they sent the client an estimate for costs of about 3,000.

About five months later the firm revised this to 3,750.

The solicitor's final bill was for only 2,000, albeit that their instructions were terminated shortly before the matter was scheduled to go before the tribunal.

The view of the remuneration certificates department was that the client had been kept fully informed about costs and there were no grounds for a waiver.

The client appealed the refusal to grant a waiver.

However, his reasons for requiring a remuneration certificate appeared to be concerned with the expertise of the solicitor.

The client suggested that, because of the solicitor's lack of expertise, he was mis-advised, unnecessary counsel's fees were incurred and that the matter took much longer, and was therefore more costly, than should have been the case.

The adjudication panel upheld the original adjudicator's decision that the client had not demonstrated any exceptional circumstances that would justify a waiver of the conditions relating to an application for a remuneration certificate.

The result was that, if the client still wanted the solicitors to obtain a remuneration certificate, he had a month from notification of the refusal to comply with the requirements.

Every case before the adjudication panel is decided on its individual facts.

This case study is for illustration only and should not be treated as a precedent