Lawyers who make it their business to sue law firms over deductions from clients’ damages have insisted they are acting legitimately amid growing controversy over the practice.
Leeds firm JG Solicitors was accused by opponents in a ruling published last week of running a ‘fishing expedition’ on behalf of clients who had long ago settled claims but now wanted to query their legal bills.
In a judgment referring to thousands of similar challenges pending, costs judge Master James refused an application to force disclosure of documents in order to challenge a bill. In Hanley v JC & A Solicitors, James said she was ‘concerned by the floodgates that would likely be opened’ if she ruled that solicitors can be ordered to hand over their complete client file.
James Green, managing director of JG, representing Hanley, said he wanted to help recover money deducted unfairly from client damages. ‘Our success in this new area of law has shone a light on the unfair treatment of some members of the public by a minority of personal injury law firms,’ he said. ‘We are convinced of the need to seek justice for those overcharged.’
The problem stems from civil justice reforms in 2013 which scrapped the recoverability of success fees and after-the-event insurance premiums and instead allowed firms to deduct a maximum of 25% of the damages recovered. Since then, a cottage industry of firms suing other firms has developed.
Mark Carlisle, director of costs recovery firm checkmylegalfees.com, said solicitors who bill in accordance with the legislation and the accounts rules, and charge a reasonable amount, have nothing to fear. He said: ‘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 a complex area of the law, is simply insupportable.’