Costs lawyers have been warned they can expect harsher treatment from the courts if they go along with solicitors’ pleas to bump up costs.
Master Jennifer James said today that judges have shown in recent years they are no longer prepared simply to disallow costs which are too high, but punish those who try to game the system.
Speaking at the Association of Costs Lawyers annual conference, the master said there have been notable examples of solicitors giving instructions to sign off a bill with higher hourly rates than the retainer allows.
‘Do not take any instructions you know you shouldn’t,’ she said. ‘If [costs inflation] comes to light that is a very serious disciplinary matter for the solicitor. When backed into a corner the kind of solicitor who will ask you to do something unethical is the kind who will point the finger when something goes wrong.’
The master said the court has recently taken the view that bumping up costs must receive a sanction, rather than simply disallowing the rates claimed for.
This might mean the courts taking away costs that would have been due on assessment, or in the most egregious cases to refer individuals to the SRA or another regulator.
The master added: ‘It is not our first port of call and not something we do routinely but it is something that can be done and will be in the right case… that is easier than in the past, it is in the zeitgeist now that solicitors can be reported to the SRA.’
Meanwhile, the conference heard that a working group looking at guideline hourly rates will report to the Master of the Rolls next summer.
Senior costs judge Master Gordon-Saker stated that new rates are needed - but courts should not be ‘slavish’ to the existing figures from 2010, adding they should be a ‘factor and starting point’.
He said the working group was likely to retain current geographical boundaries for setting rates, but suggested this might be only an interim measure in any case. A wider review might be needed in two or three years to look at lawyers’ working practices in the wake of the pandemic.