Claimant’s bill of costs struck out as the Court had significant doubt over the validity of the CFAs and retainer

In the case of Anthony Scott –v- Hull and East Yorkshire Hospitals NHS Trust [2014] Ew Misc B53 (CC)(27 October 2014), Regional Costs Judge, District Judge Besford struck out the Claimant’s claim for costs against the Defendant as he could not be satisfied that there were valid retainers in place between the Claimant’s solicitors and the Claimant.

The Claimant was successful in his clinical negligence claim against the Defendant.

Following the conclusion of the substantive claim, the Claimant commenced the detailed assessment process by serving an original bill which totalled £112,000.00 together with a notice of commencement. The original bill had been calculated with reference to an hourly rate of £400.00 throughout together with a success fee uplift of 100%.

The matter was listed for a detailed assessment hearing once points of dispute and replies had been served. The replies referred to only one CFA dated 30 November 2011.

The Claimant amended his bill shortly before the detailed assessment hearing and filed and served the amended bill which superseded the original bill. The amendments largely related to the reduction of the hourly rate from £400.00 to £146.00 as well as the reduction in the success fee uplift from 100% to 54%. As a consequence, the Claimant’s claim for costs was reduced to £36,000.00 which represented a £76,000.00 reduction from the total amount claimed in the original bill.

The initial detailed assessment hearing took place on 28 July 2014 when it came to light at the beginning of the hearing that there were two CFAs in the case and not just the expected one. In light of this fact, the Claimant’s solicitors were put to their election to either disclose copies of the CFAs and primary documents or reply upon any secondary evidence to show an entitlement to the success fee and the nature of the retainer. The assessment hearing was adjourned so that the retainer issues could be dealt with as a preliminary issue.

At the adjourned detailed assessment hearing, the Claimant solicitors chose not to disclose the two CFAs but instead they relied upon a statement from Mr Thompson. Mr Thompson was not one of the fee-earners concerned with the file; he was not involved with either CFA; and had come into the action late in the day. Mr Thompson’s verified statement also contained an error as to the date when enquiries were made of BTE insurers which was highlighted by the Defendant’s representative.

Mr Thompson was unable to confirm whether the CFAs were limited to the Defendant or the Defendant and Dr D Wheatley as the bill related to the claim for costs against the Defendant only.

District Judge Besford believed that the statement produced by the Claimant’s solicitors on the issue of proving the validity of the CFAs did not come anywhere near the particularity normally seen.

The difficulty District Judge Besford had was that, for a number of reasons, he could not be satisfied on the balance of probability that the signature of compliance on the bill could be relied upon.

Firstly, the original bill was clearly miscertified. Further, the District Judge did not have confidence in Mr Thompson’s evidence as he was not the fee-earner and had not been involved in the case prior to the costs issue; the date that the BTE enquiries were made was incorrect within Mr Thompson’s statement; and Mr Thompson was unable to say whether the CFAs identification of the Defendant or Defendants was the same or different in each of the CFAs. Finally, it did not give the District Judge confidence with regard to the statement made in the replies that there was only one CFA which was clearly incorrect.

There were a number of flaws throughout the assessment both on paperwork, the replies, the statement of Mr Thompson and oral evidence heard. On that basis, District Judge Besford had significant doubt over the position of the CFAs and retainer. As this was a standard basis assessment, where there was doubt, the Court had to exercise such doubt in favour of the paying party.

In the circumstances, District Judge Besford could not be satisfied that there were valid retainers in place between the Claimant’s solicitors and the Claimant; therefore, the claim for costs against the Defendant was struck out.

This was on the basis that if there was no valid retainer, there was no right to recover costs from the Claimant other than disbursements that had been incurred and had been paid prior to the assessment proceedings.