The costs of reserved legal activities conducted by costs draftsmen under the supervision of a Costs Lawyer are recoverable, a judge has held, saying that to rule otherwise would make a Costs Lawyers’ work for members of the public “impossible”.
This decision of Master Leonard in the Senior Courts Costs Office follows on from his ruling last year in Allen v Brethertons LLP, in which the claimant successfully applied for delivery of a statute bill. He also criticised the defendant law firm for the way it treated a Costs Lawyer instructed by the claimant, a former client.
Master Leonard said that by not properly recognising the professional status of Kerry-Anne Moore (pictured), a Costs Lawyer employed by Checkmylegalfees.com, Brethertons had failed to show “the same professional courtesy as a solicitor would expect” in such circumstances.
Master Leonard handed down a second ruling this week after the defendant acknowledged that it should be responsible for the costs of the application, but submitted that to the extent that work had been undertaken by non-Costs Lawyers, there was no entitlement in principle to recovery of costs.
Ms Moore had been assisted by her co-director Mark Carlisle, an experienced costs draftsman who undertook some advocacy, played a “broad advisory role” and engaged in correspondence with the defendant, another costs draftsman who prepared a draft bill of costs, and an unqualified fee-earner who played a “fairly typical grade D supporting role”, preparing indices, bundles and so on.
In his ruling, which has yet to be published, Master Leonard noted the distinction between reserved legal activities – which must be carried out by an authorised person or an exempt person – and other legal activity, which is undertaken lawfully whoever does it.
Further, schedule 3 to the Legal Services Act 2007 identifies various categories of exemption, where the court has granted a right of audience or a right to conduct litigation or where the work was undertaken at the direction of and under the supervision of an authorised person.
It was accepted for the purposes of the hearing that bill drafting was a reserved activity. Master Leonard found that the costs of the costs draftsman were recoverable because it was done under Ms Moore’s supervision and instruction.
The work of both Mr Carlisle – other than advocacy – and the unqualified fee-earner did not constitute reserved work and so again the costs were recoverable in principle. As the master had granted Mr Carlisle a right of audience, he was for the purpose of that hearing an exempt person, and so the costs were recoverable in principle.
The defendant was ordered to pay costs summarily assessed at £6,410.
In concluding, Master Leonard said: “It has been necessary for me, in a reserved judgement which attracted a degree of interest among costs professionals, to identify significant shortcomings in the defendant’s conduct both toward its former client and his properly authorised Costs Lawyer.
“The application itself was hard fought, the defendant taking a robust stance and defending its position with sophisticated arguments which I ultimately found to be insupportable. The claimant was given no choice but to see the matter through. Much trouble and expense could have been avoided had the defendant delivered a bill when it was asked to do so.
“The defendant’s submissions on the costs of the application themselves furnish an example of the robust approach to which I refer. On proper analysis, they have no real merit. To accept them would have been to render Ms Moore’s working life, in practical terms, impossible.”
Ms Moore said: “This is an important decision for those Costs Lawyers who act direct for members of the public. It enables us to function in a sensible and pragmatic manner in the same way that solicitors do, drawing when appropriate on the experience and abilities of other members of the costs profession and the wider legal profession who are not authorised to deal with matters direct.
“It means that our clients can be assured of the best possible service, giving them full access to specialist advice in respect of legal fees, without worrying that the costs will not ultimately be recoverable.”
Erica Bedford of Kings Chambers in Manchester, who represented the claimant in the hearing, added: “While this helpful guidance necessarily grapples with an involved question of authorisation under the Legal Services Act 2007, within it Master Leonard has delivered a healthy dose of business common sense by his timely reminder that no Cost Lawyer is an island.”
Brethertons instructed Costs Lawyer Fred Robbins.