Costs News

14 January 2016
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News in brief 14th January 2016

Time to vote

Members are reminded that they have until Wednesday 20 January to send in their votes for the chair-elect of the ACL, with Kenneth Corness and Iain Stark having put themselves forward. If you are having any problems, contact enquiries@costslawyer.co.uk.

NHSLA punished again over failure to mediate costs dispute

The NHS Litigation Authority (NHSLA) has once more been ordered to pay indemnity costs on detailed assessment proceedings after rejecting an offer to mediate.

Master Simons said in Bristow v The Princess Alexander Hospital NHS Trust (case no. HQ 12X02176) that the parties “should be encouraged to enter into mediation and, if they fail to do so unreasonably, then there should be a sanction”.

He said it took three months for the NHSLA to reject the offer to mediate, made on 1 April 2015 by Irwin Mitchell for the claimant, and “they gave no good reason other than the fact that the case had already been set down for a detailed assessment”.

Master Simons said he was not satisfied that the sanction should be increasing the interest they paid because 8% interest was already a “penal rate” and the defendant “has to bear this very high rate of interest and they are being punished already by their actions because this case could have been settled by mediation”.

He concluded that the “correct sanction” on the NHSLA was that the claimant should receive costs on an indemnity basis on the 80% awarded to it.

Irwin Mitchell had only received 80% of the detailed assessment costs because its original bill had been reduced by 43% to £135,000, with Master Simons finding it was “not accurate”, and included “significant amounts which should not have been included” because they related specifically to claims against general practitioners which were later discontinued.

Burcher Jennings moves into Manchester

Burcher Jennings has opened an office in Manchester, headed by Victoria Morrison-Hughes, a Costs Lawyer who has been operating as Kings Legal Costings for the past 11 years. It is the firm’s fourth office.

Ms Morrison-Hughes said: “To ensure all law firms in the region have access to our services and without compromising quality control, our aim has been to identify a reputable and forward thinking partner which shares similar values. Burcher Jennings was the perfect fit, especially in relation to client care and service, where the priority rests on quality and ensuring clients receive a bespoke service. Providing a personalised service is key.”

Retrospective success fee allowed

The High Court has overturned a ruling of Master Simons after he found that a law firm could not seek a retrospective success fee as the risks had changed between applying for legal aid and signing a conditional fee agreement (CFA) five months later.

In Ghising v Secretary of State for the Home Department [2015] EWHC 3706 (QB), Howe & Co argued that, when it applied for legal aid, it ticked a box indicating the chance of success at between 60% and 80%, and when the CFA was signed the risk assessment put the chances of success at 65%, with a success fee of 100%.

Master Simons ruled: “It is not for this court to make its own assessment of the risks in July and December, especially in a case such as this where it seems to me that the risks were so different, and this supports the view that the proper time to assess the risk is at the time of the entering into the CFA when one cannot use the benefit of hindsight and my judgment is that, in this particular case, these success fees should not be retrospective.”

Mrs Justice Patterson, sitting with Master O’Hare as assessor, said she did not “understand what evidential basis the master had for saying that there was a different risk in July 2012 to that which there was in December 2012″. She noted that the 65% estimated in December was “self evidently within the bracket of success originally estimated by Howe & Co”.

She added that the wording of the CFA was not ambiguous and was “clearly capable of covering a retrospective position”. Patterson J allowed the appeal and said the parties had agreed that a further detailed costs assessment could be done on the papers.

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