Avoiding Challenges to your Costs II: What is an Invoice

Until an invoice is delivered in accordance with the Act, a solicitor does not have any right to take client money. Doing so could (and probably would) be a breach of Rule 5.1 of the Solicitors Accounts Rules. Unfortunately there is no further explanation within the Act as to what a statute invoice is or what information it must contain.

This is the second blog in a series covering various aspects of solicitor / own client relationships. You can find the other blogs here:-

Avoiding Challenges to your Costs I: Invoicing Clients

Avoiding Challenges to your Costs III: Talking about Money

Avoiding Challenges to your Costs IV: Time Recording

Whether or not an invoice is a “statute” invoice is determined with reference to the authorities. There are a number of factors which the Court will take into account, but it is important to recognise that this is not a “check box” exercise. The mere fact that one or more factors are missing will not automatically mean that the invoice is not a statute invoice.

The following factors will be relevant:-

• If the invoice is raised before the conclusion of the case, whether the solicitor is entitled to charge their client at that point (Underwood, Son & Piper v Lewis [1894] QB 306 A.L.). There is a rebuttable presumption that a solicitor has no right to invoice on an interim basis unless there is a contractual right to do so (Chamberlain v Boodle & King [1982] 1 WLR 1443 and Davidsons v Jones-Fenleigh [1980] Costs LR 70).
• Whether the invoice contains a statement that it is a statute invoice and is final for the period covered (Adams v Al Malik [2014] 6 Costs LR 985).
• There should be sufficient information within the bill to identify the work to which it relates (Ralph Hulme v Gwllim [2002] EWHC 9034 (Costs)). This could include a date range or breakdown of costs.

A final invoice also may only include work actually done, and cannot include a claim for future time. Any invoice which includes a claim for future time is therefore likely to be deemed to be an invoice for a on account of costs.

In summary, a client invoice should be clear that it is final for the period covered and identify the work done. Solicitors’ retainers should be careful to incorporate terms entitling them to raise interim invoices during the case.

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