The Belsner v Cam Legal Services Limited  EWCA Civ 1387 appeal has been allowed in favour of the Solicitors.
Solicitors, CAM Legal Services, originally brought a personal injury claim on behalf of Claimant Darya Belsner. The case settled in the RTA Portal at Stage 2 for £1,917 in damages plus £500 fixed costs plus disbursements. CAM Legal Services deducted a success fee of £321 from the damages (capped at 25%) as a contribution towards costs to supplement the £500 fixed costs recovered from the Defendant.
The Claimant later instructed ‘checkmylegalfees.com’ to query the Solicitors’ charging and issued a Part 8 application for a final statute bill. The Solicitors’ Bill came to £4,306, which was £2,523 higher than the settled costs amount.
High Court Appeal
On appeal by the Claimant to the High Court, Mr Justice Lavender found that informed consent had not been provided as it should be for contentious matters, applying section 74(3) of the Solicitors Act 1974 and CPR 46.9(2).
The judge subsequently decided that a success fee of only £75 (15% of the fixed costs amount) was payable and a repayment back to the Claimant of the difference was ordered.
Court of Appeal Decision
On the basis this case was unreasonable satellite litigation over very small sums and without economic risk to the Claimant the Solicitors challenged the High Court decision.
The Court of Appeal has now reversed the High Court decision and reassessed the Bill from scratch on the basis that:
-claims brought through the RTA portal without proceedings being issued are non-contentious and section 74(3) of the Solicitors Act 1974 and CPR 46.9(2) do not apply to all claims brought through the RTA portal without county court proceedings actually being issued;
-the judge was wrong to say that the Solicitors owed the Client fiduciary duties in the negotiation of their retainer;
-although the Solicitors were not obliged to obtain the Client’s informed consent to the terms of the CFA on the grounds decided by the judge, the Solicitors did not comply with the SRA Code of Conduct for Solicitors in that they neither ensured that the Client received the best possible information about the likely overall cost of the case, nor did they ensure that the Client was in a position to make an informed decision about the case;
-the term in the Solicitors’ retainer allowing them to charge the Client more than the costs recoverable from the defendant was not unfair within the meaning of the CRA 2015; and
-the court can and should reconsider the assessment on the correct basis, which is under paragraph 3 of the Solicitors’ (Non-Contentious Business) Remuneration Order 2009, which requires the Solicitors’ costs to be “fair and reasonable having regard to all the circumstances of the case”.
Although the judgment acknowledges that the Client ought to have to have been told of the level of fixed costs she would recover if the case settled in the RTA portal, this does not necessarily mean the Bill was unfair. Consequently, the repayment made following the High Court decision is now repayable by the Claimant.
Sir Geoffrey Vos, Master of the Rolls, asserted in his judgment that: “the whole court process of assessment of solicitors’ bills in contentious and non-contentious business requires careful review and significant reform” and told solicitors not to “suggest CFA or other fee arrangements to their clients that allow for fees that they would not dream of actually charging”.
Judgment in Karatysz v SGI Legal LLP  EWCA Civ 1388
Reinforcing the condemnation of checkmylegalfees.com for bringing trivial claims for the assessment of small bills to the High Court is the judgment in Karatysz v SGI Legal LLP. Similarly, this was an appeal against a decision in relation to the assessment of costs following a solicitor’s deduction of 25%, which has now been dismissed by the Court of Appeal.