In the recent judgment of Toplasson GmbH v CMS Cameron McKenna Nabarro Olswang LLP [2025] EWHC 118 (SCCO), the Claimant sought an order under section 70 of the Solicitors Act 1974 (“the Solicitors Act”) for the Detailed Assessment of 27 invoices raised by the Defendant. All but the last bill was delivered more than 12 months before the issue of proceedings and all but the last 8 bills were paid more than 12 months before the issue of proceedings.

The Claimant, a software supplying company, instructed the Defendant, in August 2019 to prepare a contract with a customer on their behalf. The contract was subsequently terminated by the customer, which resulted in litigation and a judgment against the Claimant in the sum of €5 million, which at the time of the hearing, was being appealed by the Claimant. There were therefore two retainers between the parties, one in respect of non-contentious work for preparing the contract and the second for contentious work in respect of the litigation. Work commenced in respect of the litigation in April 2020.

There were three costs estimates given to the Claimant. The first was provided in July 2020, which was the day before the mediation was to commence, in the sum of £1,920,664. This included incurred costs of £240,000. The Defendant then filed a case management sheet in July 2021 which stated that the incurred costs were at that point £565,000, and the estimated costs to trial were £2.05 million. The final costs estimate was provided in March 2022 where future costs were stated as £1,717,500.

The invoices largely followed the same format and included a description of the work done in a similar level of detail to that which would be set out in a bill of costs, or breakdown, for Detailed Assessment. The first invoice in respect of the non-contentious work was delivered in July 2019. The Defendant issued monthly invoices for their work thereafter, with the final one delivered in May 2022.

As the litigation progressed, the balance of fees outstanding grew, with a partial payment of £500,000 fees made in January 2022. By May 2022, unpaid legal costs reached £1.3 million, prompting the Defendant to terminate their retainer.

Key issues considered

The case proceeded, based on the determination of the following key issues:

1. The status of the bills and whether they were interim statute bills or a series of on account bills which taken together formed a Chamberlain bill?
2. Under which subsection of section 70 of the Solicitors Act did the bills fall under?
3. Insofar as the bills (or any of them) were found to come within the subsections of section 70 of the Solicitors Act, on what basis could an assessment be ordered?
4. Did the Court have power to make an order for Detailed Assessment restricted to the profit costs and all other disbursements (excluding counsel’s fees and Court fees) under section 70(6) of the Solicitors Act?
5. Should the Court make any order for payments on account and if so, for how much?

Judgment

In respect of the first issue, the Defendant’s position was that the bills were interim statute bills, and final bills for the periods they covered. Meaning only the final 8 could be subject to assessment, unless ‘special circumstances’ were proven. The Claimant’s position was that all 27 bills were on account bills that together formed a single final statute bill on 7 June 2022.

Senior Costs Judge Gordon-Saker ruled that the Defendant did not have the right to render interim statute bills because:

• The retainer agreements did not explicitly state that each bill was “final” for the period it covered.
• The wording in the agreements (“keep you informed of the level of costs incurred”) was more consistent with monthly billing.
• Previous case law showed that without a clear statement that bills are final, they do not qualify as interim statute bills.

The bills collectively formed a single final statute bill on 7 June 2022 and the Claimant was therefore entitled to request a Detailed Assessment of all 27 bills, totalling £2.15 million.

For the purposes of the second issue, the judgment analysed which subsection of section 70 applied:

• Section 70(2) applies when the client seeks an assessment within 12 months of receiving the bill and provides that the Court may order such assessment on such terms as it sees fit.
• Section 70(3) applies if more than 12 months have passed and requires the client to prove ‘special circumstances’.

The Judge found that because the final bill was issued on 7 June 2022 and the claim was brought within 12 months, section 70(2) of the Solicitors Act applied, and the Claimant did not need to prove ‘special circumstances’.

Although the Claimant did not need to prove ‘special circumstances’, the Judge still examined key factors which were raised by the Claimant. In particular, the Claimant argued that the Defendant unlawfully ended its services. However, the Judge rejected this, finding that the Defendant was entitled to stop work due to non-payment.

Furthermore, the Defendant’s initial estimate was £1.95 million, but later invoices suggested costs could reach £3.7 million. The Judge therefore found, that even if section 70(3) of the Solicitors Act applied, the large discrepancy in cost estimates alone would justify a Detailed Assessment.

With regards to the question as to whether the Court could order a partial assessment, which excluded counsel and Court fees, as per the Claimant’s request, the Judge decided that section 70(6) of the Solicitors Act, did allow the Court to exclude certain categories of costs at assessment, and limit the assessment to profit costs and selected disbursements only. It was concluded that the Claimant can challenge only the parts of the bill they have disputed, rather than being forced into a full assessment. It was the Defendant’s position that this was not possible, and all costs should be assessed together.

The Court confirmed:

“… it seems to me that it is not necessary to shoehorn what was charged as a disbursement into the profit costs. The Claimant is not unhappy with counsel’s fees (and I understand that the same counsel are continuing to act for it) and nor is it unhappy with the court fees. It would be absurd to force the Claimant into an assessment of either. They would be included in the breakdown and then not challenged in the points of dispute. Their only effect would be in increasing the size of the bill when calculating whether one-fifth had been disallowed for the purposes of considering the incidence of costs under s.70(9).”

This was important for the purposes of the 1/5 rule in section 70(9) of the Solicitors Act, which will largely determine who is responsible for the costs of the assessment process. Had the Court ordered assessment of all fees, then the threshold for reducing the bill by 1/5 would have increased significantly for the Claimant, meaning they were more unlikely to recover their costs of assessment from the Defendant, even if significant reductions were made to the issues they were disputing.

The ruling reinforces the need for good housekeeping in respect of accurate fee estimates, and for solicitors to ensure they have a right to raise final ‘statute bills’ during the course of the retainer, if they wish to do so.

Bethany Collings is an Associate in Clarion’s Costs and Litigation Funding Team. You can contact the team at civilandcommercialcosts@clarionsolicitors.com.