What Costs Are Reasonable for a Deputy? JR v Sheffield Teaching Hospitals NHS Foundation Trust provides an explanation.

At a glance, the costs of a professional Deputy may seem expensive. However, the level of knowledge and work undertaken by a Deputy justifies these costs, especially in a case where the award was of substantial value. Once broken down, the costs of a Deputy are reasonable and can be justified.

Case summary

The Protected Party is a 24-year old with severe cerebral palsy. He suffered intracranial haemorrhage and brain injury following a traumatic premature birth and during a breech delivery. His litigation friend brought a clinical negligence claim on his behalf, arguing that the Protected Party’s injuries could have been avoided by a caesarean delivery. The Defendant accepted liability as the brain injury could have been avoided.

At the settlement hearing, some heads of loss had been agreed, but the costs of the professional deputy remained in dispute.

All parties accepted that the Protected Party lacked capacity to look after his own financial affairs, and predicted that this would be the case for the remainder of his life time. Therefore, a Professional Deputy was to be appointed; the cost of which continued to be argued.

It was deemed that although the Protected Party’s parents were supportive, it was not appropriate for them to administrate the Protected Party’s financial and property affairs. They had stated that they wanted to work alongside the Deputy, not against them. The Protected Party had some level of understanding and communication, so the Deputy was obliged to liaise directly with him.

What is considered reasonable for Deputyship costs?

For annual management

Year Claimant Costs Defendant Costs Award
1 30,605 plus cost of 2 visits 14,000 inclusive of 2 visits 30,000 inclusive of visits
2 21,492 plus cost of 2 visits 9,000 inclusive of 2 visits 20,000 inclusive of visits
3 17,040 plus cost of 1 visit 8,000 inclusive of 1 visit 15,000 inclusive of visits
4 17,040 plus cost of 1 visit 8,000 inclusive of 1 visit 15,000 inclusive of visits
5 onwards 11,232 plus cost of 1 visit 7,000 inclusive of 1 visit 10,000 inclusive of visits

The parties agreed that for extras such as transfers of Deputies, Wills, co-habitation or pre-nuptial agreements and “crisis payments”, a further £38,160.00 was reasonable.

The Judge allowed a total of £898,993.00.

This judgment can then be compared to the PNBA Facts & Figures 2017/18 (pages 258-288) whereby this outlines what could be classed as reasonable when awarding damages to cover the cost of the claimants Deputyship fees. Please refer to the table below.

Year and Expected Work to be Undertaken During the Deputyship Management Estimated Costs
Deputyship Application £6,638
1st Deputyship Year £32,570
2nd Deputyship Year £23,666
3rd Deputyship Year £19,775
Thereafter annual costs of £15,959 x 21.28 £339,607
Applications for appointment of new Deputy (x2) £7,588
Statutory Will Application £14,538
Contingency for crises £6,360
Preparation of tax returns £600 p.a x 24.28 £14,568
Winding up – single payment £1,800
 

 

Total Costs

 

 

£467,110.00

Finally, it’s noteworthy that all Deputyship costs are assessed by the Senior Courts Cost Office and the fee earners are regularly limited to the SCCO Guideline Hourly Rates whilst costs are awarded for Deputyship work, this is further scrutinised on assessment based on what is reasonable, proportionate and necessary in the Protected Party’s best interests.

If you have any queries, please do not hesitate to contact Georgia Clarke or the team at COPCosts@clarionsolicitors.com

 

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CONSEQUENCES OF BEATING A PART 36 OFFER: INJUSTICE

There have been various cases recently on how the courts consider whether it would be “unjust” to apply the consequences of CPR 36.17.

In White -v- Wincott Galliford Limited [2019] EWHC B6 (Costs) it was held that it would be unjust to allow an additional amount (CPR 47.17(4)(d)) for the whole of a claim where the offer had only related to some of the issues.

In Invista Textiles & Anor -v- Adriana Botes & Ors (costs judgment unreported) it was held that there is a high bar to demonstrate injustice. The ratio of the judgment suggests that the amount by which an offer has been beaten is at least not the only criterion which the Court should consider. Where a defendant / paying party seeks to argue that it would be unjust to allow some of all of the consequences of CPR 36.17 claimants / receiving parties would do well to refer to this authority as an example of the threshold for “injustice” which must be met.

It should also be noted that the court has previously held that the amount of the additional amount itself cannot be taken into account when considering whether it would be “just” to award the consequences of Part 36.17 per Cashman -v- Mid Essex Hospital Services NHS Trust [2015] EWHC 1312 (QB). In that case, the court on appeal held that the assessing officer had erred in refusing to award the additional amount “not because he considered the making of such an award unjust, but because he thought it unjust to make an award of the required amount”.

There is currently some inconsistency in the judicial approach to the application of the test of injustice. In the opinion of the author, the test is a high bar (supported by White and Invista) and the mere fact that the additional amount of 10% may appear high does not of itself render the consequence “unjust”. The consequences of CPR 36.17 are intended to be punitive and the purpose of the exception for “injustice” is not to allow judges to “soften the blow” to a litigant which has failed to accept a Part 36 offer, but to avoid genuine injustice where there are “exceptional” circumstances.

Matthew Rose is an Associate in the Costs and Litigation Funding Department at Clarion Solicitors. You can contact him at matthew.rose@clarionsolicitors.com and 0113 222 3248. You can contact the Clarion Costs Team on 0113 246 0622.

Court of Protection Costs – Types of Assessments for your Costs.

The previous blog in this series focused on the process of what goes into a Bill of Costs in the Court of Protection world. This blog will instead look at the process of an assessment in the Court of Protection and the different types of assessment that can occur.

Firstly, authority for the cost’s assessment must be established, as all Orders as to costs are at the discretion of the Court of Protection. There are three main methods of evaluating costs; agreed costs, fixed costs and summary/detailed assessment of Costs.

  • Agreed Costs

These kinds of costs Order are not regularly available in Court of Protection cases. As a principle, all bills of costs must be assessed, except where fixed costs are available. However, the Court may authorise parties to agree costs, where appropriate to do so. This is often used upon the death of a Protected Party whereby the Deputy is expected to agree costs with the Executor of the estate.

  • ­Fixed Costs

­Found within Practice Direction 19B, fixed costs are available to solicitors and professionals acting as Deputy. The general rule is that costs of the proceedings should be paid by P or charged to their estate, but this rule can be departed from.

In Cases where fixed costs are not appropriate, professional Deputies may, if preferred, apply to the SCCO for a detailed assessment of costs. However, this does not apply if P’s net assets are below £16,000. In these cases, the option for detailed assessment will only arise if the Court makes a specific order.

  • Detailed Assessment

The detailed assessment of costs under Orders or Directions of the Court of Protection is dealt with in accordance with the Civil Procedure Rules. Professional Deputies should lodge a request for detailed assessment with the SCCO (not the Court of Protection or the Office of Public Guardian) using the N258B (request for detailed assessment), accompanied by:

  • The bill of costs;
  • Documents giving the right to detailed assessment;
  • Copies of all the orders;
  • Fee notes of counsel or experts;
  • Details of other disbursements;
  • Postal Address of any person who has a financial interest in the outcome of assessment;
  • Relevant assessment fee (£115 or £225);
  • The OPG105 (if applicable).

Part 27 of the Practice Direction 17.2(2) states that cases over £100,000.00, complex or other cases are to be dealt with by a Master. The relevant papers in support of the bill must only be lodged if requested by the Master.

Once the bill of costs is lodged in the correct manner, the Costs Officer will review the bundle of documents and assess the costs. The Costs Officer will review the bill of costs alongside the files of papers and decide whether costs have been reasonably, necessarily and proportionately incurred, making reductions, where necessary based on relevant case law and judicial decisions. The bill of costs is thereafter returned to the Deputy for consideration.

Clarion can also assist with requests for reassessment if the outcome is not as expected. If you would like further information about this process, then please do not hesitate to get in contact.

Joshua Sidding is a Paralegal in the Court of Protection Team of the Costs and Litigation Funding Department at Clarion Solicitors. You can contact him at Joshua.sidding@clarionsolicitors.com and 0113 222 3245, or the Clarion Costs Team on 0113 246 0622.

You can also take advantage of our free telephone advice service – available outside of office hours – by calling 07764 501252.

Tips for Recoverability

All COP Lawyers know that the SCCO Guideline Hourly Rates can be frustrating when trying to recover all of your costs as opposed to other areas of law in which higher rates can be charged. As a result, some believe it to be unreasonable that a Costs Officer ca reduce the costs down even further on assessment. Here are some things that we have seen helps improve the recoverability of your fees.

Using 3 minutes to arrange and make payments. I know you’re told this on every assessment you’ve had back from the SCCO but ignoring it isn’t going to make your recoverability any better. The Costs Officer isn’t going to change their mind. Arranging payments are viewed as an office overhead so its best practice for you to delegate this work to a Grade D fee earner and limit the time spent and charged for to 3 minutes. The Costs Officer is going to see the effort being made and as a result, this will help with your reputation with the Court and will improve your Bill assessment outcomes.

You, like all other COP Lawyers dislike the low guideline rates that you’re restricted to. If there are any matters of complicated work, outline this to us or your other Costs Draftsperson and request enhanced rates on that particular issue. We have found that there is a higher chance of success for an enhanced rate when it is applied specifically to a complex and difficult issue than when it is applied to the whole bill. Doing this allows the Costs Officer to see specifically what was difficult and justifies why you are requesting the additional fees. We are often proactive in applying these for you when a complex matter arises, such as jurisdictional differences, the requirement of language interpretations, abusive Clients etc.

The Costs Officer will reduce or remove a second fee earner attendance at a meeting in accordance with the decisions made within the Matter of Garylee Grimsley (December 1998). Therefore, it is incredibly important for your recovery that the dual attendance is explained and justified in your attendance note. Just a line to outline why the second person was required will do, were they the main fee earner alongside the Deputy? Did the Client or Client’s family request they be present? Was the Client abusive or dangerous? It may be allowed at a reduced rate however it is

As simple as this one may sound, keep your file in chronological order and easy to get through. The last thing you want to do is make the Costs Officers life difficult when they’re assessing your costs.

Furthermore, ensure that you accurately time record your work. We appreciate that different firms have differing levels of technology available, but this need not be the most complex and time consuming system. If you do have the option to tag your time entries, this will help all parties involved when it comes to the costing of the work. Bulk time recording will cause difficulties so avoid this as much as possible. Also, ensure that the time spent is reasonable from the outset and delegate where appropriate. However, please don’t self-edit your time because if this is later reduced on assessment you will have doubly been reduced where not necessary.

Additionally, including details of the Client’s financial position assists the Costs Officer in ensuring the work undertaken is in proportion to the level of assets held and increases the chances of your time being recovered, especially in circumstances where the Client’s assets are significant and various financial schedules and reviews are required. See https://clarionlegalcosts.com/2015/06/09/how-valuable-is-the-protected-partys-estate/ for further information on this point.

I hope this helps and if you have any further suggestions or questions I would be happy to hear and discuss them further at bridie.sanderson@clarionsolicitors.com

Costs Capping Pilot Scheme

Sir Rupert Jackson’s proposal regarding costs capping is now a reality, with the launch of the voluntary capped costs pilot scheme on 14 January in London, Manchester and Leeds Business and Property Courts.

The aim of the pilot scheme

The aim of the scheme is to improve access to the Courts through:

  • streamlining the procedures of the Pilot Courts;
  • lowering the costs of litigation;
  • increasing the certainty of costs exposure; and
  • speeding up the resolution of claims.

The pilot will provide for a cap on recoverable costs for each stage of the case, and an overall cap on the total, rather than a fixed sum. The maximum a party will be ordered to pay will be £80,000.

The promise of a fixed recoverable costs scheme was first made two years ago by Sir Rupert Jackson in his IPA annual lecture “The Time Has Come”. His view was that “high litigation costs inhibit access to justice. They are a problem not only for individual litigants, but also for public justice generally. If people cannot afford to use the courts, they may go elsewhere with possibly dubious results. If costs prevent access to justice, this undermines the rule of law”. He predicted, or perhaps rather hoped, that the fixed recoverable costs project could be accomplished during the course of that year.

However, the flurry of chatter and speculation regarding the fixed recoverable costs scheme was left behind in 2016 and, as we moved into 2017, it was replaced with Sir Rupert’s proposals regarding costs capping, which he advised would follow the model used in the Intellectual Property Enterprise Court.

About the pilot scheme

This newly launched pilot scheme will last for two years. For those cases with a monetary value that are less than £250,000, and where the trial is two days or less, the voluntary pilot scheme is available. It cannot be adopted, however, for any cases where there are allegations of fraud and dishonesty; where extensive disclosure, witness evidence or expert evidence is likely; or where the claim will involve numerous issues and numerous parties.

Agreement of both parties is essential if the pilot’s shortened litigation process is to be pursued. The claim will exit the pilot if there is any dispute by any party in that regard. This shortened process is expected to be less costly, with the initial statements of case being limited in length and accompanied by the documents upon which the party proposes to rely.

Further, witness statements will also be limited in length, with the general rule being reliance on oral evidence of two witnesses. There are restrictions placed on expert evidence, which will only be permitted if the court is satisfied that it’s necessary, and it is likely to be on a single joint basis.

The trial judge will take a hands-on approach, to ensure that the trial estimate is adhered to, and has the power to strictly control cross-examination. When the several imposed time limits for filing the documents are considered collectively, the whole process – from the issue of the claim to the hearing of the trial – should not exceed 11 months.

The costs for each phase of the litigation is restricted to the cap and an assessment of costs is still required. Costs budgeting and detailed assessment are not applicable, with summary assessment being the favoured choice of the rule makers. The normal practice of filing the statement of costs prior to the hearing and the assessment of those costs then taking place at the trial will be avoided. Instead, the parties shall file and exchange schedules of their costs incurred in the proceedings not more than 21 days after the conclusion of the trial.

The schedules shall contain details regarding each applicable stage in the Capped Costs Table. The maximum cap of £80,000 for recoverable costs does not include court fees, VAT, enforcement costs and wasted costs, which are claimed additionally.

For those instances where Part 36 offers have been made the cap is increased to £100,000, and so Part 36 offers continue to play a central role.

With claims now able to be issued and pursued to trial in less than 12 months, and with costs not exceeding £80,000, will more parties engage in litigation? Or, conversely, will this restriction on the amount of costs that can be recovered be off putting? Only time will tell.

Sue Fox is a Senior Associate and the Head of Costs Management in the Costs and Litigation Funding Department at Clarion Solicitors. You can contact her at sue.fox@clarionsolicitors.com and 0113 336 3389, or the Clarion Costs Team on 0113 246 0622.

When a simple theory becomes a complex reality; the interplay between costs management and detailed assessment

The Jackson reforms envisaged a world where legal costs would be dealt with through the click of a button. LJ Jackson introduced costs budgeting in a bid to control the level of costs spent, he revamped the concept of proportionality to limit costs for claims where costs incurred considerably exceeded the sums in issue, and he created the electronic bill of costs in a bid to remove the pain staking process of multi day detailed assessment hearings.

However, theories do not always play out well in practice. The plethora of costs case law relating to costs management, proportionality, and bills of costs since the reforms means that it is crucial, now more than ever, that a litigator approaches costs correctly if they are to reap the full reward of their labour.

Regardless of how a case evolves, if a litigator is fortunate to be on the favourable side of an inter partes costs order then, providing the Court orders that costs are to be assessed by way of detailed assessment (and not summary assessment), it is paramount that they present the costs claimed correctly if they are to limit their outlay on detailed assessment costs and maximise their profit recovery.

First and foremost, the litigator should be on the front foot. If the litigation is approaching a mediation or joint settlement meeting, it is wise for the litigator to know exactly where they stand in terms of costs. This is particularly important if there is a sense that the paying party may have an appetite to do a deal on both damages and costs. If the case has been subject to costs management, it is crucial that the costs incurred are carefully considered and calculated to show the extent to which the costs fall (or exceed, with reasons for such) within budget. This is the first question that any competent paying party representative is going to ask. If a precedent Q has been prepared, and the litigator is armed with sufficient information for reasons why any costs may fall outside scope (such that the Court did not provide for a mediation and therefore the costs of such fall outside the budget scope) then any negotiations are more likely to prove fruitful, whilst saving the paying party the additional cost of detailed assessment proceedings. This would not be possible without a phased breakdown of costs.

If, however, the parties are unable to reach an amicable agreement as to costs, it will likely be necessary for a full bill of costs to be prepared in order for detailed assessment proceedings to be commenced. This is where it is crucial that a costs lawyer who fully understands the intricacies of costs management orders and the inter play with the bill of costs should be utilised.

The SCCO’s decision from 29 October 2018 in the matter Vertannes v United Lincolnshire Hospitals NHS Trust shows just how crucial this understanding is. This matter had been subject to a costs management order. The Court then proceeded to order that revised budgets should be prepared to reflect a significant change in the litigation. The parties prepared but were unable to agree revised budgets, and the claim settled before the Court considered the revised budgets. The Claimant proceeded to file a bill of costs that failed to comply with CPR 47 PD 47.5.8(8) (“the bill must be divided into separate parts so as to distinguish between the costs claimed for each phase of the last approved or agreed budget”), the Claimant’s argument being that the Court never approved the revised budget. However, the Court found that at no time had the original costs management order been replaced, and that the bill should therefore have been split so as to reflect the position against the original costs management order. The Claimant was, therefore, ordered to re-draw the bill of costs.

The inter play between costs management and detailed assessment can be complex. The Court may make multiple costs management orders during the life of a claim, where by a previous order is “topped up”, which impacts the way in which a bill is drawn, or the Court may elect to only costs management certain phases of the case, which, again, has an impact on the bill. It is, therefore, crucial that the costs lawyer is aware of all the elements of the case that will impact the drafting of the bill so as to ensure compliance with CPR 47 and the accompanying practice direction, together with maximising recovery.

Joanne Chase is a Senior Associate Costs Lawyer in the Costs and Litigation Funding Department at Clarion Solicitors.

You can contact her at joanne.chase@clarionsolicitors.com and 0113 336 3327, or the Clarion Costs Team on 0113 246 0622.

Changes in relation to CPR Practice Direction 21

From 6 April 2019, Practice Direction 21 of the CPR will be amended to make it compulsory for a bill of costs or a “informal breakdown in the form of a schedule” to be prepared and filed with any application for the approval of payment of expenses from the damages of a protected party or minor.

Many cases now settle by way of a JSM or Mediation. We recommend preparing a Bill of Costs for the JSM or Mediation in order to:

  1. Try and reach settlement of costs at the ADR meeting (to avoid the time and expense of detailed assessment);
  2. If a settlement on costs cannot be achieved, then to obtain a healthy payment on account; and
  3. Proceed swiftly post settlement with any application under CPR 21 (where applicable)The bill or schedule should make a clear distinction between inter partes and solicitor/own client costs. In terms of a schedule, we recommend preparing a statement of costs for summary assessment (Form N260 or N260B) which can be adapted, where appropriate.The bill or schedule will enable the Judge at the approval hearing to properly determine the appropriate amount to be deducted from damages, which may include (in terms of a Solicitor) a success fee, ATE insurance premium and any inter partes costs shortfall (if claimed).This blog was prepared by Andrew McAulay who is a Partner at Clarion and the Head of the Costs and Litigation Funding team. Andrew can be contacted at andrew.mcaulay@clarionsolcitors.com or on 0113 336 3334.