Tag: Senior Court Costs Office

Reductions to COP assessments and what you need to know about them

Casey McGregorLeave a comment

At Clarion, we prepare over 2500 Court of Protection bills of costs per year to be assessed by the Senior Court Costs Office. We also review the bills once they have been assessed and monitor the common reductions. Based on our experience, we have identified the 5 most common reductions and the reasoning behind the same. The below 5 reductions are in line with published case law and are therefore not likely to be allowed if a re-assessment is requested.

Arranging payments

You may notice that arranging payments are reduced throughout the bill of costs. This is in line with the Case of Jamie Walker (2002) whereby Master O’Hare defined checking the file to ensure an invoice has not already been paid, checking sufficient funds are in the account and writing a cheque and getting it signed as non-fee earner work. Arranging payments and considering invoices are typically reduced to 3 minutes within the bill of costs at Grade D rates in line with this. We therefore suggest payments and considering invoices are delegated to a Grade D fee earner. This is something that the Professional Deputies Forum would like to challenge in the future, as significant payments require consideration and often approval above Grade D rates. We hope that this case law will be reconsidered in the future.

Enclosure letters

Where you may have sent a letter enclosing payment of an invoice or an email confirming settlement of an invoice, this will be classed as an ‘enclosure letter’. In line with the case of Leighanne Radcliffe (2004), letters were reduced from the standard rate of 6 minutes to 3 minutes within the bill of costs. We therefore recommend that enclosure letters are delegated to a junior fee earner and the time is limited where possible to prevent overbilling.

Two fee earners at an attendance

If you have claimed two fee earners in attendance, in our experience, it will only be allowed in exceptional circumstances. Typically, the second fee earner’s time is struck out or reduced. In the case of Garylee Grimsley (1998) and further to R v LegalAid Board Ex Parte Bruce (1991), two fee earners at an attendance were reduced as it was deemed to be duplicative work. It stated, “in so far as expense is involved in adding to this stock in trade, it is an overhead expense and not something that can be charged to the client”. Therefore, we recommend that two fee earners should only be claimed at an attendance whereby it is necessary and reasonable to do so, as there is a higher cost to the Protected Party. Cases where two fee earners may be considered reasonable are where there is a significant safety risk or the second fee earner has different expertise, but this time is still subject to assessment and it’s important that the reasoning is clear within your file notes to justify the attendance of both fee earners.

High level of contact with the Protected Party

You may see a reduction occur whereby there is a high level of contact with the Protected Party, as it is seen to be the Deputy’s duty to keep the costs at a minimum for the Protected Party. Excessive contact would lead to a higher level of costs, which is not in the best interests of the Protected Party. A reduction could occur in line with the case of Trudy Samler (2001). This case raises the question of whether the contact was instigated by the Protected Party and whether the Deputy should be paid for such contact. Excessive contact with the Protected Party could therefore be reduced due to this case and we recommend that Deputy’s keep an eye on this. We recommend that Deputies try and manage the levels of contact with any party and involve other professionals to support the Protected Party or their family in order to manage costs.

Record keeping

Work in relation to updating the Protected Party’s financial records is typically reduced by the Costs Officers on assessment. In the case of Philpott (2015- unwritten), Master Haworth stated “It seems to me that the inputting of data into P’s ledger is not fee earning work. At most it is bookkeeping which, to my mind, is an overhead of a solicitor’s practice. This work has to be distinguished from for example, reviewing or perusing the data to come to a decision as to what then needs to be done with a P’s funds. To my mind that may well amount to fee earning work for which the solicitors can charge separately at the appropriate rate.” Therefore, we recommend that the work is distinguished in this way in order to avoid the reduction on assessment and the word ‘updating’ should also be avoided.

We are happy to review the assessed bills and provide advice to any professional Deputy who is not happy with the outcome of their assessment. Please contact Casey for more information at casey.mcgregor@clarionsolicitors.com

The Indemnity Principle in Court of Protection Costs – Why It Is So Crucial

Stephanie KayeLeave a comment

Introduction

To be defined, the indemnity principle states that, “[…] a successful party cannot recover from an unsuccessful party more by way of costs than the successful party is liable to pay his or her legal representatives.” (The Senior Courts Cost Office Guide, 2021, pg. 21.) When this principle is applied to Court of Protection costs, it posits that a Deputy cannot claim costs higher than that which they have stated in their client care letter or retainer letter.

The Protected Party is not liable to pay costs higher than those that have been stated in such documents, unless evidence is shown that the Deputy has authority to claim higher rates. The earliest form of the indemnity principle can be seen in the judgement from the case of Harold v Smith [1860] 5 H & N 381.

Over recent years, the hourly guideline rates have been in flux, as we have now landed in the era of 2021 Guideline Hourly Rates. In a climate of changing rates, it is crucial for solicitors to evidence that they have not breached the indemnity principle and it is key for Cost Officer’s to ensure the principle is being maintained. Upon having costs assessed, it is extremely common to see Cost Officer’s requesting evidence the principle has not been breached.

This blog aims to outline why this is so important for a Protected Party and to give a brief overview of the key aspects of the indemnity principle in relation to the Court of Protection.

Standard Basis/Indemnity Basis

Costs in Court of Protection are assessed on the Standard Basis, or Deputies may take fixed costs as outlined in Practice Direction 19B – a supplementary material for the Court of Protection Rules 2017. The Standard Basis simply means that in such instances, a costs judge will permit costs to be recovered that are crucially, proportionate, as well as being both reasonable in amount and reasonably incurred. (See the Court of Protection Rules Section 44.3 for further information.) This basis ensures that costs incurred for a Protected Party’s management period will always be appropriate and justified.

If costs were assessed on the indemnity basis (where the notion of proportionality is absent), Protected Parties would be at risk of being taken advantage of, since they would lack the capacity to argue the costs claimed for work carried out were unreasonable. However, the Mental Capacity Act 2005 negates this possibility, as after it was enacted all Court of Protection Costs were assessed on the standard basis.

Breaching the Indemnity Principle

As already alluded to, the common way the indemnity principle may be breached is through the absence of a Client Care Letter or Retainer Letter. A Client Care Letter is typically the first correspondence a client or Protected Party may receive from the Solicitors once the Court has appointed a Deputy. The letter will outline information regarding the services being provided and perhaps most importantly, the cost of legal services in the form of hourly rates. A retainer letter will function the same way, declaring the costs of the Solicitor’s services set out as hourly rates.

A breach of the indemnity principle may occur where a Deputy has claimed rates for work undertaken that they have not outlined to the client. For example, if one were to charge £200.00 an hour in the bill of costs, but initially informed the Protected Party the hourly rate was £100.00, this a breach of the indemnity principle – the Protected Party is liable to pay an hourly rate of £100.00, but the Deputy is attempting to recover higher costs of £200.00 which were not disclosed to the Protected Party.

Where a Deputy chooses to have their costs assessed, a Cost Officer will review the bill of costs to assess the costs that are recoverable for the Deputy. The Client Care Letter or Retainer Letter must be provided to the Senior Courts Cost Office alongside the bill of costs to evidence that the Deputy has authority to claim such rates. If a Cost Officer cannot locate such evidence, they will subsequently reduce the hourly rate of the work undertaken to that which may have previously been claimed, or assess the bill on the basis that the Deputy will provide such evidence upon applying for a Final Costs Certificate.

It is highly unlikely to see Deputies breaching the indemnity principle intentionally. To effectively comply with the SRA Code of Conduct, Solicitors will always prepare a Client Care Letter outlining their work and rates. The problem arises when this is not presented to the Cost Officer along with the bill and thus upon assessment, the Cost Officer does not know the rates at which the Deputy can claim and consequently reduces them.

Problems in Changing Rates

If the hourly rates for Court of Protection Costs were fixed, evidencing that the indemnity principle has not been breached would be much simpler. However, considering we are now into the third set of hourly rates Solicitors can claim, this complicates matters. For a Deputy to claim new rates that come into force, they have an obligation to inform the Protected Party that the rates have changed; by way of updating their Client Care Letter.

It can often be seen on assessment that Solicitors fail to amend the Client Care Letter before the change in rates comes into action, in which case it becomes difficult to claim the higher rates from when they may have commenced.

To illustrate, if hypothetical higher rates came into effect on 30 September 2022, but a Client Care Letter was not updated until 30 October 2022, it would be a breach of the indemnity principle to claim these higher rates from 30 September 2022, because the Protected Party is only liable to pay the costs that have been stated, which up until 30 October 2022, were different rates. Regardless of when the new rates may have came in, if the Protected Party was not aware of such rates, they are not required to pay costs higher than those which have been stated. Therefore, it is essential for Solicitors to amend their Client Care Letters in a timely manner, to ensure they can maximise new rates when they come into force.

Final Remarks – Protecting the Client

From what I have explained in this blog, it should be clear that the indemnity principle serves to Protect a Protected Party. The principle ensures the costs incurred by Deputy’s are always fair and balanced. Recovering costs in Court of Protection work may seem complicated at times, especially when there has been several changes to the hourly rates. However, it is important that the necessary measures remain in place to ensure Protected Party’s pay costs that are fair and proportionate to the work carried out.

For more information on what has been discussed, I invite you to consider the following resources:

You can find out more about our services here or you can contact the Costs and Litigation Funding team at costs.support@clarionsolicitors.com.

Best Practice for file keeping in the Court of Protection

Stephanie KayeLeave a comment

File keeping can have a big impact on the assessment of a Deputy’s file by the Senior Courts Costs Office (SCCO). Stephanie Kaye looks at 5 key points about file keeping in the Court of Protection and how to maximise costs recovery.

Stephanie Kaye is a Senior Associate in the Clarion Costs Department, and heads the Court of Protection Costs team. You can contact her on 0113 336 3402 or by email at stephanie.kaye@clarionsolicitors.com. 

Court holds that an application under CPR 44.11 to reduce a party’s costs on the basis of misconduct is not a vehicle to give paying parties a “second bite of the cherry”

Joanne Chase1 Comment

In Paul Andrews & Anor -v- Retro Computers Ltd & Ors [2019] EWHC B2 (Costs), Master Friston held that an application that the receiving party’s costs should be reduced or disallowed under CPR 44.11 on the basis of that party’s conduct was not to be used as a vehicle to contest the order for costs made by the trial judge.

This update is a summary of a complex and lengthy judgment. A full analysis will follow in due course.

CPR 44.11

CPR 44.11 states (so far as relevant) that:-

(1) The court may make an order under this rule where –

(a) a party or that party’s legal representative, in connection with a summary or detailed assessment, fails to comply with a rule, practice direction or court order; or

(b) it appears to the court that the conduct of a party or that party’s legal representative, before or during the proceedings or in the assessment proceedings, was unreasonable or improper.

(2) Where paragraph (1) applies, the court may –

(a) disallow all or part of the costs which are being assessed; or

(b) order the party at fault or that party’s legal representative to pay costs which that party or legal representative has caused any other party to incur.

The Case

The Defendants applied under CPR 44.11(2)(b) on the basis that the Claimants’ conduct had been “unreasonable or improper”. There was no suggestion that the Claimants’ legal representatives had acted improperly or that there had been a failure to comply with a rule or practice direction.

Summary of Judgment

The court held that:-

  1. An application under CPR 44.11 is not a vehicle to allow the paying party to have a “second bite of the cherry”, and that issues which were before the trial judge (or which the parties were reasonably capable of bringing to the trial judge’s attention) could not be considered on such an application;

2. The conduct complained of must have been relevant to the proceedings;

3. There is a high bar for establishing that the conduct was unreasonable; and

4. The sanctions the court can impose are limited.

Conclusion

It is important that solicitors and advocates ensure that issues of conduct are raised at trial and are incorporated into the order for costs.

The issues which the court can consider are wide-ranging but should generally have some relevance to the proceedings.

There is a high bar to establishing that conduce was unreasonable, that “unreasonableness” is to be interpreted narrowly, and is conduct which is so bad as to “permit no reasonable explanation” or which “the consensus of professional opinion would regard as improper”.

The sanction which the court can impose will generally be restricted to disallowing the costs which have been incurred as a result of the unreasonable conduct.

How to Keep Your Costs Officer Happy!

Stephanie KayeLeave a comment

Our specialist ‘Court of Protection Costs Team’ work for over 30% of the Deputies, and for that reason we have extensive knowledge in this area. Costs Officers tend to have a core approach which they apply to detailed assessments, together with areas which fall outside this core approach which are dealt with on a bill by bill basis. However, if the Costs Officer can deal with this core area with ease, then their job can be dealt with more easily.

An easier job = a happy Costs Officer = the optimum result!

Here are my top tips on how to keep the Costs Officer happy:

  • Always claim the appropriate hourly rates. If you do wish to claim a higher rate then an exceptional reason will be required to do so.
  • Try not to claim Grade A rates throughout the entirety of a Bill of Costs. If you are a sole practitioner or you are unable to delegate, it could be suggested that the more straightforward tasks be claimed at a lower rate. This ensures that the time and rate claimed are proportionate and reasonable to the task in hand.
  • Keep the ‘documents’ section of the bill as concise as possible to keep the Costs Officers attention.
  • Only claim for the tasks that are recoverable. A Costs Officer could look at the Bill less favourably if every task possible has been claimed for. Examples of non-recoverable items are – photocopying, …………
  • Clarify that certain parties within the Bill of Costs are not internal parties such as Tax Advisors or Accountants. If this is not clear, the time may be disallowed for a belief that it is inter-fee earner and therefore not recoverable, Leighanne Radcliffe (2004 ).
  • Try not to claim for two fee earners at an attendance, unless there is a valid reason for doing so. The Costs Officers will generally only allow one portion of the time claimed, Garylee Grimsley – (1998)

If these top tips are applied I am confident that that you will achieve your optimum result.