Ainsworth v Stewarts Law LLP [2020] EWCA Civ 178 

The Court of Appeal upheld an important decision in Ainsworth v Stewarts Law, providing important guidance on the level of detail required in Points of Dispute (PODs) during solicitor-client costs assessments, and a principle that carries over to inter-partes detailed assessment proceedings.

Mr Ainsworth had engaged Stewarts Law to handle his case and was issued several bills for legal services. After the retainer was terminated, he applied to have the fees assessed under Part III of the Solicitors Act 1974.

The client disputed the fees charged by the firm for legal services rendered in a family law matter. He submitted PODs that challenged the ‘document time’ claimed by Stewarts Law, but these objections were vague and general. For example, he objected to the overall time spent on documents without specifying which entries were problematic and why.  An extract from the Points of Dispute included:

“The Claimant requests the court to note that over a period of 11 working days the Defendant seeks to claim 46.8 hours of work which is equivalent to approximately 4.3 hours of time every single day. It is the clear opinion of the Claimant that under any stretch of the imagination, the level of time expended can in no way be justified, and against the relevant test, the time expended and its subsequent cost must be deemed to be unusual in nature and amount.

As with the timed attendances upon the Claimant, the Claimant is mindful of the requirements of the Civil Procedure Rules as to the need to keep Points of Dispute brief and succinct. It must therefore be stated that all entries are disputed. By way of general indication however, the Claimant can confirm the main issues with the document time are as follows:

1. Significant duplication between fee earners
2. Wholly excessive time expended by fee earners reviewing documentation provided by the Claimant
3. Too much time claimed generally in relation to preparation
4. An excessive level of time claimed in relation to drafting of communications
5. Unnecessary inter-fee earner discussions arising due to the duplication
6. Wholly excessive time spent collating documentation
7. Significant preparation time claimed in relation to meetings with the Claimant.

It can be confirmed that the above stated list is not exhaustive of the issues but provide a general overview as to the reason why the time claimed is unusual in nature and/or amount. The Claimant reserved their position generally.”

Stewarts Law submitted that the Points were vague and insufficient to allow them to adequately defend their charges. The Court sided with Stewarts Law, dismissing the PODs in their entirety and awarding the costs as claimed. The decision had been appealed and upheld in the High Court initially, by HHJ Klein, sitting as a High Court Judge.

From the Ainsworth v Stewarts Law decision it is clear that PODs must be specific to enable the receiving party to provide their points of reply.

PoDs must be clear, specific, and focused. Reference is made to Practice Direction 47 Para 8.2, which in turn refers to Precedent G which outlines the format expected to be followed by any Paying Party challenging costs claimed against them.  In particular, Points of Dispute must:

• Identify specific items: Instead of objecting to broad categories, pinpoint the exact entries you dispute within the Bill of Costs, and ensure specific item numbers are referenced (a specific requirement of Para 8.2(b) to Practice Direction 47).
• Explain the reasons: Clearly state why each specific item is unreasonable or unjustified. Provide concrete evidence or arguments to support the objections, though ensure that Points are kept as “short and to the point” as possible.
• Address the presumptions: In solicitor-client cases, the law presumes that the client approved the work. PODs must address this presumption by explicitly stating a client believes the work was not approved, either expressly or impliedly.

Points of Dispute are your legal arguments to the opponent’s costs, and allow the Receiving Party to understand the specific objections raised by the Paying Party, and prepare a proper defence to those objections as part of the detailed assessment process in Points of Reply.  If you fail to plead a submission correctly or at all, it will be assumed no objection is raised.

The Points of Dispute and Reply enable the Court to efficiently and fairly assess the disputes by focussing on the the contested issues. Submitting vague or general PODs can have serious consequences which may lead to strike out of the Points, which similar to the matter of Ainsworth v Stewarts Law, may result in the Receiving Party being awarded their costs in full, as well as having their additional detailed assessment costs awarded.

It is therefore imperative that you obtain the advice of a costs professional if you are seeking to challenge a Bill of Costs, as ultimately failure to consult a costs professional is likely to cost you more in the long run.

Case Study – ARC Costs Recover Full Bill of Costs for Litigant in Person

ARC Costs were recently instructed to represent a Litigant in Person as the Defendant and Receiving Party, and to draft a Bill of Costs following the discontinuance of a claim against them.

Following receipt of our client’s Bill of Costs, the Paying Party returned with their Points of Dispute which, whilst formulated in a Precedent G format, failed to comply with the requirements of CPR 47/Practice Direction 47.

In particular, the Points appeared to challenge items in bulk, offer global amounts for amalgamated items, and did not actually specify which items it related to.  To any reader of the document, it could not easily be determined what was being offered against anything in the Bill of Costs.

One of our expert Costs Lawyers drafted Points of Reply, identifying the lack of specificity in the Points of Dispute, and failure within the same to cite which specific items were being challenged/offered against.

Reference was made to Ainsworth v Stewarts Law, and relief was sought in the form that the PODs be struck out for being defective.

Points of Reply were served, and an accompanying Part 36 Offer made in respect of the Bill.  The matter was ultimately lodged for provisional assessment with the Senior Courts Costs Office (SCCO).

In the assessment outcome, the assessing officer was in agreement with the Receiving Party that Ainsworth v Stewarts Law applied, and the Points of Dispute were struck out.  In any event, commentary was passed on the individual Points that they lacked merit, nor could it be determined what they were critiquing in the Bill of Costs.

As such, the Bill of Costs was recovered as claimed at 100%, and because the Part 36 Offer had been beaten, a 10% uplift was applied, and detailed assessment costs were recovered on an indemnity basis, together with enhanced interest at 10% above base rate in line with the consequences set out in CPR 36.17.

How can ARC Costs Assist with Your Costs Dispute?

ARC Costs are an experienced and independent team of specialised Costs Draftsmen and Costs Lawyers. We can assist either paying or receiving parties in resolving costs disputes, and we are adept at preparing Costs Budgets and Bill of Costs for receiving parties, as well as providing legal costs negotiations services and preparing Points of Reply.

For paying parties, we are adept at preparing Points of Dispute, and ensuring that a proportionate level of costs is recovered. Proportionality is a subjective issue, and it is therefore important you have the right legal costs representative on your side during detailed assessment to ensure you make the most persuasive submissions on the issue.  

If you would like more information on any of our services or wish to speak to a member of our costs team about your case then please do not hesitate to contact us. Please call us at 01204 397302, or email one of our costs experts direct on info@arccosts.co.uk.

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