Counsel Fees in Fixed Costs Cases

There have often been disputes over which costs and disbursements (such as Counsel fees) can be recovered under the fixed costs regime in CPR 45. In some cases, the Court of Appeal has considered which costs are covered by fixed costs and which can be permitted as disbursements (such as medical expert fees).

In the matter of Aldred v Cham [2019] EWCA Civ 1780, which involved a child, the High Court rejected the application to recover the costs for advice from Counsel. The fee was charged by Counsel for providing advice on the child’s settlement (outside of the pre-action protocol), and had initially been allowed by the District Judge.

The Court considered whether the fee was “reasonably incurred due to a particular feature of the dispute” under CPR 45.29I(2)(h). The Court of Appeal ruled that the Claimant could not recover the disbursement under rule 45.29I(2)(h) alongside fixed costs as the fact that the Claimant was a child was “nothing whatever to do with the dispute itself.” 

In some cases, disbursements do arise due to the nature of the dispute. Despite this, the rules that determine which disbursements are necessary are now very specific. For example, in respect of Counsel fees, to recover such an item it must relate to a feature of the dispute, such as: how the accident happened; who was to blame, and; the causation of the injuries sustained rather than the age or linguistic capability of the Claimant. Because of this, the Court has shown that Counsel fees will now only be allowed in specific circumstances.

Coleman v Townsend (SCC Senior Courts Costs Office 13 July 2020)

In the recent Road Traffic Accident fixed costs case of Coleman v Townsend, a £12,000 settlement had been proposed following the index accident in 2015. The claim was submitted to the Portal however, it exited from the same. Following a denial of liability, Court proceedings were commenced. The Defendant subsequently admitted liability in their Defence, following the Acknowledgement of Service.

The claim was listed for a Trial at Romford County Court, and Counsel was briefed to attend. On the day before the hearing, the Defendant proposed a Part 36 Offer which the Claimant accepted, concluding matters between the parties.

Section IIIA of CPR 45 sets out the fixed costs when a claim no longer continues under the Protocol, and this also includes provisions for when the case settles before the Trial.

The Costs Discussions

Cost discussions began, and it was held that Counsel’s fees for an abated brief and skeleton argument were not recoverable under the fixed costs regime as the case settled the afternoon before the hearing.  As such it was considered that the advocacy phase of Table 6B had not yet triggered, and this that such fees were not recoverable. Master Howarth stated that “this was not a dispute where the Court could allow the fees as a disbursement which were either properly or reasonably incurred”. To support this decision, the Judge referred to the Court of Appeal decision in Aldred v Cham where Lord Justice Coulson denied recovery of disbursements for work that did not fall within the fixed recoverable costs regime. It was decided by Master Howarth that the “claim for fees fell within the category which includes all work on/after the day of listing, but prior to the trial.”

The Counsel fees were quite significant, as the abated brief fee for the trial was £852.50, and the skeleton argument fee was £370.

The Claimant stated that the Court had made the proposal for the skeleton arguments to be exchanged, and therefore the Counsel fee charged should be a disbursement, and recoverable. Furthermore, Counsel had already been briefed for the hearing, and there was no rule which prevented the fee from being paid.

The Defendant responded by stating that a Trial advocacy fee was only recoverable when the claim was settled on the day of Trial or at the Trial itself. Master Howarth was clearly in agreement with the Defendant as the Claimant’s Counsel fees were disallowed.

Was This the Correct Decision?

One can understand the Claimant’s position given that the Trial had been fully prepared for and Counsel had been briefed.  It seems somewhat backwards that all preparations can be completed and no costs/disbursements recovered for the same, simply because the case settled a day prior to Trial.

However, the Defendant and Master Howarth’s viewpoint can also be understood as the fixed fees as set out in CPR 45 are clear, and no specific provision is made for an abated brief fee/skeleton argument fee save for under the ambiguous provision of CPR 45.29I(2)(h): “any other disbursement reasonably incurred due to a particular feature of the dispute.”

In our opinion at ARC Costs, the decision to disallow an abated brief was unreasonable, but the decision to disallow the skeleton fee was reasonable, given that this would form part of any brief fee under the fixed costs.  The Court is afforded a wide scope of discretion however, clear guidance is unlikely to be provided from a more senior Court, given the Supreme Court’s refusal to interfere in the decision of Aldred v Cham.

How Can ARC Costs Assist?

ARC Costs are a team of highly skilled and experienced Costs Lawyers and Costs Draftsmen. We acknowledge that Fixed Recoverable Costs disputes are becoming much more common for low-value personal injury claims. Our highly experienced staff can assist in handling and recovering your legal costs in disputes concerning the fixed costs regime.

We understand the importance of settling cases quickly and efficiently, and this why we consistently secure an interim payment on account. Bills of Costs may need to be prepared, and in some cases, a provisional assessment hearing may need to take place. However, the success rates that we have accrued encourage you to place your trust in our skilled team as we regularly demonstrate our ability to succeed on CPR 45 Fixed Costs Disputes.

W can be contacted via email at info@arccosts.co.uk, or by telephone on 01204 397302. For more information on legal costs, please find out more about our speciality areas of expertise and our services on our legal costs page.

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