The Statute Bill of Costs

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What is a Statute Bill?

In order for a Bill of Costs to be deemed a statute bill, it must comply with the Solicitors Act 1974.

Two important factors which need to be considered in ensuring a statute bill is complaint with the Solicitors Act 1974 are that the statute bill, whether a final bill or interim bill, must be signed as per Section 69 (2A). Furthermore, Section 69 (2C) states that the statute bill must be delivered to the party personally responsible for the payment of the bill.

If a solicitor’s bill is served to their client, the solicitor can sue for payment of the bill. Furthermore, if a solicitor serves such a bill to their client, the client can challenge the bill by asking the Court to assess the bill under Section 70 of the Solicitors Act 1974. For further assistance on challenging a solicitor’s bill see here.

Statute bills do not have to be raised at the end of the case only but can be raised throughout the duration of the retainer between the parties and can be deemed as requests for payment on account. If the statute bill is not deemed to be final, then it is seen as an interim bill or a request for monies on account. When this is the case, the time limits set out under section 70 of the Solicitors Act 1974 do not apply. Furthermore, if it is the case that the client is applying for an assessment on the statute bill, then the time limits under section 70 of the Act do not apply in this instance either.

However, the solicitor can increase the amount of monies being claimed, and if a bill is not paid, the solicitor can terminate the retainer.

Richard John Slade (t/a Richard Slade and Company) v Boodia & Anor [2018] EWCA Civ 2667.

 

This case included Richard Slade and Company (the solicitors firm) and Mr and Mrs Boodia (the client of the firm). The clients signed a retainer in 2013, instructing the firm to act on their behalf. The clients went on to cancel instructions in November 2016. By the time instructions had been cancelled, there had been a total of 61 bills generated by the firm to the clients. Forty-three of these bills were in relation to profit costs, and the remainder were relating to disbursements. The client refused to pay the final four bills generated and asked the Court to have the bills assessed by issuing a claim form under the Solicitors Act 1974. 

The retainer which had been signed by the clients included the following term:

“Bills are rendered monthly in arrears. Our bills are detailed bills and are final in respect of the period to which they relate, save that disbursements (costs and expenses which we incur on your behalf) are normally billed separately and later than the bill for our fees in respect of the same period. Please do not assume, therefore, from a bill for our fees which does not refer to any disbursements that no disbursements were incurred during the period. The more usual situation is that disbursements will have been incurred and will be billed separately.” 

At the hearing, Master James found that the agreed retainer mentioned above allowed for interim bills to be raised and that these interim bills should include both profit costs and disbursements. As the bills raised during the course of the retainer, in this case, did not include both profit costs and disbursements, then they were not rendered interim bills.

The Defendant was granted permission to appeal, and this was unsuccessful in front of Slade J. The Defendant then appealed to the Court of Appeal.

At the Court of Appeal, the Lord Justices considered the lower Court’s findings that a statute bill must include both profit costs and disbursements. The Court of Appeal held that this was not correct. Section 70 (6) of the Solicitors Act 1974 stated that a statute bill could include both profit costs and disbursements, it was found that the wording of this section did not state that the statute bill must include both these factors.

Due to this, the appeal was allowed, and it was found that simply because a bill did not include both profit costs and disbursements did not mean that this was not a statute bill. 

How can ARC Costs Assist? 

ARC Costs are specialist Costs Draftsmen and Costs Lawyers who can assist with the recovery of your costs. We can assist in preparing Bills of Costs, assist in negotiating costs, preparing Points of Dispute and representing you at detailed assessment. Whether you are the receiving party or the paying party, we hold vast experience on both disputing costs and defending the same. If you require our assistance or would like to discuss your query on costs, please complete the online form, and one of our costs experts will contact you to discuss. Alternatively, you may call us on 01204 397 302 or email us at info@arccosts.co.uk.

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