Duplication, Supervision and Assessment of Time
Posted on 24th June 2022 at 09:57
The decision by Costs Judge Rowley in Lyle & Anor v Bedborough & Anor  EWHC 1628 (SCCO) (23 June 2022) gives practitioners an insight to the approach to be taken at assessment. A number of lessons can be learned.
By way of background the costs claim arose from an application whereby the Claimants established that the Respondents had been involved in a transaction at an undervalue within the meaning of section 339 Insolvency Act 1986.
The following useful lessons arise:
1. Where a lot of time is spent on a document, the Court will scrutinise it.
2. A junior fee earner will take more time on a task than someone more senior.
3. Where there is duplication, only the fee earner with conduct time will be allowed.
4. Receiving parties ought to consider whether all of the time “ought to be recorded, or at least sought from the paying party”
5. Involvement of Counsel does not negate need for supervision by a senior fee earner. Whilst both are experienced, their views will come from different perspectives and are not mutually exclusive.
6. It is reasonable for a solicitor review documents produced by Counsel – “clients expect solicitors to be able to discuss and advise them on such issues as well”.
7. Where there is no contemporaneous evidence, doubt will be resolved in favour of the paying party.
8. For a Bill of Costs of just over £169,500.00, the Costs Judge would “not have expected more than an hour to be claimed for checking and signing”.
If the evidence on file doesn’t justify the time, don’t expect to get it
One of the issues which Costs Judge Rowley looked at was the time spent on an Advice Note (17 hours), the Letter of Claim (16 hours) and Instructions to Counsel (20.8 hours). It should not be a surprise that where significant time is claimed upon a document the Court will closely scrutinise the same.
Costs Judge Rowley observed that:
“25. Each document runs to four or five pages. More than 15 hours has been claimed for drafting each of these documents. Having reviewed them, I cannot see that such times can possibly be considered reasonable between the parties. These are not isolated documents since I could quite easily have taken the draft response to the second respondent's reply to the letter of claim, for example. These four items contain the great majority of the work claimed in the first four pages of the first schedule.”
A few paragraphs on the Court noted that:
“27. Judging by the entries, there seems to have been a rigour imposed by all fee earners make sure that time on the file was amply recorded whenever it was opened. This applies to the minor fee earners as well as the major ones. For example, Ms Gallop drafted a certificate of service on 8 January 2019. The following day she amended that certificate and then drafted correspondence to file the certificate (along with the certificate relating to the first respondent). A claim of 12 minutes for drafting the certificate is not unusual but ultimately 30 minutes is claimed for dealing with the certificate. These are only modest entries in themselves, but they highlight the fact that it is not simply the longer times claimed which are surprisingly high.”
The Court here highlighting how multiple entries for the same work can quickly add up to an unreasonable amount and should be viewed as such.
Time recorded does not mean it is recoverable
Costs Judge Rowley further stated that:
“28. The rigour of recording time spent is not matched, in my view, with a rigorous consideration of whether all of the time ought to have been recorded, or at least sought from the paying party. For example, 5 hours 24 minutes is claimed by Ms Farmer in November 2017 for what is obviously reading into the file. Such time is a matter between the solicitors and their client. It is not for the opponent to have to pay.”
Where there is no contemporaneous evidence doubt will be resolved in favour of the paying party and junior fee earners will take more time
Costs Judge Rowley stated that:
“29. There is obviously some conjecture involved in considering the time claimed in the absence of any attendance notes but that is a matter for the receiving party. In the absence of such notes, then inevitably any doubt goes towards the paying party on the standard basis. It may not matter a great deal however since the time claimed for documents such as those that I have highlighted are undoubtedly unreasonable, at least as between the parties.”
Where there is no contemporaneous evidence then such time will be vulnerable at assessment.
The Court did, however, reflect thus:
“31. Where considerable time has been claimed in the manner of this bill, it is tempting to consider exactly what needed to be done and simply to put times against those steps. However, in my view that tends to underestimate the vagaries of running a case and assumes that everything is done without a hitch.”
“32. The alternative approach is to take something of an impressionistic broad brush to the times that have been claimed bearing in mind everything that I have seen and heard during the course of the hearing and my subsequent review of the documents. I take into account the fact that this case was essentially run by a junior fee earner and that she could be expected to take longer to accomplish tasks than Mr Caldicot would be expected to have taken. The fact that Ms Farmer was the main fee earner also means that if she were involved in the same task as another fee earner, then it would be her time that would be allowed if there was any duplication. Consequently, the proportion of her time that is recoverable in my view is rather higher than either Mr Caldicot's or Mr Bowen's.”
Three points arise here:
1. There is a recognition that litigation is almost never straightforward.
2. Junior fee earners will take more time to undertake a task.
3. If there is any duplication then it would be the conducting fee earner’s time which would be allowed.
Involvement of Counsel doesn’t mean supervision from a Partner is unreasonable
The Court stated that:
“33. I do not accept that the involvement of counsel negates the need for supervision by a partner in the firm. Whilst both counsel and Mr Caldicot might provide Ms Farmer with an experienced view, those views come from different perspectives and they are not mutually exclusive. Nor do I accept Mr Fairburn's argument that because counsel has drafted documents, there was no need for the solicitors to review such documents or alternatively provide drafts on which counsel was to work. Clients expect solicitors to be able to discuss and advise them on such issues as well.”
Bill Checking Time
Costs Judge Rowley found that the 5 hour checking time of the Bill of Costs was too high and that an hour was more reasonable. He stated thus:
“37. Finally, I deferred dealing with the bill checking time of 5 hours claimed as part of item 65 in the bill. I would not have expected more than an hour to be claimed for checking and signing a bill of this size. The need to answer the bill drafter's queries is not usually time recoverable between the parties. The question at the time of the hearing was whether I should disallow all of the time given the extent to which the bill had not been drafted in accordance with the order and the checking had not picked up that fact. Having now been through the documents schedules, I take the view that a complete disallowance of the bill checking time would not be appropriate and I therefore allow one hour of Ms Farmer's time under this item.”
There is an argument that an hour’s checking time for a Bill of Costs totalling £169,532.16 is asking a lot of the certifying solicitor, though this highlights the Master’s expectations as to the level of time which ought to be taken on such a task.
The judgment gives some interesting insights on how the Court will address issues at assessment, many of these points are not ground-breaking but it’s a good reminder.
Practitioners need to ensure that time is evidenced on the file to give the best opportunity of recover. Moreover, they should be aware that where significant levels of time are undertaken for a task the Court will closely scrutinise the end result.
Moreover, it is assistive to see that the recognition from the Court that the use of Counsel does not negate the involvement of a senior fee earner. They also recognised that junior fee earners would take more time to undertake a task. A double edged sword for those who are more experienced. The Court expects efficiency from senior fee earners.
We can also see that where duplication arises, the time will be allowed for the conducting fee earner only.
There is a lot to unpack in this case but for anyone facing assessment of costs it is essential reading.
Should you have any queries arising from this article or upon costs generally then please do not hesitate to get in touch with our friendly team either via phone 01482 534567 or e-mail firstname.lastname@example.org
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