Solicitors have ‘very persuasive case’ for costs being above current Guideline Hourly Rates
Posted on 15th December 2020 at 13:49
Solicitors could have a very persuasive case for seeking costs above and beyond the current Guideline Hourly Rates (GHR) – even before the results of a pending Civil Justice Council review are revealed.
That’s the expert opinion our very own Sean Linley, a Costs Draftsman with over eight years’ experience, following a recent High Court ruling.
Cohen v Fine and Ors  EWHC 3278 (Ch), a costs case involving the costs of a professional executor, recently saw Judge Hodge QC suggest that GHRs should be increased by 35% to reflect inflation.
In the case, Cohen applied for £48,000 in costs but the judge awarded him just £27,000, a sum then increased on appeal to nearly £36,000.
Existing GHRs, which were last reviewed in 2014, are based on rates fixed in 2010 and practitioners have been arguing for some time that they are out-dated and no longer fit for purpose.
They are currently under review by a Civil Justice Council working group, which is expected to publish a report before this year ends.
Handing down the ruling in Cohen v Fine and Ors, Judge Hodge QC said that “the present GHRs are considerably below the rates actually being charged by the solicitors who practise in those courts” referring to his experience of sitting in the business and property courts.
He also added that the table of counsel's fees “bears no relationship to the fees which the courts see being charged for counsel” appearing in those courts.
Judge Hodge QC stated: “In my judgment, pending the outcome of the present review, the GHR should be the subject of, at least, an increase that takes due account of inflation.”
He said an increase of around 35% would be “justified as a starting point” if using the Bank of England Inflation Calculator.
When asked for his opinion on the issue by law publication Solicitors Journal, Mr Linley said: “There is undoubtedly now a chorus of judiciary members making plain that the GHRs in their present form are antiquated and no longer fit for purpose.”
“The comments made, however, have to be seen in the context of the pending Civil Justice Council review.”
“Once that is completed then the goal-posts are likely to shift again. But until that time, solicitors have a very persuasive case for seeking costs above and beyond the guideline rates.”
He commented that the “slew of recent decisions” concerning hourly rates are already relied upon regularly in costs proceedings, although he questioned how long they will continue to bear relevance.
He added that the Cohen judgment also makes clear that specific factors in CPR r44.4 could justify the application of rates higher than the GHR, even after adjusting for inflation.
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