The case of Eurasian Natural Resources -v- Dechert LLP [2017] EWHC B4 (Costs) has already attracted much attention. A previous hearing before the Court of Appeal involved no less than five QCs just to determine whether aspects of the solicitor and own client assessment should be held in private. Master Rowley, in this judgment, considered what amounted to “special circumstances” under Section 70(3) of the Solicitors Act 1974 so that the court could assess bills that were challenged but had been paid in the 12 months prior to the proceedings.
KEY POINTS
Special circumstances under Section 70(3)
- A discrepancy between estimates and the bills delivered can amount to special circumstances.
- The peculiarities of the solicitor/client relationship in this matter could amount to special circumstances.
- The defendant’s response to the challenges could amount to special circumstances.
- Billing irregularities could amount to special circumstances.
- The size of the bills was a factor to take into account when assessing special circumstances.
- The fact that there were other bills being assessed in relation to the same issues did not amount to special circumstances.
THE CASE
The claimant was seeking an assessment of its former solicitor’s costs. The invoices had been paid in full. Some of the bills (some£3.9 million) were outside the 12 month period for solicitor and own client assessment and the court had no jurisdiction. There were 15 invoices which were rendered between one and twelve months before the assessment, these amounted to £4.2 million. If assessment of these bills was to take place the court had to find “special circumstances”. The Master considered “special circumstances” in this case.
THE LAW
Section 70(3) Solicitors Act 1974 states:
(1) Where before the expiration of one month from the delivery of a solicitor’s bill an application is made by the party chargeable with the bill, the High Court shall, without requiring any sum to be paid into court, order that the bill be assessed and that no action be commenced on the bill until the assessment is completed.
(2) Where no such application is made before the expiration of the period mentioned in subsection (1), then, on an application being made by the solicitor or, subject to subsections (3) and (4), by the party chargeable with the bill, the court may on such terms, if any, as it thinks fit (not being terms as to the costs of the assessment ), order—
(a) that the bill be assessed ; and
(b) that no action be commenced on the bill, and that any action already commenced be stayed, until the assessment is completed.
(3) Where an application under subsection (2) is made by the party chargeable with the bill—
(a) after the expiration of 12 months from the delivery of the bill, or
(b) after a judgment has been obtained for the recovery of the costs covered by the bill, or
(c) after the bill has been paid, but before the expiration of 12 months from the payment of the bill.
no order shall be made except in special circumstances and, if an order is made, it may contain such terms as regards the costs of the assessment as the court may think fit.
THE MASTER’S FINDING OF SPECIAL CIRCUMSTANCES
The Master found that there were special circumstances because of the major discrepancies between the estimates given in relation to costs and the actual bills.
Discrepancy between estimates and work done.
55. Mr Browne did not tackle the figures directly in relation to the discrepancy between the estimates and the actual costs billed. In my view that was simply because he could not do so. The only position the defendant could take was to say that the amount of the work done was demonstrated in the many documents exhibited to the witness statements. But that, it seems to me, is aiming at the wrong target. It may be that at the detailed assessment hearing all of the work claimed can be justified as being reasonable. But it cannot be an answer to the question of whether the discrepancy calls for an explanation simply to demonstrate that a lot of work has been carried out. There is no way to compare the amount of work carried out with the estimates because, as Mr Williams pointed out, there has been no attempt to cost the various work plans. The defendant’s attempt to provide an explanation in this manner so as to avoid the court concluding that the discrepancy calls for an explanation is an impossible one to achieve in a case of this size. If there was a small bill for which the defendant could demonstrate simply why the extra costs had been incurred, it might be possible to take the approach that the defendant has here. But in bills of this magnitude, it cannot in my judgment be done.
56. I therefore consider that the claimant has demonstrated that a special circumstance exists in the discrepancy between the estimates provided and the costs actually billed. Despite the estimates being updated periodically, they have not come close to mirroring the actuality and they are deficient in themselves. It must be arguable that the claimant can demonstrate some reliance upon the estimates such that the court may consider reducing the overall sums billed on the basis that it would be unreasonable for the client to pay the full amount in accordance with the decision in Mastercigars.
OTHER MATTERS
The Master went on to consider six other points which could have represented special circumstances.
(2) The size of the bills
58. As I set out at the beginning of this decision, the sums paid by the claimant to the defendant are significant. The bills at the heart of this application alone amount to £4.2 million.
59. Both parties referred me to the following passage in the decision of Lewison J in Falmouth House:
“Morgan Walker argue that the fact that there are large sums involved is not a special circumstance and rely for that proposition on the decision of Mr John Martin QC in Winchester Commodities Group Ltd v RD Black and Co [2000] BCC 310. However, in that case Mr Martin held that the stark level of the fees in issue was “at first sight a good point”; but that for seven particular reasons on the facts of that case the point turned out to be of little substance. That case is not authority for the proposition that the amount of fees in issue is irrelevant to the question whether there are special circumstances. In Re Robinson (1867 – 68) LR 3 Ex 4 the Court of Exchequer held that a large charge calling for explanation was a special circumstance. In my judgment Master Simons was entitled to take it into account.”
60. There was very little difference between the submissions of Mr Williams and Mr Browne on that passage. The size of the bills rendered could not amount to a special circumstance in itself, but it was something that was a relevant factor for the costs judge to consider.
61. Mr Williams said that his client accepted this was always going to be high cost litigation. Nevertheless, even for the heaviest commercial litigation the “run rate” of £800,000 per month on average was exceptional. Mr Browne’s argument was that the extent of the work and therefore the extent of the invoices was clearly justified by the work plans et cetera that had been exhibited. Therefore whilst he accepted that the invoices were for significant sums, they merely reflected the work that had to be carried out and which expanded as time went by as the scope of the investigation increased.
62. The fees in dispute in the Falmouth House case were £201,417.07. In the Winchester Commodities case there was, like here, a spread of invoices which were caught by the various provisions of s70. The equivalent invoices were for roughly £430,000 as can be seen by the following passage recorded by the judge:
“Another of Miss Hilliard’s submissions had far more substance. It was based upon the proposition that total charges of £340,243 for profit costs and £91,300 for counsels’ fees in an action which had not progressed beyond close of pleadings cried out for explanation.”
63. The sums in those two cases are therefore roughly 5% and 10% respectively of the relevant invoices in this case. Or to put this another way, are equivalent to a week or a fortnight’s work in this case at the average monthly spend. There is an order of magnitude of the costs involved in this case which it seems to me is impossible to ignore. I accept that it cannot be the case that bills of a certain amount automatically achieve the threshold of a special circumstance. But it seems to me inevitable that bills of this sort of size inevitably weigh heavily in the balance of factors to be considered. Where, for example, specific challenges to items contained within the invoices are considered, fairly modest items such as an additional fee earner or fee earners at meetings are much more likely to amount to a special circumstance because of the number of such meetings that will have occurred given the costs involved overall.
64. Both counsel’s submissions regarding “value judgments” concentrated on small items potentially not justifying an assessment. But it seems to me that small items that are likely to be repeated within bills of this size tend to favour a finding of special circumstances rather than the opposite.
65. Similarly, the disbursements claimed in the relevant invoices amount to £331,301.99. The disbursements allegedly either unevidenced or not broken down are said to be £177,576.34. This is a sum that is not far off the entirety of the Falmouth House invoices. In that case, both Master Simons and Lewison J considered the figures at stake to be sufficient to contemplate whether the size of the bill in itself was a special circumstance. Here the disbursements are one of the lesser items.
66. Therefore whilst I do not say that the size of the bills is in itself a special circumstance it magnifies the effect of any other matters which might be considered a special circumstance.
(3) The fact that there is to be a detailed assessment of a substantial part of the defendant’s charges in any event
67. As I have set out above, there are bills amounting to £5.5 million which are going to detailed assessment regardless of the decision that I have made in relation to the invoices in this judgment. Mr Williams suggested that this circumstance reinforced his arguments generally that there were special circumstances to be found. The same arguments regarding matters such as hourly rates and the personnel involved would be taken at the detailed assessment of the “uncontested bills” (by which Mr Williams meant that the entitlement to a detailed assessment was uncontested). Consequently there would be less prejudice to the defendant in these circumstances than there would be where a defendant potentially had no detailed assessment in prospect if it successfully opposed a special circumstances hearing. The final detailed assessment would be lengthened by the additional costs to be reviewed but in practice assessments involving either £5 million or £10 million were unlikely to reach the end of the assessment since the parties invariably would reach an agreement based on decisions made on the first £1 million or £2 million assessed.
68. Mr Williams submitted that the court would be troubled by an outcome which involved refusing to allow the contested bills to be heard at a detailed assessment and then potentially finding considerable sums need to be reduced on the uncontested bills. The net effect of this would of course be that the solicitor had received payment for bills rendered which ought to have been considerably reduced.
69. Mr Browne did not accept that the fact other bills being assessed could be a special circumstance. Mr Williams categorised Mr Browne’s submission on this point as being no more than simply an assertion without making that assertion good. There is some force in Mr Williams’ characterisation of Mr Browne’s submission which clearly was that it was self evident that the existence of other invoices could not be a special circumstance. Whilst Mr Browne’s submission was undoubtedly succinct, it is one which I accept. It is far from uncommon for a range of invoices to be challenged by a client and at the initial directions hearing, those invoices are separated out into ones which will definitely be assessed; those which might be assessed subject to special circumstances; and those which are too late to be assessed (see, for example, Winchester Commodities). The fact that some invoices fall into the first category has never before in my experience led to the suggestion that the invoices caught by s70(3) should also go to assessment simply because of the existence of invoices within s70(1) or s70(2). I do not consider the fact that there is a range of invoices in this case to be a special circumstance.
(4) The impossibility of the claimant challenging the defendant’s bills during the currency of the retainer and (5) the defendant’s approach to billing queries during its retainer
70. At the outset of this decision, I referred to Mr Williams’ argument that the use of interim statute bills by the defendant has made the claimant’s position more difficult. In essence, the claimant would not wish to be issuing court proceedings on a monthly or fortnightly basis in order to protect its position in seeking to challenge the defendant’s bills. As I have said above, I tend to agree with Mr Williams’ description of the increased use of interim statute bills but that does not alter the need for the client to demonstrate special circumstances. Furthermore, in my view, it is not an unusual circumstance for a client to receive such invoices, particularly in large-scale matters such as this. It cannot amount to a special circumstance in itself.
71. Mr Williams’ argument regarding the difficulty his client was placed in regarding challenging the defendant’s bills went beyond the generality of the point that I have just described. In the particular circumstances of this case, the claimant, according to Mr Williams, needed to maintain its relationship with the defendant in a way that would not normally be the case. If this matter has involved a large scale piece of litigation, the claimant could have expressed its dissatisfaction with the defendant by ending the retainer, paying the bills and accepting the need to meet its new solicitors’ charges for reading into the file before proceeding with it. However, in this case the claimant could not take that approach.
72. It was the claimant’s case, according to Mr Ehrensberger’s evidence, that they had instructed Mr Gerrard (and then followed him from DLA Piper to the defendant) because of his particular expertise in investigations carried out by the Serious Fraud Office. It was his relationship with the SFO that the claimant prized. If there had been a falling out with Mr Gerrard, then not only would they lose his expertise, but they would undermine the SFO’s confidence in the investigation that the claimant was carrying out into its own activities. For this reason, the claimant did not dare risk its relationship with Mr Gerrard or the defendant generally. Whilst the legal fees were significant, they were still subordinate to the risk of a potential criminal investigation.
73. When the secondees from Addleshaw Goddard had arrived at the claimant’s legal department, they had queried some of the invoices raised by the defendant. But in Mr Williams’ submission, there was an obvious difference between asking for some time to be written off (as Addleshaw Goddard had requested) and the bringing of formal Solicitors Act proceedings. In any event, the reaction of the defendant to the modest queries raised by Addleshaw Goddard showed how unreal the concept of challenging the bills formally would have been during the course of the defendant’s retainer. By way of example, Mr Williams referred to paragraph 171 of Mr Gerrard’s witness statement in which he referred to his frustration with the queries raised by the Addleshaw Goddard people. His witness statement states that the defendant had committed significant resources in order to meet those concerns and which was “time which could have been better served dealing with the salient issues arising out of the Kazakhstan Investigation and the Africa Investigation.”
74. Mr Williams also referred me to two email exchanges involving Clarissa Coleman of Addleshaw Goddard and Mr Gerrard between October 2012 and January 2013. The first exchange occurred where Mr Gerrard was chasing bills which it would appear had been outstanding for three months at that point. Mr Williams accepted that Mr Gerrard was entitled to chase the payment, but not in such aggressive terms. He referred, in particular, to Ms Coleman’s email dated 18 October 2012 in which she stated that:
“I think we need to take the temperature down. As you know I’ve been in this role for 3 weeks and do not know how things work. I have prior commitments today and won’t be at enrc until 3pm. I will deal with this as a priority then.”
75. Mr Williams also relied on internal emails between Ms Coleman and Louisa Caswell of ENRC on 20 November 2012 which stated:
“Re dechert – I have raised the issues you pointed out with Dechert. They will input all the changes next time but can’t do it today. Can you prepare a summary of the comments which we can send them for the future bills.
Leann emailed all the outstanding invoices – can we approve them on the basis that future invoices have that information. I’m not sure we can stomach another fight at this time. Louisa – perhaps you can do this and get beat to sign them.”
76. Following receipt of the defendant’s invoice on 7 December 2012, Ms Coleman clearly took exception to Mr Gerrard’s email correspondence and telephone calls at the time. It would appear that Ms Coleman interpreted Mr Gerrard’s responses as implying that the claimant was being obstructive and that the defendant was being accused of fraud or padding its fees. This allegation was denied by Ms Coleman (a point relied upon by the defendant as discussed below). She made reference to Mr Gerrard’s “very aggressive manner” on the telephone to what she appeared to consider to be routine enquiries about items in the invoice breakdown.
77. Mr Williams also referred to Mr Ehrensberger’s evidence here about the jeopardy in which the claimant would place itself if it did not pay its bills promptly. He accepted that Mr Gerrard said that there was no such jeopardy and that there are no contemporaneous documents to assist me. Since neither party gave evidence other than in witness statements, it was not a matter that I could decide unless I concluded that the evidence was incredible. In Mr Williams’ submission I should simply note that there was a dispute and that, once I accepted that special circumstances existed and so the claimant had crossed the threshold it needed to pass, there should be a final hearing at which such evidence could be tested. Mr Browne’s position on this point was that he was quite happy for me to take the view that I could not decide any factual disputes based on the evidence. This was founded on the basis that his case relied upon the contemporaneous documents that had been exhibited to the witness statements and which were not challenged by the claimant.
78. On a number of occasions both counsel requested me to take a “worldly view” or to consider how things are in the “real world”. On this point, Mr Williams said that solicitors appreciate that it is likely that there will be an overall reconciliation of the fees charged on a particular matter in order to keep clients happy. As such the defendant should not have been so prickly in respect of the queries raised as the matter proceeded. The contemporaneous emails from October 2012 and January 2013 referred to above supported Mr Ehrensberger’s evidence about the existence of a dispute regarding fees and his understanding of what was likely to happen if those fees were formally challenged. Mr Williams also pointed out that once the defendant ceased to act, there was an immediate response from the SFO by its demands for documents from the defendant.
79. [This paragraph has been redacted in its entirety.]
80. Mr Browne did not accept that the claimant was in in any difficulty challenging the fees as the case progressed. The terms of business clearly set out the complaints regime if the claimant had wished to use it. Bills were rendered regularly based on agreed work plans and streams of work. No challenge was made to the relatively limited descriptions of the work done until Ms Coleman and her colleagues became involved. Until that point, the sensitivity of the work and the possibility that invoices and their narratives might be seen by the SFO had militated against too much detail being in the invoices and that had been agreed with the claimant. When Ms Coleman requested further information, that was provided. Mr Browne did not accept that Mr Gerrard’s approach was overly aggressive but in any event pointed out that “pressure” according to the case law was not sufficient to amount to a special circumstance in the absence of overcharging. In Mr Browne’s submission there is no overcharging demonstrated in this case.
81. Indeed, Mr Browne prayed in aid the involvement of Ms Coleman and her colleagues which covered the entire period of the invoices in dispute. Her challenging of specific items which were responded to by Mr Gerrard and her specific denial that her challenges amounted to a suggestion of “padding” of fees bolstered the defendant’s argument that the fees had been considered by the claimant at the time of paying them. In these circumstances, the challenge now being raised did not get off the ground in raising a special circumstance.
82. Mr Williams disputed that the role of Addleshaw Goddard precluded the claimant from arguing that the bills needed to be formally assessed. He told me that the secondees had been deployed generally to assist the claimant’s legal department and had not been mandated simply to deal with the defendant’s fees. They were just one of “multitudinous” responsibilities. As such, far from them providing an independent review, the contemporaneous documents only showed that they were focusing to any extent on the invoices for October and their bruising encounters in respect of those fees made them reluctant to challenge the invoices any further.
83. Whilst it must be right that I do not seek to prefer the evidence of Mr Ehrensberger or Mr Gerrard absent contemporaneous documents, I do think that the contemporaneous emails of Ms Coleman in particular are helpful on this part of the application. She had no obvious axe to grind and I have no reason to doubt that her emails reflected events as she saw them at the time.
84. On 18 October 2012, she picked up Mr Gerrard’s chasing emails and, it would appear, complaints from a colleague about chasing messages from Mr Gerrard’s personal assistant. Having emailed Mr Gerrard at 1:31pm to say that she would be at the claimant no earlier than 3pm, she then sent an email to Mr Gerrard at 4:54pm on the same day. That email begins by asking whether Mr Gerrard wished her to make further enquiries about assurances Mr Gerrard appears to have received regarding payment of his bills. If so, he was asked to provide more detail of that issue. She then stated that:
“In the short time available to me in the office (in Beat’s absence), I have been unable to find out about what was said/done. However, I have made sure that you will be paid tomorrow in full.”
85. She then sets out further information that she wants provided for the future and states that “Beat and I want to meet you to discuss billing in general including numbers of attendances at meetings, charging for taxis etc.”
86. These emails support the claimant’s position that it was concerned about specific billing matters at the time and that this is not simply something constructed after the end of the retainer by the claimant. More fundamentally in my view, it demonstrates that the challenge to the invoices by Addleshaw Goddard was in no way a forensic exercise. The email of 18 October 2012 is sent by Ms Coleman within an hour or so of being in any position to investigate. It is clearly no more than an administrative matter of making sure that a supplier’s invoices had been paid. The tenor of the email is that Ms Coleman wished to get matters up-to-date and to improve the information provided on future invoices. I do not think that it is any answer to the claimant’s queries to say that Addleshaw Goddard have provided some form of independent scrutiny over and above the sort of checking that might have been expected by the claimant’s own legal department had it not been under resourced at the time.
87. Mr Browne contended on the issues of hourly rates and estimates that the regulatory investigation involved here bore no resemblance to ordinary commercial litigation. Indeed, he described it as a very specialist field in which Mr Gerrard made his mark and was much in demand. This line did not seem to help him, in my view, when it came to explaining why the peculiar position regarding the SFO and the self-investigation did not make it unusually difficult for the claimant to commence Solicitors Act proceedings. He referred to the fact that the claimant was at the time a FTSE 100 company [the remainder of this sentence has been redacted.] He said that they were used to dealing with City solicitors when striking bargains. Mr Browne also said that the risk of the defendant “walking off the job” did not seem to worry Mr Ehrensberger sufficiently to prevent him from leaving the defendant’s bills unpaid for three months. Nor did it suggest that the claimant was concerned to keep the SFO happy when it sacked the defendant seven days before it was due to report formally to the SFO.
88. It does not seem to me that any of these points really answers the claimant’s argument that the self-investigation potentially to avoid a criminal prosecution caused there to be a number of unusual features in the solicitor client relationship. The ease with which the claimant could contract with other City solicitors does not bear on the peculiarities of that relationship. The sums being invoiced to the claimant suggest to me that the defendant was unlikely to walk off the job, to use Mr Browne’s phrase, unless there had been an extremely serious breakdown in the relationship. Put bluntly, even on the defendant’s estimated monthly run rate, significant fees were being earned for a client of substance and whose work profile meant there was obvious potential for repeat business. The likelihood of Dechert walking away because of some delay in payment was an insignificant risk in my view.
89. The decision to end the retainer was of course a much more significant decision. It seems to me that once the client has decided to end the retainer, it has reached the point where it felt it had no other option and would have to run the risk of a disaffected SFO. Indeed if anything, it seems to me to indicate the extent of the concern of the claimant with the relationship with its solicitor. The claimant says that this was a result of the level of fees charged. The defendant says that this was caused by factors other than the extent of the fees.
90. I cannot decide the cause of the breakdown of the relationship without evidence being given but it seems to me that the need to keep the SFO onside regarding the self-investigation is not disputed. I accept that this state of affairs required the claimant to keep Dechert onboard, at least for the period of the relevant invoices. I consider this to be a special circumstance since that the claimant could not realistically challenge its solicitors’ fees within the month required by the Solicitors Act to avoid needing subsequently to demonstrate special circumstances.
(6) Specific billing irregularities
91. The parties’ costs lawyers have given witness statements in respect of aspects of the time claimed which are said to be excessive or unusual such that they ought to be assessed. In particular, the claimant challenges the hourly rates charged by the defendant, especially the increase in the rates initially charged. The claimant also challenges the number of attendees who came to various meetings and interviews as well as various challenges to the time spent by paralegals in document review and in quasi administrative or secretarial activities.
92. Both counsel referred to the witness statements of their respective costs lawyers as well as submissions set out in their skeleton arguments rather than spending time going through the minutiae orally. In the event there is no need for me to consider these elements in any detail and they are really matters for a detailed assessment in any event. I have made the point regarding the size of certain discrete items challenged given the overall size of the bill earlier in this decision.
93. The only other point canvassed by the parties’ counsel in any detail was the appropriateness of seeking to sample the billing entries available to both parties. The claimant says that it asked for information be provided on a spreadsheet so that the figures could be manipulated more easily. It points out that such information had previously been provided and therefore did not accept the defendant’s refusal to provide any such spreadsheets was justified. The defendant challenged the alleged difficulty of manipulating the data already provided, particularly given the amount of time that this case has taken to get to this stage. If there were any points to be taken then there was plenty of time to have brought those forward.
94. It did not seem to me to be a particularly attractive argument for the defendant to say that exporting data to a spreadsheet would involve a disproportionate amount of time in dealing with write-offs et cetera in order to marry the information to the invoices actually rendered. To the extent that there is further time recorded on the sheets, it may well form part of the breakdowns provided in any event so that they may bolster the sums claimed in any event. It seems to me that the claimant could hardly complain if the time recording was simply downloaded onto a spreadsheet with the covering comment that no such tailoring had taken place given that the defendant was unlikely to recover any costs for so doing. In my experience both bespoke and generic case management software in solicitors’ firms can easily export time recording information into a spreadsheet form.
95. I do not therefore criticise the claimant’s sampling approach in respect of bills of this size. Nor do I think that it is inappropriate to choose examples from the so-called “uncontested” bills as demonstrating potential matters of concern in the contested bills. For the reasons I have given regarding the size of the bills generally, it seems to me to be a fairly low hurdle to demonstrate specific billing issues may amount to a special circumstance in this case.
(7) The defendant’s sustained attempts to avoid scrutiny of their charges
96. This Solicitors Act application has already been to the Court of Appeal on the question of whether or not the proceedings should be held in private. The need for privacy is to prevent the witness statements (and the documents exhibited to them) being discussed in public where the SFO or any other interested body could hear the allegations made by the defendant against the claimant. The defendant says that it needs to rely upon such documentation to defend the allegations made by Mr Ehrensberger on behalf of the claimant in his first witness statement, particularly in the final paragraphs.
97. Mr Williams sought to distinguish between the penultimate and pre-penultimate paragraphs of Mr Ehrenberger’s witness statement which seek to summarise why the claimant seeks permission for the assessment of the defendant’s invoices. In his view, the pre-penultimate paragraph (number 82) was the sort of paragraph regularly seen in Solicitors Act assessments which alleges gross overcharging and costs that were otherwise unreasonably incurred. He accepted that the penultimate paragraph (number 83) went further than it needed to in relation to the Solicitors Act proceedings. The allegations made in that paragraph, together with various other references to matters involving the conduct of the defendant, were not being pursued in these proceedings. To the extent that they would be pursued, they were matters for hearing elsewhere.
98. Mr Browne indicated that he and his clients had come to this hearing in the expectation of having to meet the serious allegations made in paragraph 83 of Mr Ehrensberger’s witness statement and indeed matters referred to elsewhere in his statement. Mr Williams’ concession that those matters were not being pursued in these proceedings meant that much of the evidence on which the defendant relied was no longer required.
99. It is apparent from the witness statements and the fact that matters reached the Court of Appeal simply on the method of hearing the application that matters have become very heated. I do not think there is any benefit in me intervening at this juncture on the matters that have been raised at anything other than a high level. It seems to me in principle that the parties’ conduct in Solicitors Act proceedings can be relevant. Regular examples given for special circumstances in the commentaries are that either the solicitor has agreed to a detailed assessment of his charges or conversely has put pressure on the client not to seek an assessment. In either case it is the solicitor’s conduct that is said to amount to a special circumstance.
100. In my view, the defendant’s conduct of these proceedings would amount to a special circumstance in that they call for an explanation. It is not unusual at all for the client to allege that there has been overcharging by its solicitors. Nor is it unusual for allegations of a quasi professional negligence nature to be raised. Whilst the allegations made in paragraph 83 appear to be drafted more in the terms of a litigant in person than a represented party, in my view they would not have come as any particular surprise to the experienced legal team representing the defendant. The allegations made against professional people are clearly serious ones but I do not see how they could possibly have been heard within the context of a Solicitors Act assessment and I would have expected that point to be clear to the defendant. Therefore, whilst Mr Browne may be right in that he and his clients attended the special circumstances hearing prepared to deal with such points, I do not think that they would have expected that to be likely to be necessary. In any event, the question of putting confidential information into the public domain in witness statements and their exhibits in circumstances where third parties were clearly interested in that information is, on the face of it, contrary to the case of Nationwide Building Society versus Various Solicitors [1999] PN LR 52 and as such would call for an explanation.
101. In my view, some of both counsel’s submissions on this point were aimed as much at the costs of these proceedings themselves as to the substantive matter raised by Mr Williams of whether or not conduct in these proceedings could amount to a special circumstance. I presume that the costs of the first and second appeals have been dealt with separately, at least in terms of costs orders having been made. In the circumstances, I do not think that I need to consider this in any more detail, nor am I likely to be assisted by the parties continuing to place it at the front of the assessment. To the extent that it affects the costs of the detailed assessment proceedings themselves, then obviously the parties will need to address such matters at the relevant time.
102. I think it would be helpful to summarise my decisions regarding whether special circumstances exist in respect of factors two to seven in Mr Williams’ list. The only one which does not amount to a special circumstance is the existence of other bills being assessed (factor 3). The peculiarities of the solicitor client relationship here making Solicitors Act applications unrealistic (4) combined with the defendant’s response to any challenges (5) amounts to a special circumstance in my view. So too does the defendant’s approach to these proceedings (7). The billing irregularities (6) would amount to a special circumstance when viewed through the magnifying prism of the size of the bills (2).
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