COST BITES 84: MEDICAL AGENCY MUST PROVIDE A BREAKDOWN OF ITS BILL TO SHOW WHAT THE EXPERT WAS PAID: DECISION ON APPEAL

I am grateful to my colleague Paul Hughes for providing me with a copy of the judgment of HHJ Bird in Northampton General Hospital NHS Trust -v- Hoskin, County Court at Manchester22nd May 2023, a copy is available here  HoskinsAppealJudgment.     The judge ordered that bills for expert reports rendered by an agency should be broken down so that the paying party could see the amounts being charged by the expert.  In default of compliance the expert’s fees were to be assessed at nil.

“I am satisfied that it is clear that PD 47 imposes a duty on the receiving party to provide the fee note of any expert instructed and, where such costs are claimed details of the costs of any MRO. Premex is not an expert. Its invoice cannot be described in any sensible way as a fee note and is in any event not the fee note of the expert.”

THE CASE

The court was assessing costs in a clinical negligence case. There was agreement in relation to the bill except for the cost of two expert reports.

THE INVOLVEMENT OF THE AGENCY

The invoices, for £5,400 plus vat and£ 8,755 plus vat were provided through a medical reporting organisation.

3. An invoice for each sum, issued by Premex Services Limited, and addressed to the Claimant’s solicitor was served with the bill. Premex is a medical reporting organisation. It is instructed by solicitors to provide medical reports. It maintains a panel of medical experts to whom it offers quick payment terms and other services. In exchange for those favourable payment terms and services, the experts provide reports at a lower cost than they would charge if directly instructed by solicitors.

THE DEFENDANT’S REQUEST

The defendant asked for a breakdown of the costs of the two expert reports. That is how much of the fee related to the report and how much to the service provided by Premex.

REJECTION OF THE DEFENDANT’S REQUEST

Premex declined to provide a breakdown. Its position was that the invoiced amount was both reasonable and proportional and there was no need for a breakdown.

THE DECISION OF THE COST JUDGE AT FIRST INSTANCE

The defendant made a specific application for a breakdown. This was refused by the judge at first instance.

THE DEFENDANT’S SUCCESSFUL APPEAL

The defendant’s appeal to HHJ Bird was successful. The judge reviewed PD 47 and the case law on this issue in detail.

PD 47, PARA 5.2

This imposes a duty to provide the fee notes of any experts for fees claimed in the bill.

On commencing detailed assessment proceedings, the receiving party  must serve on the paying party and all the other relevant persons the following documents —
….
(c) copies of the fee notes of counsel and of any expert in respect of fees claimed in the bill;
(d) written evidence as to any other disbursement which is claimed, and which exceeds £500….

THE JUDGE’S DECISION: THE AMOUNT CHARGED BY THE EXPERT MUST BE DISCLOSED

8. In my judgment the language of PD 47 is very clear and admits of no doubt. Paragraph 5.2 applies if the receiving party is asking the paying party to pay for the cost of an expert. If that is the case, then the receiving party is required to provide a copy of the expert’s fee note(s). The effect is that the precise cost charged by the expert (recorded in the fee note) is known.
19. Seized of that information the paying party can make a decision about the fee. In doing so it may well consider what the “going rate” for a similar report is. Without the fee note the paying party cannot make a rational, evidence based decision, about whether to accept that aspect of the bill, reject it or make a counteroffer. The court is in the same position.
20. If, as here, the paying party seeks to recover the fees of a medical reporting organisation in addition, it seems to me the same points apply. If the paying party (and potentially the court) is to make a decision about MRO fees it needs to understand what they are.
21. The points made by His Honour Judge Cook in Stringer apply with equal force today as they did in 2002. A Judge faced with the task of assessing items 53 and 58 as they presently stand is faced with an impossible task. Absent a breakdown the Judge risks permitting the type of “extreme” identified by His Honour Judge Cook.
22. I am satisfied that it is clear that PD 47 imposes a duty on the receiving party to provide the fee note of any expert instructed and, where such costs are claimed details of the costs of any MRO. Premex is not an expert. Its invoice cannot be described in any sensible way as a fee note and is in any event not the fee note of the expert.
23. Once this conclusion is reached, in my view it follows that the appeal must be allowed. The Deputy District Judge was in my view wrong to refuse the order sought. If the paying party is entitled to receive the breakdown (as I have found), as a general rule it is entitled to an order vindicating that right. The court should manage its proceedings in a way that facilitates the just disposal of any matter it has to decide. Here, making the order would have facilitated that aim by ensuring that the court had before it all relevant and necessary information needed to conduct the detailed assessment. It was not suggested that it would be difficult, let alone disproportionate to provide the breakdown so that no reason to depart from the general rule was advanced. By refusing the order, the Deputy Judge left the Judge who would conduct the detailed assessment without the information they needed.

 

OUTCOME: THE STING IN THE TAIL

 

24. Having allowed the appeal, in my view I am in a good position to determine the application. I am satisfied that an order ought to be made. I will require the receiving party to provide a breakdown between the Premex costs and the expert costs and to provide copies of the experts’ fee notes. That should be done within 14 days of the date of the order that follows from this judgment. I propose to order in addition, given what in my view is a clear failure to comply with PD 47, that in default of compliance with the order that items 53 and 58 each be assessed at zero.