In  Olukoya v Riverbrooke Solicitors Ltd [2023] EWHC 2771 (SCCO) Costs Judge Leonard assessed a solicitor’s bill as nil. The judge found that there was a binding contractual agreement  as to the sums payable by the client following an informal resolution by the Legal Ombudsman.  Further the solicitor had rendered a final bill to the client and required permission of the court to amend it.  No permission had been sought, and permission would not be given.  Finally the solicitor was estopped from trying to recover a higher sum in any event.


it seems to me to be beyond doubt that when the Claimant and the Defendant accepted and put into effect the Informal Resolution brokered by the Legal Ombudsman they entered into a legally binding contract.  The terms of that contract were clear and complete”



The claimant was a former client of the defendant firm of solicitors. In 2017 the defendant had represented her in employment tribunal proceedings.  There was a dispute about the defendant’s costs arising out of those instructions. The original estimate of costs was £6,000 – £10,000.   After the first stage of the proceedings the claimant complained to the defendant that the costs were in the region of £85,000. The defendant’s retainer was terminated.


The claimant made a complaint to the legal ombudsman.  After detailed negotiations, and effectively mediation, by the ombudsman an agreement was reached

    1. Ms Bartlam [the member of staff at the ombudsman]  wrote to Mrs Chikwendu:
“Thank you for your email dated 14 February 2020 concerning Ms Olukoya’s complaint.
To resolve this complaint, your firm and Ms Olukoya have agreed that you will issue a full and final bill of costs by no later than 4 March 2020 as follows:
£10,000 costs
£2,000 VAT at 20 % £1,000 Disbursements
Total bill £13,000.
Less payments on account totalling:
The amount claimed should be £10,500.
You should do this by no later than 4 March 2020. Ms Olukoya has agreed that upon receipt of the bill, she will pay it in full within 2 weeks of receipt. If Ms Olukoya fails to make the payment and breaks the agreement with the firm, this case with the Legal Ombudsman will remain closed but the firm can then take legal action if necessary to recover any outstanding costs…
This case will now be closed and I will take no further action.”
  1. The Defendant then rendered to the Claimant a bill dated 21 February 2020 and headed “Final Invoice”. In accordance with the terms of the Informal Resolution, the bill incorporated profit costs of £10,000, disbursements of £1,000 and VAT of £2,000. Against the total of £13,000 the bill set off a payment on account of £2,500, leaving a balance payable of £10,500.


Nothing happened for two years and nine months. The defendant then sent a “Revised Final Invoice” to the claim for £157,951. Against that the sum  of £13,000 (which had been paid) was credited leaving a balance claimed of £144,951.

The revised bill was sent because the Legal Ombudsman had referred the matter to the SRA.  This referral was not done by the claimant but as part of the Legal Ombudsman’s general duties.

The defendant solicitors, therefore, felt that the agreement was no longer valid.
    1. At paragraphs 34 and 47 of her witness statement, Mrs Chikwendu says:
“… notwithstanding the agreed outcome, the Claimant was pursuing a separate and undisclosed claim against the Defendant with the Defendant’s regulator through the LeO…
It would be patently unethical and may amount to a travesty of justice if the Claimant is at liberty to simultaneously maintain a claim upon unsubstantiated conclusions… and at the same seek the intervention of the costs court to preclude a detailed assessment of the same subject matter… which intervention of the costs court upon a detailed assessment in itself is required…”
    1. I have omitted, in the passages quoted above, references to the subject matter of the report which further demonstrate that the delivery of the “Revised Final Invoice” was a response to the Legal Ombudsman’s Report to the SRA, which Mrs Chikwendu interprets as a “separate and undisclosed claim” against the Defendant by the Claimant, and in relation to which she believes that vindication for the Defendant can only be properly achieved through a detailed assessment of the Defendant’s full claimed costs.
  1. It is beyond question, however, that the Claimant has not made an “undisclosed claim” through the Legal Ombudsman. The terms of the Legal Ombudsman’s scheme do not permit “undisclosed” complaints. The undisputed evidence demonstrates that, as between the Claimant and the Defendant, the complaint resolution process before the Legal Ombudsman terminated with the Informal Resolution. As is equally evident from the rule 5.59 referred to above, any referral to the SRA was a matter for the Legal Ombudsman and entirely outside the control of the Claimant. She had no say in the matter.


The judge held that the defendant solicitors were bound by the agreement.

    1. Notwithstanding references in Mrs Chikwendu’s evidence as to “Riverbrooke Solicitors’ intention” I do not believe that there is any difference of opinion between the parties as to the principles that govern the determination of this issue.
    1. It is settled law that the question of whether there is a binding contract between parties, and if so upon what terms, requires consideration of what was communicated between the parties by words or conduct. Subjective intentions are irrelevant.
    1. The principles were helpfully summarised at paragraph 45 of the judgment of the Supreme Court in RTS Flexible Systems Ltd v Molkerei Alois Müller GmbH & Co KG (UK Production) [2010] UKSC 14[2010] 1 WLR 753:
“… Whether there is a binding contract between the parties and, if so, upon what terms depends upon what they have agreed. It depends not upon their subjective state of mind, but upon a consideration of what was communicated between them by words or conduct, and whether that leads objectively to a conclusion that they intended to create legal relations and had agreed upon all the terms which they regarded or the law requires as essential for the formation of legally binding relations. Even if certain terms of economic or other significance to the parties have not been finalised, an objective appraisal of their words and conduct may lead to the conclusion that they did not intend agreement of such terms to be a precondition to a concluded and legally binding agreement.”
    1. Applying those principles, it seems to me to be beyond doubt that when the Claimant and the Defendant accepted and put into effect the Informal Resolution brokered by the Legal Ombudsman they entered into a legally binding contract.
    1. The terms of that contract were clear and complete. They were based on the offer from the Claimant communicated to the Defendant in Ms Bartlam’s letter of 12 December 2019, as expressly accepted by the Defendant in Mrs Chikwendu’s letter of 14 February 2020 and relayed to the Claimant by Ms Bartlam. Ms Bartlam’s letters of 18 February 2020 set out the procedure by which the agreement would be implemented, which both parties, by their actions, plainly accepted. Accordingly, under the terms of the contract the Defendant was to render a “full and final bill of costs” for £10,000 plus specified disbursements and VAT, as the Defendant did on about 21 February 2020, and the Claimant was to pay it within two weeks, which the Claimant did.
    1. Mr King for the Defendant submits that Ms Bartlam was mistaken in indicating to the Claimant that the Defendant was willing to accept the sum of £10,000 in full and final settlement of its entitlement to recover its fees. The Defendant was, he says, accepting that sum only in part payment.
    1. As to that, applying RTS Flexible Systems Ltd, one must look to the parties’ communications and actions. Ms Bartlam confirmed to the Defendant in her letter dated 18 February 2020 that it was a term of the Informal Resolution that the Defendant would render a “full and final” bill of costs to the Claimant, to be paid within two weeks of receipt. The Defendant did not argue with or purport to correct that statement, but delivered a bill, clearly identified as “final”, in accordance with the terms of the Informal Resolution. There was no mistake, and no suggestion at any time that the sum paid by the Claimant was being accepted only in part payment: that would have been wholly inconsistent with the agreed termination of the Claimant’s complaint.
    1. The Defendant argues that there was no consideration for the Informal Resolution, so that it cannot (by reference to authorities such as Foakes v Beer (1884) 9 App Cas 605British Russian Gazette and Trade Outlook, Limited v Associated Newspapers, Limited, [1933] 2 K.B. 616 and Ashia Centur Ltd v Barker Gillette LLP [2011] 4 Costs LR 576) represent a binding agreement. I mean no disrespect to Mr King’s careful submissions when I say that that, to my mind, is an insupportable assertion.
    1. The Claimant provided good consideration for the Informal Resolution. She did so by terminating her complaint to the Legal Ombudsman; surrendering the possibility of public vindication of her complaint by the independent authority established to deal with such complaints; and foregoing her possible entitlement to remedies beyond the reduction of the costs payable, such as compensation or an apology from the Defendant.
    1. That in itself is quite sufficient by way of consideration for the acceptance of £10,000 in settlement of the Defendant’s claimed costs, but the Claimant’s acceptance of the Informal Resolution conferred other benefits on the Defendant.
    1. The Defendant’s belated acceptance, in February 2020, of the Claimant’s offer as first communicated by Ms Bartlam on 12 December 2019, followed Ms Bartlam’s clear indication that she had come to the conclusion that had the Claimant understood at the outset that the Defendant’s costs would exceed £10,000, she would not have instructed the Defendant.
    1. One very possible outcome of that conclusion, had the matter proceeded to a formal determination, would have been a determination by the Legal Ombudsman to the effect that, in consequence of a failure to supply adequate costs information, the Defendant’s recoverable costs should be substantially reduced to a level consistent with the original estimate. The Legal Ombudsman’s findings, as Ms Bartlam mentioned, would have been published on the Legal Ombudsman’s website, which at the least would have been an embarrassment for the Defendant.
    1. The Defendant avoided that substantial risk (and the risk of the other possible sanctions available to the Ombudsman to which I have referred) by accepting the Claimant’s offer. Having done so it is not now open to the Defendant to assert that in accepting the Informal Resolution, the Defendant was simply accepting part payment of a debt. That is plainly not the case.
    1. Mr Barber has identified a further benefit to the Defendant from the Informal Resolution. Ms Bartlam appears to have believed, mistakenly, that the Defendant was still instructed by the Claimant on 22 January 2019, when the Defendant sent Mr Julius Nkafu of counsel to attend the costs hearing before the Tribunal.
    1. In fact the Claimant had terminated the Defendant’s retainer over five months earlier. Mr Nkafu was not instructed by or on behalf of the Claimant (who was, as ever, represented by Ms Mallik). He was instructed by the Defendant to represent the Defendant’s interests. The Defendant was not entitled to include Mr Nkafu’s fees as a disbursement in a bill to the Claimant. In doing so, and in accepting payment of those fees from the Claimant, the Defendant received a benefit which fell outside any legitimate claim for costs against the Claimant.
    1. In the light of those conclusions it is not necessary for me to make any finding as to whether the Defendant’s claimed costs could be characterised as a liquidated debt, of the kind to which the authorities relied on by Mr King apply. I would observe however that (by reference to Turner & Co v O Palomo SA [2000] WLR 37, at paragraph 46) the Defendant’s claim for costs does not appear to be a liquidated debt. I find the Defendant’s attempts to characterise it as such to be unconvincing, contradicted as they are not only by Mrs Chikwendu’s express acknowledgement, in her correspondence with Ms Bartlam that the Defendant’s claim for cases was in “Quantum Meruit”, but the Defendant’s desire for the “Revised Final Bill” to undergo a detailed assessment by this court (in which, as Mrs Chikwendu puts it, the court would “examine whether in fact the work claimed was carried out, the reasonableness of the work carried out, and at the level of costs claimed for every item of work”). The court does not undertake the detailed, point by point assessment of liquidated debts.
    1. Finally, I should deal with an argument raised by the Defendant to the effect that an Informal Resolution”, by virtue of being “informal”, cannot be binding. It seems to me that terminology is entirely beside the point. One must look at the correspondence and the parties’ actions to determine whether or not the Informal Resolution was contractually binding.
    1. For all those reasons, my conclusion is that the Defendant is bound by the terms of the Informal Resolution entered into by the parties in February 2020, and has no further claim to costs. It follows that the “Revised Final Invoice,” referred to in this court’s order of 26 January 2023 as the “Revised Bill”, must be assessed at nil.
  1. Given that finding, it is not strictly necessary for me to address the remaining preliminary issues, but I should do so because I have concluded that even if the Informal Resolution had not been a binding contract, the Defendant would still not have been entitled to render any further invoice to the Claimant after payment of the 21 February 2020 “Final Invoice”.



    1. When I received skeleton arguments from each party prior to the commencement of the preliminary issues hearing, it appeared to me that neither party had yet addressed the principles that led me to identify this as a preliminary issue. According, I referred both parties to Bilkus v Stockler Brunton (a Firm) [2010] EWCA Civ 101, an authority which offers a useful starting point in considering the relevant principles.


    1. The point, in brief, is that a final bill rendered by a solicitor to a client is, by definition, final for the work described in it. It has recently been established (Boodia and another v Richard Slade and Co Solicitors [2018] EWCA Civ 2667) that there may be a separate final bill for disbursements, but that has no bearing for present purposes.


    1. Being final, the bill is binding upon the solicitor who renders it. The solicitor cannot amend that bill without the agreement of the client or the permission of the court.


    1. To be clear, I refer here to a “statutory” (or “statute”) bill, meaning a solicitor’s bill that satisfies the requirements of the Solicitors Act 1974 and of the relevant case law. Otherwise, the bill has no legal force at all: the solicitor will not be able to take action to recover the billed costs and the client will not be able to obtain an order for their assessment.


    1. In her witness statement Mrs Chikwendu says that “The final invoice dated 20 February 2020 rendered by the Defendant to the Claimant does not constitute a Statute Bill”, but she does not say why. Whether or not a solicitor’s bill is a statutory bill does not turn upon the intentions of the solicitor who delivered it. One must look at what the parties did, and apply the established criteria accordingly.


    1. It is perfectly possible for a solicitor to deliver a non-statutory invoice, typically by way of an “interim bill” that represents nothing more than a request for payment on account during the course of the solicitor’s retainer. Following the termination of the retainer, however, there is no more work to do and there is no point in rendering an interim bill. One would expect a bill delivered at that point, absent some specific provision to the contrary such as an outstanding conditional fee arrangement, to be (or at least to be intended to be) a statutory bill. Absent good reason a solicitor should render a final statutory bill promptly after the termination of a retainer: if not, the court may order the solicitor to do so.


    1. The Informal Resolution brokered by the Legal Ombudsman provided expressly for the Defendant to render a “full and final bill” and for the Claimant to pay it within a specified period. The bill was on its face described as a “Final Invoice”, meaning of necessity that there were no further invoices to be rendered.


    1. Nor would the two bills rendered by the Defendant to the Claimant in December 2022 and February 2023 have been headed “Revised Final Invoice” if they did not purport to be revisions of a final bill (it is evident from Mrs Chikwendu’s evidence that she was at the relevant time unaware of any legal obstacle to the revision of a solicitor’s final bill).


    1. The Informal Resolution provided that if the Claimant did not pay the “full and final bill”, the Defendant would be free to sue upon it (and not, as Mrs Chikwendu suggests, to take action to recover the full amount of its claimed costs, which is inconsistent with the term “full and final bill of costs”). That would not have been possible unless the bill was a statutory bill.


    1. It does not (as I understood Mr King to suggest) matter that the bill dated 21 February 2020 was marked “final” rather than “full and final”. That is a distinction without a difference.


    1. I also understood Mr King to argue that there was insufficient information in the bill dated 21 February 2020 for it to allow it to qualify as a statutory bill. It is not open to the Defendant to rely upon alleged defects in its own final bill as a ground for purporting to render another. If the Claimant does not complain that the bill is insufficient, it does not lie with the Defendant to do so.


    1. It is not a good point in any event. The sufficiency of the information in a bill turns not just upon the contents of the bill but upon the knowledge of the parties. In this case, the Claimant was well aware of what the Defendant claimed to have done on her behalf, and she had, according to the Defendant’s correspondence, received what was described as “a detailed bill” in August 2018. The final bill represented the outcome of an agreed compromise. The Claimant did not need to know more than that, but in fact she knew all about the Defendant’s claimed costs.


    1. All that aside, it is simply not credible that a solicitor would deliver a bill marked “final” and then wait for almost three years to deliver the real “final” bill. As I have observed, the delivery of the “Revised Final Invoice” was prompted by the Legal Ombudsman’s report to the SRA. If that report had not been made, the “Revised Final Invoice” would in my view never have been delivered.


    1. For those reasons, my finding is that whether or not the Informal Resolution represented a contractually binding settlement, it is eminently clear that the bill dated 21 February 2020 was delivered as, and was, a statutory bill. It follows that the Defendant needed, but did not apply for, the permission of the court to deliver a “Revised Final Invoice” to the Claimant almost three years later.


    1. As for whether the Defendant should receive such permission retrospectively, it seems to me beyond argument that even if the Informal Resolution had not been legally binding upon the Defendant, permission should not be given.


    1. At paragraphs 58 to 60 of his judgment in Bilkus v Stockler Brunton, Stanley Burnton LJ explained the relevant principles. I have highlighted in bold some passages that are particularly pertinent to the present case:


“… In Sadd v Griffin [1928] 2 KB 510, Farwell LJ, giving the judgment of the Court of Appeal , said:

‘… it is settled beyond controversy that the solicitor is, for the purposes of taxation, bound by the bill that he has delivered and cannot alter it without the leave of the court or the consent of the party.’

However, it was emphasised that the jurisdiction of the court to grant leave to a solicitor to alter or to withdraw his bill was to be carefully and sparingly exercised, being restricted to cases of genuine mistake or error on the part of the solicitor when preparing his original bill. In Polak v Marchioness of Winchester [1956] 1 WLR 818, the Court of Appeal confirmed that it had an inherent jurisdiction to permit a solicitor to withdraw his incorrect bill of costs and to substitute a fresh correct bill, but Jenkins LJ said, at 827:

‘I entirely agree with the judge when he said that one has to take a strict view to maintain the necessary safeguards, and nothing I say is to be regarded as suggesting to solicitors that they can be careless or unbusinesslike in a matter such as this, and then as of course apply for and receive the assistance of the court. It is only in exceptional cases, cases of special circumstances, of genuine mistake [or] inadvertence, that assistance ought to be given.’

These principles are equally applicable to bills delivered following the enactment of the Solicitors Act 1974…”

    1. There was no question of mistake here. The bill dated 21 February 2020 was prepared and delivered exactly in accordance with the terms of the Informal Resolution.


    1. Further, even if the Informal Resolution had not been legally binding on both parties, it would be wholly contrary to the public policy underlying the Legal Ombudsman’s scheme rules to allow a solicitor, having accepted an informal resolution brokered by the Legal Ombudsman in accordance with that policy, to walk away from the settlement and to render another bill as if it had never happened. That would be so even if the motive for attempting to do so had not been (as it was) an unfounded grievance against the Claimant.


    1. For those reasons, my finding is that the Defendant had no right, without the court’s permissions, to deliver a “Revised Final Invoice” to the Claimant in December 2022 (or for that matter to purport to deliver another “Revised Final Invoice” to the Claimant on 9 February 2023), and that it would be wrong for permission to be given.


    1. It follows that even if I had not found the Informal Resolution to be contractually binding on the Defendant, I would have found that the “Revised Final Invoice” must be assessed at nil.



Conclusions: Whether the Defendant is Estopped from Raising the Revised Bill

    1. Promissory estoppel operates to prevent a party from insisting upon their strict contractual entitlement against another party where they have promised or represented that they would not do so.


    1. For the principle to be enforced, there must be no ambiguity on the part of the party making the promise (which can be express or implied). They must be clear that they do not intend to enforce their legal rights, and the person to whom the promise is made must have acted on that promise either to their detriment or have altered their course of action as a direct result of relying on that promise.


    1. Promissory Estoppel will not be available as a defence if the promisee has behaved inequitably.


    1. The Defendant argues, by reference to Jones v Richard Slade & Co Ltd [2022] Costs LR 1191, that I do not have jurisdiction to determine whether the Defendant was estopped from delivering the “Revised Final Invoice” in December 2022.


    1. This objection came late in the day: it should have been raised on 8 March 2023, when I made an order to the effect that I would hear this issue. As best I can recall, the issue of jurisdiction was not then raised by the Defendant but even if it had been disputed at the time, the right course would have been to appeal that part of the order of 8 March 2023, instead of trying to shut out the issue on the date set for it to be heard.


    1. In any event I do not believe that Jones v Richard Slade & Co Ltd excludes the hearing of this issue on an assessment. The question, as Johnson J explained at paragraph 44 of his judgment, is whether the issue is relevant to the assessment of costs. There is jurisdiction to address such matters if it is necessary to do so as part of the process of assessing costs (including the decision whether to order the assessment of costs). Such is the case here.


    1. That said, the issue, in view of the findings I have already made, is academic. I would only point out that the matters I have identified that demonstrate that the Claimant provided good consideration for the Informal Resolution would apply equally to support the conclusion that the Defendant is debarred, through promissory estoppel, from raising or relying upon the “Revised Amended Invoice”.


    1. Even if I were to disregard the Claimant’s evidence to the effect that, on the understanding that her dispute with the Defendant had been settled, she disposed of various records that would have assisted her in disputing the Defendant’s claimed fees in a detailed assessment, and that the passage of time has affected her ability to meet them (and there is no reason why I should disregard it) it seems to me that the basis for promissory estoppel is fully made out.


    1. The Defendant argues that the Claimant has forfeited any right to rely upon estoppel because she behaved inequitably. That is based upon two allegations. The first is that the Claimant being “deceptive” in pursuing an “undisclosed claim” with the Legal Ombudsman. I have already demonstrated why that allegation is unfounded.


    1. The second is that the Claimant pursued a claim for the Defendant’s full claimed costs before the Tribunal, so seeking to recover costs which, at the same time, she disputed were due to the Defendant.


    1. The obvious obstacle to that second allegation, which as framed as an allegation of “duplicity” (in other words, dishonesty) is that there is no evidence to support it.


    1. Contrary to what Mrs Emuekpere seems to believe the Claimant, having disinstructed the Defendant, was under no obligation to keep the Defendant informed of the progress of her costs application, or of the attempted appeal from the Tribunal’s refusal to make an order. As for the hearings themselves the evidence, including that of Mrs Emuekpere, indicates that neither the Claimant nor Ms Mallick accepted the Defendant’s costs figures.


    1. The position as put to me by Mr King was that it is “inconceivable” that the Claimant did not put the Defendant’s full claimed costs to the Tribunal in the course of applying for a costs order. I find it entirely conceivable, and in fact there is no good reason to suppose that she did. Of necessity, an order for costs comes before the quantification of the costs payable under that order, and the quantification stage was never reached. Nor do I have any reason to suppose that Ms Mallik, as counsel for the Claimant, would have represented to the Tribunal that the Claimant had a legitimate claim for costs at a level which she herself did not believe to be correct.


    1. I am familiar with the dilemma faced by any solicitor’s client who needs to maximise the recovery of their incurred litigation costs from an opponent, whilst at the same time taking issue with the level of costs claimed by their own solicitor. In this court, the problem may be addressed by providing for an assessment to take place between solicitor and client, with the assessment between the opposing parties to be stayed in the meantime.


    1. Presumably the Tribunal, had it made an order for costs, could have referred the Claimant’s costs for assessment in the County Court, so that some similar arrangement could have been made. It might well have been necessary, in that event, for the Claimant to identify the Defendant’s claimed costs before the Tribunal, whilst explaining that the Defendant’s figures were not accepted. There is however no evidence to support the supposition that the Tribunal ever had any details of the Defendant’s costs at all.


    1. In any event, for the reasons I have given, had I not found that the Informal Resolution was contractually binding upon the Defendant, I would have found that the Defendant was debarred by promissory estoppel from relying upon the “Revised Final Invoice”.




Summary of Key Conclusions

    1. The Informal Resolution brokered by the Legal Ombudsman in February 2020 is a contractually binding agreement which limited the Defendant’s claim against the Claimant for costs and disbursements to a total of £13,000, all of which has been paid in accordance with the terms of that Informal Resolution.


    1. For that reason alone, the Defendant had no right to render a “Revised Final Invoice” almost three years later, in December 2022. The “Revised Final Invoice” stands to be assessed at nil.


    1. As an entirely separate point, the bill delivered by the Defendant to the Claimant on about 21 February 2020 and headed “Final Invoice” was a final, statute bill. The Defendant needed, but did not have permission, to revise that bill as the Defendant purported to do in December 2022 and again in February 2023.


    1. Nor would it be appropriate for permission to be given. That is not just because the necessary criteria, on established authority, have not been made out, but because it would allow the Defendant to escape the outcome of an informal resolution brokered by the Legal Ombudsman in accordance with the Ombudsman’s Scheme Rules. To give permission in those circumstances would be wholly contrary to public policy.


  1. Again, for that reason alone, it would be appropriate to assess the “Revised Final Invoice” at nil.