Dispute Resolution analysis: On appeal from a decision of a costs judge, Mr Justice Freedman has upheld a firm's practice of rendering final monthly bills (excluding disbursements) and has held that the client faces a strict one month limitation period for seeking detailed assessment of each of those bills under section 70 of the Solicitors Act 1974.
Boodia v Richard Slade and company [2023] EWHC 2963 (KB)
What are the practical implications of this case?
This is an important decision in relation to disputes as to costs between solicitors and their litigation clients. It has upheld a firm's retainer which permitted the rendering of monthly bills for time costs (excluding disbursements). Provided the terms of the retainer are sufficiently clear, the firm is able to rely upon the strict time limits in section 70 of the Solicitors Act 1974 where a client at a later date and following a dispute with the firm seeks a detailed assessment of those fees. There is no contractual obligation upon the solicitor (in the form of express or implied terms) to explain to the client the implications of such terms in a retainer as regards the client's ability to seek detailed assessment under the Act. The clients raised a separate argument, not yet determined, that such obligations fall on the solicitor as a result of consumer protection law. Permission to appeal on those consumer protection provisions was, however, granted. There is likely, therefore, to be a further judgment on this issue in due course.
What was the background?
For approximately three years between 2013 and 2016, Richard Slade and Co acted for Mr and Mrs Boodia in relation to what was principally a right of way dispute. The did so under the terms of a written retainer dated 24 January 2013 incorporating the standard terms of business of the firm. The retainer included a term which entitled the firm to serve bills each of which would be final for the period to which they related. The standard terms of business included a provision entitling the Boodias to have the firm's charges reviewed by the Court in accordance with the Solicitors Act 1974. During the course of the instruction, the firm rendered bills monthly, save for disbursements which were billed separately. The relationship between the Boodias and the firm broke down and the Boodias applied for detailed assessment of each of the 61 bills rendered by the firm under section 70 of the Solicitors Act 1974. That section imposes a one month time limit from the delivery of the bill for an application for detailed assessment to be made. The costs judge who heard the application determined that the firm was entitled contractually in light of the terms of the retainer to deliver interim bills as statutory bills. However, because the bills did not include the entirety of the costs (i.e. they omitted the disbursements), they did not constitute statutory bills. The Court of Appeal overturned this conclusion. The omission of the disbursements did not prevent them from being statutory bills. The matter was remitted to a costs judge where the Boodias took a different point, namely that they had not given their informed consent for the delivery of interim bills and, therefore, in this regard, the retainer was ineffective. The costs judge applied the decision of Richard Slade & Co v Erlam [2022] EWHC 325 (QB) to which she felt bound and on the basis of that authority a solicitor was not bound to spell out for a client the legal implications of billing in this way. The Boodias appealed.
What did the court decide?
The appeal was dismissed. The Court distinguished the professional duties, found in statute and regulations, on the part of a solicitor to ensure that their clients receive the best information about pricing and the likely overall costs of the litigation from the notion of implication of terms into the contract between the solicitor and client. The terms of this retainer were clear and the Court should give effect to those terms. There was no requirement on the part of the firm to explain to the Boodias how section 70 of the Solicitors Act 1974 operated or the effect which those clear words had on their rights under than provision. Neither of the relevant tests for the implication of terms into the retainer, namely the business efficacy test or the obviousness test justified the implication of terms into the retainer obliging the firm to explain to the Boodias the consequences for them of rendering monthly bills or to obtain their informed consent. The costs judge had also declined to permit the Boodias to make various arguments based on consumer protection on the basis that the Boodias had failed to raise them as part of the earlier contractual interpretation arguments. At the conclusion of this judgment, permission to appeal was granted in respect of this issue, however, it was not determined. The parties were directed to file more focused submissions on this issue.
Case details
- Court: King's Bench Appeals
- Judges: Mr Justice Freedman
- Date of judgment: 21 November 2023
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