England and Wales High Court (Family Division) Decisions

IN THE HIGH COURT OF JUSTICE
FAMILY DIVISION

		Case numbers omitted Royal Courts of Justice Strand, London, WC2A 2LL
		28 April 2017

Sir James Munby, President of the Family Division :


 


1. I gave judgment in these matters (Case F and Case H) on 15 September 2015: In re A and others (Legal Parenthood: Written Consents) [2015] EWHC 2602 (Fam), [2016] 1 WLR 1325, paras 81-84 (Case H), paras 100-105 (Case F). I now have to deal with the question of costs in accordance with orders the material parts of which provide in each case that:

"The Applicants' costs of and incidental to the proceedings herein (including in respect of any costs previously reserved) shall be paid by the [clinic – Barts], with any dispute as to the quantum of those costs (including the question of what, if any, interest should be paid) being referred to the President of the Family Division for determination if the quantum thereof is not agreed …, and with any such dispute to be determined on the basis of such written submissions as may be delivered by e-mail to the Clerk to the President of the Family Division by 10 June 2016 and any such further procedure as the President of the Family Division may then require."

2. Different solicitors acted for the applicants in Case F and Case H. The same leading counsel was instructed in both cases. It will aid understanding if I note at this stage that leading counsel appeared in Case F at hearings before Holman J on 16 September 2014, before Roderic Wood J on 27 January 2015 and before me at directions hearings on 3 March, 21 April and 17 June 2015, and in both Case F and Case H at the final hearing before me which started on 13 July 2015.
3. It is important to note that, in very large part, the same generic issues were common to both Case F and Case H: see In re A, paras 44-46, 49. So, in very significant part, the preparatory work undertaken for the final hearing by leading counsel was common to both cases, as were the submissions made in court; the oral evidence in each case (see In re A, para 66) was, of course, quite separate and distinct. Leading counsel's submissions in each case dated, 10 June 2016, make clear, as do the relevant fee-notes, that "in all respects in which the work of leading counsel in Case F [Case H] was also done for the benefit of Case H [Case F] … a 50/50 apportionment has been made."
4. It is also important to note that the solicitors' involvement in each of these cases began in 2014 (in Case F in March 2014, in Case H in November 2014), that junior counsel in Case H was first instructed in January 2015 and that leading counsel was first instructed in September 2014 (Case F) and June 2015 (Case H), that is, after the decision of Cobb J on 24 May 2013 in AB v CD and the Z Fertility Clinic [2013] EWHC 1418 (Fam), [2013] 2 FLR 1357, but, except for leading counsel in relation to Case H, before the judgment of Theis J on 13 February 2015 in X v Y (St Bartholomew's Hospital Centre for Reproductive Medicine Intervening) [2015] EWFC 13 and obviously before my own judgment on 11 September 2015 in In re A. It was that judgment which, for the first time, set out the relevant law clearly and comprehensively. The brevity of the central parts of my judgment in the present cases (In re A, paras 81-84, 100-105) is therefore apt to mislead. What after September 2015 was in large part simple and clear, would have been very far from simple or clear, indeed both complex and obscure, prior to then.
5. In relation to Case F, and ignoring for present purposes certain costs already paid, the total costs claimed, in a bill dated 18 March 2016, amount, exclusive of VAT, to £79,188.60, this total comprising three elements: (i) the costs of the solicitors amounting to £14,151;^[1] (ii) counsel's fees amounting to £64,485 (leading counsel £63,835; junior counsel £650); and (iii) court fees and other disbursements amounting to £552.60. On top of that, a further sum of £1,625, exclusive of VAT, is claimed in relation to leading counsel's fees for preparing the submissions in relation to costs dated 10 June 2016. So, the grand total, exclusive of VAT, amounts to £80,813.60.
6. In relation to Case H, the total costs claimed, in a bill dated 8 October 2015, amount, exclusive of VAT, to £70,108.93, this total comprising three elements: (i) the costs of the solicitors amounting to £16,636.33; (ii) counsel's fees amounting to £53,050 (leading counsel £33,350; junior counsel £19,700); and (iii) court fees and other disbursements amounting to £422.60. By the time the Form N260 was served on 3 June 2016, the solicitors' costs, exclusive of VAT, had been re-calculated and amounted to £17,901 (an increase of £1,264.67), bringing the total to £71,373.60. A second Form N260, also dated 3 June 2016, and relating to costs since 8 October 2015, showed further solicitors' costs, exclusive of VAT, in the sum of £2,959, bringing the total to £74,332.60. On top of that, a further sum of £1,170, exclusive of VAT, is claimed in relation to leading counsel's fees for preparing the submissions in relation to costs dated 10 June 2016. So, the grand total, exclusive of VAT, amounts to £75,502.60.
7. The clinic's primary submission in relation to Case F is that the costs should be referred for detailed assessment to a costs judge. In the alternative, and not disputing the costs of the solicitors, junior counsel's fees or the disbursements, the clinic contends that, even when taking account of the novel and significant issues in the case, the fees charged by leading counsel are too high. There is specific challenge to six items:

i) Leading counsel's brief fee for the directions hearing on 16 September 2014 – £4,000, exclusive of VAT – was "high" for a directions hearing.

ii) Leading counsel's brief fee for the hearing on 27 January 2015 – £8,500, exclusive of VAT – was "excessive"; although prepared as for a substantive hearing, the fee, it is said, should be limited to what would be appropriate for a directions hearing, since no allowance for any additional work done was subsequently made in the brief fee for the final hearing.

iii) Leading counsel's brief fee for the directions hearing on 21 April 2015 – £4,000, exclusive of VAT – was "high", given the hearing lasted only a little over 1½ hours.

iv) Leading counsel's brief fee for the final hearing on 13 July 2015 – £25,000, exclusive of VAT – was "high".

v) Leading counsel's refresher for closing submissions on 20 July 2015 – £4,000, exclusive of VAT, rather than the other refreshers claimed at £2,500 – was not justified, given that "Counsel already had an extremely detailed working knowledge of the case."

vi) Leading counsel's fee for perusing the draft judgment and suggesting revisions^[2] – £1,885, exclusive of VAT – was "excessive", it being said that only a nominal fee is appropriate given the limited work required.

8. The clinic's submissions in relation to Case H are directed to the original bill dated 8 October 2015 in the amount, exclusive of VAT, of £70,108.93. The clinic's primary contention again is that the costs should be referred for detailed assessment to a costs judge. In the alternative, it contends that:

i) The solicitors' costs are excessive, not least because counsel was instructed throughout and effectively had full conduct of the claim, so that the involvement of the solicitors was "essentially to oversee the instruction of counsel."

ii) The appropriate hourly rates for the fee earners should be respectively £250, £220, £190 and £120 rather than, as claimed, £390, £240, £220 and £120.

iii) Attendances claimed are excessive and disproportionate. There is specific challenge to five items: (a) £97.50 (15 mins at £390ph) reviewing, amending and signing application – this, it is said, was supervisory work duplicative of work already carried out by another; (b) £210 (1¾ hours at £120ph) attending court to issue application – this, it is said, was unnecessary and in any event an administrative task; (c) £210 (1¾ hours at £120ph) reviewing medical notes – the time claimed is said to be excessive; (d) £325 (50 mins at £390ph) reading medical notes – this, it is said, was largely duplicative of work already carried out; and (e) £260 (40 mins at £390ph) reading the judgment – this, it is said, is simply duplication of work already carried out by the primary fee earner.

iv) Counsel's fees: it is said that, even when taking account of the novel and significant issues in the case, the fees charged by leading counsel are too high. There is specific challenge to four items:

a) Leading counsel's brief fee for the directions hearing on 13 July 2015^[3] – £5,000, exclusive of VAT – was "high", being "more akin to a brief fee for a fully contested trial, not a directions hearing."

b) Leading counsel's brief fee for the final hearing – £16,500, exclusive of VAT – was "high."

c) Leading counsel's fee for perusing the draft judgment and suggesting revisions^[4] – £1,885, exclusive of VAT – was "high", it being said that only a nominal fee is appropriate given the limited work required.

d) Junior counsel's fee claimed as a "Refresher not sitting 7hrs reading and prep" on 14 July 2015 – £1,400, exclusive of VAT – "served no purpose and has not progressed the case or added anything material to the application."

9. In support of the fees and costs being claimed, the point is made, both in Case F and in Case H, that, given the nature of the predicament in which they found themselves as a result of the clinic's failings, the applicants were entitled to "high quality" legal advice and representation; a "cheese-paring" approach to quantum, it is said, is not appropriate. The litigation, it is said, undoubtedly warranted the use of leading counsel, whose fees should reflect the fact that there was a mass of authorities and other materials to be mastered and (in Case F) that leading counsel was acting without a junior. In relation to the solicitors' costs in Case H it is said that the work was done by fee-earners of appropriate grades and with perfectly reasonable charging rates; the point is made that "their hourly rates are within the guideline rates published by the SCCO for 2010."
10. I do not, in all the circumstances, and having regard to the terms of the orders referred to in paragraph 1 above, propose to direct a detailed assessment by a costs judge.
11. In relation to Case F, I propose summarily to assess the costs as claimed but with the following adjustments, which I arrive having regard to all the circumstances and taking into account the opposing contentions:

i) I see no proper basis for reducing the amount recoverable in relation to the brief fee for the directions hearing on 16 September 2014.

ii) The amounts recoverable in relation to the brief fees for the hearings on 27 January 2015 and 21 April 2015 and in relation to the refresher for the hearing on 20 July 2015 will be reduced to £4,000, £2,500 and £2,500 respectively (from £8,500, £4,000 and £4,000), in each case exclusive of VAT, essentially for the reasons put forward by the clinic.

iii) The amount recoverable in relation to the brief fee for the final hearing will be reduced to £17,500, exclusive of VAT. This takes account of (a) the reduction in the brief fee for the directions hearing on 27 January 2015, (b) the overlap between Case F and Case H and, see below, (c) the amount I propose to allow in relation to the brief fees in Case H.

iv) The amount recoverable in relation to the judgment will be reduced to nil. I have taken the work involved here into account in assessing the amount to be allowed in relation to the brief fee for the final hearing.

v) The amount recoverable in relation to the preparation of the costs submissions will be reduced to nil. There is no justification for requiring the paying party to pay the fees of leading counsel for preparing such a document.

12. In relation to Case H, I propose summarily to assess the costs as claimed in the original bill dated 8 October 2015 but with the following adjustments, which I arrive at having regard to all the circumstances and taking into account the opposing contentions:

i) Given the complex and novel nature of the issues, and having regard to the points made in paragraph 9 above, I do not think, in all the circumstances, that there is any basis for challenging the fee-earners' charging rates.

ii) In the light of the specific challenges referred to in paragraph 8(iii) above, I propose to reduce the amount recoverable in relation to the solicitors' costs of £16,636.33 by the sum of £750, exclusive of VAT. Otherwise I do not propose to make any reduction.

iii) I do not propose to make any reduction in relation to junior counsel's fee.

iv) In relation to leading counsel's fees:

a) the amounts recoverable in relation to the brief fees, which I propose to consider in the aggregate, will be reduced from £21,500 to £17,500; this takes account of the overlap between Case F and Case H and, see above, the amount I have allowed in relation to the brief fees in Case H;

b) the amount recoverable in relation to the judgment will be reduced to nil; as in Case F, I have taken the work involved here into account in assessing the amount to be allowed in relation to the brief fee for the final hearing.

13. This leaves the further costs claimed subsequently in Case H (see paragraph 6 above). I propose to:

i) reduce to nil the amount recoverable in relation to the additional costs of £1,264.67; no adequate explanation has been given for the increase in the amount claimed in the original bill;

ii) reduce to nil the amount recoverable in relation to the preparation of the costs submissions; there is no justification for requiring the paying party to pay the fees of leading counsel for preparing such a document;

iii) make no reduction in relation to the additional costs of £2,959, in relation to which the clinic has not sought to make any submissions.

14. I summarily assess the costs in Case F and in Case H accordingly.
15. In both cases, interest is claimed, attention being drawn to two potentially relevant dates: the conclusion of the proceedings on 11 September 2015, and the date of service of the relevant bill (8 October 2015 in Case H, and 18 March 2016 in Case F). In my judgment it is fair, just and appropriate that interest should be paid at the usual rate. In the circumstances, interest will run in Case F from 18 March 2016 and in Case H from 8 October 2015 (except in relation to the additional costs of £2,959 where interest will run from 3 June 2016).

Note 1    The vast bulk of this was work done by a fee-earner initially as a Grade B charged at £175ph and subsequently as a Grade A at £185ph.    [Back]

Note 2    The actual fee – £3,770, exclusive of VAT, representing 6½ hours work – has been divided equally between Case F and Case H.     [Back]

Note 3    Whereas in Case F a single brief fee of £25,000 was claimed for the final hearing starting on 13 July 2015, in Case H separate brief fees of £5,000 and £16,500 were claimed for the hearing on 13 July 2015 and the resumed hearing starting on 15 July 2015.     [Back]

Note 4    See footnote 2.    [Back]