Disbursement Recovery Guide

Disbursement Recovery Guide

Is it reasonable incurred, reasonable in amount and proportionate?

Items which are difficult to recover

PRACTICE DIRECTION 47 - PROCEDURE FOR DETAILED ASSESSMENT OF COSTS AND DEFAULT PROVISIONS

CPD 5.22

(3) Local travelling expenses incurred by legal representatives will not be allowed. The definition of ‘local’ is a matter for the discretion of the court. As a matter of guidance, ‘local’ will, in general, be taken to mean within a radius of 10 miles from the court dealing with the case at the relevant time. Where travelling and waiting time is claimed, this should be allowed at the rate agreed with the client unless this is more than the hourly rate on the assessment.

(4) The cost of postage, couriers, out-going telephone calls, fax and telex messages will in general not be allowed but the court may exceptionally in its discretion allow such expenses in unusual circumstances or where the cost is unusually heavy.

(5) The cost of making copies of documents will not in general be allowed but the court may exceptionally in its discretion make an allowance for copying in unusual circumstances or where the documents copied are unusually numerous in relation to the nature of the case. Where this discretion is invoked the number of copies made, their purpose and the costs claimed for them must be set out in the bill.

Expert Fees

Not relied upon

This does not necessarily mean it will not be recoverable. The Court will not apply hindsight when assessing costs, so the Judge will consider whether it was reasonable to have instructed that expert based on what was known to the solicitor at that time.

High fees

I would encourage you to check fees when you check capacity and turn around times. You will usually be able to recognise whether an expert fees is higher than usual. It might be wise to get a couple of quotes in order to demonstrate that the fees of the expert you instruct are reasonable.

Disproportionate

You should be mindful of proportionality at all times. Incurring £10,000 worth of expert fees in a claim worth only £25,000 is likely to cause disproportionate costs overall. It is always important to weigh up the costs v benefit, whilst of course always fulfilling your professional duty to the client in respect of investigating the claim. You are not required to incur disproportionate costs- it is a sensible conversation which needs to be had with the client.

 

Counsel’s Fees

In principle

Was it reasonable to have instructed Counsel, are the fees reasonable in amount and are the fees proportionate? That is the test.

Frequency

The Court expects Counsel to be involved to deal with complex or novel issues, advocacy and for anything where it is more economic for Counsel to deal. The Court does not like it where you spend 3 hours instructing Counsel to draft a document which you probably could have prepared yourself within those 3 hours.

Disproportionate

If you have a low value case where you are already concerned that costs might be disproportionate, then you probably want to avoid incurred any unnecessary expenses. Proportionality is now heavily featured in the CPR and the Courts will now allow costs which are disproportionate, even if they are reasonable and necessary.

Court Fees

Remission

Some individuals are eligible for a remission in respect of Court fees if they are on state benefits or are low earners. https://www.justice.gov.uk/courts/fees

Hearing Fees for Trial

Hearing fees may also be fully or party refunded depended on when the case settles (The Civil Proceedings Fees (Amendment) Order 2014).

Where a case is on the multi-track or fast track and, after a hearing date has been fixed, the Court receives notice in writing from the party who paid the hearing fee that the case has been settled or discontinued then the following percentages of the hearing fee will be refunded:

(i) 100% if the court is notified more than 28 days before the hearing;

(ii) 75% if the court is notified between 15 and 28 days before the hearing;

(iii) 50% if the court is notified between 7 and 14 days before the hearing.

 

Other Disbursements

Any other disbursements have to pass the same test of reasonably incurred, reasonable in amount and proportionate.

So take for example accommodation and sustenance. This is reasonable where you are travelling a long distance, working out of normal hours or engaged in a multiple-day hearing. But the expenses still have to be reasonable. The Court will now allow anything which is an unnecessary luxury.

 

ATE Premiums

This is a complex area of law. There are a number of High Court and Court of Appeal decisions dealing with ATE Premiums. The leading authority is Rogers v Merthyr Tydfil County Borough Council [2006] EWCA Civ 1134. The Court should be slow to interfere with the complicated calculations performed by insurance underwriters.

Often the insurer will assist with any disputes in respect of their premium. We act for insurers defending premiums, so we can give specific advice if required.

Be sure that your client does not have BTE insurance before obtaining ATE. Also be sure that you give all the relevant information to the insurer and comply with all reporting requirements.