Medical Agency Breakdown Must Be Provided To Avoid A 75% Reduction In Fees

In Chaudhry v AXA Insurance UK Plc, the claimant, Mr Mohammad Chaudhry, pursued a personal injury claim following a road traffic accident (RTA) which occurred on 20 May 2020. The underlying dispute related to alleged injuries suffered by the claimant and subsequent claims for damages. While liability and causation issues were resolved early, the legal costs associated with disbursements became a point of contention, leading to the defendant’s Part 18 application.

The defendant submitted a Part 18 Request on 22 January 2024, asking the claimant to disclose a breakdown of the costs relating to the medical expert’s invoice and the associated MRI. The defendant’s position was premised on the need for transparency to assess the reasonableness and proportionality of the claimed disbursements. The claimant responded by asserting that this information was not within his possession. Premex indicated its unwillingness to release this data, citing commercial sensitivity.

The defendant argued that the claimant had a duty to provide the requested details in accordance with procedural rules governing recoverable expert costs, specifically citing established case law, including *Stringer v Copley* (2002), which emphasised the importance of clarity in medical agency fee arrangements. The defendant maintained that, without such a breakdown, the court and paying party were unable to properly assess the proportionality of these costs.

Conversely, the claimant contended that there was no legal or procedural obligation for further disclosure beyond what had already been provided. He argued that the full disbursement amounts were recoverable as reasonable, proportionate, and appropriate for summary assessment. The claimant asserted that requiring additional information was unnecessary and disproportionate, particularly as he lacked the means to compel Premex to disclose commercially sensitive details.

The matter proceeded to a hearing on 23 July 2024, where the defendant sought an order compelling the claimant to disclose the requested breakdown and, further, sought an unless order restricting recovery to 25% of the disbursements if the claimant failed to comply. Judgment was reserved and delivered on 13 November 2024.

Chronology of Relevant Events

• 20 May 2020: The claimant suffered personal injuries in a road traffic accident.
• 22 January 2024: The defendant submitted a Part 18 Request seeking a detailed breakdown of the fees claimed for medical evidence.
• 1 February 2024: Premex responded, declining to provide the requested breakdown on grounds of commercial sensitivity.
• 23 July 2024: The defendant’s application to compel disclosure was heard. The judgment was reserved.
• 13 November 2024: The court issued its judgment and ordered the claimant to provide the requested breakdown within 21 days or face restricted recovery.

The Defendant’s Arguments

The defendant advanced the following points:

1. The claimant’s failure to provide a breakdown of medical disbursements contravened established legal principles, particularly those in *Stringer v Copley* (2002), which emphasised transparency between expert fees and agency charges.
2. Without the breakdown, the court could not assess whether the agency’s fees were reasonable and proportionate. This information was critical to ensure that the agency’s charges did not exceed what would reasonably be charged if handled directly by a solicitor.
3. The claimant’s reliance on commercial sensitivity from Premex was untenable, as it prevented the paying party and the court from verifying the propriety of the claimed disbursements.
4. The claimant had the power to compel Premex, an agent acting under his instruction, to disclose the requested data.
5. An unless order was justified to ensure compliance and avoid prejudice to the defendant, as the lack of transparency placed the defendant at an unfair disadvantage.

The Claimant’s Arguments

The claimant opposed the application on the following grounds:

1. The request, and its scope, were neither necessary nor proportionate under Civil Procedure Rules nor Part 18 principles. The claimant argued that the reasonableness and proportionality of fees could be addressed via a summary assessment without the need for further breakdown.
2. The claimant had complied with the Part 18 request to the best of his ability by providing all information in his possession and could not be compelled to produce information that he did not have.
3. Premex’s refusal to disclose commercially sensitive data was outside the claimant’s control, meaning an order compelling disclosure would place him in an unfair position where non-compliance was inevitable.
4. The defendant’s reliance on *Stringer* and other non-binding authorities was misplaced, as the cited cases related to detailed assessments, while this case would involve a summary assessment.
5. The unless order sought by the defendant was disproportionate and draconian in circumstances where the claimant had not committed any breach.

 Decisions and Findings  

The judge held that the Defendant’s Part 18 request for further information about the breakdown of medical agency fees was justified in order to allow for the assessment of reasonableness and proportionality under the Civil Procedure Rules. He determined that such information is necessary for both the Defendant and the Court to analyse whether the fees incurred were reasonable and proportionate.  

“I am satisfied that the Defendant’s request is necessary and proportionate. … The same applies to the Medical Reporting Agency fees. In the absence of this information both the Defendant and the Court are unable to assess whether the fees of that organisation are reasonable and proportionate.”

He found that without transparency from the medical agency, the Court cannot evaluate whether the charges exceed what would reasonably have been charged by a solicitor for similar work. and rejected the Claimant’s argument that the Court cannot compel information the Claimant does not possess. He  found the Claimant’s position untenable, reasoning that since the medical agency is the Claimant’s agent, the Claimant has a right and an obligation to compel the agency to provide the requested information. Furthermore, he stated that the medical agency’s claim of “commercial sensitivity” does not override the Claimant’s duties under Paragraph 5.2 of Practice Direction 47 regarding transparency of expert fee notes.  

“Premex is the Claimant’s agent and undertook its role on the Claimant’s instructions and with his authority to do so. It would be an extraordinary position if he were not entitled to compel the agency to provide him with details of the fees that were incurred on his behalf and for which he is primarily liable to pay.”

“Paragraph 5.2 PD 47 … requires that the receiving party must provide the expert’s fee notes so that the charges of the expert are precisely known to all. … This information enables the paying party to form a view about whether and if so to what extent to challenge the amount of fees claimed, and it enables the Court to form its view if the issue proceeds to assessment.”

The judge adopted the principle elucidated by HHJ Saggerson in Ena Aminu-Edu v Esure Insurance Company Ltd, reinforcing the concept that “commercial sensitivity” does not absolve a party of its obligation to provide transparency in relation to recoverable costs and that lack of transparency creates the potential for disproportionate fees to be concealed. He aligned with existing judicial authorities that highlight the risk of agency fees becoming an unreasonable proportion of the costs claimed, as described in Stringer v Copley [2002].  

“I adopt the comments made by HHJ Saggerson in the case of Ena Aminu-Edu v Esure Insurance Company Ltd – ‘The court is entitled to require transparency from those whose fees form part of claimed and potentially recoverable costs. ‘Commercial sensitivity’ does not have any relevance to proportionality.’”

“The retail/wholesale cost analysis advanced by Premex is an approach which itself creates the circumstances … which could permit the ‘extreme’ scenario of the medical examination fee being only a very modest part of the overall disbursement claimed which was substantially comprised of the Agency fee – which had it been known would ‘undoubtedly’ have been considered to be ‘unreasonable and disproportionate.’”

The judge made an order requiring the Claimant to provide a breakdown of the costs within 21 days. He further imposed an “unless order,” stating that failure to comply would result in the Claimant only being entitled to recover a maximum of 25% of the disputed disbursements.