Solicitors Act Assessment Claim Dismissed Due To Delay And Concurrent Part 7 Proceedings

CAPTIVATIUN LIMITED v ORR LITCHFIELD SOLICITORS LIMITED [2025] EWHC 679 (SCCO)

Captivatiun Limited brought a Part 8 Solicitors Act claim against Orr Litchfield Solicitors Limited seeking a detailed assessment of two invoices totalling £13,518, substantially delayed after the original bills were issued in May and September 2022. The Defendant sought to dismiss the proceedings, arguing the claim was out of time and an abuse of process, particularly given concurrent Part 7 debt recovery proceedings already in progress. Costs Judge Nagalingam dismissed the Part 8 claim, finding the Claimant could not establish the “special circumstances” required to proceed with a late assessment under Section 70(3)(c) of the Solicitors Act 1974. The judge determined the existing Part 7 proceedings already provided adequate mechanisms to investigate the Claimant’s allegations regarding the invoices, including disclosure, witness evidence and a fast-track trial. Consequently, the Part 8 claim was deemed unnecessary and potentially duplicative, with the Defendant awarded costs of the application and response.

“I simply cannot conclude that additional court time and party resources to a further hearing to decide if special circumstances arise is either warranted or proportionate. There is nothing in the Claimant’s Part 8 claim nor evidence, skeleton argument or oral submissions made since that leads me to conclude there is any prospect of special circumstances being established.”

Citations

Wallis v Valentine [2002] EWCA Civ 1034 Engaging in parallel proceedings for the same subject-matter with the collateral purpose of causing expense or harassment amounts to an abuse of process and justifies dismissal of the claim. Yasin v Whitmore Solicitors (SC-2021-APP-000450) A client who seeks assessment of a solicitor’s gross sum bill must rely on the correct section of the Solicitors Act 1974; a mischaracterisation of the claim may restrict the availability of certain remedies.

Track allocation housing disrepair CPR 46.13 settlement sum costs restriction SCCO

MRO fee markup cap 25% detailed assessment personal injury Senior Courts Costs Office

Security for costs refused CPR 25.27 very high probability success excessive estimate King's Bench

IPEC scale costs transfer Patents Court PD 30 para 9.2 costs caps Court of Appeal

Costs budget variation CPR 3.15A promptness significant development unfair prejudice Chancery Division

Costs budgeting inter partes proportionality high hourly rates AI disclosure Patents Court CPR 3E

Beneficiary personal liability section 71(3) Solicitors Act 1974 indemnity costs VAT self-supply SCCO

Summary assessment indemnity costs unless order payment on account disclosure default Chancery Division

Provisional assessment set aside CPR 3.1(7) points of dispute filing duty PD 47 para 14.3 SCCO

Fixed recoverable costs police claims CPR 26.9(10)(e) intentional tort exemption

Key Points

An application for detailed assessment under section 70(3)(c) of the Solicitors Act 1974 made more than 12 months after delivery of the bill requires the applicant to demonstrate special circumstances to justify such an order. The burden lies firmly on the applicant to demonstrate facts warranting further investigation. [29, 34]
Standard allegations that fees are excessive or unreasonable, without more, do not constitute special circumstances sufficient to justify detailed assessment under section 70(3)(c) of the Solicitors Act 1974. [43]
Where factual disputes as to whether work was carried out can be fully resolved through a defended Part 7 claim with appropriate directions for disclosure and oral evidence, those disputes will not ordinarily amount to special circumstances supporting a separate Solicitors Act assessment. [37, 44–47, 70–72]
Commencing separate Part 8 proceedings after delivery of a defence in ongoing Part 7 proceedings concerning the same invoices may be abusive or disproportionate if it causes unnecessary duplication, delay, or court time, particularly where directions under Part 7 mirror those sought under Part 8. [60, 63, 68–69, 74–75]
CPR 46.14 is only engaged where the sole issue between the parties concerns the quantum of costs and there is no dispute as to liability; the existence of broader disputes about whether any sums are payable in principle precludes reliance on this rule. [77–84]

“Given the statements of costs I have seen thus far in the Part 8 proceedings, there is no compelling reasonableness or proportionality argument that would lead me to conclude that in the factual procedural circumstances of this case, as at 12 March 2025, the parties would be better served under Part 8 than Part 7.”

Key Findings In The Case

The Claimant’s application for detailed assessment under section 70(3)(c) of the Solicitors Act 1974 was brought nearly 23 and 20 months respectively after the delivery of the disputed invoices, and the court found no special circumstances to justify permitting the application to proceed out of time [29, 30, 75].
The court found that the serious factual allegations raised by the Claimant—such as claims that some of the work was not carried out—could be fully adjudicated within the scope of the existing Part 7 proceedings, which were already subject to directions including disclosure, exchange of witness evidence and trial listing [37, 44–47, 70–72].
The retainer documentation between the parties did inform the Claimant of its rights under the Solicitors Act 1974 to challenge the solicitors’ costs, and therefore the Claimant’s allegation of being unaware of such rights was rejected as unfounded [21–25, 41].
The court determined that the Claimant initiated the Part 8 proceedings well after serving a defence in ongoing Part 7 proceedings involving the same invoices, and found that continuing with the Part 8 proceedings would cause unnecessary duplication and delay; dismissal of the Part 8 claim was therefore ordered [63, 68–69, 74–76].
The court found CPR 46.14 inapplicable because there was no written agreement confirming liability to pay costs, and substantive disputes remained as to whether any costs were payable at all, evidenced by denials of liability contained in the Claimant’s Part 7 defence [77–84].

“As to a common law damages assessment (of unpaid fees) versus a detailed assessment of the same sum, Mr Miller for the Claimant was unable to explain to me what benefits Part 8 had over Part 7 in the context of the disputed invoices in this matter.”

The case involved proceedings initiated by Captivatiun Limited (“the Claimant”) against Orr Litchfield Solicitors Limited (“the Defendant”). Initially, the Defendant was instructed by the Claimant to assist with litigation involving Unlockd Marketing Ltd. The Claimant made an initial payment on account of £900 plus VAT. Disputes soon arose concerning the fees charged by the Defendant.

On 30 May 2022, the Defendant issued an invoice for £4,500 plus VAT. The Claimant sought to discuss the invoice, but by 16 June 2022, the Defendant indicated they could not undertake further work until the invoice was settled. This led to the Claimant concluding that their relationship with the Defendant had ended. Subsequently, on 6 September 2022, a second invoice for £9,018 plus VAT was generated.

The Defendant commenced Part 7 proceedings on 19 December 2023, seeking recovery of unpaid fees totaling £13,338. In response, on 12 April 2024, the Claimant notified the Defendant of their intention to issue a Part 8 claim for an order and directions for a Solicitors Act assessment of the invoices.

Procedural complications followed. The Claimant filed the Part 8 costs-only proceedings on 18 April 2024 to secure detailed assessment of the invoices. This led to a directions hearing being scheduled by the Senior Courts Costs Office (SCCO) on 10 May 2024, which was later adjourned to 26 June 2024 due to service issues.

On 26 June 2024, the Claimant served the sealed Part 8 claim form on the Defendant, although a certificate of service was not filed until 15 November 2024. The Defendant disputed the court’s jurisdiction in their acknowledgement of service filed on 18 December 2024, and on 12 February 2025, the Claimant requested a breakdown of the disputed invoices.

The matter centred on whether the Part 8 claim was an abuse of process, given the concurrent existence of Part 7 proceedings. Further, the court needed to consider if “special circumstances” justified allowing the Part 8 claim despite the delays.

This case raises crucial issues on the intersection of procedural rules governing costs disputes under Part 7 and Part 8, especially when one party is out of time under the Solicitors Act 1974.

Costs Issues Before the Court

The primary costs issues the court had to determine included the timeliness and appropriateness of the Claimant’s Part 8 application under the Solicitors Act 1974. Specifically, the Claimant was out of time but sought to rely on Section 70(3)(c) of the Act, which allows a court to exercise discretion if “special circumstances” arise.

The court had to consider:
– Whether the Claimant’s delay in bringing Part 8 proceedings constituted an abuse of process considering the ongoing Part 7 proceedings.
– The Claimant’s eligibility to pursue a Part 8 claim when it had been significantly out of time.
– Evaluation of the procedural efficiency and merits of resolving the dispute under Part 8 versus continuing under the ongoing Part 7 proceedings.

These issues were framed within the context of competing procedural rules, the timeline of events, validity and proper service of proceedings, and the special circumstances argument posited by the Claimant.

The Parties’ Positions

The Claimant, represented by James Miller, argued that although out of time, there were special circumstances warranting a Part 8 detailed assessment. It cited the Defendant’s lack of transparency and failure to provide a breakdown of costs despite repeated requests. The Claimant asserted that invoking the Part 8 process was essential to investigate serious allegations regarding the Defendant’s fees, including accusations of fabricated charges.

On the other hand, the Defendant, represented by Francesca O’Neill, focused on the argument that the Claimant was out of time and that their Part 8 application constituted an abuse of process. The Defendant contended that the issues raised by the Claimant were already adequately addressed in the Part 7 proceedings, which were well advanced. They argued that the ongoing Part 7 litigation offered a more appropriate forum for resolving the disputes and insisted that the parallel Part 8 proceedings were unnecessary and vexatious.

The Court’s Decision

Costs Judge Nagalingam ruled against the Claimant’s Part 8 application. He clarified that, despite the Part 8 procedural framework usually being favoured for costs disputes, the concurrent existence of the advanced Part 7 proceedings and the considerable delay by the Claimant in initiating Part 8 procedures could not be ignored.

The court found that the special circumstances asserted by the Claimant, such as the Defendant’s refusal to provide cost breakdowns and allegations of fabricated charges, were equivalent to common themes in many solicitor-client disputes. These did not, in themselves, rise to the level of special circumstances required to justify a late Part 8 application.

Additionally, the court found that all procedural directions necessary for a detailed investigation into the Defendant’s fees had already been set in the ongoing Part 7 proceedings, including orders for disclosure, exchange of witness evidence, and provision for a trial. Considering these facts, the court saw no added value in permitting the Part 8 application to proceed.

The court dismissed the Claimant’s Part 8 claim and awarded costs to the Defendant. However, the court expressed concerns over the significant costs claimed by the Defendant in response to the Part 8 claim and suggested that both parties aim to agree on a sensible sum before any further costs assessments.

In conclusion, Judge Nagalingam determined that continuing with the Part 7 proceedings was the most efficient and just course of action, both procedurally and substantively.

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