In the case of Blue Manchester Limited versus Howard Kennedy LLP, the SCCO considered whether 15 interim invoices delivered by the Defendant solicitors between January 2021 and June 2022 were valid interim statute bills within the meaning of section 70(3)(a) of the Solicitors Act 1974, and whether any “special circumstances” justified their court-ordered assessment.

The Claimant argued that the invoices could not be statute bills because they were not genuinely final for the service periods they covered, particularly given the conditional fee agreement (CFA) under which Howard Kennedy’s fees were substantially discounted but subject to possible top-up charges contingent on the arbitration’s outcome. Blue Manchester also questioned the accuracy of the Defendant’s cost estimates and invoices, citing both a retrospective overcharge admitted by the solicitors and the Defendant’s inconsistent communication about a revised overall cost estimate.

Conversely, the Defendant maintained that the terms of the CFA, combined with their standard business terms, permitted the issuance of monthly interim statute bills, thereby triggering the statutory deadlines for assessment challenges.

Costs Judge Nagalingam ultimately found for the Claimant, concluding that Howard Kennedy’s failure to adequately clarify the status and finality of the bills, particularly due to the contingent nature of the CFA’s top-up provision, precluded treating them as interim statute bills. The Judge further held that special circumstances existed, significantly influenced by the admitted overcharging, the late communication of drastically revised cost estimates, and the ongoing uncertainty around the invoices’ completeness.

In Hensley v Morris Law [2024] EWHC 1101 (SCCO), the High Court considered an application under section 68 of the Solicitors Act 1974 for the delivery of a statute bill of costs following the conclusion of a personal injury claim. The central issue was whether the bill provided by the defendant solicitors, which only addressed the success fee deducted from the claimant’s damages, complied with the requirements of a statute bill. Costs Judge Rowley found in favour of the claimant, holding that the bill did not meet the necessary criteria, as it failed to provide a complete account of the fees, charges, and disbursements incurred. The judge emphasized that clients are entitled to a compliant bill upon request, regardless of the solicitor’s view on the merits of any potential assessment under section 70 of the Solicitors Act 1974. The defendant was ordered to provide a final statute bill, with the claimant being awarded the costs of the application.

Pickering v Thomas Mansfield Solicitors Limited [2024] EWHC 1107 (SCCO) involved a client’s application for assessment of her former solicitors’ invoices, which totalled over £2.5 million. The key issues were whether the invoices were statute bills capable of assessment under the Solicitors Act 1974 and if so, whether the assessment should be conditional upon a further interim payment by the client. Costs Judge Brown found the invoices were statute bills but declined to order a further payment on account, citing concerns about potential reductions to the bills on assessment and the continued availability of security for the solicitors’ costs. The decision provides guidance on the requirements for statute bills and the court’s approach to interim payments in the context of a solicitor and client assessment.

“In my judgment the overall cap does not apply where the solicitor elects to claim their charges before the conclusion of the claim (for the reasons stated in Higgins), but it does apply where the solicitor elects to await the outcome of the claim.”

“The terms of that contract were clear and complete. They were based on the offer from the Claimant communicated to the Defendant in Ms Bartlam’s letter of 12 December 2019, as expressly accepted by the Defendant in Mrs Chikwendu’s letter of 14 February 2020 and relayed to the Claimant by Ms Bartlam. Ms Bartlam’s letters of 18 February 2020 set out the procedure by which the agreement would be implemented, which both parties, by their actions, plainly accepted. Accordingly, under the terms of the contract the Defendant was to render a “full and final bill of costs” for £10,000 plus specified disbursements and VAT, as the Defendant did on about 21 February 2020, and the Claimant was to pay it within two weeks, which the Claimant did.”