Interpreter Fees Through Related Companies Require No Breakdown Absent Abuse

The High Court dismissed an appeal challenging assessment of interpreter fees as disbursements in fixed costs litigation, holding that no breakdown was required to separate alleged agency elements where services were provided through a related company.

MOTOR INSURERS’ BUREAU V RAPHAEL DE LIMA SANTIAGO [2026] EWHC 513 (KB)

In Motor Insurers’ Bureau v Santiago [2026] EWHC 513 (KB), the High Court dismissed an appeal concerning the assessment of an interpreter’s fee as a disbursement in fixed costs proceedings. Following the claimant’s £20,000 settlement for injuries caused by an uninsured driver, his solicitors claimed £924 for interpretation services provided by PALS, a related company. After the Court of Appeal determined such fees were recoverable under CPR 45.29I, HHJ Dight assessed the reasonable sum at £794.40 on remission. The MIB argued that a breakdown was required to exclude any agency profit element, that without it the fee should be nil, and that the assessment was excessive. Moody J rejected these contentions, holding that interpretation services constituted classic disbursements under Crane v Cannons Leisure Centre for which solicitors bore no personal responsibility. Providing services through a related company was permissible under the Legal Services Act 2007 and did not mandate a breakdown absent evidence of abuse. The Judge correctly assessed reasonableness and proportionality under CPR 44.3 using a market-based approach endorsed in Callery v Gray, setting the fee at the mean of comparative quotes, an evaluative judgment disclosing no error of law.

[14] The MIB’s argument is that the PALS invoice includes a disguised element of solicitors’ profit costs or an agency element and so therefore a breakdown was required. In agreement with the Judge below, I reject this submission. Interpretation services are (per Crane) not services for which a solicitor carries personal responsibility to the client. In my judgment, there is nothing wrong with interpreter services being provided via a company…It is inevitable that only part of the sum paid to the company will end up in the pocket of the interpreter.

Citations

Cham v Aldred [2019] EWCA Civ 1780 The case established that certain costs principles related to fixed costs regimes cannot automatically disallow interpreter’s fees as recoverable disbursements under costs rules. Crane v Cannons Leisure Centre [2007] EWCA Civ 1352 It clarified the distinction between solicitors’ profit costs and disbursements, indicating that solicitors have a personal responsibility to the client only for the former. MIB v Santiago In this case, the costs for interpretation services were considered as disbursements. The court determined that no breakdown was necessary to assess reasonableness and proportionality under fixed costs rules. Callery v Gray [2002] UKHL The judgment emphasised the role of market rates in assessing whether claimed fees are reasonable and proportionate under costs rules.

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Key Points

A fee for a service for which a solicitor does not bear personal responsibility to the client is recoverable as a disbursement, even where the service is provided via a company rather than directly by an individual practitioner. [13, 14]
There is no rule of law or practice requiring a receiving party to provide a breakdown of a disbursement invoice to identify an internal agency or profit element, unless such information is necessary to investigate a potential abuse or to establish the reasonableness of the fee. [17, 18]
The fact that a service provider company is related to the receiving party’s solicitors does not, of itself, render the arrangement unlawful or automatically require the disclosure of a breakdown of the invoice. [16]
When assessing the reasonableness and proportionality of a disbursement, the court may have regard to the market and consider a range of alternative quotations for comparable services. [20]
The assessment of a reasonable and proportionate fee for a disbursement is an evaluative judgment for the first-instance judge, with which an appellate court will be slow to interfere. [21]

[17] There may be cases where an abuse is suspected, or indeed where it is necessary to establish the reasonableness of the fee charged, where a breakdown should be required and provided. My attention has been drawn to County Court cases where a breakdown has been required for invoices rendered by medical agencies and my attention has also been drawn to the previous (2025) edition of Cook on Costs at [28.15] where that practice was deprecated.

Key Findings In The Case

The Honourable Mr Justice Moody held that the interpreter’s fee was a disbursement, not disguised profit cost, and was therefore recoverable as a separate expense under the costs regime applicable at the time [3], [13], [14].
It was determined that there was no requirement for a breakdown of the invoice from Professional and Legal Services Ltd (PALS), despite the MIB’s argument that it might include a non-recoverable agency or profit element. The judge found that such a breakdown was unnecessary to assess the reasonableness of the fee and that the relationship between PALS and Bond Turner did not necessitate transparency beyond what was provided [16], [18], [19].
The judge rejected the submission that the costs should have been assessed at nil in the absence of a breakdown of the interpreter fee, concluding that the evidence presented was sufficient to determine the reasonableness of the claimed costs without requiring an itemised invoice [18], [19].
The court used a range of alternative quotations to gauge the reasonableness and proportionality of the interpreter’s fee, ultimately assessing it based on the mean of these quotes. The judge concluded that a reasonable and proportionate fee in this context was £794.40, adjusted from the initially claimed £924, due to concerns about proportionality relative to the claim’s value [20].
Mr Justice Moody’s decision demonstrates appellate restraint by affirming the trial judge’s evaluative judgment regarding the fee’s reasonableness and proportionality, underscoring the notion that such assessments should not typically be interfered with by an appellate court [21].

[18] In my judgment, there is no rule of law or practice that requires a breakdown in every case where a litigation service is provided through a company. The court’s task is to assess reasonableness and proportionality. It is a question of fact in any particular case as to whether a breakdown is required in order to enable the court to perform its task...I reject the submission that the costs should have been assessed at nil in the absence of a breakdown.

The High Court’s decision in Motor Insurers’ Bureau v Santiago [2026] EWHC 513 (KB) addresses whether interpreter fees provided through a company related to the claimant’s solicitors must be broken down to identify recoverable disbursement elements in fixed costs cases.

Background

The respondent, Mr Raphael De Lima Santiago, sustained injuries in a motorcycle accident on 22 May 2018 involving an uninsured driver. Consequently, the Motor Insurers’ Bureau (MIB) was joined as second defendant to the claim. The substantive claim settled on the first day of trial for £20,000 plus costs, with the case falling under the fixed recoverable costs regime.

Mr Santiago required Portuguese interpretation services. His solicitors, Bond Turner, served a costs schedule dated 8 August 2022 claiming £924 for an interpreter’s fee at trial. The supporting invoice was issued by Professional and Legal Services Ltd (PALS), a company related to Bond Turner. On provisional assessment, the MIB contended that interpreter fees were not recoverable as a disbursement under the then applicable CPR 45.29I. A Deputy District Judge accepted this argument. The claimant successfully appealed this point directly to the Court of Appeal, which held that an interpreter’s fee was a recoverable disbursement. The matter was then remitted to His Honour Judge Dight, the Designated Civil Judge for London, to assess the quantum of that fee.

Before Judge Dight, the MIB argued that the PALS invoice likely contained an irrecoverable agency or profit element and sought a breakdown. The claimant resisted providing a breakdown, maintaining the fee was reasonable. Judge Dight, in a reserved judgment dated 21 February 2025, assessed the recoverable fee at £794.40 (being £662 plus VAT). The MIB appealed that assessment, and permission was granted by Sir Stephen Stewart on 4 August 2025.

Costs Issues Before the Court

The appeal concerned the correct approach to assessing a disbursement for interpreter services within a fixed costs case. The central issues were: first, whether the receiving party was required to provide a detailed breakdown of an invoice from a service provider company (particularly one related to the solicitors) to identify and potentially strip out any agency fee or outsourced profit cost; second, whether, in the absence of such a breakdown, the fee should be assessed at nil; third, whether the Judge’s methodology for assessing a reasonable and proportionate fee was erroneous in law.

The Parties’ Positions

The appellant, the MIB, represented by Mr Robert Marven KC, advanced three principal arguments. First, it submitted that the element of the fee retained by PALS was irrecoverable in principle, being characterised as a disguised solicitors’ profit cost or an impermissible agency fee outside the fixed costs regime. A breakdown was therefore essential to identify what could be recovered. Second, it argued that a breakdown was necessary as a matter of procedural fairness to enable a proper assessment. Third, it contended that the Judge’s assessed figure of £794.40 was too high, suggesting a lower figure should have been applied, potentially aligned with the evidence of an interpreter’s direct fee of £300.

The respondent, Mr Santiago, represented by Mr Benjamin Williams KC, opposed the appeal. He submitted there was no general rule requiring a breakdown of a disbursement invoice. He argued that the fee for interpretation services, provided via a company, was a proper disbursement, drawing an analogy with fees charged by expert consultancies. He maintained that the Judge had all necessary evidence to assess reasonableness and that his conclusion was within the range of his legitimate discretion.

The Court’s Decision

Mr Justice Moody dismissed the appeal. On the first issue, the court rejected the argument that a breakdown was required as a matter of principle to separate an agency component. It approved the distinction from Crane v Cannons Leisure Centre that a disbursement is characterised by work for which the solicitor does not bear personal responsibility to the client. Interpretation services fell into this category. The court held there was nothing wrong with such services being provided via a company, noting potential advantages such as providing cover for illness or a range of interpreters of differing levels of expertise and experience. The fact that PALS and Bond Turner were related did not of itself render the arrangement unlawful or necessitate a breakdown. The court noted that the Legal Services Act 2007 expressly permits procuring services from a related company. The analogy with an expert report from a consultancy firm was considered helpful; the full fee charged would be a disbursement without needing to dissect the expert’s internal remuneration.

The court acknowledged that there may be cases where a breakdown is needed to investigate abuse or establish reasonableness. The court noted that its attention had been drawn to County Court cases requiring breakdowns for medical agency invoices and to commentary in Cook on Costs that deprecated that practice. However, the court held there was no rule of law or practice that requires a breakdown in every case where a litigation service is provided through a company. On the facts, the evidence before the Judge provided sufficient information for the assessment. This included Mr Dean’s evidence that the specific interpreter, Mr Alvarenga, would charge £300 directly, and Mr Ryder’s evidence of alternative quotes for interpreter services. With this information, no breakdown was required and the fee was not to be assessed at nil.

On the second issue, the court found no error in the Judge’s assessment of a reasonable and proportionate fee. The Judge had correctly directed himself by reference to CPR 44.3 and the market-based approach endorsed in Callery v Gray. His decision to take the mean of the quoted figures provided by the claimant’s costs draftsman was an evaluative judgment reached by an experienced judge who would himself have conducted summary assessments after trials in London including claims for interpreters’ charges. The appeal court emphasised that this was a paradigm case for appellate restraint and would not interfere with the first-instance judge’s assessment.

Accordingly, the Judge’s assessment of £794.40 was upheld and the appeal dismissed.

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