Inadequate Estimate Fails To Establish Special Circumstances Under s70(3) Where Client Would Have Made The Same Choices

A solicitor’s failure to provide adequate cost estimates will not establish special circumstances under section 70(3) where the client’s conduct demonstrates they would have made the same choices regardless. The test is whether better information would have led to different decisions.

BIGGAR V HOWARD KENNEDY LLP [2026] EWHC 132 (SCCO)

In Biggar v Howard Kennedy LLP [2026] EWHC 132 (SCCO), Costs Judge Leonard determined the claimant’s application under section 70 of the Solicitors Act 1974 for assessment of 19 bills totalling £195,954.60 from his former solicitors. The issues were whether the first three bills were ‘paid’, barring assessment under section 70(4), and whether ‘special circumstances’ under section 70(3) justified assessing the remainder. Applying Menzies v Oakwood [2024] UKSC 34, the judge held payment required agreement inferable from conduct; the claimant’s arrangement of payments against the outstanding balance sufficed, so those bills were paid and beyond jurisdiction. On special circumstances, the judge found none. The initial £10,000–£15,000 estimate was expressly preliminary and superseded, notably when the claimant later sought €1.3 million in funding. Evidence, including a March 2023 email, showed the claimant would have continued instructing the defendant regardless of updated estimates. The claimant’s other arguments — that a restraint order over his assets, the defendant’s enforcement proceedings, and his ongoing criminal trial constituted special circumstances — were also rejected. The application was dismissed.

I do accept that when considering whether a solicitor’s costs should be limited by reference to inadequate or non-existent estimates of future costs, the court can take into account that a client, in consequence, lost the opportunity to make different, less expensive choices. It does not follow that a client who, on receipt of better estimates, quite evidently would have made exactly the same choices can still make a credible case for limiting the solicitor’s costs. That seems to me to be the Claimant’s difficulty.

Citations

Falmouth House Freehold Co Ltd v Morgan Walker LLP [2010] EWHC 3092 (Ch) Established that whether special circumstances exist under section 70 is essentially a value judgment, requiring comparison with an ordinary case to determine if detailed assessment is justified. Raydens Ltd v Cole [2021] 7 WLUK 539 Confirmed that special circumstances can arise from anything out of the ordinary course and that a cost item or charging situation which calls for explanation can merit assessment. Stone Rowe Brewer LLP v Just Costs Ltd [2015] EWCA Civ 1168 Affirmed that special circumstances need not be exceptional and may be established by something sufficiently outside the ordinary to justify an assessment. Masters v Charles Fussell & Co LLP [2021] EWHC B1 (Costs) Discussed special circumstances in the context of whether the situation warranted departure from the general position under the Solicitors Act 1974, highlighting the relevance of issues calling for explanation. Wong v Vizards [1997] 2 Costs LR 46 Considered the significance of estimates in determining what a client should reasonably be expected to pay under a solicitor’s retainer. Mastercigars Direct Ltd v Withers LLP [2007] EWHC 2733 (Ch) Addressed the impact of an inaccurate cost estimate on the amount a client should pay, especially where reliance was placed on that estimate. Reynolds v Stone Rowe Brewer [2008] EWHC 497 (QB) Highlighted that clients do not need to prove they would have acted differently given more accurate cost estimates, only that the opportunity to consider alternatives was denied. Harrison v Eversheds [2017] EWHC 2594 Emphasised that significant deviations from initial cost estimates require serious explanation, affecting whether costs claimed are reasonable. Menzies v Oakwood [2024] UKSC 34 Held that agreement to pay a solicitor’s bill requires the client to have been informed of and to have accepted the specific sum claimed, whether expressly or by conduct.

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For the purposes of section 70 of the Solicitors Act 1974, a bill is “paid” when there is an agreement to the sum taken in payment, which may be inferred from the client’s conduct in making payments against the outstanding balance of bills rendered, without requiring specific agreement to the allocation of each payment to a particular invoice. [63, 66-67]
The existence of “special circumstances” justifying an assessment of a solicitor’s bill out of time is determined by comparing the case to the ordinary run of cases to see if it is out of the ordinary course and calls for an explanation or further scrutiny. [45, 47]
A client’s failure to challenge a solicitor’s bills for a prolonged period, while continuing to instruct the solicitor and never expressing dissatisfaction with the amounts charged, is a powerful factor weighing against a finding of special circumstances. [59-60, 79]
A preliminary estimate of costs for initial work that is subsequently exceeded does not, of itself, constitute a special circumstance when it is expressly provisional and is quickly superseded by the client’s subsequent conduct demonstrating an understanding of the likely scale of costs for the full matter. [69-70, 77]
Where a client, with full knowledge of accruing costs, demonstrates a clear preference to continue instructing a particular solicitor despite the cost, the court is unlikely to find that a lack of updated estimates constitutes a special circumstance, as the client has not lost a real opportunity to make different choices. [73, 75-76]

"The Claimant received the Defendant’s bills and, from time to time, made arrangements for the Defendant to receive payments against the outstanding balance of those bills. That constituted an agreement to pay. It was not necessary for him to agree to the allocation of specific sums against specific bills. It was open to him to leave that to the Defendant, as, evidently, he did."

Key Findings In The Case

The first three bills issued by the Defendant were held to have been “paid” within the meaning of section 70(4) of the Solicitors Act 1974, as the Claimant, by making and facilitating payments against outstanding balances, demonstrated conduct from which agreement to the sums claimed could be inferred, notwithstanding the absence of allocation to specific invoices [63–67].
The Defendant’s June 2020 estimate of £10,000–£15,000 plus VAT was a preliminary estimate limited to initial review and advice; it was held not to constitute a special circumstance because it was expressly non-binding and clearly superseded by the Claimant’s later conduct and understanding of the overall likely costs, including his pursuit of funding up to €1.32 million [69–70, 77].
The Court found that the Claimant did not lose any real opportunity to explore alternative legal representation due to a lack of updated estimates, as he made a deliberate and informed choice to continue instructing the Defendant despite being aware of rising legal costs, weakening any argument that insufficient cost updates constituted special circumstances [73, 75–76].
The Defendant did not issue regular prospective estimates after the initial retainer, but this was not found to amount to a special circumstance because the Claimant continued instructing the firm with full knowledge of outstanding debts, without any objections to the invoices until litigation commenced [72–73, 79].
The Claimant acknowledged his indebtedness in a written agreement dated 19 July 2023 and agreed to a payment plan, which he ultimately failed to honour; this affirmative conduct and prolonged absence of challenge to the bills until faced with enforcement proceedings effectively ruled out the existence of special circumstances justifying a late assessment [33–34, 59–60, 79].

"As for the lien, the Claimant had been advised at the outset that the Defendant would claim a right to retain papers if bills went unpaid. It is wholly unsurprising, when promises of payment were not met, that the Defendant chose to exercise that right. It is hard to see how the Claimant could realistically have delayed making an application to assess over 17 months in the hope that the Defendant would take a different view."

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The Senior Courts Costs Office’s decision in Biggar v Howard Kennedy LLP [2026] EWHC 132 (SCCO) confirms that deviation from a preliminary estimate will not establish special circumstances where the client’s conduct demonstrates they would have made the same choices regardless.

Background

Mr Alan Biggar made an application under section 70 of the Solicitors Act 1974 for the detailed assessment of 19 bills of costs delivered to him by his former solicitors, Howard Kennedy LLP [§1]. The bills, rendered between 29 June 2020 and 28 July 2023, totalled £195,954.60 [§1]. The Defendant’s records indicated that the first three bills, up to 26 August 2020, had been paid in full [§1]. The remaining bills were wholly or partly unpaid.

The Defendant had acted for the Claimant between June 2020 and June 2023 in connection with serious charges of fraudulent trading brought by the Financial Conduct Authority (FCA) relating to Worthington Group plc, a company listed on the London Stock Exchange [§5–6]. A restraint order, made on 13 April 2018 by HHJ Taylor at Southwark Crown Court, prevented the Claimant and his wife from dealing with their assets and did not contain an exception for legal fees [§10]. The retainer was governed by an engagement letter dated 12 June 2020 and the firm’s standard terms of business [§7]. The letter included a preliminary estimate of £10,000–£15,000 plus VAT for initial work (reviewing papers, liaising with the FCA, and providing initial advice), stating that further estimates would be provided as the matter progressed [§8–9].

The Claimant faced significant difficulties in funding his defence. An initial third-party funder, Mr Stephen Dando, withdrew in May 2021 [§19]. The Claimant’s estranged wife contributed £10,000 in October 2021 but was unable to provide further funding [§20]. Subsequent promises of funding from Anglo Swiss Advisory Ltd, outlined in a letter dated 14 October 2022, failed to materialise [§24–25]. That letter contemplated funding of at least €1,320,000 [§24]. Despite mounting unpaid fees, the Defendant continued to act. In July 2023, the parties entered a written agreement in which the Claimant acknowledged a debt of £101,137.42 and agreed to a repayment plan [§33]. The plan was not honoured [§34].

On 22 May 2024, the Defendant issued County Court proceedings for unpaid fees totalling £102,109.40 plus interest [§35]. The Claimant filed a defence challenging the reasonableness of the fees and sought an order for detailed assessment [§35]. Shortly thereafter, on 9 January 2025, he issued a Part 8 application in the Senior Courts Costs Office [§36]. On 15 January 2025, HHJ Evans-Gordon stayed the County Court proceedings pending the conclusion of the assessment claim [§36].

Costs Issues Before the Court

The court was required to determine two principal issues [§4]. First, whether the Defendant’s first three bills had been “paid” for the purposes of section 70 of the Solicitors Act 1974. If they were paid more than 12 months before the application, the court had no jurisdiction to order their assessment under section 70(4) [§3]. Second, whether “special circumstances” existed to justify an order for the assessment of the remaining unpaid bills. As the application was made more than 12 months after the delivery of those bills, the Claimant needed to demonstrate special circumstances to overcome the statutory restriction in section 70(3) [§3].

The Parties’ Positions

The Claimant’s Position: The Claimant argued that special circumstances existed. He contended that the existence of the restraint order was itself a special circumstance sufficient to justify assessment [§48]. He relied heavily on the Defendant’s initial cost estimate of £10,000–£15,000, arguing that the eventual fees of nearly £200,000 represented such a significant deviation as to call for an explanation [§51]. He stated he had relied on this estimate and was vulnerable when instructing the Defendant [§37, §51]. He also cited his involvement in a lengthy criminal trial as a factor explaining his delay in challenging the bills [§52]. Regarding payment, he submitted that, applying Menzies v Oakwood [2024] UKSC 34, he had not agreed to the allocation of specific payments to specific bills, and therefore the first three bills could not be considered “paid” [§53].

The Defendant’s Position: The Defendant submitted that the application was a tactical manoeuvre to delay payment [§54]. It argued that the first three bills had been paid by agreement, which could be inferred from the Claimant’s conduct in making payments against the outstanding balance over a prolonged period [§55–58]. On special circumstances, the Defendant contended the preliminary estimate was just that — preliminary — and was quickly superseded by events [§61]. It highlighted that the Claimant had later sought to raise over €1.3 million in funding, demonstrating his understanding of the true potential cost [§61]. The Defendant pointed out that the Claimant had repeatedly affirmed the debt, including in the July 2023 agreement, and had never queried the bills until faced with enforcement [§59–60]. It argued there was nothing out of the ordinary in a complex fraud case with a restraint order [§62].

The Court’s Decision

On Payment of Bills: Costs Judge Leonard found that the first three bills had been paid [§67]. Applying the principles from Menzies v Oakwood, the judge held that payment requires an agreement to the sum taken, which can be inferred from conduct [§63]. The Claimant had received the bills and subsequently arranged for payments to be made against the outstanding balance. This constituted an agreement to pay [§67]. The judge rejected the argument that agreement required specificity in allocating payments to particular bills, finding that standard to be artificial and impracticable [§66]. Consequently, the court had no jurisdiction to order assessment of those bills under section 70(4).

On Special Circumstances: The court dismissed the application, finding no special circumstances [§89].

The judge rejected the argument based on the initial estimate [§69]. The estimate was expressly preliminary and related only to initial work: reviewing papers, contacting the FCA and previous solicitors, and providing advice [§69]. The Claimant’s comparison of this figure to the total three-year costs was “artificial” [§69]. The judge noted that by October 2022, the Claimant was seeking to raise over €1.3 million, showing his understanding of the potential scale of costs [§77]. Furthermore, the evidence demonstrated that even with full knowledge of accruing costs, the Claimant wished to continue instructing the Defendant rather than seek cheaper alternatives. In March 2023, having already received bills exceeding £170,000, he emailed: “I’d rather of course stay where we are. I value your guidance and as we’ve said before when liberty is at stake its not a time to go for the cheapest” [§29, §73]. Accordingly, any failure to provide updated estimates had not caused the Claimant to lose an opportunity to make different choices [§76].

The court also rejected the other proposed special circumstances. The restraint order was not unusual for a substantial fraud prosecution [§80, §83]. The Defendant’s subsequent enforcement action was a reasonable consequence of unpaid fees and broken promises [§84]. The Claimant’s ongoing criminal trial did not adequately explain a 17-month delay in applying for assessment, especially as the trial did not begin until September 2024 — well after most of the delay had elapsed [§81]. The judge also found that the Defendant had complied with its retainer terms regarding notification of rate increases by detailing them on each invoice [§86]. In any event, such a discrete point would not justify a full assessment [§88].

In concluding, Costs Judge Leonard accepted the Defendant’s submissions as to the merits and motivation behind the application [§68]. The Claimant had been advised from the outset of his right to challenge bills and the applicable time limits, was reminded of this with every bill, and never expressed dissatisfaction until faced with enforcement [§79]. The Part 8 application was dismissed [§89].

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