No Fishing | Disclosure And Part 18 Applications In Solicitors Act Assessments

Turner v Coupland Cavendish Ltd [2023] EWHC 2721(SCCO) involved a dispute over legal costs between Mr Stephen Turner (the Claimant) and Coupland Cavendish Limited (the Defendant), his former solicitors.

The Defendant delivered a bill of costs to Mr Turner on 11 March 2022. Mr Turner commenced Part 8 proceedings on 29 March 2022 seeking an assessment of the bill under section 70 of the Solicitors Act 1974. As the proceedings were brought within a month of the bill being delivered, Mr Turner’s entitlement to that assessment was absolute. An order for assessment was made on 17 February 2023. The Defendant subsequently served a breakdown of costs and an electronic copy of its file by the directed dates. Mr Turner served points of dispute, alleging inadequate disclosure by the Defendant. He referred to recent case law which he said required him to put in a level of detail in respect of the points of dispute which the claimant’s representatives did not consider they could achieve in the absence of further disclosure. The defendant’s response was that the file had been disclosed as ordered and neither the points of dispute nor the correspondence between the representatives explained what was said to be missing.

The main issues in dispute between the parties related to:

1. The Claimant’s application for disclosure and inspection of the Defendant’s telephone call recordings with the Claimant.
2. The Claimant’s application for the Defendant to answer Part 18 requests relating to commissions and benefits received in respect of after-the-event (ATE) insurance policies.
3. The Claimant’s application for the company number of a Gibraltar company to which a payment was made by the Defendant

The Claimant’s application for disclosure and inspection of the Defendant’s telephone call recordings with the Claimant.

The Claimant’s Position

Mr Turner argued that CPR Part 31 applied to the claim and therefore the Defendant was obliged to disclose call recordings referenced in the file at pages 41 and 43, which related to a crucial funding conversation. He contended the recordings would show whether the time recordings for calls with him and others were accurate. Mr Turner’s position was fully reserved pending receipt of the requested disclosure.

The Defendant’s Position

The Defendant responded that disclosure had already taken place of the file itself. Call recordings were not stored on the file and no application existed for disclosure of documents not on the file. The notes on pages 41 and 43 showed a script, and Mr Turner had not alleged the script was inaccurate. A query over a small amount of time could not justify the sweeping disclosure sought, which was merely a fishing expedition.

The Decision

Costs Judge Rowley rejected Mr Turner’s application for disclosure of the call recordings on two grounds. Procedurally, there had been no application made for specific disclosure as required under CPR Practice Direction 31A.

Substantively, Mr Turner had failed to provide any positive evidence about why the call recordings were needed to advance his case.

“…this is not a case where the defendant has failed to carry out a sufficient search. It has provided the solicitors’ file and has confirmed that the entirety of that file has been disclosed when pressed by the claimants. In any event, call recordings would not be on the solicitors file but, if anywhere, in some IT backup of presumably thousands of calls taken by the solicitors over time… There is nothing before me from either side about the facility with which any individual telephone call could be identified. It does not strike me as being likely that it is a particularly straightforward task….

“The defendant has disclosed the solicitors’ file in the usual way in support of the bill delivered to the client. The call recordings made no appearance in the original points of dispute and their supposed importance has only surfaced quite recently and without any indication of why the claimant says those call recordings might assist. Why they should be exhumed, should they exist, and be listened to by the solicitors or their costs lawyers in such circumstances, given the expense that would incur, is not readily apparent….

“I refuse the claimant’s application for disclosure of any call recordings that there may be, both on the grounds of procedural irregularity in there being a complete absence of application, draft order or evidence to put this application on a proper specific disclosure footing, as well as the failure of the claimant to make out why such documents advance the claimant’s case in the absence of any form of positive statement of the claimant’s position.”

The Claimant’s application for the Defendant to answer Part 18 requests relating to commissions and benefits received in respect of after-the-event (ATE) insurance policies.

The Claimant’s Position

The Part 18 requests related to any undisclosed commissions or benefits received by the Defendant relating to the ATE policies. Mr Turner argued these were reasonable requests to determine if any commissions had been received but not disclosed, which could lead to remedies under the Financial Services and Markets Act 2000. He submitted that as principal he was entitled to access the agent’s records, relying on Yasuda Fire and Marine Insurance Co of Europe Ltd v Orion Marine Insurance Underwriting Agency Ltd [1995] QB 174. Mr Turner maintained his dispute regarding the cash account was still live and it was inappropriate to dismiss the application.

The Defendant’s Position

The Defendant responded that no application existed for the Part 18 requests to be answered. Mr Turner had provided no evidence of any undisclosed commissions. The request was a fishing expedition given the lack of evidence.

The Decision

Costs Judge Rowley rejected the application on procedural grounds, as the wording of the requests themselves had not been provided. He also found Mr Turner was not entitled to wide-ranging access to the Defendant’s records without providing some positive evidence in support of the requests, which he had failed to do.

“The documentation in respect of that purchase – the certificate and any policy documentation actually provided (rather than a reference to wording available online, for example) – is obviously something to which the client is entitled. Where the solicitor has an interest (including commission from the insurer) in recommending any particular ATE insurance, the Court of Appeal in Tankard v John Fredericks Plastics [2008] EWCA Civ 1375 made it clear that such interest needed to be notified to the client. On the other hand, the solicitor is not required to “trawl” the ATE market place for the best product for the client but merely an appropriate one. In practice, the solicitor will generally establish a relationship with an ATE insurer which it considers provides such a product and then obtain insurance for its clients from that insurer as part of a “basket” to avoid any suggestion of adverse selection….

“I reject the submission that Yasuda provides the claimant with a gateway for a client to be able to see all of the solicitors’ records, not just in relation to their own claim (the “direct transactional records”) but also of any other financial records of the solicitor – which was the effect of Mr Carlisle’s submissions. The support that Yasuda was said to give to obtaining the call recordings in the first application, since they would be a computer record, demonstrates how wide-ranging the decision in Yasuda was said to travel. In my judgment, the requirement of the defendant to provide records to the claimant is no more than the contractual ATE documents I have described above. Absent any positive case by the claimant, the defendant has to be taken to have followed the law as set out in Tankard regarding any declaration of interest in recommending any particular ATE insurance….

“Therefore, in respect of the second application, it fails procedurally for the absence of any evidence, including documents in support such as the requests themselves. I also find that the decision of Colman J in Yasuda, in the circumstances of this case, does not provide the claimant with an entitlement to wide ranging access to the defendant’s records in the absence of the claimant putting forward a positive case in support of the Part 18 Requests that have apparently been served.”

The Claimant’s application for the company number of a Gibraltar company to which a payment was made by the Defendant

The Claimant’s Position

According to the Replies to the Points of Dispute, a payment of £750 had been made to AJG Limited on 27 October 2020. AJG Limited is was apparently a Gibraltar based company and the claimant had expressed a wish via his solicitors to make enquiries regarding AJG Limited.

The Defendant’s Position

The Defendant responded that the company number related to a separate third party, not the Defendant itself. Mr Turner could obtain the information by paying the Companies House fee.

The Claimant’s Response

Mr Turner argued the Defendant should provide the number rather than make him pay £10 to obtain it, since the Defendant likely had it or could readily access it.

The Decision

Costs Judge Rowley did not order the Defendant to provide the company number. He found each party should have assisted the court in dealing with the case justly and proportionately, rather than expend significant time and costs on this minor issue. While he did not order costs against Mr Turner, he indicated if Mr Turner succeeded on the cash account dispute, he may allow recovery of costs spent on this correspondence.

“Even though the parties’ advocates did not spend long on this point, it still took up some time in the hearing which, together with Mr Carlisle’s skeleton argument and the communications between the parties has expended far more than the cost of the search etc. It was a rather dispiriting display of the parties failing to observe their duty in CPR Part 1 to assist the court in achieving the overriding objective of dealing with the case justly and at a proportionate cost.”