Court Clamps Down on Costs Building Tactics in Low Value Abuse Claims: TRX v Southampton Football Club Ltd [2022] EWHC B7 (Costs)

Judgment in the case of TRX v Southampton Football Club Ltd [2022] EWHC B7 (Costs) is relevant to those handling abuse claims.

In TRX, it was alleged that sexual abuse had been committed by a former employee of the defendant and that the defendant should be held vicariously liable for the aforesaid employee’s tortious behaviour.

The action was valued at £50,000 on issue. However, settlement was agreed at £4,000 shortly after proceedings were served, defence was filed and allocation was to the multi-track.[i] It was maintained that the nature of the settlement was commercial and did not reflect its true value.

Subsequently, Master Brown was tasked with determining the appropriate hourly rates and level of fee earner at the Senior Courts Costs Office, after the claimant’s bill sought legal fees totalling over £65,500.

Upon his assessment of costs, the starting point identified was to have regard to the ‘eight pillars of wisdom’, or CPR 44.4(3) factors.

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Here, the amount of money involved (based on the settlement figure) was ‘relatively modest’ in the context of personal injury litigation and a ‘very small sum’ for a High Court case – see CPR 44.4(3)(b). It was suggested that lower damages might be indicative of inferior importance, to the extent that a client might question the prudence of incurring ‘very substantial costs’ in pursuit of their claim.

The Master’s view was that this was a case where a Grade C solicitor in a specialist firm could have ‘reasonably’ and ‘adequately’ undertaken the general day-to-day handling of the claim as the principal or main fee earner.

Having regard to the ‘eight pillars’, it was judged that a junior fee earner would be qualified to manage the particular issues arising in the claim by deploying up to four-years of experience with sexual abuse claims.

Instruction of a Grade A or Grade B fee earner in this capacity was therefore unwarranted in the present case. Higher grade involvement was not, however, unjustified when viewed from the aspect of generic costs presented in the bill. It was accepted, for instance, that some input by way of supervision from a ‘more senior fee earner’ would be reasonable.

Enhanced rates were permitted for using solicitors that specialised is sexual abuse litigation, even above those set out in the ‘new GHR, CJC consultation documents’. An uplift was also appropriate, given the ‘nature’ of the case.

All in all, it was decided that the bill should be assessed at £23,000, owing to the bulk of the work which should have been completed by a Grade C solicitor.

Full text judgment can be accessed here.

Publishing an article on TRX in his Civil Litigation Brief blog, barrister, Gordon Exall, stressed that:

‘This not authority for the proposition (which appears to have been mooted by some people) that all such cases should be dealt with by Grade C. Rather that a low value case, with no particular complexity, could properly be dealt with by a Grade C within a specialist firm’.[ii]

For many, though, TRX addresses ‘growing concern’ about the level of bills presented in abuse claims, where legal costs ‘routinely dwarf’ the compensation recovered.[iii] It is often the case that senior fee earners lead these claims and rely on counsel and, in so doing, incur substantial amounts of time charging excessive hourly rates.

Whether or not Master Brown’s guidance proves, as claimant representatives contend, to be purely ‘fact-sensitive’ and of little consequence for future claims, or highly assistive in the assessment of costs, remains a topic for continued debate.

 

[i] ‘Defendant firm welcomes guidance on costs for non-recent abuse cases’ (24 February 2022 Association of Costs Lawyers) <https://www.associationofcostslawyers.co.uk/%2Fnews/news-in-brief-24022022> accessed 22 March 2022. 

[ii] Gordon Exall, ‘PERSONAL INJURY CASE SHOULD HAVE BEEN DEALT WITH BY A GRADE C FEE EARNER: SENIOR COSTS OFFICE DECISION’ (14 March 2022 Civil Litigation Brief) <https://www.civillitigationbrief.com/2022/03/14/personal-injury-case-should-have-been-dealt-with-by-a-grade-c-fee-earner-senior-costs-office-decision/> accessed 22 March 2022.  

[iii] John Hyde, ‘Costs row in abuse cases as court rules Grade C fee earner should lead’ (7 March 2022 Law Gazette) <https://www.lawgazette.co.uk/news/costs-row-in-abuse-cases-as-court-rules-grade-c-fee-earner-should-lead/5111755.article> accessed 22 March 2022.