Last week saw the shock adjournment of the appeal in the case of Belsner v Cam Legal Services Limited after half a day’s argument in the Court of Appeal. In order to cast a little light on the issues, the Court of Appeal hearing was televised and the recording of the hearing (as far as it got) can be found on the Judiciary website.
For a quick refresher on what the case was about, the High Court judgment can be found here: Belsner v Cam Legal Services Limited [2020] EWHC 2755 (QB) and it seems a very long time ago since that judgment was handed down.
Belsner is to be relisted before the 31st July with further skeleton arguments and at least 2 days allowed for oral arguments. In my view, it is likely to prove the most significant costs case of the year, as the consequences of the judgment for solicitor-own client costs disputes are likely to be profound.
In particular leaving aside issues of legal principle, there is a policy point in play though whether this will be articulated in the judgment or not is an interesting question: how severely should the court police solicitors in providing such things as costs estimates and other advice to clients, deducting costs for shortcomings? or to what degree is a lighter touch appropriate, bearing in mind the client’s right to complain about so many things including fees and overcharging, to the SRA or the Legal Ombudsman?
Put bluntly, should the court stem the flow of part 8 multi-track proceedings that has been pouring forth in the last few years, with their attendant costs, on the basis this is unwonted satellite litigation? Or should the court interpret the statute and the rules to make the SCCO and the District Registries into consumer champions?
The points of legal principle in the case include the following matters:
1. Whether section 74(3) of the Solicitors Act 1974 applies to cases where no proceedings are issued.
2. The proper construction of rule 46.9(2) and whether compliance with it requires informed consent on the part of the client.
3. Whether a fiduciary duty applies to a solicitor when negotiating her own remuneration and how that might be discharged.
4. Whether the Consumer Rights Act 2015 has any application to a solicitor’s remuneration.
A crucial issue will be to what extent use of the Law Society Model CFA and CFAs derived from it, support deductions from damages or whether it facilitates solicitor-own client challenges to fees.
It is a reasonable supposition that-however the case goes at the reconvened appeal-solicitors will have to address the following matters going forward:
1. Solicitors are likely to have to review their retainers and check if the advice on costs contained in their conditional fee agreements and client care letters is adequate to explain to clients the likely charges they face.
2. Solicitors are likely to have to review the way they provide costs estimates and in particular involve the client in the costs budgeting process.
3. Solicitors are likely to have to review how they draw their bills and how they ensure they are delivered and finality achieved in respect of any issues with their own clients.
Not only will the judgment (when it comes) deal with the current round of challenges, it will also form a precursor to the likely increase in solicitor-own client work, when fixed costs come to the fore later this year, one consequence of which, is the likelihood an expanded fixed costs regime will put more solicitors at odds with their clients over deductions.