Regulator’s successful Appeal against Costs Order

24 November 2023

The Solicitors Regulation Authority (SRA) brought an appeal to the Administrative Court under section 49 of the Solicitors Act 1974 against a costs order imposed by the Solicitors Disciplinary Tribunal (SDT) in its favour in the sum of £5,000, contending that the costs awarded should have been in the sum of £22,200: Solicitors Regulation Authority Ltd v Whittingham [2023] EWHC 2981 (Admin) Neil Cameron KC

The respondent, who was served with notice of the appeal and a skeleton argument, did not appear and was not represented. In reply to service of the notice and the hearing bundle the respondent said he was confused about the purpose of the proceedings. There was further correspondence in which he was reminded of the time, place and date of hearing.

The Deputy High Court Judge exercised his discretion to allow the appeal to proceed in absence. Approaching that decision with care he gave the following reasons for doing so: (i) the respondent had been given notice and the hearing date; (ii) the respondent replied to an email which included a reference to the hearing date, the inference being that he was aware of the hearing date; (iii) the respondent did not indicate whether he intended to attend the hearing; (iv) the respondent had not engaged with the regulator; (iv) there was no good reason not to proceed, and it was right that the hearing should proceed: General Medical Council v. Adeogba [2016] EWCA Civ 162)

The appellant’s solicitors charged a fixed fee (including disbursements) of £18,500 plus VAT (£22,200). The total number of hours spent were 65.4, 59.6 of which were attributable to work undertaken by an associate solicitor, and the remaining hours were attributable to work undertaken by a partner and a barrister. Six hours were included for the second day of the hearing which in fact lasted for one day. The disbursements related to £9,275 (plus £1,855 VAT).

When the SDT assessed costs summarily in the sum of £5,000 it took into account: that the facts were straightforward and there were no complex legal issues; the substantive hearing had taken less time than anticipated (less than a day instead of two days); the former solicitor had not attended the hearing; there had been no witnesses; it did not require counsel of such seniority to draft the Rule 12 statement.

His Lordship found that the SDT failed to take into consideration Rule 43(4) paras (a) to (d) of the Solicitors (Disciplinary Proceedings) Rules 2019 which were relevant: (a) the conduct of the parties and whether any or all of the allegations were pursued or defended reasonably; (b) whether the Tribunal’s directions and time limits imposed were complied with; (c) whether the amount of time spent on the matter was proportionate and reasonable; (d) whether any hourly rate and the amount of disbursements claimed was proportionate and reasonable.

The SDT’s decision was quashed and the court acceded to counsel’s request to re-exercise the costs discretion afresh and not to remit the matter to the SDT.  The “blended” hourly rate for the work undertaken was £189 which was proportionate and reasonable, and it was reasonable for the SRA to instruct counsel of such seniority to draft the rule 12 statement, to draft the pleadings and to appear at the substantive hearing.

That the hearing lasted for one day and not two was a relevant factor to take into account when assessing costs. The court assessed the costs payable by the respondent to the SRA  in respect of proceedings before the SDT at £19,468.