What can a third party who is responsible for a solicitor's bill challenge?
Posted on 30th Aug, 2011
Tim Martin Interiors Limited v Akin Gump LLP [2010] EWHC 2951 (Ch)
The case itself concerned a mortgage but the same “third party” right can apply in other situations as well.
The case states the main principles which apply in these circumstances :-
First, the provisions of Section 70 of the Solicitors Act permit someone who is not the client, but is liable to pay the solicitor’s bill, to have it assessed as if that someone were the party chargeable with the bill in question.
However, not all items in the solicitor’s bill can be passed on to the third party. There may well be “extraneous” items in the solicitor’s bill which the third party is not liable for and which remain the liability of the client. These items fall completely outside any Section 70 assessment proceedings begun by the third party.
Crucially, on the application of a third party who is liable to pay a solicitor’s bill, the Court must assess the bill as if the client had requested the assessment. This means that within the assessment procedure which takes place on the indemnity basis, the third party can only raise objections which the client would have been able to raise. CPR 48.8 highlights that on a solicitor/client assessment, costs are presumed to have been reasonably incurred if they were incurred with the express or implied approval of the client and presumed to be reasonable in amount if their amount was expressly or impliedly approved by the client. This gives a third party very little room for manoeuvre in mounting a challenge to those items which can legitimately be passed on to the third party.