Recovery Time
Jessica Swannell explains how to avoid a common mistake that can cost public bodies dearly in litigation.
During my years of working for both Central and Local Government, there have been numerous occasions where both are losing a substantial amount of money through recovery of legal costs by not simply time recording correctly.
The usual rule is that the unsuccessful party will be liable for the successful party’s legal costs in the proceedings.
There are two types of basis of assessment, Standard or Indemnity Basis which are contained at CPR44.3. The usual rule is that costs are assessed on the Standard Basis unless ordered otherwise.
Standard Basis is where only proportionate costs are allowed and any doubt as to reasonableness of the costs claimed are found in favour of the paying party.
Indemnity Basis is where any doubt as to reasonableness is found in favour of the receiving party. Proportionality does not apply to Indemnity Basis awards.
The Court will not allow costs that are on either basis unreasonably incurred or unreasonable in amount.
If you are recovering your legal costs on the standard basis and there is the slightest bit of doubt in the Judge’s mind upon an assessment in relation to an item then you will either loose the time spent on that item or have the same reduced.
The following are four key steps on how to maximise your legal costs recovery.
1. Time Recording System
There are some very good case management systems on the market which include a programme for time recording however, the same are very expensive. If there is not enough money within the budget for this software, it is very easy to create your own time recording system by simply using Excel and formulas to calculate the amount of time and expenses. The basic columns that you will need are:
- Date
- Reference
- Case Name
- Fee Earner
- Fee Earner’s hourly rate
- Description of work done
- Time spent
- Amount in money each item took to complete
- Expenses Tab
The above are the basic columns you will need but you can add as many as you require and you can also have the system self-calculating in relation to calculating how much each item of work has costed.
2. Attendance notes
Attendance notes are the lifeblood of claims for costs. Costs are the lifeblood of any legal practice. Whilst time recording is important to help maximise recovery, if there is no evidence of the work conducted on file or a detailed attendance note is not completed, how will you be able to prove to the Judge upon assessment that the work was actually done and the same was reasonable?
Therefore time must be spent making proper attendance notes. An entry on a time sheet recorded on a computer without any reference to the file itself, will not achieve this. It is significant to note that under current law and practice, time spent making attendance notes is chargeable as is the case of other preparation. Of course the attendance note must be reasonable and the time taken to prepare it must also be reasonable.
It is also vital to remember throughout the conduct of any matter that it is not just attendances which should be noted on the file. Substantial amounts are lost by failure to record time spent on consideration, perusal, preparation and drafting of documents which often will be the single most time consuming element of the work undertaken on the case.
3. File Management
You must ensure that your file is in chronological order and all correspondence is on the file. If you are recovering your legal costs and your case proceeds to Provisional or Detailed Assessment, you will need to submit your file of papers. If your papers are not in chronological order or there is missing correspondence the Judge will instantly be annoyed by this fact given that he only has a set amount of time to read the papers.
4. Bill of Costs preparation
Unfortunately, I have seen both Central & Local Government try to recover their own legal costs but the Bill is either not CPR compliant or the costs have not been maximised. It really is worth spending time and effort maximising your legal costs recovery and using a qualified Costs Lawyer to help you with this.
Remember, good file management and timed, dated and informative attendance notes are the key to maximising costs recovery
Jessica Swannell is a Costs Lawyer and Practice Manager of A&M Bacon Limited, Legal Costs Specialists.
