Criminal procedure – Defendants’ costs – Expenses – Representation orders

Frederic Peter Brewer v Secretary of State for Justice: QBD (Mr Justice Holroyde): 8 May 2009

The appellant (B) appealed against a decision of the costs judge that he could not recover fees and expenses he had paid an American attorney (T) after the granting of a representation order.

B had been investigated by the Serious Fraud Office. The matter under investigation included events that had occurred in the US and B contacted T, who had acted for him in the US and was therefore well acquainted with the case. He entered into an agreement with her to act on his behalf in relation to all matters arising out of the SFO investigation. B also instructed solicitors in the UK to work on the case. A year and a half later, B and four others were charged with the offence of money laundering and he was granted a representation order which covered the work of the solicitors and counsel. The resulting trial was subsequently stopped and all the defendants were acquitted. Following the first defendant’s application, the trial judge made a defendant’s costs order to be taxed. Counsel for B made a similar request, both in respect of B’s out-of-pocket expenses after the grant of legal aid and also to cover a period of time prior to the grant of legal aid where other expenses were incurred. The judge made a similar order in respect of that application. B’s claim for reimbursement included a substantial sum in respect of the fees and expenses he had paid T, but the determining officer did not allow any sum in respect of payments to her. B applied for a redetermination, but that was later quashed and the matter came before another costs judge. He awarded a sum to B in respect of work reasonably done before the grant of the representation order, but held that B could not recover fees and expenses paid to T after the representation order, and only his expenses on fares and subsistence were recoverable. B appealed, pursuant to regulation 11 of the Costs in Criminal Cases (General) Regulations 1986, and the judge certified two points of principle of general importance: (1) whether a claim for expenses in respect of professional services incurred after the date of a representation order were recoverable out of central funds by an applicant (being a person in whose favour a costs order had been made) either wholly or in part; (2) whether an order for costs made in favour of any applicant out of central funds for ‘out-of-pocket’ expenses was limited to expenditure such as fares or subsistence or whether it covered professional expenses including a second set of representation costs.

Held: (1) The fact that the person in whose favour a defendant's costs order had been granted was represented by counsel and solicitors whose bills had been separately addressed did not necessarily prevent a further claim by an applicant in respect of ‘expenses properly incurred’, R v Bedlington Magistrates Court Ex p Wilkinson [2000] 164 JP 156 QBD and R (on the application of Brewer) v Supreme Court Costs Office [2006] EWHC 1955 (Admin), (2007) 1 Costs LR 20 applied. However, an applicant’s claim was likely to fail when the subject matter of it was expenses incurred by him during the currency of the representation order in respect of legal professional services. The task of the determining officer in every case was to determine the particular claim in accordance with statute and the regulations, and, in doing so, to take account of all relevant circumstances. Those circumstances might include: (i) the profession and professional services of the person who provided the relevant services; (ii) the exact nature and purpose of the professional services provided; (iii) the reason why it was necessary and reasonable to engage that person to provide those services; (iv) the reason why such services could not be provided by the legal team instructed under the representation order, bearing in mind that the representation order was intended to provide the level of legal advice and representation appropriate to the specific case; (v) the reason why the claim did not form part of the solicitors’ fees and disbursements under the representation order; (vi) the basis on which, and the rate at which, the provider of services charged the applicant; (vii) the extent to which there was duplication of work done under the representation order; (viii) what was said on the applicant’s behalf when the application was made for a defendant’s costs order; (ix) the reason why an applicant’s claim for reimbursement of his expenses was not made at the same time as the claim of his lawyers under the representation order.

(2) The expense of paying fees in respect of professional services was in principle capable of being an out-of-pocket expense and the costs judge had erred in limiting B’s recoverable expenses in the way he had. The judge’s decision was, accordingly, set aside and the matter remitted for fresh determination.

(3) (Obiter) The brevity of applications for, and the grant of, defendants’ costs orders was common practice. The present case demonstrated the danger of that practice where nothing was done to alert the trial judge to an unusual or exceptional case. It would be appropriate for advocates applying for a defendant’s costs order to indicate at least the heads of claim which would or might be made and if possible to give an expected quantum.

Appeal allowed.

Jeremy Morgan QC (instructed by Layzells) for the appellant; Tim Buley (instructed by treasury solicitor) for the respondent.