Barristers’ fees – Comparators – Funding arrangements

Lord Chancellor v John Charles Rees & ors: QBD (Sir Charles Gray): 19 December 2008

The appellant Lord Chancellor appealed against the decision of a costs judge to increase by significant amounts the basic fees allowed to the respondent counsel (R).

R had acted for defendants in complex and lengthy criminal proceedings for serious fraud. As they had been instructed under public funding pursuant to the Criminal Defence Service (Funding) Order 2001, the basic fees payable to them were subject to an ex post facto assessment, that was, they were to be assessed retrospectively. The determining officer who subsequently carried out that assessment held that the basic fees claimed by R were wholly unsupportable and should be reduced. In arriving at his conclusion, the determining officer took account of the fees paid to the prosecuting counsel and the rates that would have been payable to R if the case had been accepted under the very high cost cases (VHCC) scheme. He did not consider the graduated fee scheme as being a comparator. On appeal, the costs judge increased the basic fees payable to R by significant amounts. He held that the Clerk of the Parliaments Reference Regarding Criminal Legal Aid Taxation (2000) 1 Costs LR 7, which was a report that reviewed the fees allowed to barristers for conducting appeals to the House of Lords, did not lay down any general principles, and that the VHCC scheme, graduated fee scheme and the prosecution counsel fees were not relevant comparators for determining R’s fees. He also held that, where appropriate, a determining officer could take into account the issue of ‘lost work’ and the recovery of additional remuneration for other professional work lost as a result of R’s lengthy involvement in the instant case. The Lord Chancellor submitted that, pursuant to the House of Lords report, the costs judge had erred in failing to consider as comparators the VHCC scheme, graduated fee scheme and prosecution fees, and that no allowance could be made for lost work. R submitted that, in determining the reasonable amount to be paid to counsel by way of basic fees in ex post facto cases, the use of any comparators was illegitimate and impermissible.

Held: (1) Pursuant to paragraph 1(2) and paragraph 15(1) of schedule 1 of the 2001 order, the appropriate officer, in determining costs, was required, having taken into account all the relevant circumstances of the case, including the nature, importance, complexity or difficulty of the work and the time involved, to allow a reasonable amount in respect of all work actually and reasonably done. Further guidance as to the factors relevant in determining the reasonable amount were to be found in the Taxing Officer’s Notes for Guidance 2002. In accordance with the House of Lords report, which was not intended to be confined to appeals in criminal cases to the House of Lords, it was in principle legitimate to have regard to comparators as a means of cross-checking what amounts should be payable to counsel by way of ex post facto fees in other criminal cases.

(2) The House of Lords report specifically stated that in appeal cases the fees paid to the prosecution ought to provide guidance as to the proper fee for defence counsel. In many cases it would be legitimate for the determining officer to take such fees into account, Lord Chancellor v Wright [1993] 1 WLR 1561 QBD applied. Although there were obvious differences between the role of a prosecutor and a defender, such factors did not amount to a good reason for rejecting the use of prosecuting counsels’ fees as a comparator.

(3) A comparison with fees payable in cases within the VHCC scheme might, however, be inappropriate by reason of the particular circumstances of the ex post facto scheme under consideration. That particular scheme remained separate and distinct from the category of cases where costs were assessed on an ex post facto basis. Likewise, sufficient care should be taken when using the graduated fees scheme as a comparator, due to the difference in cases under the fees scheme and ex post facto. It was not legitimate to use privately funded cases as comparators in the assessment of publicly funded work. Privately funded work was market-driven and was the subject of negotiation, whereas publicly funded work was closely regulated.

(4) In respect of the issue of lost work, although R’s commitment of time in the instant proceedings was very significant, it was clear from the wording of paragraph 1 of schedule 1 that the costs to be determined were the costs of ‘work done’ under the relevant representation order, so that the amount allowed related only to work ‘actually and reasonably’ done in that case, Loveday v Renton (No2) [1992] 3 All ER 184 QBD applied. In any event, the calculation of the value of lost time would be a formidably difficult task and represent a significant additional burden for determining officers.

(5) The costs judge had, accordingly, fallen into error in the way he had dealt with R’s costs and the assessments were remitted to a costs judge for determination of the appropriate fees payable in each case.

Appeal allowed.

Clive Lewis QC, Vikram Sachdeva (instructed by the Treasury Solicitor) for the appellant; in person for the first respondent; Clare Montgomery QC, Andrew Post (instructed by Irwin Mitchell) for the second to 15th respondents.