Background
Stephen Turner retained Coupland Cavendish Limited, trading as Gowing Law, under a conditional fee agreement for a personal-injury claim arising from a road accident. The claim settled for £3,000 plus costs. The solicitors later delivered a bill showing profit costs of £7,944 inclusive of VAT, a £750 success fee, and disbursements. Their cash account also recorded a £245 after-the-event insurance premium deducted from Turner’s damages.
Turner commenced proceedings under section 70 of the Solicitors Act 1974 for a solicitor-and-own-client assessment of the profit costs and success fee. His new solicitors served a purported CPR Part 18 request asking, among other things, whether Gowing Law had received any commission or other financial benefit connected with the ATE policy. Costs Judge Rowley refused to order answers, but Sweeting J allowed Turner’s appeal and directed that the request be answered in full. Gowing Law brought a second appeal.
The Court’s Holding
The Court of Appeal unanimously allowed the appeal. It held that the court had no power in the section 70 assessment proceedings to compel answers about a possible ATE commission because that subject was not a “matter in dispute in the proceedings” for CPR Part 18 purposes. A solicitor-and-own-client assessment concerns whether the costs in the solicitor’s bill were reasonably incurred and reasonable in amount; it is not a proceeding for taking a general account between solicitor and client or obtaining disgorgement of secret profits.
The cash account serves a limited role in the assessment: it enables the costs judge to identify payments toward the assessed bill, relevant sums held for the client, and the resulting balance to be certified under section 70(7). The judge need not investigate unrelated entries or alleged omissions, such as a commission that could not be treated as payment toward the assessed costs. The court disapproved Edwards v Slater and Gordon UK Ltd on this point, holding that its Raubenheimer ruling was wrongly decided and per incuriam.
The Court also held that the Costs Judge had been entitled to refuse the requested order because no formal application had been made and the questions were not before him. Although solicitors’ fiduciary obligations ordinarily require disclosure of a commission and their refusal to answer was described as unattractive and unwise, those duties did not enlarge the jurisdiction available in a section 70 assessment.
Key Takeaways
- A CPR Part 18 request in a solicitor-and-own-client assessment must concern an issue the court is required to determine in that assessment; it cannot be used to investigate a possible separate claim.
- A costs judge’s review of the cash account is generally limited to identifying payments or funds applicable to the assessed bill and calculating the balance due.
- A client seeking information or relief concerning a suspected secret ATE commission must ordinarily pursue proceedings for an account or complain to the Legal Ombudsman.
Why It Matters
The ruling confines section 70 assessments to their statutory purpose and prevents them from becoming a procedural shortcut for investigating fiduciary claims against solicitors. It also clarifies that describing a cash account as “in dispute” does not itself create a matter that can be examined through Part 18.
The Court nevertheless identified a practical access-to-justice problem: a client may lack evidence of a commission precisely because the solicitor controls the information, while the likely recovery may be too small to justify separate proceedings. Any more economical mechanism for compelling disclosure, the Court said, must come from Parliament or the Civil Procedure Rule Committee.