A costly affair

Lynne Bradey provides a step-by-step guide on the process to follow when looking for remuneration from the Court of Protection.

Claiming costs in Court of Protection matters is often thought to be slightly more complex than solving a Rubik’s cube without cheating, and to involve leaping more hurdles than Ed Moses ever had to face. The reality is that it really is a case of taking things a step at a time, and if you know the correct procedure, those hurdles will fall away. This article aims to take readers through the procedure for claiming costs in receivership matters and applications on behalf of a mentally incapable person. Conveyancing has its own fixed fees, generally expressed as a percentage of the value of the property involved, but the principles are the same.

Step one – the costs draftsman
It may be that the work you wish to bill falls within the fixed costs allowed. A list of the fixed costs for 2006 can be found in the ‘news’, ‘news for professionals’ section of the Public Guardianship Office (PGO) website, www.guardianship.gov.uk. If the amount of time on the clock falls within the fixed costs you are free to bill the matter and take the costs without a costs certificate. If you need funds from the court to pay the bill, you should send the bill to the PGO requesting the release of funds.

If the costs are in excess of the fixed costs or there is no fixed cost (such as in a statutory will or gifting application) the order should provide for the costs to be assessed. If it does not, you should ask the court for an order to that effect as soon as possible. Assessment falls into short form assessment (costs under £3,000) and full assessment (costs over £3,000).

While the costs for the short form bill may not be recoverable, the costs for the bill for full assessment will be. It may, however, prove to be more cost effective for the costs draftsman to prepare even short form bills, as their rate is lower than a fee earner’s.

The costs draftsman will need your detailed billing guide and your file. You should set out details of each person who has been involved with the file, that is, their status and number of years qualification, if relevant. The costs draftsman will then be able to grade the fee earner into categories A to D. You should also set out that person’s hourly rate.

As the file will be with the costs draftsman for a couple of weeks, it is a good idea to keep a shadow file with any contact details and other papers, and information you may need in the meantime.

Step two – the Supreme Court Costs Office
Once the bill and file have come back from the costs draftsman, check that you are happy with the draftsman’s conclusions. Provided that you think the costs allowed are acceptable, you should then send the file with the bill (not your internal billing guide, as that only confuses the issue) and the order for assessment, along with Form N258B (which the costs draftsman will often provide) off to The Supreme Court Costs Office (SCCO). You will need to give the PGO reference for the patient. The SCCO is at DX 44454 STRAND.

If your costs draftsman has not provided the N258B, you can complete this by hand. The form is not really designed for Court of Protection matters, but a suggested method is to write ‘Court of Protection’ after ‘In the’, write the Court of Protection reference in as the claim number and put your name as claimant for the patient – for instance, ‘Mr A Solicitor for Mrs A Patient’.

You should then tick the items you are enclosing. These will usually just include the document giving the right to detailed assessment (that is, the court order), and the bill of costs and the file, although you may also have some fee notes for disbursements which you may have to put in. The fee for a short form assessment is £100, payable to HMCS. If the assessment is a full assessment, the fee is £200, also payable to HMCS. The payee was, until recently, HMPG, but any cheques payable to this payee now will be returned to you. You can then sign the form as the receiver’s solicitor. Again a shadow file would be useful.

Step three – agreeing or disagreeing the assessment
The bill will come back from the SCCO, usually with a varying amount of ink over it. If you are happy with the assessment that has been made, bearing in mind that the court usually knocks something off, then you should write back to the court indicating that you are happy with the assessment and asking them for the final costs certificate. The court will require a costs certificate to pay your bill. If the funds are held on client account, it is usually safe to raise your bill at the same time as writing off to the SCCO for the costs certificate, as the certificate comes back fairly quickly. If the funds are in court you may want to wait until the court actually sends the funds. The PGO will require a copy of the final costs certificate and your bill to release funds to pay a bill.

If you do not agree with the assessment, you should write back to the SCCO within 14 days, setting out your reasons for requesting a review of the bill. A hearing can be requested, but these matters are generally dealt with by telephone or letter. It is important that detailed reasons are given for disagreement. For example, you may have been penalised for travelling to a meeting in a different city but the receiver could be there because of a family emergency and unable to leave. Alternatively, the person assessing costs may feel that too many telephone calls have been made in the same day, but if you point out that the client has been calling you and that because of the nature of the matter or the client’s circumstances, this is the way the client prefers to deal with issues, the time may be allowed in whole or in part.

Step four – claiming costs on an ongoing basis
It is also possible to claim quarterly costs in ongoing matters. For example, if you are dealing with an ongoing receivership matter, you are allowed to take quarterly costs at three months, six months and nine months after the date of the entry of the order up to a maximum of £750 per quarter. You need to inform the court that you have done so but you can raise a bill and be paid for these immediately. You must have your costs assessed after the fourth quarter, however, for the whole year if they exceed the fixed-fee limit. It is generally a good idea to have a cushion of a few hundred pounds, just in case the bill is knocked down on assessment.

You can ‘catch up’ on quarterly billing – for example if the first quarter’s time on the clock was £250, which you billed, in quarter two you could bill £750 plus the £500 you have left from quarter one. This can be useful for matters where a client meeting or other involved work takes place in a later quarter.

If you believe that costs will amount to more than £3,000 in the year, it is possible to agree a higher quarterly amount with the court, subject to your costs being assessed at the end of the year.

The types of assessment
The two types of assessment are the standard basis and the indemnity basis. The court will rarely order assessment on the indemnity basis, and the onus is usually on the solicitor involved to persuade the court that it is warranted.

There are two key differences between the two bases of assessment. First, the standard basis resolves any issues over reasonableness or proportionality of costs in favour of the paying party, whereas issues on the indemnity basis are resolved in favour of the receiving party. The second difference is that there is no reference in the definition of indemnity assessment to the proportionality of costs to the assets involved.

Further information
This article has given, I hope, an overview of the process to follow in order to have costs in Court of Protection matters assessed where necessary, billed and paid. Further, more detailed information can be found at www.guardianship.gov.uk/formsdocuments/publications.htm. There is a section entitled ‘costs in the Court of Protection’ which contains, among other things, a very helpful guidance note issued by the master in March 2005.

Lynne Bradey is a solicitor with Wrigleys. She can be contacted on lynne.bradey@wrigleys.co.uk