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Irwin Mitchell has been forced to defend its pricing policy after the Master of the Rolls Lord Neuberger highlighted a case in which it charged six times the amount paid out to its client.
Ruling in favour of the firm in the widely anticipated costs case, Simcoe v Jacuzzi UK Group (16 February 2012), the MR said “something is out of kilter” when the firm had managed to amass costs of £75,000 when its client, plumber Adrian Simcoe, had received a £12,500 settlement for a personal injury claim.
Giving the substantive Court of Appeal (CoA) judgment Neuberger MR stated: “Unless this is an exceptional case, the fact that, without even incurring the cost of as trial, it cost the claimant nearly six times as much to pursue the claim as it was actually worth suggests that something is out of kilter in at least some parts of the civil justice system.”
Irwin Mitchell, however, contended that it was the defendant’s solicitors at Berryman Lace Mawer who had driven up costs “through unnecessary delays and tactics”.
“The defendants refused and dragged this case all the way to the door of the court, settling one working day before the trial was due to begin,” the firm said.
It continued: “If the defendants had listened to the expert medical reports, then this case could - and should - have been settled much earlier. The fees would have been much lower and our client would have been able to move on with his life much more quickly and not have this dragged out unnecessarily over three years.”
Berrymans Lace Mawer responded: “The amount of costs in relation to damages in this matter is not uncommon and highlight the issues within the current costs regime. We agree with the Master of the Rolls’ comments and welcome reform.”
The MR’s comments were made in a judgment on the appeal brought by Irwin Mitchell’s client Simcoe, against a decision regarding the date upon which interest became payable on costs which the respondent had been ordered to pay.
The CoA panel of four, made up of Neuberger MR, Lord Justice Hooper, Lord Justice MacFarlane and Master Gordon Saker, was asked whether the interest ran from the date the order for costs was made, ‘the incipitur date’, or the date on which the costs were subsequently assessed or agreed, ‘the allocatur date’.
Lawyers said with interest rates set at 8 per cent substantial sums are at stake in larger cases.
The long-standing position, which has been reinstated in this judgment, is that interest runs from the incipitur date - the date on which the order for costs is made.
Neuberger MR stated in his judgment: “The date from which interest ran on an award of costs in the county court in favour of a successful litigant was, by reason of article 2 of the County Court (Interest on Judgment Debts) Order 1991, the date the order for costs was made, not the date on which costs were assessed or agreed.”