A High Court registrar has launched a searing attack on City firms’ billing rates after Baker Tilly brought in Mayer Brown Rowe & Maw (MBR&M) on the administration of Cabletel Installations.
Baker Tilly, the court-appointed administrator to Cabletel, was strongly criticised by Mr Registrar Baister over costs and in particular the decision to replace Cabletel’s own law firm Wortley Byers with MBR&M to advise on a dispute with Sky.
In a costs judgment handed down earlier this year, Registrar Baister said: “Far from being effective, the approach the administrators took involved writing off much, if not most of, the value of the work done by Messrs Wortley Byers, having it duplicated at great cost by engaging City solicitors.”
He concluded: “The decision to change solicitors appears to me to have been so wrong-headed and so costly (work must have been duplicated and undertaken at a much greater cost) as to entitle me to conclude that it had a negative impact on the effectiveness of the administration.”
The registrar’s comments were primarily directed at Baker Tilly, not MBR&M. He said: “I make no criticism of Rowe & Maw’s costs: they are not on trial here and have had no opportunity to be heard as to their costs.”
Registrar Baister disallowed £10,000 of Baker Tilly’s costs as a direct result of the administrator’s decision to bring in MBR&M.
The registrar singled out Baker Tilly for failing to request a quote from MBR&M. He said: “Some of the advice sought by administrators could be said to be of the ‘hand-holding’ kind, so that the effect was to shunt on to the legal advisers some work and some decisions which experienced administrators in a large firm ought to have been able to do.”
Legal fees, which were estimated at £90,000, will be paid out of Cabletel’s estate and Registrar Baister did not have the authority to assess them. Baker Tilly’s fees were reduced from £237,770.60 to £87,056.78.