Pine v Law Society (No 2)

For the statutory taxation regime, a bill is a solicitor’s bill where the work is connected with the profession, the solicitor was employed because of that professional status, and the work would not have been entrusted to him otherwise. Acting as an intervention agent can satisfy that test even without legal advice or litigation.

Where such bills are paid or owed by a person secondarily liable, section 71 of the Solicitors Act 1974 confers a corresponding right to seek taxation. Schedule 1 paragraph 13 does not exclude that right. Clear words or an obvious implication are required. Recovery as a debt does not prevent assessment from reducing an excessive claim.

The Law Society intervened in Pine’s solicitors’ practice under section 35 and Schedule 1 to the Solicitors Act 1974, appointing another firm to administer the practice. It paid five bills submitted by that firm and sought reimbursement from Pine under Schedule 1 paragraph 13.

Pine applied under section 71 for taxation of the bills. The Law Society applied to strike out or summarily dismiss the claim. HH Judge Maddocks, sitting as a deputy judge of the Chancery Division, dismissed that application but granted permission to appeal. The central questions were whether the bills were solicitor’s bills and whether paragraph 13 excluded the section 71 taxation right.

Appeal dismissed unanimously. The Vice-Chancellor gave the leading judgment. Lord Justice Robert Walker and Lord Justice Rix agreed.

1. Character of the bills. Section 87(1) of the Solicitors Act 1974 defines costs broadly. The governing test, stated in Allen v Aldridge (1843) 5 Beav. 401, asks whether the business was connected with the solicitor’s profession, whether the solicitor was employed because he was a solicitor, and whether he would otherwise not have been appointed. Acting as an intervention agent can fall within that test even where the solicitor is not advising on a specific legal problem or conducting litigation.
2. Application of the test. The intervention work involved the orderly collection and distribution of files and money. The firm’s professional knowledge and skill were used. The Law Society had resolved to appoint a solicitor, and the agent would not have been appointed without that professional qualification. The form and contents of the bills, including the information required by regulation 6 of the relevant Order, supported that conclusion but were not conclusive. All five bills were therefore solicitor’s bills for sections 69 to 71.
3. Effect of paragraph 13. Section 71 gives a person who has paid or is liable to pay a solicitor’s bill a right comparable to that of the person primarily chargeable. Paragraph 13 creates the Law Society’s secondary liability and provides for recovery as a debt, but it does not exclude section 71. The general taxation right would require clear words or an obvious implication to be displaced. Recovery as a debt is not inconsistent with reducing an excessive claim on taxation.
4. The contrary view in The Law Society v McKanan-Jones 14th July 1992 (unreported) was respectfully rejected. The practical safeguards in sections 70(2) and 70(3), including payment or security conditions, adequately protect the Law Society from unmeritorious applications. Questions concerning section 70(4) and the exercise of the statutory discretion were left for the further hearing of Pine’s application.
5. Section 3 of the Human Rights Act 1998 did not arise because the ordinary construction already gave Pine the right for which he contended. The court therefore found no breach of Articles 6(1) or 14 of the Convention, or Article 1 of the First Protocol.

1. Court of Appeal (Civil Division): On 20 February 2002, the court unanimously dismissed the Law Society’s appeal.
2. Chancery Division, deputy judge: HH Judge Maddocks dismissed the Law Society’s application to strike out or summarily dismiss Pine’s claim and granted permission to appeal.