Kundrath v Kwatia & Anor

On an appeal concerning a solicitor’s bill delivered more than 12 months earlier, the question whether “special circumstances” justify detailed assessment is a broad discretionary judgment. An appellate court should interfere only for an error of law or analysis, or where the decision falls outside the generous ambit of discretion.

The relevant circumstances must be assessed cumulatively. Misleading pressure by solicitors, particularly where a client is led to believe that a substantial payment is a condition of assessment, may constitute special circumstances. Uncertainty about when a retainer ended and the bill became payable may also be relevant. Delay does not necessarily defeat an application where it has caused no significant prejudice.

The appellant appealed from Master Rogers’s refusal on 26 April 2004 of her application for detailed assessment of a bill of costs for £23,746.05 rendered by the respondent solicitors.

The bill had been delivered in July 2002. The appellant relied on a letter stating that assessment would be conditional on payment into court of 40 per cent of the bill, uncertainty about termination of the retainer, the absence of a client care letter, and allegations of pressure and overcharging. The central issues were whether the Master had erred in exercising his discretion under section 70(3) of the Solicitors Act 1974, and whether the circumstances justified assessment.

1. Appeal allowed. The Master’s order was set aside and the discretion was exercised afresh.
2. The discretion concerning “special circumstances” is broad. The appellate court does not exercise it afresh merely because it might have reached a different conclusion. Intervention is justified where there is a mistake of law or analysis, or the decision falls outside the generous ambit of discretion.
3. The circumstances must be considered in the aggregate. The Master had not adequately considered whether the respondents’ letter of 19 August 2002 exerted improper pressure, together with the other circumstances.
4. The letter stated that an assessment order would be conditional on payment into court of 40 per cent of the bill. It was sent before the expiry of the 12-month period, when no special circumstances were required under section 70(2) and (3) of the Solicitors Act 1974. In the circumstances, and given the inequality between solicitor and client, the induced belief could dissuade the client from seeking assessment and was capable of amounting to special circumstances.
5. The Master had also failed to consider when the retainer ended and when the bill became payable. The apparent suggestion that the retainer remained on foot, coupled with the absence of a client care letter or written instructions, was relevant.
6. Allegations of pressure and overcharging in the points of dispute, the misleading letter and its purpose were sufficient, cumulatively, to establish special circumstances. Although there had been unexplained delay, there was no evidence of significant prejudice to the respondents.
7. A detailed assessment was ordered. The respondents were required to provide a detailed breakdown within 21 days, the appellant was to provide points of dispute within 30 days thereafter, and proceedings concerning the bill were stayed pending final determination. There was no order as to the costs of the appeal.

• High Court (Queen’s Bench Division): appeal from Master Rogers’s order dated 26 April 2004 allowed; detailed assessment ordered.
• Supreme Court Costs Office: application for detailed assessment refused on the basis that special circumstances had not been established.