Nicholas Drukker & Co v Pridie Brewster & Co

A party may abuse the court’s process by raising in a costs assessment matters which could and should have been pursued in earlier proceedings. The question is fact-sensitive and requires a broad assessment of all the circumstances. A Costs Judge’s jurisdiction under section 70 of the Solicitors Act 1974 does not extend to wholesale allegations of professional negligence going to the heart of the retainer rather than discrete items in the bill. Even if jurisdiction exists, allegations involving complex facts, expert evidence and substantial cross-examination may be unsuitable for detailed assessment. Such matters should ordinarily be litigated, if at all, in the High Court.

Pridie Brewster & Co appealed against rulings made by Master Seager Berry during the detailed assessment of Nicholas Drukker & Co’s solicitors’ bill. The Master struck out allegations of professional negligence and breach of contract which the defendants had previously set out in pre-action protocol correspondence but had not pursued in proceedings.

The allegations concerned delays in selling a restaurant business, advice on assignment and waiver, and advice concerning liabilities and indemnities. The central issues were whether raising those allegations in the Points of Dispute was an abuse of process and whether they were suitable for determination by a Costs Judge.

The appeal was dismissed and the Master’s decision upheld.

1. Abuse of process. The court applied the broad, merits-based approach in Hunter v Chief Constable of West Midlands Police [1982] AC 529, Henderson v Henderson (1843) 3 Hare 100, Yat Tung Investment v Dao Heng Bank [1975] AC 581 and Johnson v Gore Wood [2002] 2 AC 23. Whether conduct is abusive depends on all the circumstances. Here, the defendants had particularised the same negligence allegations in the pre-action protocol process, had caused the solicitors substantial expense, and had then chosen not to issue proceedings. Reintroducing those allegations in the Points of Dispute was therefore an abuse.
2. Jurisdiction and suitability. Under section 70 of the Solicitors Act 1974, a Costs Judge may determine whether particular costs are properly chargeable. The jurisdiction does not extend to trying wide-ranging professional negligence claims affecting the substance of the retainer. The distinction drawn in In re Massey and Carey (1884) Ch XXVI 461 was between disallowing particular items and determining whether negligence caused the loss of the whole action.
3. The allegations here involved disputed facts, witnesses, expert evidence, voluminous documents and issues affecting about 70 per cent of the bill. They were unsuitable for a costs assessment and should be litigated, if at all, in the High Court. The defendants were not deprived of a remedy because a professional negligence action remained available.

• High Court (Queen’s Bench Division): Master Seager Berry struck out the four categories of allegations from the Points of Dispute in the detailed assessment.
• High Court (Queen’s Bench Division): The appeal was dismissed and the Master’s ruling upheld.