Halborg, R (on the application of) v The Law Society

A solicitor’s entitlement to submit interim statute bills depends on the true construction of the retainer and the bills. A contractual reservation of a right to issue interim invoices may amount to express agreement to submit interim statute bills where the surrounding terms distinguish interim bills from payments on account. A client must request a remuneration certificate within the prescribed period for the relevant bill. Posting the request is sufficient to constitute a requirement, but the solicitor’s obligation to obtain the certificate arises only when the solicitor becomes aware of it. Payment after the request does not invalidate that request.

A solicitor sought judicial review of an adjudicator’s decision arising from a client’s complaint about unpaid legal bills. The adjudicator concluded that the solicitor’s bills were requests for payment on account, that a request for a remuneration certificate covered all the bills, and that the solicitor had been obliged to obtain one. He directed the solicitor to apply for a certificate in respect of all twelve bills.

The court had to determine the legal nature of the bills, the effect of the one-month time limit and subsequent payment, when the client’s request became operative, and whether the adjudicator had power to direct the solicitor to obtain a certificate.

1. The bills. The court held that all twelve bills were interim statute bills. The retainer’s reference to a right to issue interim invoices, its provision for interest on interim invoices, and its separate reference to interim bills and payments on account showed that the client had expressly agreed that interim statute bills could be submitted. The bills’ description of specified work performed during specified periods and the accompanying remuneration-certificate information supported that conclusion. The solicitor bore the burden of establishing that the bills were statute bills.
2. Time limit and scope. Under Solicitors’ (Non-Contentious Business) Remuneration Order 1994, the client could require a certificate only for a bill in respect of which the request was made within one month of the prescribed information or delivery of the bill, whichever was later. The first eleven bills were therefore outside the permitted period. The last bill could not properly be treated as covering the earlier work, particularly since it referred only to one hour’s work.
3. Communication and payment. The client’s request became effective when it was sent, whether or not it was received. However, the solicitor’s obligation to obtain a certificate arose only when the solicitor became aware of the request. Subsequent payment did not invalidate a request already made. Article 12(1) did not imply that payment prevented a later request where no application had yet been made.
4. Adjudicator’s power and outcome. Schedule 1A to the Solicitors Act 1974 empowered the adjudicator to direct the solicitor to secure rectification of an omission or take action in the client’s interests. A finding of inadequate professional service was unnecessary; it was sufficient that the adjudicator considered the service inadequate. The direction was lawful only in relation to the bill dated 17 October 2007. The corresponding part of the adjudicator’s directions concerning the other bills was quashed. Compliance with the remaining direction was required by 16 February 2010 if the client insisted on it.

First-instance judicial review proceedings. The judgment states that the matter had previously been before the Administrative Court, but gives no citation for an earlier decision.