Argyn Khassenov, R (on the application of) v Kulich and Kulich

A costs determination from central funds must distinguish the line-by-line audit of individual items from any subsequent global or category-based reduction. A Singh discount may be applied only after a clear total has been established following the audit. The reduction must be reasoned and explained sufficiently for the prosecutor to understand it and, if necessary, challenge it. A determination is fatally defective where it does not disclose how much was removed during the audit and how much by the Singh discount. The assessment must also address the nature, importance, complexity and difficulty of the work and the time involved. Non-chargeable administrative work may properly be excluded.

The appellant was a private prosecutor who sought payment from central funds under section 17 of the Prosecution of Offences Act 1985 for costs incurred in confiscation proceedings under the Proceeds of Crime Act 2002. The Determining Officer reduced the solicitors’ preparation time from 734.3 hours to 300 hours after a line-by-line audit and a further adjustment said to follow Singh. The appellant challenged the method of applying that reduction, reliance on comparator cases, and the disallowance of particular items. The central issue was whether the reasons disclosed a lawful and sufficiently transparent assessment of the sum reasonably sufficient to compensate expenses properly incurred.

1. Disclosure-platform work. The court construed its earlier 2019 judgment as allowing both the bespoke disclosure-platform cost and the associated time and work. The earlier ruling had treated the platform as an unusually heavy and reasonable expense rather than an overhead. Bespoke training was likewise recoverable because it was specific to the prosecution and would not benefit other clients.
2. Singh reduction. The governing approach permits a determining officer, after auditing individual items, to stand back and assess the overall reasonableness of the claim. But the officer must first identify the total figure remaining after the audit and then explain any further Singh reduction. The reasons must be sufficiently detailed and comprehensible to permit the claimant and the court to understand and challenge the calculation.
3. The Determining Officer had not disclosed the figure after the audit phase or separated audit deductions from the Singh reduction. The court therefore could not determine how much of the substantial reduction resulted from each process. That lack of clarity was a fatal flaw and meant that the Singh reduction had not been properly applied.
4. The court could not yet determine whether the comparator case of O’Reilly was apt, or whether the individual audit deductions were reasonable. The assessment had to be reconsidered with sufficient detail about what was disallowed and why. Work such as routine administration, arranging travel, typing attendance notes and similar non-legal tasks could properly be excluded where it was not work properly undertaken at a professional fee-earner rate.
5. The matter was remitted to the Determining Officer to explain the audit reductions and the Singh reduction. The parties were directed to seek agreed directions, or provide competing proposals for the timetable and further hearing. Costs were reserved.

• Senior Courts Costs Office: the appeal from the Determining Officer’s redetermination was allowed in relation to the defective application of the Singh reduction and remitted for further explanation and directions. Other grounds remained to be determined.