Bidzina Ivanishvili v Signature Litigation LLP

A solicitor’s interim invoice is a statutory bill only if it is complete and final for the work it covers. A bill representing only an unconditional part of fees payable under a conditional fee agreement is not final where further charges for the same work may become due. The issue depends on the proper construction of the retainer and any subsequent variation. Client knowledge of the legal consequences is not required where the contract clearly authorises interim statutory bills. Payment without demur cannot itself establish such an agreement where it would contradict the retainer. Non-statutory invoices may form part of a final Chamberlain series, or become final at a natural break, only once billing has been finalised.

The claimant sought declarations under CPR Part 8 that invoices delivered by the defendant solicitors during a long-running retainer were not statutory bills under the Solicitors Act 1974. Alternatively, he sought assessment under section 70 of that Act.

The retainer involved a conditional fee arrangement. The claimant paid discounted hourly rates, while further fees could become payable upon specified recoveries. The defendant issued regular invoices and later varied its terms to refer expressly to interim statute bills and payment-on-account invoices. The issues were whether the original or varied retainer authorised interim statutory bills, whether an agreement could be inferred from conduct, and whether termination converted the invoices into statutory bills.

1. Statutory bills and finality. The claimant’s invoices were not statutory bills. A statutory or interim statutory bill must be complete and final for the work it represents. The relevant question is not whether the invoice is final for the charge presently demanded, but whether it incorporates the final charge for the work covered.
2. Construction of the original retainer. The June 2016 Retainer authorised regular invoices, normally monthly, but did not clearly provide that they were final statutory bills. It contemplated a final invoice when the work was completed and further conditional charges for the same work. The invoices were therefore non-statutory.
3. Contractual authorisation and informed consent. Whether a retainer authorises interim statutory bills is determined by ordinary contractual interpretation. No separate requirement exists for the solicitor to explain the legal consequences of the arrangement where the contractual provision is clear. The original retainer was not sufficiently clear, particularly in the context of the conditional fee arrangement.
4. Conduct and payment. Payment without demur did not establish an inferred agreement that the invoices were statutory bills. Such an inference would have contradicted the contractual arrangement under which the invoices were rendered and paid.
5. September 2021 variation. The May 2021 Terms applied prospectively. They did not retrospectively convert earlier invoices into statutory bills. Paragraph 6.4(a), read with paragraph 6.1, lacked the necessary clarity because it appeared to permit repeated final bills for the same work. Paragraph 6.4(b) was better understood as providing for interim non-statutory payment-on-account invoices in conditional or contingent fee arrangements.
6. Termination and Chamberlain principle. Termination did not make the invoices final. The Chamberlain series and natural-break principles presuppose that billing has been finalised. They could apply only if the defendant delivered a bill for all further fees due, or accepted that nothing further was payable.
7. Scope of future assessment. The expiry of time for assessing an invoice does not prevent a later assessment of further bills, insofar as those bills claim additional fees based on the same work, unless the work has already been assessed or the parties have clearly agreed otherwise.

The claimant’s declarations were granted in substance: none of the monthly invoices became statutory bills before or after the September 2021 variation, or upon termination.