Various Claimants v News Group Newspapers Limited

Guideline hourly rates are a useful starting point in detailed assessment, but they are not a finishing point. The court must assess the factors in Civil Procedure Rules 1998, r 44.4, including the complexity, importance and weight of the litigation and the expertise required.

Under the transitional provisions governing recoverable success fees, a collective costs arrangement cannot retrospectively create services provided to a claimant before the commencement date. A claimant whose own CFA pre-dates that date may, however, recover a success fee under a later CFA with counsel.

Success fees should reflect litigation risk assessed prospectively. A staged fee may provide a substantial discount for early settlement while preserving a 100% fee if the case proceeds to trial.

The judgment concerned preliminary issues arising on the detailed assessment of common costs in the fourth tranche of the Mobile Telephone Voicemail Interception Litigation. The issues were the appropriate hourly rates, recoverability and quantum of solicitors’ and counsel’s success fees, and notification of counsel’s CFAs.

The claimants used individual CFAs with their solicitors, a Costs Sharing Agreement and collective CFAs between counsel and the lead solicitor. Twenty-five claimants had entered into individual CFAs before 6 April 2019; 57 had done so afterwards. The central questions were whether the arrangements satisfied the transitional provisions in Legal Aid, Sentencing and Punishment of Offenders Act 2012, and what success fees were reasonable.

1. Hourly rates. The guideline hourly rates were a useful starting point, but the court was required to consider the factors in Civil Procedure Rules 1998, r 44.4. The claimants’ specialist expertise, the value, complexity and importance of the litigation justified the claimed Grade A rates for the principal solicitors. The Grade B rate was reduced to £350 per hour and the peripheral Grade A rate to £460 per hour.
2. Recoverability of counsel’s success fees. Section 44(6) of Legal Aid, Sentencing and Punishment of Offenders Act 2012 required the relevant pre-commencement arrangement or provision of services to relate to the particular person liable for the success fee. The CSA and the Costs Arrangements Order did not retrospectively establish that services had been provided to the 57 claimants whose individual CFAs were entered into after 6 April 2019. Their counsel’s success fees were therefore irrecoverable.
3. The 25 claimants with pre-6 April 2019 individual CFAs came within s 44(6)(a). A later instruction of counsel did not prevent recovery, and a later subscription to the CSA did not discharge or vitiate the original CFA.
4. Notification. Under the former Costs Practice Direction, further notification was unnecessary where notice had already been given of a CFA with the principal legal representative and another CFA was later entered into with an additional legal representative. Relief from sanction would in any event have been granted if required.
5. Success-fee quantum. The appropriate structure was generally 100%, discounted to 25%–35% where settlement occurred within four weeks after the claimant’s without-prejudice valuation. Counsel were subject to the same two-stage structure, with a discounted rate of 25%, unless the relevant CFA contractually limited recovery to 15%. The assessment had to be conducted prospectively; the defendant’s history of settlement reduced the early-settlement risk but did not eliminate the possibility of trial.

The preliminary issues were determined accordingly.