Stephen Turner v Coupland Cavendish Limited

In a solicitor and client costs assessment, a cash account is in dispute when the client or the court raises a genuine query about its accuracy. A client seeking information under CPR Part 18 need not establish an arguable case, provide prior evidence of wrongdoing, or prove matters outside the client’s knowledge. The relevant threshold is that the information relates to a matter in dispute.

The solicitor must satisfy the court that the cash account is accurate. This includes information about possible undisclosed commissions or other financial benefits connected with an ATE policy. A solicitor must also provide basic information identifying a company to which client money has been paid where that information is relevant to explaining the transaction.

The appellant, a former client of the respondent solicitors, commenced a solicitor and client costs assessment under section 70 of the Solicitors Act 1974 after receiving a statutory bill. He disputed the cash account, alleging possible undisclosed commissions connected with ATE insurance and questioning a payment of £750 from his compensation to a Gibraltar-based company.

The Costs Judge refused to order replies to Part 18 requests and refused to order disclosure of the company number. Permission to appeal was limited to those two issues. The central questions were whether a client must show evidence or a positive case before obtaining information about disputed cash-account items, and whether the solicitor had to provide identifying information concerning the payment recipient.

1. Appeal allowed. The Costs Judge erred in applying a threshold equivalent to that required for pre-action disclosure or specific disclosure. Under CPR Part 18, the essential requirement is a dispute. A non-admission may constitute a dispute, and information may properly be sought to clarify whether a dispute exists.
2. The cash account must be accurate before the Costs Judge can certify the result of the account and make a final order. The solicitor bears responsibility for satisfying the court of that accuracy. The client need not prove that an undisclosed commission exists, particularly where the relevant facts lie within the solicitor’s exclusive knowledge.
3. The reasoning in Herbert v HH Law Ltd. [2019] 1 WLR 4253 limits a direct challenge to the amount of an ATE premium in a section 70 assessment because the premium is an item in the cash account rather than a solicitor’s disbursement. It does not prevent inquiry into whether the recorded payment is accurate or whether related commissions or other financial benefits were received and omitted.
4. Points of Dispute, Replies and cash accounts are not Statements of Case for CPR purposes. In particular, they lack the formal features, including a statement of truth, that would justify treating the solicitor’s assertion of accuracy as conclusive. The Part 18 requests therefore had to be answered in their entirety.
5. The payment to AJG Ltd from client compensation created a legitimate interest in understanding the nature and basis of the transaction. A solicitor, acting generally as fiduciary and agent and holding client money on trust, must provide basic information needed to explain an otherwise unexplained payment. It was therefore unwarranted to require the client to obtain the company number independently from Gibraltar Companies House.

The judgment records an appeal from two orders of Costs Judge Rowley dated 31 October 2023 and 15 November 2023. Permission to appeal was granted on 15 March 2024, limited to the Part 18 requests and information concerning the Gibraltar-based company. The High Court allowed the appeal on both grounds.