EJW Builders Limited & Anor v Audrey Elizabeth Marshall & Ors

An order under section 194 of the Legal Services Act 2007 is discretionary. The amount payable to the prescribed charity need not exactly correspond to the costs that would have been ordered had the representation not been free. The court must have regard to the conventional costs principles while also advancing section 194’s purposes, including levelling the litigation risk and supporting free legal services. Guideline hourly rates are not binding, but rates above them require clear and compelling justification. Where a broad-brush assessment is appropriate, the court may make a proportionate assessment by category rather than scrutinising every item.

The claimants’ substantive claim was dismissed after trial, and the court ordered them to pay costs relating to the first and second defendants’ pro bono representation to the Access to Justice Foundation. The order was made under section 194 of the Legal Services Act 2007, with assessment on the standard basis if the amount was not agreed.

The parties disputed the proper hourly rates, the reasonableness of the claimed attendances and document work, and the amount payable to the charity. The court conducted a paper-based summary assessment.

1. The court assessed the payment payable by the claimants to the Access to Justice Foundation at £117,000.
2. Section 194 of the Legal Services Act 2007 confers a discretionary power. Under CPR 1998 rule 46.7, the court may assess a sum equivalent to the costs that would have been payable for the representation had it not been free. That equivalent is not necessarily the same as the conventional costs figure.
3. Following Manolete Partners plc v White (No 2), the court had to consider both ordinary costs principles and the legislative purposes of section 194. Those purposes include placing privately funded litigants at a comparable costs risk and providing funding for free legal assistance.
4. It was artificial to ask whether the defendants had acted reasonably in choosing a London firm because their solicitors had been allocated through Law Works. It was reasonable for them to accept free representation. London band 2 rates were therefore the appropriate starting point, although the claim was sufficiently straightforward to be handled by a local firm.
5. The claimed rates exceeded the guideline rates. Applying Samsung Electronics Co Ltd v LG Display Co Ltd, a clear and compelling justification was required for the excess, and none was provided. The claimed rates were reduced accordingly. Excessive attendances and disproportionate partner-led document work were also reduced.
6. Applying a broad-brush approach, the court would have assessed conventional costs at £117,000. Having regard to the discretion under section 194 and its legislative purposes, the same sum was ordered as the payment to the charity.

The substantive claim was dismissed at trial by the same judge in [2025] EWHC 2765 (Ch). This judgment concerned the subsequent paper-based assessment of the payment due under the section 194 order.