Lisa Pickering v Thomas Mansfield Solicitors Limited

A security for costs application in Solicitors Act assessment proceedings may be made under Civil Procedure Rules 1998, because the proceedings constitute a case or claim for the purposes of the relevant rules. The applicant must satisfy the applicable eligibility condition and establish, with written evidence, that security is justified. Under CPR 25.27(b)(vi), dealing with assets does not itself justify security. The relevant question is whether the claimant has taken steps that would make enforcement of a costs order difficult. Converting cash into property, reducing mortgage liabilities, replacing one asset with another, or repaying debts will not necessarily amount to dissipation where the assets remain available for enforcement. The court must also consider whether an order is just in all the circumstances.

The defendant solicitor sought security for costs from a client whose bills were being assessed under the Solicitors Act 1974. The application relied on CPR 25.27(b)(vi), the court’s general case-management powers under CPR 3.1, and CPR 25.21(2). The defendant argued that the client had taken steps concerning substantial funds and assets which made enforcement of a future costs order difficult.

The client had made substantial payments on account and retained property, cash and other assets. The central issues were whether Solicitors Act assessment proceedings constituted a claim for the purposes of CPR 25.26, whether the conditions for security were met, and whether making an order was just in all the circumstances.

1. Application maintainable. Solicitors Act assessment proceedings, although procedurally unusual and initiated through Part 8, constitute the case in question for CPR 25.26 purposes. The solicitor was therefore entitled to apply for security for costs. The word “claim” in CPR 25.26 is not confined to a conventional Part 7 claim.
2. Alternative procedural provisions. CPR 25.21(2) concerns interim payment orders and could not support an application which was solely for security for costs. CPR 3.1(3) permits conditions and sanctions to be attached to orders, but the court would not attach an automatic sanction of non-participation in a substantial detailed assessment. Any non-compliance could instead be addressed by a later unless-order application.
3. Burden and evidence. CPR 25.26(2) placed the evidential burden on the applicant. The client had not asserted impecuniosity, so the burden did not shift to her to prove inability to provide security. The applicant could have sought further information, specific disclosure or cross-examination, but had not done so.
4. CPR 25.27(b)(vi). The applicant failed to show that the client had taken steps concerning her assets which would make enforcement difficult. The provision refers to assets, not merely cash or liquid funds. Mortgage repayments, acquiring or improving property, replacing a vehicle, repaying a debt and selling investment gold did not, on the evidence, put assets beyond enforcement. Assets remained within the jurisdiction and substantial funds and property remained available.
5. Justice in all the circumstances. The application also failed the overarching requirement in CPR 25.27(a). Substantial payments had already been made, the payment schedule had been complied with, the assessment was imminent, and the asserted assessment costs appeared excessive and insufficiently persuasive. The application was dismissed. The defendant was ordered to pay the client’s costs, summarily assessed if not agreed.