Blue Manchester Limited v Howard Kennedy LLP
[2024] EWHC 2823 (SCCO)
Guest Supplies Intl Limited v Spector Constant & Williams Limited
20 September 2024
[2024] EWHC 2450 (SCCO)
Senior Courts Costs Office
A client sued their solicitors over unpaid bills. The solicitors said they'd already been paid because they took money from the client's funds, but the court disagreed. The court said the solicitors' paperwork wasn't proper and didn't allow them to take the money. The solicitors must now provide proper bills, and the client can then challenge them.
Key Facts
- •Guest Supplies Intl Limited (Claimant) challenged Spector Constant & Williams Limited's (Defendant) bills.
- •A Conditional Fee Agreement (CFA) existed between the parties.
- •The Defendant deducted fees from monies received by the Claimant.
- •The Claimant argued the deductions were made against non-statutory invoices, not interim statute bills.
- •The Defendant argued the bills constituted a 'Chamberlain bill' and were paid in full, requiring the Claimant to show special circumstances for assessment.
- •The Claimant's primary argument was that the bills were not interim statute bills; secondary argument was lack of consent to deductions.
Legal Principles
Payment of a solicitor's bill requires a transfer of money in satisfaction of a bill with the payer's knowledge and consent; consent can be given beforehand if authorised in a contract.
Menzies v Oakwood Solicitors Ltd [2023] EWCA Civ 844
A 'Chamberlain bill' is not intentionally created; it arises when a series of non-compliant invoices, when taken together, meet the requirements of a statute bill.
Bari v Rosen [2012] EWCH 1782 (QB), Sprey v Rawlinson Butler [2018] EWHC 354
The Solicitors Act 1974 provides consumer protections, allowing challenges to bills even after a year under certain circumstances.
Solicitors Act 1974
A compliant statute bill cannot be created piecemeal; sufficient narrative is required (Ralph Hume Garry v Gwillim [2002] EWCA Civ 1500).
Ralph Hume Garry v Gwillim [2002] EWCA Civ 1500
Outcomes
The Defendant did not have a contractual right to raise interim statute bills.
The client care letter, terms and conditions, and CFA did not explicitly or implicitly grant such a right. The documents suggested payments on account in anticipation of a final bill.
The documents delivered by the Defendant did not amount to interim statute bills or a Chamberlain bill.
The invoices lacked sufficient narrative, contained overlapping date ranges, and were not labelled as bills. The court rejected the argument that providing breakdowns later could retrospectively create compliant statute bills.
The Defendant's claim that the bills were paid in full, requiring the Claimant to show special circumstances, was rejected.
The court found no valid interim statute bills existed, meaning the time limits for challenging the bills had not run out.
The court ordered the Defendant to deliver a final statute bill and a cash account. Costs were reserved.
This allows the Claimant to challenge the final bill within the statutory time limits.