Analysis of Costs Schedule and Legal Principles in Intersar Al-Balhaa & Anor v RMG Residential Management Group Ltd: EWHC-KBD 2024 229

Citation: [2024] EWHC 229 (KB)
Judgment on

Introduction

This article provides an analysis of the case law for “Intersar Al-Balhaa & Anor v RMG Residential Management Group Ltd : EWHC-KBD 2024 229” as reported in the High Court of Justice, King’s Bench Division. The focus is to identify and examine the key topics and legal principles as they have been set forth in the judgment handed down by Mr Justice Dove.

Key Facts

The case involved an appeal against the order of Deputy Costs Judge Erwin-Jones relating to a costs schedule. The appeal was heard on November 15, 2023, and subsequent written submissions were made by both parties concerning the costs, as the appellants had not had adequate time to review the costs schedule submitted by the respondent on the eve of the hearing.

The primary contentions revolved around the hourly rate charged for grade C and D lawyers, attendance fees claimed in respect of a grade A fee earner, the amount of time claimed for attendances on the respondent, and the interest rate payable on the costs order.

Several legal principles can be discerned from the judgment:

Hourly Rates and Summary Assessment

Mr Justice Dove analyzed whether the hourly rates charged by the respondent were reasonable and proportional, citing the Solicitors’ Guidelines as a benchmark. The judgment suggests that within the context of a summary assessment, the court may not find rates to be unreasonable or disproportionate solely because they exceed the guideline hourly rates, provided there is no convincing evidence to the contrary.

Grade Differentiation in Costs

The appellant’s claim that some of the hours should be billed at a lower grade due to the fee earners’ qualifications was addressed. This contention was dismissed on the basis that none of the fee earners listed in the costs schedule were identified as grade D, supporting the principle that costs should align with the actual grade of the legal professionals who worked on the case.

Proportionality of Time Spent

The judgment reinforces that the time claimed for legal work must be reasonably incurred. Given the complexity and duration of the appeal, Mr Justice Dove accepted that a considerable amount of work was likely needed and found no basis to dispute the time claimed by the respondent.

Interest on Costs Orders

Legal principles surrounding the interest rate on costs orders were applied in accordance with the Judgments Act 1838. The appellant’s suggestion to adjust the interest rate to reflect current commercial rates was dismissed, with the acknowledgment that the costs order is a judgment and therefore subject to statutory rates.

Outcomes

The outcome of the appeal resulted in a partial victory for the appellant, leading to a reduction of £1300 from the overall costs schedule. Mr Justice Dove ordered that the appellants pay the respondents’ costs in the sum of £34,355.55 to be settled within 14 days.

Conclusion

In summary, the judgment by Mr Justice Dove in “Intersar Al-Balhaa & Anor v RMG Residential Management Group Ltd” elucidates on principles related to the assessment of costs in legal proceedings, namely the adherence to Solicitors’ Guideline Rates, proper grading of fee earners, reasonableness and proportionality of time spent on a case, and the application of the Judgments Act 1838 to interest rates on cost orders. The case underlines the consideration given to the arguments regarding hourly rates and how exceptions to guideline rates may still be accepted when justified, the importance of correctly graded legal work, the necessity for incurred time to be reasonable for the work required, and the statutory basis for interest on judgments.