High Court Upholds Wasted Costs Order Against Rainer Hughes Solicitors for Failure to Comply with Witness Statement Procedures

Citation: [2024] EWHC 585 (KB)
Judgment on

Introduction

In the High Court of Justice case “Rainer Hughes Solicitors v Liverpool Victoria Insurance Company Limited & Ors,” various legal principles were scrutinized as part of a dispute involving a solicitor’s professional conduct and the subsequent application for wasted costs. The case centered around allegations of negligence by Rainer Hughes Solicitors in their failure to comply with procedural rules regarding witness statements in a client’s “own language,” ultimately leading to a wasted costs order against them.

Key Facts

Rainer Hughes Solicitors appealed against an order to pay wasted costs on the grounds of their client’s witness statements not being in her “own language,” deemed to be Turkish. The wasted costs arose from the firm’s failure to translate documents, despite indications that the client required a translator, resulting in the striking out of a claim due to non-compliance with procedural requirements. The firm’s defense contested the client’s need for translated documents, asserting that her English proficiency was adequate; however, this clashed with the evidence presented.

The case hinged on several legal principles outlined in the Civil Procedure Rules (CPR), and established case law. Key principles included:

  • Compliance with CPR and Practice Directions: This case involved the application of CPR 32 relating to witness statements and the need for documents to be in the witness’s “own language” if they are not proficient in English, as well as Practice Direction (PD) 22 regarding statements of truth.

  • Negligence and Misconduct: The case referred to the concept of negligence by solicitors in the Ridehalgh v Horsefield case, which describes negligent acts as those that result in a breach of duty causing costs to be incurred unnecessarily.

  • Proportionality: The Harrison v Harrison case was cited in considering whether the costs of pursuing a wasted costs order were disproportionate to the costs at stake, highlighting that the court’s discretion may lead to the dismissal of a wasted costs order application if it is not cost-effective.

  • Discretion of the Court: The judgment reaffirmed the wide discretion judges have when deciding whether to make a wasted costs order, as expressed in Royal Institute of Chartered Surveyors v Wiseman Marshall.

Outcomes

The High Court, through Mr Justice Martin Spencer, reinforced the decisions made by HHJ Monty KC:

  • Firstly, the court upheld the decision to order Rainer Hughes to pay wasted costs, setting the quantum at £3,000.

  • Secondly, the court decided that Rainer Hughes should also pay the costs of the First Respondent relating to the wasted costs application, and separately, the costs of the Second and Third Respondents, on an indemnity basis for the former due to their stance being “an attempt to defend the indefensible.”

  • Thirdly, the court dismissed the appeal based on procedural grounds that the learned Judge did not err in considering or exercising his discretion in relation to the proportionality of the wasted costs application.

  • Fourthly, the court noted the importance of compliance with proper procedures when a ‘show cause’ order is made, suggesting that applicants should serve notices identifying the legal representative’s alleged actions or inactions and the costs sought against them, thus addressing the spirit of PD 46, 5.9.

Conclusion

In summary, this case underlines the importance of strict adherence to the Civil Procedure Rules and Practice Directions by solicitors, specifically in terms of ensuring witness statements and documents are filed in a client’s “own language” where necessary. The decision also highlights the court’s broad discretion in granting wasted costs orders and emphasizes the consideration of proportionality in costs applications. The detailed analysis by both HHJ Monty and Mr Justice Spencer affirms the judiciary’s role in enforcing compliance and the significant implications for solicitors who fail to uphold their duties within the legal framework.

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