In a High Court appeal earlier this year against a decision of the former Taxing Master, Kearns J clearly re-stated the law and approach of the High Court towards the measurement of legal costs. The claim related to a road traffic accident in which an out-of-court settlement of €800,000 was reached.
The plaintiff’s solicitors claimed the costs of €406,000.51, including an instruction fee of €240,000. The Taxing Master awarded the sum of €212,000 for the instruction fee which the defendants challenged. Kearns J found that the former Taxing Master had erred in failing to apply the criteria as set out in the High Court jurisprudence. Furthermore, he concluded that the mathematical formula used by the former Taxing Master was inappropriate and remitted the matter to the new Taxing Master.
The key points from Kearns J judgment are as follows:
- The Rules of the Superior Courts and the jurisprudence of the High Court require that the Taxing Master ascertain (1) what work was done by the solicitor and whether a special skill was required in the commission of such work, (2) the nature of that skill, and (3) the reason why such skill was necessary.
- The former Taxing Master erred by suggesting it would be inappropriate for him to estimate the time spent by the plaintiff’s solicitors on a piece of work. Current High Court jurisprudence indicates that what a person did and how long it took are the most elementary inquiries in evaluating the work.
- Comparator cases may be used for broad guidelines to a Taxing Master in relation to costs.
- A party seeking his costs is only entitled the bare essentials required to conduct the litigation. Family and personal matters of a plaintiff are not appropriate for party and party taxation, and are not relevant to the issue of costs.
Importantly, Kearns J also indicated that the level of costs allowed during years of prosperity may no longer be appropriate in times of grave hardship. Further, that it is not clear to him if the current stream of financial crisis is factored into the taxation process and noted that there appears to be a strong case for arguing that it should be.
This decision gives a clear insight into the High Court’s attitude to determining the appropriate level of legal costs. It serves as a warning to solicitors when preparing their Bill of Costs not to exaggerate or include unnecessary costs. Excessive solicitors’ instructions fees and Counsels’ brief fees will be reduced. The starting point for assessing the appropriate level of fees will be the ‘work done’ principle.