McIlwraith v McIlwraith & Ors

The question for decision in this case concerns what, if any, costs are recoverable for work done personally by a litigant who is a solicitor during periods of the litigation in which he was represented by a firm of solicitors. The point is a novel one because the solicitor litigant in question was neither the proprietor of, nor a partner in, either of the firms which have represented him in these proceedings.

The bill before me relates to the Claimant’s costs of proceedings in the Chancery Division which he took against his brother who is the executor of their late father’s estate. These proceedings are in fact the third set of proceedings brought by the Claimant arising out of the estate. All three cases have produced several orders for costs, sometimes in favour of the Claimant, sometimes in favour of the executor. The first set of proceedings concerned a dispute as to the distribution of the Claimant’s inheritance. It was settled in August 1999 with an order for costs in favour of the Claimant.

The second set of proceedings concerned an application for inspection of trust documents. The Claimant sought inspection because he was concerned that certain costs had been incorrectly charged to the estate. In that action the executor ultimately consented to an order for inspection without prejudice to his contention that such an order was unnecessary. The costs of the second action were provided for in a subsequent order dated 14 February 2000. That order made no order for the Claimant’s costs and awarded the executor’s costs on the indemnity basis out of the estate. However there was a proviso that the Claimant could apply to have those orders set aside and the liability for costs redetermined if, before May 2000, further proceedings were brought challenging the level of administration costs paid by the estate. The proviso has not led to those orders for costs being set aside but did lead to the institution of the third set of proceedings to which the bill of costs now before me relates.

The third set of proceedings was commenced on 26 April 2000. At that stage the Claimants were named as a Mr Hughes and a Miss Trier, the trustees of the trust affecting the Claimant’s inheritance and they were partners in the firm of Messrs Downs. The Defendants were named as the executor and his solicitors, Messrs Stevens & Bolton. In these proceedings two claims were made, namely (a) an inquiry as to whether the executor was entitled to charge certain legal and accountancy costs to the estate; and (b) a detailed assessment pursuant to Section 71 of the Solicitors Act 1974 of the legal bills submitted by the Second Defendant.

By an order dated 7 August 2001 the Claimant was added as Claimant to these proceedings in substitution for the two trustees.

The claims raised in these proceedings proceeded to a hearing before Master Price on 6 November 2001. He dismissed the claim for detailed assessment and ordered the Claimant to pay the Second Defendant’s costs of the claim. Master Price had divided the bills into three categories. The first category contained bills paid more than 12 months previously which meant that, the claim for their detailed assessment was statute barred. The second category of bills were bills then recently paid: in respect of these the Claimant had to show special circumstances but, in Master Price’s view, no special circumstances had been shown. The third category (bills where no special circumstances needed to be shown because they had been recently delivered and were still unpaid) Master Price exercised his discretion against sending them for detailed assessment. The total amount of these bills was about £16,000 of which the Claimant’s share, as a beneficiary, was 25%, ie about £4,000. He refused detailed assessment of those bills "bearing in mind the overriding objective and the need for proportionality in relation to the procedure to be adopted and the employment of the court’s resources".

Master Price did, however, grant the application for an inquiry. Although he expressed his reluctance to make this order, in view of the small amount at stake, he felt that the Claimant as a beneficiary had a right to such an inquiry which could not be refused on grounds of proportionality. He reserved the inquiry to himself and directed that it should proceed by way of a Scott Schedule prepared by the executor setting out the work which had been done and charged for by the solicitors and the accountants. The Claimant would then set forth his objections in the schedule identifying the items he alleged should not be charged to the estate but should be charged only to the beneficiaries in question or to the executor. No objections were to be allowed in relation to quantum. His order reserved the costs of the claim as between the Claimant and the executor so far as it related to the inquiry.

The Claimant sought to challenge that order by way of an appeal. Although he won a preliminary point on the appeal and the costs therefor (whether any of the bills were statute barred) detailed assessment was still refused as a matter of discretion and therefore the appeal was unsuccessful.

The inquiry proceeded to a one day hearing on 16 June 2003. According to a statement of costs filed by the executor for that hearing, his costs had by that stage exceeded £72,000. Both sides were represented by experienced junior counsel. The Claimant successfully applied for an adjournment to a later date at which date there could be examination and cross-examination of several witnesses. The inquiry finally began in December 2003 and lasted eight days. The Claimant was represented by counsel whose brief fee was £14,000 with refreshers of £2,250. The Claimant was partially successfully at the inquiry and an order was made that the executor should pay to him the sum of £4,737.17 and 50% of his costs of the proceedings, such costs to include "the costs of the original claimants and all costs previously reserved".

The bill now before me totals about £176,000 in respect of which the Claimant seeks 50%. The bill follows the order dated 22 January 2004 in treating the costs as if the Claimant had been Claimant at all stages, and the detailed assessment before me is proceeding upon the same footing.

The bill is divided into four parts. Part 1 covers the period from commencement in early 2000 until September 2001. For most of that period the independent trustees were named as Claimants and were represented by themselves in their firm name, Messrs Downs. In fact, most of the legal work in this period was done by the Claimant himself. He is a senior solicitor who specialises in family law matters. Neither he nor Messrs Downs specialised in contentious probate proceedings. Although Messrs Downs were on the record of the action, and indeed for most of the time were named as Claimants in the action, it was agreed between them and the Claimant that the services they would provide would be mainly secretarial and administrative. At the hearing before me the Claimant explained that his main motivation in conducting the action in this way was because his chosen counsel was unwilling to accept instructions from him directly. Part 1 of the bill totals about £34,000 and comprises over £17,000 in respect of work done by the Claimant, a little over £3,000 including VAT in respect of work done by Messrs Downs and most of the balance comprises counsel’s fees.

Part 2 of the bill covers the period from September 2001 to December 2002. During that period the solicitors on the record for the Claimant were Messrs Tilbrook Turner Foster ("TTF"). At the hearing before me the Claimant explained the change from Messrs Downs as follows. The junior fee earner with whom he had been in touch at Messrs Downs had left their employment and the firm was therefore unable, or at any rate unwilling, to continue the working arrangement he had previously had. By this time Messrs Downs’ partners had ceased to be named as Claimants in the action. At or about this time the Claimant was an employed solicitor with TTF and, since he perceived a need to continue to have a firm of solicitors on the record, they agreed to go on the record for him. I was shown a copy of a letter dated 3 September 2001 which was written by the Claimant in his capacity as a solicitor with TTF to himself as a client of that firm. In that letter the Claimant addressed himself as "Dear Mr McIlwraith", informed himself that he would have prime conduct of this matter, stated the hourly rate which would be payable, reserved the right to deliver interim bills and, after a few other formalities, invited himself to sign the enclosed extra copy of the letter and return it to himself. In fact, TTF did not render any bills to the Claimant. He continued to conduct the case himself but now used TTF’s notepaper to do so. Part 2 of the bill totals just over £18,000 of which about £14,000 is in respect of work done by the Claimant. Most of the balance is in respect of counsel’s fees. No claim for costs is in fact made by or on behalf of TTF and, at the hearing before me it was made clear that no claim for costs by them was expected. Nevertheless, I was told that their being on the record was no empty formality. They had accepted responsibility as solicitors in this case and indeed accepted responsibility to pay counsel’s fees. The arrangement came to an end when the Claimant’s employment with TTF terminated.

Part 3 of the bill covers the period from December 2002 until the conclusion of the inquiry, which was in January 2004. During this period Messrs Downs were again on the record for the Claimant. A change in their personnel had made them again able and willing to accept instructions from the Claimant on the same basis as before, ie he did most of the work but they took responsibility for secretarial and administrative matters and also instructed counsel. Part 3 comprises over £50,000 in respect of work done by the Claimant personally and a further £50,000 plus VAT in respect of counsel’s fees. A claim is also made for about £8,000 in respect of the fees of Messrs Downs plus VAT thereon.

Part 4 of the bill covers the costs of the detailed assessment. At present it contains only costs draftsman fees totalling over £6,000 and £400 in respect of work done by the Claimant personally, claimed at the rate of £160 per hour. In fact it is now conceded by the Claimant that he cannot claim at a rate exceeding £9.25 in respect of time reasonably spent by him in this part. Messrs Downs are no longer on the record for him and, as a litigant in person, he is not able to bring himself within the exception which applies to solicitors who are "represented in the proceedings by his firm or by himself in his firm name" (Costs Practice Direction para 52.5).

At the hearing on 26 April 2005 I heard argument as to whether the Claimant is entitled to any costs at all in respect of the work done by him whilst he was represented by Messrs Down or TTF. The executor says I should disallow all of these costs and, if I did so, over £85,000 would be wiped from the total costs to be assessed. The Claimant would still be entitled to claim costs at £9.25 per hour in respect of Part 4 and perhaps also for a period of about a month beginning in August 2001 on the change over from Messrs Downs to TTF. I reserved judgment on that question. Before giving that judgment it is convenient to record that the hearing continued as to two other topics: namely the hourly rate I should allow if a rate exceeding £9.25 is recoverable, and a preliminary point as to proportionality. As to the appropriate hourly rate, if a commercial rate is recoverable, the bill claims £120 in Part 1 and £160 in Parts 2 and 3. I would allow £80 in respect of Part 1 and £87.50 in respect of Parts 2 and 3. I reached this decision having regard to the seniority of fee earner required (grade B), the hourly rates for the appropriate locality published in the Guide to the Summary Assessment of Costs in 2001 and 2003, and the need to make a discount having regard to the decision made in Stubblefield v Kemp [2001] 1 Costs LR 30.

On the preliminary question of proportionality I ruled that, whatever sum, if any, is allowed in respect of work done by the Claimant personally, the claim for costs herein is, or appears to be, disproportionate during the period after Master Price’s Order dated 6 November 2001. In making this decision I had regard to, amongst other things, the maximum value attributed to the eight invoices in the Scott Schedule. It would have been unfair to have regard to the sum found due to the Claimant on taking the account (£4,737) given that he was awarded only 50% of his costs.

Before summarising the party’s arguments in this case it is necessary to set out at some length the principles to the derived from London Scottish Benefit Society v Chorley (1884) 12 QBD 452 (Divisional Court) and 13 QBD 872 (Court of Appeal). That case establishes a rule that costs are limited to legal costs and also establishes also an exception to that rule; a solicitor who acts for himself in litigation and therefore incurs no costs, can nevertheless recover costs as if he had retained a solicitor to act for him. Large passages are often quoted from that case in other cases. I turn first to the well known case of Buckland v Watts [1970] 1 QB 27 in which the Court of Appeal held that a litigant in person other than a solicitor is not entitled to claim costs in respect of the time which he had expended in preparing his case but only for his out of pocket expenses. This ruling was of course subsequently negatived by the Litigants in Person (Costs and Expenses) Act 1975. In Buckland Danckwerts LJ stated as follows:

The basis of the rule about solicitors being able to recover for their own time was considered by the Court of Appeal in Malkinson v Trim [2003] 1 WLR 463. In that case a solicitor successfully defended proceedings brought against him in respect of a probate matter undertaken by a firm of solicitors (now defunct) of which he had been a partner. In these proceedings he was represented by the firm of which he was currently a partner and was entitled to recover costs in respect of the work his current firm had done. In that case Chadwick LJ analysed the reasoning which underlies the decision in London Scottish Benefit Society v Chorley, as follows:

The principles in London Scottish Benefit Society v Chorley have recently been adopted and applied to a barrister litigant in criminal proceedings (Khan v Lord Chancellor [2003] 2 Costs LR 228). However, in civil cases, the principles are now excluded save to the extent that they are restated in the Rules of Court and Practice Directions. CPR 48.6 makes provision for the costs of litigants in person, thereby implementing the provisions of the Litigants in Person (Costs and Expenses) Act 1975. CPR 48.6(6) states as follows:

Whilst that sub-rule appears to treat solicitors in the same way as other litigants in person it must be read in conjunction with para 52.5 of the Costs Practice Direction which states as follows:

The validity and effect of these provisions of the CPR were considered by the Court of Appeal in Malkinson v Trim, as to which Chadwick LJ stated as follows:

Mr Hutton, Counsel for the executor, starts his argument with the proposition that CPR 48.6 and the Costs Practice Direction which allow remuneration at £9.25 per hour for time reasonably spent is not applicable in this case for the periods when the Claimant was represented by solicitors whose name appeared in the record of the action. He argued that a represented party who is awarded costs can recover only legal costs and out of pocket expenses which are of type which, if he had not paid them directly, his legal team would have paid them. Reliance was placed upon two cases, Re: Nossen’s Letter Patent [1969] 1 WLR 638, and Richards & Wallington v Monk (1984) Costs LR (Core Vol) 79. Mr Hutton argued that case law reveals only two exceptions to this principle: London Scottish Benefit Society, which, as now limited by CPR 48.6, does not apply to this Claimant for most of the action, and Re: Nossen’s Letter Patent [1969] 1 WLR 638; a corporate litigant may employ members of its own staff to carry out work as in-house experts.

In Nossen the respondent, the United Kingdom Atomic Energy Authority had had experiments conducted by its expert employees for the purpose of proceedings it anticipated would be brought by the applicant, and subsequently for the purpose of those proceedings. Lloyd-Jacob J, sitting with assessors, held that the reasonable, actual and direct cost of those expert’s work, excluding any overhead costs, were recoverable by the respondent. Lloyd-Jacob J held:

Nossen was followed by Bingham J in Richards & Wallington v Monk [1984] Costs LR (Core Vol) 79 where the issue was whether work done by the company litigant’s own employees in digging out factual material was of help to their independent expert. Counsel for the receiving party in that case argued that the work the employees did:

Mr Hutton next argued that, the Claimant’s claim in respect of the work done by him in this case cannot be brought within the Re: Nossen’s Patent exception. Any attempt to do so (i.e., treating legal services supplied by the Claimant to himself as if it were "expert work") would contradict the limit placed on costs recovery by CPR 48.6.

Mr Hutton also quoted at some length from the decision of Stanley Burnton J in Admiral Management Services Ltd v Para-Protect Ltd [2002] 1 WLR 2722, a case in which the claimant’s in-house computer experts were instructed to examine material seized from the claimant under a search and seizure order. In that case Stanley Burnton J followed and applied both Nossen and Richards & Wallington:

The Claimant’s primary case starts by agreeing with his opponent that, because of his representation by Messrs Downs and TTF at different times, the CPR provisions in rule 48.6 allowing only £9.25 per hour do not apply. Absent these limitations it is argued that the costs should be limited only by what is reasonable and proportionate. As to "reasonableness" Mr Bacon (counsel for the Claimant) points out that, because he acted for himself, the Claimant has achieved a substantial saving of costs, not only for himself but also for the executor. Reliance is placed upon the decision of His Honour Judge Thornton QC in Amec Process & Energy Ltd v Stork Engineers & Contractors BV (15 March 2002). The facts of that case and the conclusion reached will I hope be sufficiently shown by the following quotation:

Mr Bacon placed reliance, next, upon R (Factortame Ltd) v Secretary of State for Transport, Local Government and the Regions (No.8) [2003] QB 381. In that case the claimants, who were legally represented, sought to recover as costs sums payable by them to forensic accountants they had employed (on contingency fee terms) to provide services ancillary to the litigation being conducted by the claimant’s solicitors (preparation of a computer model, arranging and liaising with independent expert witnesses and others and advising on settlement). Strictly speaking the decision in that case concerned only whether the Costs Judge had been right to hold that the accountant’s agreement with the claimants was not champertous. The Court of Appeal held that the agreement was not champertous and so dismissed the appeal. The Court of Appeal was not asked to consider whether fees payable to accountants who did not act as independent experts, could be regarded as costs, and the cases thereon, including Re: Nossen’s Patent and Richards & Wallington v Monk were not cited. Mr Bacon relied on the case as an example of the recovery of costs which were not, strictly, legal costs. There would have been little point in litigating the champerty point to the Court of Appeal had the accountant’s fees not been recoverable anyway.

The final authority relied on by Mr Bacon is the decision of Master Seager Berry in Papera Traders Co Ltd v Hyundai Merchant Marine Co Ltd (17 September 2003). That had been a claim for damages in respect of a fire on board the ship named The Eurasian Dream. Investigation and other work in connection with that case had been undertaken for the claimants by Messrs W K Webster & Co, who are marine recovery agents. The claimants had claimed to recover the fees of Websters either as part of the damages or as part of the costs. Cresswell J had held that the fees were to be recoverable as costs, as defined in CPR 44.3(1)(a) to be assessed (if not otherwise agreed) on the standard basis. In that case counsel for the paying party (Mr Bacon, as it should happen) had argued that the categories of costs were limited to the fees of solicitors, experts, litigants in person and disbursements of professional witnesses and counsel, reliance being placed on Nossen and Richards & Wallington. Counsel for the receiving party had argued that the old cases had been overtaken by CPR as demonstrated in the judgment of His Honour Judge Thornton in Amec. In order to demonstrate the effect of the CPR he had relied upon other, non costs cases, including Biguzzi v Rank Leisure Plc [1999] 1 WLR 1926 and Nat West Lombard Factors Ltd v Arbis (a decision of Hart J reported in The Times Law Reports, 29 October 1999). On these points Master Seager Berry found in favour of the receiving parties. He stated as follows:

His Honour Judge Thornton QC’s decision in Amec was made just eleven days after the decision of Stanley Burnton J in Admiral Management, a decision which does not appear to have been cited to His Honour Judge Thornton QC. Mr Bacon described the difference of approach taken by those two Judges in this way. In Admiral Management the claimant was content to rely upon the decision in Re: Nossen’s Letter Patent, and therefore conceded that, as a general rule, a company cannot recover by way of costs any payment for the time of its employees engaged in investigating or prosecuting its claim (see paras 13 and 27 of the judgment).

As I have mentioned above, the Claimant’s primary case involved asserting that because Messrs Down & TTF were on the record as his solicitors, CPR 48.6 does not apply to him during those periods. However, he also sought to argue that if his first line did not succeed in achieving remuneration at commercial rates, I should use whatever discretion I may have to allow the Claimant remuneration at the rate of £9.25 per hour.

In his submissions at the hearing as well as in his skeleton argument, Mr Hutton acknowledged that Admiral Management had proceeded on the basis of a concession by the Claimant. In his submission that concession had been well made on the existing authorities and was not the subject of any disagreement from Stanley Burnton J. Accordingly, he invited me to follow the well established principles set out in Nossen, Richards & Wallington and Admiral Management, all of which were binding authorities upon His Honour Judge Thornton and Master Seager Berry. The Papera Traders case could also be distinguished on the basis that the recovery agents, whose remuneration was allowed as costs in that case "were neither the client nor the solicitors". That case therefore did not cover the point at issue in this case where the work in question was done by the client, ie the Claimant, himself. As to the Claimant’s alternative ground, Mr Hutton submits that the Claimant cannot have it both ways. In Parts 1, 2 and 3 of the bill he chose to be represented by solicitors and therefore can only claim the costs charged to him by those solicitors for those periods. To allow a litigant costs for his own time in a case where he has a solicitor on the record is likely to lead to an increase in costs rather than a saving of costs. Indeed, in this case, on 20 January 2004, the Claimant gave a statement of costs totalling £76,490.42 with no claim for costs in relation to his own time save for expenses of £7,750. It was only after the main hearing that he suddenly claimed the cost of his own time and those costs well exceed £85,000 by themselves.

The London Scottish Benefit Society v Chorley case, with its references to Lord Coke’s dicta about costages and costare sets out a general rule that the only sums recoverable as costs between the parties are sums paid in respect of professional legal representatives plus out of pocket expenses (such as court fees) which were directly financed by the litigant. Whatever its original justifications were, the rule today is plainly based on policy (see the judgment of Sedley J (as he then was) in R v Legal Aid Board ex p. Eccleston [1998] 1 WLR 1279, cited below).

There are two main categories of costs which the general rule makes irrecoverable. The first is losses and expenses incurred whilst instructing legal representatives; for example, the cost of travel to lawyers and experts and time spent sitting in a solicitor’s office, counsel’s chambers or in an expert’s office or surgery. A good example of this category is provided by R v Legal Aid Board ex p. Eccleston [1998] 1 WLR 1279, in which Sedley J held that, although travel costs were not recoverable between litigants, such costs could properly be authorised by and claimed against the Legal Aid Board in respect of a litigant who was legally aided. In that case Sedley J ruled as follows:

The second category of cost made irrecoverable by London Scottish Benefit Society includes losses and expenses incurred doing work which, otherwise, a solicitor would have done. This aspect of the general rule partly (but not wholly) coincides with section 20 of the Solicitors Act 1974 which provides that no unqualified person shall :-

Case law examples of the second category include the London Scottish Benefit Society case itself (except for solicitor litigants), Buckland v Watts [1970] 1 QB 27 and Jonathan Alexander Ltd v Proctor [1996] 1 WLR 518 which held that the court had no power to award costs for time spent by a director of a company who was given a right of audience to represent the company at a trial:

The results reached in each of these three cases would be different if they were reheard today. The rulings in the London Scottish Benefit Society case itself (for non-solicitor litigants) and Buckland v Watts have now been negatived by the Litigants in Person (Costs and Expenses) Act 1975. The result reached in Jonathan Alexander Ltd v Proctor has now been negatived by a change in the Rules of Court so as to include companies within the definition of litigants in person.

I turn now to consider the exceptions to the general principle. Today the court’s power to award costs is provided by Section 51 of the Supreme Court Act 1981 which expressly states the power to be "subject to Rules of Court". I accept the decision of His Honour Judge Thornton QC that the introduction of the CPR enables the court to redraw the policy lines affecting the definition of costs. However, it would be inappropriate for me to stray any further from the pre-CPR authorities than I am clearly permitted to do so by the decision in Amec or by higher authority. Although the decision in Admiral Management takes precedence over the decision in Amec, I am not persuaded that those two cases are in conflict. In Admiral Management, the point at issue was conceded by the Claimant thereby making it unnecessary for Stanley Burnton J to consider what changes were necessary to take account of the CPR.

There is no doubt that the pre-CPR case law was ripe for reconsideration. In Buckland v Watts Donaldson J (as he then was) criticised the rule which treated solicitor litigants differently from other litigants (see [1970] 1 QB 27 at 29D-E). In Richards & Wallington by Bingham J invited the Court of Appeal to consider reviewing the law, but no appeal to the Court of Appeal was made:

The first exception to the general rule in the London Scottish Benefit Society case concerns the costs of solicitor litigants, which, in civil cases today is governed by CPR 48.6 and the Costs Practice Direction. As such it is not relevant in this case. The Claimant was not represented by a firm of which he is the proprietor or by himself in his firm name. The fact that he was employed by one of the firms who represented him in the proceedings has no bearing on this matter. Although a person employed by a firm may sometimes refer to that firm as "his firm", the expression "his firm" which appears in para 52.5 of the Costs Practice Direction is not used in that colloquial sense.

The second exception which was made to the general rule in London Scottish Benefit Society was approved and upheld by the Court of Appeal in Re Eastwood [1975]1 Ch 112; litigants who do not retain independent solicitors but are represented instead by their in-house legal department may recover as costs awarded to them the expenses they incurred on their in-house team. For the purposes of assessment, that expense will normally be treated as not less than the fees an independent solicitor would have charged. That exception is plainly not relevant in this case; the Claimant was an employed solicitor, not an employer of solicitors.

The third exception to the general rule concerns costs under the Litigants in Person (Costs and Expenses) Act 1975 and CPR 48.6. I shall consider this exception further in relation to the Claimant’s secondary arguments.

Most of the case law to which I have been referred falls within the fourth exception: costs incurred in respect of work done by non lawyers which is incidental to the conduct of a claim. The early decisions upon which this exception was based were narrow (Nossen and Richards & Wallington). At that time the exception might just as well have been expressed as an exception in respect of work done by employees, thereby making this exception a close cousin of the ruling in Re Eastwood [1975]1 Ch 112 (see above).

The fourth exception, whilst once narrow, has been widened by subsequent case law. It may be that the decision in Factortame is only slightly wider than Nossen (i.e., it relates to the expert services of accountants who were not employees). However, the decision of His Honour Judge Thornton QC in Amec, as applied by Master Seager Berry in Papera Traders, is much wider. It permits the recovery of costs in respect of non lawyers doing work which does not relate to expert testimony.

Was His Honour Judge Thornton QC entitled to come to the decision he did, given the strong ruling to the contrary given by the Court of Appeal in Jonathan Alexander Ltd v Proctor [1996] 1 WLR 518? I have come to the conclusion that he was. Jonathan Alexander Ltd can be distinguished today for the following reason. At the time it was decided there was long standing binding authority on the definition of the term "costs" included in the old rules of court. The judgment in that case therefore concentrated upon another aspect of the old rules, the scales of costs to be paid to lawyers or other persons exercising a right of audience or a right to conduct litigation. Post CPR the court is entitled to consider the definition of costs afresh even though that definition uses the same words as the old definition used. The decision in Jonathan Alexander Ltd, taken at face value, would deny the validity of the exception recognised in Nossen. Whether or not Nossen was valid pre CPR, the Court of Appeal decision in Factortame indicates that, post CPR costs in respect of expert testimony and indeed costs in respect of other incidental legal services are now based upon a new philosophy.

I should add that, for the costs of work done by non lawyers to be recoverable, the work done must not amount to conducting the litigation or work done in breach of section 20 of the Solicitors Act 1974.

There are two matters which I have found difficult to reconcile with the decision in Amec. The first is the following text in the definition of costs (CPR 43.2(1)):

I see the force of an argument that the words I have quoted from CPR 43.2 were intended to extend what would otherwise have been a narrow definition of costs. Nevertheless I have reached the conclusion that those words were put in for clarification, not by way of extension.

The second matter which I have found difficult to reconcile with Amec is the decision of the Court of Appeal, made post CPR, in United Building and Plumbing Contractors v Kajla [2002] EWCA Civ 628. In that case a litigant in person was not allowed to recover the fees he had paid to a debt collection agency. The result of that case is clearly in conflict with a wider definition of costs. However, in that case the Court of Appeal looked only at the wording of CPR48.6 and did not refer to any case law at all affecting the definition of costs. I have reached the conclusion that the decision in this case is inconsistent with Nossen and Factortame. It turns only upon the construction of CPR48.6 in force at that time (I acknowledge that it has not changed significantly). Therefore it is at most authority only for the following limited proposition: litigants in person, unlike litigants represented by solicitors, cannot employ non lawyers to undertake any legal work incidental to the litigation. As such, it is not determinative of this case.

A characteristic which is common to all of the cases exemplifying the fourth exception is that the costs incurred always relate to work done by someone other than the litigant himself. In Admiral Management Stanley Burnton J drew attention to the illogicality underlying this characteristic:

However, there is no doubt that this curiosity is part of the law (see the fourth principle identified by Chadwick LJ in Malkinson v Trim, a quotation from which appears in para 18 of this judgment). In my judgment it prevents this exception being applied to the Claimant in this case. Save where CPR 48.6 applies the general rule remains that a litigant cannot recover as costs compensation for the expenditure of his own time and trouble.

In the "Access to Justice Final Report" Lord Woolf MR (as he then was) referred to:

In my judgment those arrangements have not been developed beyond their pre-CPR state. Thus, a litigant who instructs solicitors cannot recover the cost of proofing important witnesses if he did the work himself but can recover the reasonable costs of instructing someone else to do it, including someone who is not a solicitor.

Because none of the exceptions I have considered above apply to him, I am drawn to the conclusion that the Claimant in this case cannot claim commercial rates in respect of any work done by him and cannot claim any costs at all other than out of pocket expenses for work done by him except during periods when he was a litigant in person.

Putting that conclusion in the positive, the Claimant in this case can claim £9.25 per hour reasonably spent for the following periods: the month or so at the end of the period covered by Part 1 (see para 15, above); the period covered by Part 4 of the bill; the periods covered by the rest of the bill if the Claimant’s secondary argument succeeds.

Neither CPR 48.6 nor the Litigants in Person (Costs and Expenses) Act 1975 contains an exhaustive definition of the term "litigant in person". In general terms it can be taken to refer to a litigant in proceedings who is not professionally represented, e.g., by a solicitor or by another authorised litigator. In Jonathan Alexander Ltd Peter Gibson LJ defined the term in this way:

In applying these words to the Claimant in this case I should, in my judgment, treat this as a matter of substance not form. As a matter of substance the Claimant is now and has always been acting in person. He has not relied on the solicitors whose name has been on the record for him for legal representation but only for secretarial services and for help in underwriting counsel’s fees. Because of the involvement of Messrs Down and TTF the Claimant has at some stages been labelled as if he were a represented party. However, such labels should not be treated as conclusive. There are other circumstances in which such a label may be inaccurate. For example, where a represented litigant and his solicitors part company just before trial, but no notice of change is served. If the litigant appears at trial in person and wins an order for costs he will be entitled to costs in respect of his time reasonably spent at the rate of £9.25 per hour even though his former solicitor’s name still appears on the record. If the litigant at trial appears by new solicitors, and wins an order for costs, he is entitled to the reasonable costs incurred by his new solicitors even if, the requirement to serve and file notice of change having been overlooked, his new solicitors’ name is not on the record.

In the example I have just given the litigant, being represented by his new solicitors, would not be entitled to costs in respect of his own time spent on the case. In other circumstances however a litigant who can fairly be said to be a litigant in person is entitled to recover "payments reasonably made by him for legal services related to the conduct of the proceedings" (CPR 48.6(3)(b)). The decision in United Building compels me to find that the reference to legal services in this part of the CPR is limited to legal services provided by a legal representative or other person authorised to conduct litigation. Nevertheless, in this case, the fees charged by Messrs Down in Part 1 do fall within that definition and those fees in no way duplicate the time reasonably spent by the Claimant in Part 1.

In summary I have reached the conclusion that the Claimant is entitled to costs at the rate of £9.25 for every hour reasonably spent by him during all of the periods covered by his bill of costs herein. In all of these periods he was in substance, if not in form, a litigant in person. I have not overlooked the complication that, in the early stage of these proceedings the Claimant was not a litigant at all. However, it is I think appropriate that my ruling should follow the order for costs herein dated 22 January 2004 which treated all the costs herein as if the Claimant had been Claimant at all stages.

In addition to costs in respect of his own time spent the Claimant should also be allowed costs under CPR 48.6(3)(b) in respect of fees paid to Messrs Down to the extent that those fees are shown on assessment to be reasonable and proportionate.

When formally delivering this judgment I will hear argument as to permissions to appeal and costs and, if necessary, give directions as to the completion of this detailed assessment. As to those directions I strongly urge the parties to agree, if they can, a reasonable and proportionate sum in respect of time spent by the Claimant in this case. Agreements may of course be made subject to any successful appeal as to the rate, if any, applicable during periods when Messrs Downs or TTF were on the record.