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Clearing up taxation of legal costs

A reserved judgment on taxation of legal costs in a recent medical negligence case sets out welcome principles that clarify how costs are arrived at. Lloyd Mudiwa reports.

Ciarán Breen, Director, State Claims Agency: ‘Clear principles’

The Taxing Master Declan O’Neill has enunciated a number of principles that will be of considerable assistance to practitioners in relation to the taxation of costs associated with medical negligence claims.

Stating that the principles were of significant importance, the Director of the State Claims Agency, who has previously commented on the disproportionately high level of legal costs associated with clinical negligence actions, said this month that they arose from the State Claims Agency’s decision to contest the plaintiff’s Bill of Costs in the case of Isabelle Sheehan (an infant, suing by her mother and next of kin, Catherine Sheehan) v  David Corr.

Ciarán Breen said this reserved judgment “set out clear principles”. “They constitute a welcome set of guiding principles for plaintiffs’ and defendants’ practitioners alike as to how costs should be measured in catastrophic injury medical negligence actions. The Taxing Master’s reserved judgment represents a considerable step forward in the understanding of how legal costs are measured at taxation.”

Bill of Costs

In October 2011, the parties reached an interim settlement which was approved by the High Court, such that the plaintiff would recover against the defendant the sum of €1.9 million and costs of the action.

The plaintiff’s Bill of Costs was listed before Taxing Master O’Neill in September 2012 and he delivered his reserved judgment in November 2012.

O’Neill reduced the plaintiff’s solicitors’ professional fee, claimed at €485,000, down to €270,000.

Similarly, he reduced Senior Counsel’s brief fee, claimed at €125,000, to €65,000. Junior Counsel’s brief fee was reduced to €32,500, i.e. to 50 per cent of Senior Counsel’s brief fee.

The Taxing Master did not accept an argument, advanced on behalf of the plaintiff, that there was an element of novelty or uniqueness attaching to the particular case which should bear on the level of the instructions fee.

O’Neill stated that the higher the level of complexity and the harder a case was fought, the higher the instructions fee was likely to be. In that particular case, he held that it did not fall within the higher range of complexity or extent of work, insofar as the nature of the solicitor’s work on liability and causation was concerned.

He stated that specialist skills were demonstrated by the plaintiff’s solicitor of the type which might reasonably be expected in a solicitor undertaking litigation of that sort.

O’Neill also did not see the need for the attendance of two specialist solicitors, both of whom, in his view, were eminently qualified to advise the plaintiff and take part in negotiations in their own right. He held, therefore, that the cost of attendance of the second and additional senior solicitor was not recoverable on the party-and-party basis.

Expertly represented

O’Neill ruled that the plaintiff in the case was fully and expertly represented at all stages by solicitor and counsel and he heard no compelling argument as to why the attendance of the additional solicitor was necessary for the attainment of justice on behalf of the plaintiff. He could not take into account, therefore, the fact that two senior counsels were briefed on behalf of the plaintiff.

The Taxing Master also noted that, in his experience, the high rate of Court Duty payable by the indemnifying party, following taxation of costs, provided an almost irresistible incentive to such paying party to settle the costs without recourse to taxation. To achieve this, he said, a more generous approach has been adopted in relation to the measurement of fees and that this had been the position for many years. He therefore put it that the validity of any cited comparators must, at least, be questioned.

In relation to the issue of five-star accommodation for the expert witnesses on behalf of the plaintiff, the Taxing Master held that it was a policy of the particular solicitor to arrange accommodation in one particular hotel of this standard. To him, however, this was a luxury in respect of which the defendant was not obliged to indemnify the plaintiff. Accordingly, the Taxing Master reduced the overall cumulative expenses by €500 — a reduction he believed did justice between the parties.

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