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GAZETTE
A
PRIL
1990
Solicitors costs
J. J. Bourke, Inspector f Taxes -v- W. G. Bradley & Son.
Counsel's Note of the Judgment of Blayney J., delivered on 26
January, 1990.
Our correspondent from W. G. Bradley & Sons, Solicitors, who
has brought the following case to the
Gazette's
attention notes that
he understands that this case is of primary importance to solicitors
for the following reasons:
(a) It acknowledges that a solicitor acting in his own cause can
recover his/her costs from the losing party.
It establishes that an agreement by a solicitor's client to pay
the solicitor's costs does not prejudice recovery of those costs
from the losing party.
This appears to be the first case to consider a situation where
the costs of a successful party are paid in the first instance by
a non-party to the proceedings.
(b)
(c)
This is an interesting and unusual
case. I have to start with some
basic facts. Firstly, there is the fact
that in the case stated and on the
appeal to the High Court Lardner J.
granted an order for costs in favour
of Bradleys, the respondents on
that appeal. Bradleys were re-
spondents and also acted as the
solicitors for the respondents but it
is accepted by counsel on both
sides that the fact that Messrs
Bradleys were acting as solicitors
does not alter the position in any
way. It follows that the position in
law would have been exactly the
same if Bradleys had retained a
different firm of solicitors to act for
them.
Secondly, it seems to me that,
prima facie,
Bradleys were liable to
the solicitors retained by them for
the costs of the proceedings. The
prima
facie
position is that
Bradleys, by virtue of the order for
costs in their favour, would be
entitled to recover their costs from
the appellant.
What are the normal require-
ments which have to be satisfied in
order that a party recover their
costs? They are set out by Walsh
J. in
Attorney Genera! (McGarry) -
v- S/igo County Council,
Supreme
Court, unreported, 5th May 1989,*
at page 2 of the Transcript of his
judgment as follows:
"A. That the Court has made an
Order for costs in favour of the
party;
B. That the matters claimed had
been properly incurred; and
C. That the party in question is
under legal liability to pay
them."
The requirement at A is fulfilled
in this case. As to B, that is a matter
for the Taxing Master to decide
whether the items in the Bill are
reasonable if I should come to the
conclusion that the Respondents
are entitled to their costs from the
Revenue.
This case falls to be decided in
relation to the third issue, that is
Item C. One starts with the
prima
facie
position that a party repre-
sented by a solicitor in litigation is
responsible for the costs of that
solicitor even if he has been
retained by a third party to act on
the client's behalf. The fact that he
acts means that the client becomes
liable. As has been set out in a
number of the cases cited to me by
Mr. McDonald, the party to the
litigation, even though his solicitor
is retained by someone else, is still
the party liable because he will be
personally liable for the costs of the
other side should he lose; while, if
he is successful, the costs of the
solicitor acting for him are
prima
facie
recoverable from the other
side. (See for example
Lewis -v-
Averay
(No. 2)
[1972] 2 All
E.R.229.) There the Automobile
Association instructed solicitors to
act on behalf of a party who
wished to appeal a case which had
gone against him. Thp appeal was
successful and the appellant was
given an order for his costs. It was
held that costs were incurred by
the appellant even though the
solicitors were instructed by the
Automobile Association.
However, Mr Quinn says that in
the present case the situation on
the facts is that Messrs Bradley &
Sons, in their capacity as a party to
the litigation, did not incur any
liability to their solicitors. I have to
look at the position as if Messrs
Bradleys had instructed a different
firm of solicitors to act for them. If
they had done that then quite
clearly
prima facie
they would have
incurred liability to their solicitor for
the costs of the proceedings. But
Mr Quinn submits that on the
particular facts Bradleys never had
any liability to their solicitors. Mr
Quinn submits that Messrs
Bradleys at no time had any liability
to their solicitors. The main reason
advanced for this is that the Taxing
Master was entitled to infer from
the fact that Lloyd's agreed to pay
Messrs Bradleys costs, and agreed
to pay them on a solicitor and client
basis, that Bradleys
prima
facie
liability was excluded.
The principle is not in dispute; Mr
Quinn accepted that this is so only
if there is an agreement that under
no circumstances whatever is the
client to be responsible to the
solicitors for their costs. The case
Mr Quinn has to make is that I must
infer that under no circumstances
were Bradleys in their capacity as
clients to be responsible to their
solicitors for costs. Two grounds
are advanced for that case:
1. Lloyds agreed to pay the costs
on a solicitor and client basis,
and
2. The real clients were not
Bradleys but were in fact
Lloyds.
In regard to the second matter,
the party to the litigation was
Bradley & Sons and it may be that
in addition to them being instructed
by themselves they were also being
instructed by Lloyds. But that
would not entitle me to infer that
Bradleys (as clients) were not to be
under any liability to Bradleys (as
solicitors) for the costs incurred.
Prima facie
they were liable.
The real question is whether I
should infer from the fact Lloyds
agreed to pay Bradleys costs on a
solicitor and client basis that
Bradleys were to have no libaility in
regard to costs. The situation is
unusual in that Bradleys had two
roles but I have to consider it on the
basis of a position as if they had
retained another firm of solicitors to
act for them. Assuming that Lloyds
had agreed to pay these costs on
a solicitor and client basis, it seems
to me that there would be nothing
in such an agreement which would
exclude the primary liability of
Messrs Bradleys to pay the costs of
the solicitor acting for them. That
is shown by
Lewis
-v-
Averay (No.
2).
171