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How the CJC Guideline Hourly Rates are applied in relation to the location of the Lawyer's office. And what the position is for those lawyers who work from home

The settled position in respect of charging rates is arguably derived from the published guidelines (which have been updated from 1st October 2021) in the context of CPR 44.4 (3) and principally in line with the decision of the Court of Appeal in Wraith v Sheffield Forgemasters Ltd [1998] 1 WLR 132. Consequently, the Court will ordinarily consider hourly rates based on the geographical location having regard to the circumstances of the claim, the expectation being that the litigant will generally instruct legal advisers local to themselves.

By way of a reminder, the guideline charging rates with affect from 1st October 2021 are:

Upon analysis of the updated rates, and in particular the national rates which are applicable to the firms outside of London, it is immediately apparent that the historically significant difference in that regard has been narrowed. Previously the 2010 guideline rates comprised significant differences, as follows:

The position now, is that outside of London, a choice of Solicitor anywhere in England & Wales is arguably objectively reasonable, and that the only costs that may be subject to challenge, in accordance with Wraith, would be the costs associated with travelling in the event that the solicitor and client are not local to each other.

Conclusion

Hourly rates, in the context of the above guidelines, are now wholly current and predicated on an evidenced based review. That said, it is helpful to remind ourselves, that in accordance with the “Guide to Summary Assessment of Costs”, these rates are not scale figures; they are broad approximations only and may also be a helpful starting point on detailed assessment.  Further, the foreword in the “Guide to the Summary Assessment of Costs” refers:

In every case, a proper exercise of judicial discretion has still to be made, after argument on the issues has been heard.

CPR 44.4(3) allows certain factors to be taken into account in deciding the amount of costs:

Rule 44.4(3) sets out the factors to be taken into account in deciding the amount of costs. Those factors include: the conduct of the parties, including conduct before as well as during the proceedings; the efforts made, if any, before and during the proceedings in order to try to resolve the dispute; the value involved in the proceedings; the importance of the matter to the parties; the complexity of the proceedings; the skill and specialised knowledge of the lawyers; the place where the work was done; and the receiving party’s last approved or agreed budget.

In view of the “new way of working”, a noteworthy mention is paragraph 31 of the “Guide to the Summary Assessment of Costs”, where work is undertaken remotely:

Where all or part of the work on a case is done in a different location from that of the solicitor’s office on the court record, the appropriate hourly rate for that part should reflect the rates allowed for work in that location, whether that rate is lower or higher (provided that, if a higher rate is claimed, a decision to instruct solicitors in that location would have been reasonable). The location of a fee earner doing the work is determined by reference to the office to which s/he is, or is predominantly, attached.

There are of course exceptions and contrary arguments, and these are separate matters, but ultimately achieving properly rewarding hourly rates remains challenging and contentious.

If you require any assistance with your legal costs requirements, please do get in touch with the team on 01733 350 880, or by email mail@aandmbacon.co.uk. For more information please do visit our website www.aandmbacon.co.uk.

Published 25 November 2021

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