John Meehan appears for the successful Respondent in an important Court of Appeal decision concerning the indemnity principle and the requirements for the commencement of detailed assessment.
The appeal clarifies that detailed assessment proceedings are still effectively commenced even where the Bill of Costs is defective or deficient. Furthermore, a solicitor’s signature on a Bill confirms compliance with the indemnity principle, even where the mandatory certificate (Precedent F) is not fully completed to confirm compliance with the indemnity principle.
Background
Following the conclusion of a claim for damages for disrepair, the Claimant served its Bill. The Bill contained a certificate which was signed by the solicitor. However, whilst the certificate was completed to confirm that the Bill was both accurate and complete, the Claimant had left blank the part of the certificate that stated “…the costs claimed herein do not exceed the costs which the receiving party is liable to pay me/my firm…”
The Defendant failed to file Points of Dispute and the Claimant obtained a Default Costs Certificate. The Defendant applied to set aside the Default Costs Certificate alleging that (1) service of the Bill had been defective as the Defendant had not confirmed that it would accept service by email and (2) that service was defective in the absence of a certification of compliance with the indemnity principle.
First Appeal
On first appeal, the Court determined that the Defendant had in fact agreed to service by email and that any alleged failure to certify the Bill did not result in service being invalid or defective. Accordingly, the Defendant had been required to serve Points of Dispute and there was no automatic basis to set aside the Default Costs Certificate under CPR 47.12(1).
Second Appeal
On second appeal, the Defendant asserted that, given the fundamental importance of the indemnity principle, a failure to include certification as to compliance with the indemnity principle should result in the Bill being treated as a nullity such that commencement of the detailed assessment proceedings was ineffective and accordingly the Claimant had not been entitled to obtain a Default Costs Certificate.
In rejecting the appeal, the Court of Appeal determined that, in signing a Bill, a solicitor confirms compliance with the indemnity principle, even where a separate certificate of compliance with the indemnity principle is not provided. The Court reiterated thata solicitor who knowingly or recklessly served a Bill which breached the indemnity principle would be committing a serious disciplinary offence.
Whilst express certification of compliance with the indemnity principle was a mandatory requirement of the rules, a failure to comply with that requirement was not fatal to the validity of the Bill and it did not justify non-service of the Points of Dispute.
Furthermore, the Court of Appeal confirmed that detailed assessment proceedings are still effectively commenced even where the Bill is defective or wholly deficient. Accordingly, a defective or deficient Bill will not justify a paying party refusing or failing to serve Points of Dispute nor will such a deficiency entitle a party to set aside a Default Costs Certificate as of right pursuant to CPR 47.12(1). CPR 3.10 applies with full force to the costs provisions in CPR 47.
Join our mailing list if you want to be kept up to date with our future seminars & conferences.
