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England and Wales High Court (Senior Courts Costs Office) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Senior Courts Costs Office) Decisions >> BFS Investments Plc v Manches Plc  EWHC 90082 (Costs) (29 August 2007)
Cite as:  EWHC 90082 (Costs)
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SUPREME COURT COSTS OFFICE
London, EC4A 1DQ
B e f o r e :
| BFS INVESTMENTS PLC (IN LIQUIDATION)
|- and -
Mr Simon P Browne (instructed by Manches LLP) for the Defendant
Hearing dates: 13th August 2007
Crown Copyright ©
Master Gordon-Saker :
"To assist in connection with your appointment as joint liquidator of BFS Investments plc."
"Thank you for instructing Manches LLP in connection with advising on the preparation on both issuing at Court a Freezing Injunction and a claim in the High Court for the recoveries of monies owed to BFS.
We previously were advising Mike Solomons only in his personal capacity on the investigations and the merits and preparation of a legal action."
(1) Whether the Claimant, a company in liquidation, had the standing to seek detailed assessment of bills chargeable to the liquidators of the Claimant.
(2) Whether the Claimant could establish any special circumstances such as to enable the Court to order the assessment of the 13 bills which had been paid before these proceedings were issued.
Whether the Claimant has the standing to seek the order
"(1) Where a person other than the party chargeable with the bill for the purposes of section 70 has paid, or is or was liable to pay, a bill either to the solicitor or to the party chargeable with the bill, that person or his executors, administrators or assignees may apply to the High Court for an order for the taxation of the bill as if he were the party chargeable with it, and the court may make the same order (if any) as it might have made if the application had been made by the party chargeable with the bill."
"(1) Where before the expiration of one month from the delivery of a solicitor's bill an application is made by the party chargeable with the bill, the High Court shall, without requiring any sum to be paid into court, order that the bill be taxed and that no action be commenced on the bill until the taxation is completed.
(2) Where no such application is made before the expiration of the period mentioned in subsection (1) then, on an application being made by the solicitor or, subject to subsections (3) and (4), by the party chargeable with the bill, the court may on such terms, if any, as it thinks fit (not being terms as to the costs of the taxation) order … that the bill be taxed …
(3) Where an application under subsection (2) is made by the party chargeable with the bill –
(c) after the bill has been paid, but before the expiration of 12 months from the payment of the bill,
no order shall be made except in special circumstances and, if an order is made, it may contain such terms as regards the costs of the taxation as the court may think fit."
"Where the court has no power to make an order by virtue of subsection (1) except in special circumstances it may, in considering whether there are special circumstances sufficient to justify the making of an order, take into account circumstances which affect the applicant but do not affect the party chargeable with the bill."
i) That there was an agreement between the liquidators and the Defendant that the bills could be assessed by the Court after payment.
ii) That the costs claimed by the Defendants exceed the estimates that had been given.
iii) That the work done to analyse the potential claims open to the Claimant was of no or little value.
iv) That it was not necessary to obtain a freezing order, as the subject of the order was willing to give undertakings.
"I gather from our recent conversations that the Creditors' Committee remain concerned over the level of fees incurred by the professional advisers in relation to BFS' liquidation. In particular, I understand that Mr Harris has raised the proposition that Manches' legal fees are assessed by the Court and that he takes over the conduct of the litigation concerning BFS Group on a day to day basis. In the meantime, as you are aware, £176,717.97 of Manches' fees … remain outstanding. I confirm that Manches require payment of these outstanding fees ideally by the end of this week …
We will of course agree to engage in any application made by you for the detailed assessment by the Court of any of our fees which the Creditors' Committee consider remain open to justifiable criticism. We ask that our outstanding fees are paid first. We are confident that no substantial reduction will be made upon detailed assessment and draw to your attention two of the features of assessment:
1. If the Court considers that detailed assessment is appropriate, then generally they are assessed by the Judge on an indemnity basis. …
A view will need to be taken by you as to the actual benefits of such a process and if you decide upon detailed assessment as an option, I recommend you seek independent legal advice in this regard. We are not shying away from being subjected to this and any appropriate legal process in that regard. …"
"I understand from a conversation that you had with Matthew Martin that Manches have not been instructed to continue litigating/settling the BFS matter with the other side on an ongoing basis. …
I gather from Matthew that the creditors have decided that Manches will now not be receiving £190,000 plus VAT in connection with our outstanding fees. We note that any proposal to be agreed will be in full and final settlement and as Matthew said, we will need to discuss this internally given the nature of the proposal. …
"Payment of the fees as referred to in paragraph 1 above does not mean that your fees charged in this matter, being costs, charges and expenses as contemplated in rule 7.34(1) of the Insolvency Rules, 1986, are agreed. To the contrary, I expressly reserve my right to serve notice requiring Manches to commence detailed assessment proceedings of its fees. I require from Manches an undertaking to repay immediately any money which may, when detailed assessment is made, prove to have been overpaid, with interest at the prescribed rate for the period from the date of payment to that of repayment."
"By this email, Manches LLP also agreed to "engage" in any application made by Mr Solomons and Mr Wood for a detailed assessment of any of Manches LLP's fees which the Creditors' Committee considered remained open to justifiable criticism. The key word here is "engage". What was stated amounted to no more than an agreement by Manches LLP to engage in the statutory process of considering whether assessment is appropriate."