Costs: Medical agency fees not recoverable as a disbursement in fixed costs claims

The County Court at St Helens recently handed down a decision which will be welcomed by defendants and their representatives, that medical agency fees are not recoverable as a disbursement in a fixed costs claim.

Pauline Powles v Carl Alexander Hemmings [2021] County Court at St.Helens

The claimant sought to rely on the case of Beardmore v Lancashire County Council [2019] in which agency fees had been allowed as a recoverable disbursement. However, the defendant relied upon the Court of Appeal judgment in Aldred v Cham, where the Court concluded that counsel’s fee for advice on an infant approval case was not a recoverable disbursement in accordance with CPR 45.29I. This was on the basis that this was not incurred as a result of a particular feature of the dispute.

Deputy District Judge Akers considered the cases cited and held that Aldred was more persuasive. The Court found that the uplift claimed by the medical agency was already covered by the fixed costs element of the claim and therefore not recoverable as a disbursement.

Background

The claimant claimed the cost of the psychological report at £750 plus VAT. £350 plus VAT was the fee charged by the expert for examination and production of the report. The remaining £400 plus VAT was the fee applied by the agency for items such as issuing a consent form to the claimant, instruction letter to the expert, checking availability dates and quality checking the medical report before sending the same to the claimant’s representatives.

The defendant argued that these fees are not recoverable and are already dealt with within the fixed costs regime. By attempting to claim these fees, the claimant was seeking to claim profit costs twice, or items of work which should be claimed within profit costs, twice.

The defendant’s submissions were that the principles established in the Court of Appeal decision of Aldred v Cham applied.

The claimant sought to distinguish Aldred because that case was considering the recoverability of counsel’s fees in infant approval matters which is different to the medical agency fees in this case. Further, in Aldred, the Court of Appeal was considering the applicability of CPR 45.29I(h) which deals with any other disbursement reasonably incurred due to a particular feature of the dispute, whereas in this case, the applicable part was 45.29I(2)(a) relating to the cost of obtaining medical reports.

Judgment

Deputy District Judge Akers found that the issues in Aldred were “entirely applicable” to this case “because we are looking at items of work which are deemed, or could be deemed to be within the fixed recoverable costs, which is effectively the administration of the claim”. This included dealing with correspondence and obtaining further documentation which is “subsumed within the fixed costs which are awarded to a party within table 6B, they are not separate items of disbursement”.

The claimant submitted that the Court of Appeal in Aldred had stated that disbursements are one-off items for specific items of work which was not easily addressed by reference to the same general considerations in this case. DDJ Akers agreed but found that “the disbursement in question in this report amounts to £350 plus VAT because that is what the claimant’s own breakdown tells me it is”.

The remainder of the breakdown related to “various items of agency work” which DDJ Akers found to not be recoverable. These items fell “fairly and squarely within the analysis of their Lordships in Aldred v Cham as being items which are part and parcel of the fixed recoverable costs within table 6B of CPR 45.29C”.

As such the psychological report was limited to £350 + VAT and the medical agency uplift was found not to be recoverable.

What can we learn

• This decision will be welcomed by the defendants and their representatives following on from Aldred which confirmed that as well as counsel’s fees, translation fees are not recoverable under the fixed costs regime as they do not satisfy the criteria of a particular features of the dispute.
• Practitioners handling fixed recoverable costs cases should ensure that any disbursements which are not fixed by the rules are queried where they may include agency fees for administration of the claim. Breakdowns should be requested in respect of the fees claimed by the experts and uplift applied by the agency.
• This is however a first instance judgment and is not a binding authority to compel the receiving party to disclose the breakdown between the fees.
• The paying party ought to also refer to the Master Cook’s decision in Stringer v Copley (2002) where it was held that in order for the court to properly assess the fees claimed, a breakdown between the expert’s fees and the Medical Agency administrative uplift should be made available to the court at assessment. Although there is no obligation to disclose breakdowns to the paying party, this should be provided to the court at assessment.