Reference:  EWHC 1235 (QB)
Court: Queen's Bench Division
Judge: Eady J sitting with Costs Judge Wright and Mr Martin Cockx
Date of judgment: 26 May 2006
Summary: Costs - Privacy - Data protection - Appeal - Proportionality - Conditional fee agreement - Success fee - Appropriate hourly fee - Entitlement to claim for increases in hourly rates
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Instructing Solicitors: Schillings for the Claimants; Olswang for the First Defendant
MGN had published photographs of DJ’s Sara Cox and Jon Carter (“Cs”) topless on their honeymoon in a villa on a small private island in the Seychelles. Cs brought an action for invasion of their privacy and breach of the Data Protection Act, and complained to the PCC. Initially this was privately funded but later Cs entered into a CFA. Ultimately a settlement was concluded through means of a consent order. One of the terms of the settlement was that the Cs would receive their costs. The Costs Judge, Master O’Hare, found Cs overall costs to be proportionate, and ordered a success fee of 40% be recoverable. The Defendants appealed, and the Claimants appealed against decisions as to the appropriate hourly rate for the senior partner of their solicitors and whether they could recover increases in the hourly rate after the date of the CFA.
(1) Whether the overall bill was proportionate;
(2) What proportion of the success fee was recoverable in accordance with the CFA;
(3) What was the appropriate hourly fee for Mr Keith Schilling, the senior partner of the solicitors acting for C;
(4) Whether Cs solicitors were entitled to claim for increases in their hourly rates after the date of the CFA.
Dismissing the appeals: (1) The Master’s decision on proportionality was well within the range of reasonable options open to him, and he had not misdirected himself in law. It is too simplistic to compare the bill with the amount of financial compensation recovered when there is a significant need to press for other remedies, as here.
(2) The Master had not strayed outside the range of reasonable assessments. Cs had a strong case which justified setting the success fee at a rate much less than the 95% sought by Cs solicitors, but 40% was not so high as to conflict with the public policy considerations addressed by Lord Bingham in Callery v Gray nor was the figure one which “would have solicitors scrabbling for the right to conduct such cases”.
(3) There was no solid basis which would justify interfering with Master O’Hare’s assessment of Mr Schilling’s hourly rates.
(4) The construction of the CFA which would allow for the claimed increases was inconsistent with the CFA Regulation
Although the decision of the Master that the Claimants’ overall base costs were proportionate was upheld, despite it being three times the level of compensation recovered (five times when the success fee is included), this decision contains a wealth of comments from Eady J that media defendants will find useful when seeking to reduce the costs payable to claimants in privacy cases. The Defendants were awarded 75% of their costs, with the Claimants ordered to pay £25,000 on account.