Fixed Costs and Medical Agency fees – Again

Paramount Legal Costs

Ms Clair Wilkinson-Mulvanny v UK Insurance Ltd [19th January 2023] (County Court Decision).

Despite its age,  Fixed Recoverable Costs still seems to be a platform for dispute.

In this particular matter, though it was undisputed that Fixed Costs applied, a dispute regarding the recoverability of a medical agency’s fee (contained within a medical report fee) arose.

The Defendant disputed the recoverability of the agency fees, relying on the first instance decision of Powles v Hemmings, where it was found that the fees of the medical agency were allowed for in the recoverable fixed costs. Essentially the Solicitor needed swallow the cost of the agency fees from their base costs (aka profit costs though “profit” may be a debateable word in the current climate).

The decision in Powels reflected the principles of the Court of Appeal case of Aldred v Cham which, interestingly, arose as a result of something entirely different – Aldred  grew from arguments about whether counsel’s advice fee in a child claim was recoverable as a disbursement, in addition to the fixed costs.

Despite Powels being a non binding decision, it has resulted in a flurry of Paying Party disputes as to the recoverability of agency fees. Many Paying Parties now demand breakdowns of experts fees and argue that any agency element should not be recoverable at all.

Interestingly what seems to have been forgotten, or missed, (for those who have been around long enough) is the very relevant Appeal Case of Woollard v Fowler [2006]. Woollard, was a fixed costs case surrounding what was considered a disbursement under the fixed cost Rules, the Court determined that the cost of obtaining a medical report was a disbursement and that “obtaining” included the work of procuring the report, rather than simply the cost of the report itself. The agency fee was allowed.

In this case Aldred was not accepted as being of assistance on the issue of recoverability of medical agency fees and, instead, the decision of Woollard v Fowler was accepted. It is refreshing to see historic knowledge and common sense applied here.

Despite this, consideration still needs to be given by receiving parties when such points are raised, especially having regard to some of the comments made by DJ Phillips. Wilkinson -Mulvanny is helpful and its outcome is sensible, but the decision is not binding so please do consider any and all disputes you may receive on this issue on a case by case basis.

For example, where an amount for a report is fixed under a rule, then it will remain so, even if there is an agency uplift. Or, where a disbursement is not fixed please remember that the Court may assess said disbursement and make reductions.

If you are ever in need of advice on this, or any other cost issue, please contact her here.