Halborg, R (on the application of) v The Law Society [2010] EWHC 38 (Admin)

[2010] EWHC 38 (Admin)

Case No CO/10291/2008

IN THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

ADMINISTRATIVE COURT

Venue Royal Courts of Justice, Strand, London, WC2A 2LL

Date 19 January 2010

Before

MR JUSTICE KEITH

Between

R (on the application of Scott Halborg, trading under the style of Halborg & Co, Solicitors)Claimant

The Law SocietyDefendant

Mr Vikram Sachdeva (instructed by Halborg & Co) for Claimant

Mr Clive Sheldon (instructed by Natalie Turner, the Law Society) for Defendant

Hearing Hearing date: 18 December 2009

Judgment

Introduction

[1]If you think that your solicitor has overcharged you, there are a number of steps you can take. Until recently, one of them was to ask your solicitor to get a remuneration certificate from the Law Society. Such a certificate will say what the Law Society thinks would be a fair and reasonable charge for the work. This case is all about when you can ask your solicitor to get such a certificate, and whether your solicitor is obliged to get one. When opening the case, counsel told me that my boredom threshold would be severely tested by it. That was, I think, a little pessimistic. Although this case will not be grabbing the attention of the public, it had the potential to raise not entirely uninteresting questions of concern to solicitors.

[2]However, it is rather surprising that this case is still being litigated. The rules relating to remuneration certificates have now been repealed, and such certificates are no longer part of the armoury available to people who claim that they have been overcharged by their solicitor. Accordingly, the issues which the court is having to address are now of no practical interest to anyone other than the parties and the few people who may still have unresolved disputes about remuneration certificates. In addition, the dispute between the solicitor and client in this case could have been settled if the solicitor had agreed not to press for payment of fees of less than £1,100.00. Yet the case has now been before the Administrative Court twice, and I imagine that the costs which have been incurred in these proceedings – to say nothing of the cost of investigating and determining the complaint which led to this case – outweigh what is financially at stake by a very considerable margin.

[3]The case comes before the Administrative Court as a claim by a firm of solicitors for judicial review. The firm’s client had complained to the Law Society that it had been overcharged by the firm for the amount of work which had been done. In the course of investigating that complaint, the Law Society noted that the client had requested the firm to obtain a remuneration certificate, but the firm had not done so. The firm claimed that it had not been obliged to obtain such a certificate, but the adjudicator appointed by the Law Society to investigate the complaint decided that the firm had been obliged to obtain it. He directed the firm to apply for such a certificate. The firm challenges that decision.

The legal framework

[4]The statutory provisions. Section 56(2) of the Solicitors Act 1974 (“the 1974 Act”) provides for the making of “general orders prescribing and regulating … the remuneration of solicitors in respect of non-contentious business”. The relevant order for present purposes is the Solicitors’ (Non-Contentious Business) Remuneration Order 1994 (SI 1994/2616) (“the 1994 Order”). This order has now been replaced, but the order which applies to the bills in this case is the 1994 Order. Art. 4(1) of the 1994 Order provides that the client of a solicitor could “require [the] solicitor to obtain a remuneration certificate from the Council [of the Law Society] in respect of a bill which has been delivered where the costs are not more than £50,000”.

[5]In order to ensure that proceedings against a client for the recovery of costs for non-contentious business were not issued prematurely, Art. 6 required certain information to be given to the client in writing before any such proceedings are brought. Art. 8 provided that such information should include the fact that the client could require the solicitor to obtain a remuneration certificate provided that the client did so within one month of being informed of that right or receiving the bill (or being notified of the costs), whichever was the later.

[6]Art. 9 set out the circumstances in which a client could “not require a solicitor to obtain a remuneration certificate”. They include “(a) after a bill has been delivered and paid by the client, other than by deduction; (b) where a bill has been delivered, after the expiry of one month from the date on which the client was informed in writing of the matters specified in article 8 or from delivery of the bill if later; …” Finally, Art. 12(1) provided:

“After an application has been made by a solicitor for a remuneration certificate the client may pay the bill in full without invalidating the application.”

[7]The different types of bill. Requests for interim payments on account have to be distinguished from bills. A request for an interim payment on account does not necessarily relate to work which has been done. It cannot therefore be sued upon by solicitors and the client cannot apply for it to be taxed. In order to sue for work which has been done, the solicitor has to render a self-contained bill for that work.

[8]Such bills – known as statute bills because they have to comply with the requirements of the 1974 Act – can be interim or final bills. A final bill speaks for itself. It is the bill which solicitors submit when they have completed all the work to which their retainer relates. An interim bill is one which solicitors can submit before they have completed all the work to which their retainer relates, and is a bill for work which has already been done. Such a bill, known as an interim statute bill so as not to be confused either with a final statute bill or with a request for an interim payment on account, has been said to be “rare”, and to be capable of arising during the currency of the retainer only by agreement or if there is a natural break in the work: see Cordery on Solicitors, para. 305. It is not suggested that there were any natural breaks in the work done pursuant to the retainer in the present case, and the only basis on which it is said that the firm was entitled to submit interim statute bills was by agreement. The circumstances in which such an agreement might arise were considered by the Court of Appeal in Davidsons v Jones-Fenleigh (1980) 124 Sol J. 204. In the course of his judgment, Roskill LJ (as he then was) said:

“A solicitor is entitled to select a point of time which he regards an appropriate point of time at which to send in a bill. But before he is entitled to require that bill to be treated as a complete self-contained bill of costs to date, he must make it plain to the client either expressly or by necessary implication that that is his purpose of sending in that bill for that amount at that time. Then of course one looks to see what the client’s reaction is. If the client’s reaction is to pay the bill in its entirety without demur it is not difficult to infer an agreement that the bill is to be treated as a complete self-contained bill of costs to date.”

The facts

[9]The firm’s retainer. The claimant, Mr Scott Halborg, is a solicitor practising under the style Halborg & Co. His firm was retained by the interested party, Modern Apartments Ltd. (“the company”), and its directors in relation to a claim for negligence and/or breach of contract which the company was thinking of bringing. The terms of the firm’s retainer (which the company agreed to) were set out in the firm’s letter to the company of 7 February 2007. The letter contained the following passages:

“Fees … It is our normal practice to ask you to make a payment on account of fees and expenses (‘disbursements’), particularly as we are required by the Law Society and Bar Council to have funds with which to pay Counsel and other agents directly. We will write further later regarding the appropriate amount of a payment on account of costs and/or disbursements. Billing We will send you our final account on completion of this matter. We reserve the right to issue interim invoices. Payment is due to us within 7 days of our sending you a bill. If a bill remains unpaid, we reserve the right to charge interest at 3% per month until payment is made. This is higher than the Court judgment rate. Termination of retainer You may terminate your instructions to us in writing at any time but we will be entitled to keep all your papers and documents while there is money owing to us for our charges and expenses … We may decide to stop acting for you only with good reason; for example, if you do not pay a final or an interim bill or comply with our request for a payment on account. We must give you reasonable notice that we will stop acting for you. If you or we decide that we will no longer act for you, you will pay our charges as set out earlier.”

Following that letter, the company paid the firm £1,000.00 on account of its fees, and a further £8,000.00 was paid on account of its fees on 27 February 2007 after the firm had submitted its first bill to the company of £1,123.59 (4¼ hours at £225.00 an hour plus VAT). Those sums were paid into the firm’s client account.

[10]The firm’s bills. The firm submitted a total of twelve bills to the company over the period 26 February to 17 October 2007. Attached to each of them was a document giving the company the information about remuneration certificates required by Art. 8 of the 1994 Order. It included a statement that if the company wished the firm to obtain a remuneration certificate, the company had to ask the firm to do so within a month of receiving the document. The first ten bills were paid in full by the appropriate sum being transferred from the firm’s client account to its office account. The last two bills – those dated 10 September and 17 October 2007 and which amounted to £1,057.51 – were not paid, because on 21 August the balance of the company’s money in the firm’s client account had been returned to the company.

[11]The request for a remuneration certificate. On 19 October 2007, one of the directors of the company, Shaun McDonnell, telephoned the firm and spoke to a trainee solicitor there. He told her that the company wished to terminate the retainer, and that it proposed to collect the files and pay the outstanding bills that day. Mr McDonnell was told that the bills had to be paid before the files could be released, and a letter was sent to the company confirming that. Mr McDonnell claims that he then wrote to the firm requesting it to obtain a remuneration certificate. The firm says that it did not receive the letter, and Mr Halborg suspects that it was never even sent. However, what purports to be a copy of that letter has been produced. It is dated 19 October 2007. Although it asked for a remuneration certificate to be obtained, it ended up by saying that “the issue” between the firm and the company could be resolved if the firm were to release the files without requiring the settlement of its two outstanding bills.

[12]The county court proceedings. On 21 January 2008, the firm issued proceedings in the Northampton County Court against the two directors of the company. The claim was for the £1,057.51 due on the two outstanding bills plus interest. A default judgment against Mr McDonnell alone was subsequently entered, and the outstanding bills were eventually paid “under protest” on 9 April 2008.

[13]The complaint to the Law Society. In the meantime, the company had lodged a complaint with the Law Society’s Legal Complaints Service. The complaint was that the services which the firm had provided had been minimal, and had not justified the bills which had been submitted. The complaint, together with the firm’s response to it, was considered by caseworkers within the Legal Complaints Service before being referred eventually to an adjudicator. His decision shows that he was not at that stage being asked to decide whether the bills were justified or whether the firm had provided an inadequate professional service to the company. He was only being asked to determine whether the company had been entitled to require the firm to obtain a remuneration certificate, and whether the firm had been obliged to obtain one. He described his decision on these issues as “interim” ones, but it is plain that his decision on these issues was final. What he meant, I think, was that he was being asked to decide these issues as preliminary issues.

The decision of the adjudicator

[14]The first issue which the adjudicator had to consider was whether the company had been entitled to require the firm to obtain a remuneration certificate. Since all of the bills had been accompanied by a document giving the company the information required by Art. 8, and since the company did not require the firm to obtain a remuneration certificate until its letter of 19 October 2007, it follows that, even if the bills were bills of the kind to which the 1994 Order related and were therefore bills of the kind for which a remuneration certificate could be sought, only the last bill was one for which the company could require the firm to obtain a remuneration certificate. That was because all the previous bills had been received by the company more than one month before it required the firm to obtain a remuneration certificate, and therefore the company was prevented by Art. 9(b) from requiring the firm to obtain a remuneration certificate in respect of the previous bills. However, one of the issues which the adjudicator addressed was whether the previous 11 bills were bills of the kind for which a remuneration certificate could be sought, i.e. interim statute bills, or whether they were merely requests for payment on account, for which it was common ground that a remuneration certificate could not be sought, because he took the view that if they were the latter, the nature of the last bill was such that a request for a remuneration certificate of that bill amounted to a request for a remuneration certificate for all the work done under the retainer.

[15]The adjudicator concluded that the first 11 bills were not interim statute bills but merely requests for payment on account. His reasoning is set out in para. 3.4 of his decision as follows: “[The bills are] a running commentary on the fees being incurred up to a point in time and there is nothing to suggest that these bills signalled a ‘natural break’ on the course of the retainer, which if it did, would lead to a different interpretation on their status. Despite Halborg & Co stating that their terms of business letter makes it clear that they have ‘… the right to issue interim statute bills payable within 7 days’ their letter says nothing of the sort. The relevant paragraph in their letter states: ‘We will send you our final account on completion of this matter. We reserve the right to issue interim invoices.’ When looked at with the bills delivered these two sentences support my finding that these were intended to be and were interim bills only as their letter anticipates sending a final bill perhaps preceded by the issue of interim invoices. There is no hint of the word ‘statute’ but even if there were I would be entitled to look at the bills themselves and interpret whether the content represented just an interim bill rather than an interim statute bill which is what I conclude.” ‘… the right to issue interim statute bills payable within 7 days’ ‘We will send you our final account on completion of this matter. We reserve the right to issue interim invoices.’

[16]The adjudicator then turned to the effect which that finding had on the request for a remuneration certificate for the last bill. He had previously noted that it was common ground that that bill had been a “final” bill, by which he meant, I think, that it was a statute bill, i.e. that it had been one which the company could require the firm to obtain a remuneration certificate for, but he went on to hold that his finding on the nature of the 11 previous bills meant that the company’s request for a remuneration certificate for the last bill “cover[ed] the bills delivered throughout the lifetime of the retainer”. The effect of that conclusion was that, on the assumption that the company had indeed required the firm to obtain a remuneration certificate, that requirement related to the work covered by all 12 bills which the firm had submitted.

[17]The other issue which the adjudicator had to address was whether the firm had indeed been required to obtain a remuneration certificate. He did not doubt that the company had sent the firm the letter dated 19 October 2007 which had required the firm to obtain a remuneration certificate. And by agreeing with the views of one of the previous caseworkers who had noted that an earlier caseworker had not doubted that the firm had not received that letter, the adjudicator should, I think, be treated as having accepted that the firm had not received the letter. Those findings raise the question whether the request to a solicitor to obtain a remuneration certificate has to have been actually received by the solicitor if the solicitor is to be regarded for the purposes of Art. 4(1) of the 1994 Order as under an obligation to obtain one.

[18]The adjudicator concluded that the request did not have to have been actually received by the solicitor for the solicitor to be obliged to obtain a remuneration certificate. His reasoning for that conclusion was set out in para. 3.2 of his decision as follows: “There is nothing in [Art. 4(1) of the 1994 Order] that supports Halborg & Co’s statement that: ‘… it is therefore up to the client to prove on the civil burden of proof that the request was made in writing within the one month timescale.’ It says no such thing directly or impliedly. The fact that Halborg & Co say that they did not receive [the company’s] letter of 19 October 2007 does not mean that that letter was not sent. The letter exists and I have seen a copy of it and it is not for the [Legal Complaints Service] to require some sort of proof of posting. The existence of the letter is evidence, sufficient enough, for the [Legal Complaints Service] to accept that it was within the one month timescale for requesting a Remuneration Certificate. Similarly there is no requirement for [the company] to have sent the letter by Recorded Delivery or to have sought confirmation from Halborg & Co that they had received it. It is also entirely correct that it is in order for any one of the authorised officers of the company that is the Directors, to request it.” ‘… it is therefore up to the client to prove on the civil burden of proof that the request was made in writing within the one month timescale.’

[19]Having concluded that the firm had been obliged to obtain a remuneration certificate, but had not done so, the adjudicator “directed” the firm to “apply” for one in respect of the 12 bills which the firm had submitted to the company within 28 days of the firm’s receipt of his decision. His decision did not state what provision in the 1994 Order gave him the power to make such a direction.

The nature of the bills

[20]The onus of establishing that a bill constitutes a statute bill is on the solicitor: see In Re Romer & Haslam

[1893] 2 QB 286

at p.299. It is to be observed that none of the 12 bills submitted by the firm itemised with any particularity the work which had been done. But(a) one of them (bill 10) was for counsel’s fees,

(b) three of them (bills 3, 5, and 9) were for counsel’s fees and Mr Halborg’s fees for a specified number of hours spent by him on work to which the retainer related,

(c) the remaining eight bills (bills 1, 2, 4, 6, 7, 8, 11 and 12) were all for Mr Halborg’s fees for a specified number of hours similarly spent by him on work to which the retainer related,

(d) one of the bills (bill 5) related to 6.5 hours of work but charged for only 3.5 hours, and

(e) nine of the 11 bills which included fees for Mr Halborg’s work (i.e. all of them excluding bills 3 and 4) related to a specific period during which the work was carried out (the period being at irregular intervals), and the remaining two bills (bills 3 and 4) appear to have related to a specific period during which the work was carried out but not a period covered by the other bills, namely the period from 16 March to 10 May 2007.

[21]It is true that all of the bills which were paid by transfer from sums in the firm’s client account (with the exception of the one which was for counsel’s fees only) had a receipt endorsed on them which recorded that the payments had been made by transfer “on account of fees and disbursements”. But the fact that all of the bills were for specific hours of work which Mr Halborg had carried out over specified periods – and were neither expressed in round figures not submitted at regular intervals – is more consistent with these bills having been self-contained interim invoices, i.e. interim statute bills, than just requests for interim payments on account. Moreover, the fact that each of the bills was accompanied by information about the company’s right to ask the firm to obtain a remuneration certificate is equally inconsistent with them being simply requests for payment on account: see Wilson v William Sturges & Co

[2006] EWHC 792 (QB)

at [39]. Indeed, since it is common ground that the last bill was a statute bill, it is a little difficult to say that its language was so obviously different from the previous ones so as to suggest that the previous ones may not have been statute bills: see O. Palomo SA v Turner & Co

[2000] 1 WLR 37

at p.53H.

[22]However, that is not decisive. However much the firm may have intended the bills to be interim statute bills, they could only have been interim statute bills if the company could be regarded as having agreed to the firm submitting bills at regular intervals during the course of the retainer for work done to date. A decent argument can be mounted for saying that the company did not expressly agree to do that. By agreeing to the terms of the letter of 7 February 2007, the company admittedly agreed that the firm had “the right to issue interim invoices”, but at first blush that could have referred to bills for work actually done or requests for payment on account of costs and disbursements.

[23]On the other hand, the right which the firm reserved to charge interest on “interim invoices” as well as “final” accounts suggests that any “interim invoices” were intended to be interim statute bills, because interest can hardly be charged on requests for payment made on account. And particularly telling is the fact that the company also agreed that the firm could withdraw from its retainer if the company did not pay “a final or interim bill or comply with [the firm’s] request for a payment on account”. In this passage, a distinction is being drawn between an “interim bill” and a “request for a payment on account”. The firm was reserving to itself the right to treat a failure to pay either type of bill as entitling it to treat its retainer as withdrawn. The reference in this context to an “interim bill” could only have been a reference to an interim statute bill, and the firm could only have reserved the right to treat the failure to pay such a bill as entitling it to treat its retainer as withdrawn if the company had agreed to the firm submitting interim statute bills in the first place. That is why the company’s reservation of “the right to issue interim invoices” has to be construed as a right to issue interim statute bills.

[24]I have not overlooked the passage in the letter of 7 February 2007 in which the firm said that it would send its “final account on completion” of the retainer. But that does not mean that the firm was not saying at the same time that it would be sending interim statute bills. Indeed, the company said just that by going on to reserve “the right to issue interim invoices”.

[25]These are my reasons, therefore, for concluding that the company expressly agreed that the firm could submit interim statute bills, and that the 12 bills which the firm submitted were in fact interim statute bills. It is therefore unnecessary for me to consider the firm’s alternative case that by paying all the bills the company had impliedly agreed that the firm could submit interim statute bills. But if the company had not expressly agreed that the firm could submit interim statute bills, I doubt whether it could have been said that the company had impliedly agreed that the firm could do that. As Simon Brown LJ (as he then was) said in Abedi v Penningtons (Court of Appeal, 23 March 2000, transcript p. 9), “agreement is not readily to be inferred from the mere fact of payment being made in response to the submission of interim bills”. The last two bills were only paid under protest, and the first ten were only paid by the firm transferring the appropriate sum from its client account. The company’s equanimity about those transfers is much more likely than not to have been attributable to the fact that the money came from sums deposited with the firm on account of its fees. In other words, Mr McDonnell may well not have appreciated the significance of the transfer of sums in the firm’s client account to the firm’s own account, and he might have thought that the bills were simply identifying the cost of the work done to date for which a final bill would be submitted in due course.

[26]In deciding that all 12 bills submitted by the firm were interim statute bills, I am conscious that I have reached a different conclusion from a specialist tribunal: the adjudicator was, I am told, a solicitor, no doubt with experience of disputes between solicitors and their clients. I acknowledge, in addition, that it is not appropriate in claims for judicial review for the court to substitute its own view for that of the decision-maker. But the question which the adjudicator had to consider was essentially a question of contractual construction, and it is entirely appropriate for the court on a claim for judicial review to reach, and give effect to, its own view on an issue of that kind, if the court thinks that the adjudicator fell into legal error by misinterpreting the true legal nature of the first 11 bills. Having said that, I do not agree with the firm’s contention that the adjudicator gave no, or no adequate, reasons for his decision on the issue. In construing the words “interim invoices”, the adjudicator regarded as significant(a) the absence of the phrase “interim statute bills” in the letter of 7 February 2007 and

(b) the language of the bills themselves. I have not regarded (a) as significant, and the language of the bills seem to me to support rather than undermine the firm’s argument, but the fact that I have taken a different view from the adjudicator about the aids to construction which he regarded as significant does not mean that the reasons he gave were inadequate.

[27]It follows that the first 11 bills were not bills to which the request for a remuneration certificate could have related, because they had all been received by the company more than one month before the remuneration certificate was requested. Accordingly, the adjudicator’s conclusion that the request for a remuneration certificate covered the work to which those 11 bills related as well as the last bill becomes academic. But it is nevertheless very difficult to see how the last bill (which was the only bill for which, on any view, a remuneration certificate could have been sought) could in effect be treated as a bill which covered all the previous work done pursuant to the firm’s retainer, when(a) neither the previous work nor any of the previous bills were referred to in the last bill, and

(b) the last bill specifically related only to one hour’s work between 11 September and 17 October 2007.

[28]In the interests of completeness, I should add that this does not necessarily mean that the company had to ask the firm for a remuneration certificate after each bill. I assume that the firm was obliged to submit a final bill at the conclusion of its retainer, and I imagine that such a bill would have had to identify(a) all the work which had been carried out under the retainer and

(b) the total cost of that work, giving credit to the company for any sums paid previously, whether on account or in settlement of interim statute bills. Presumably, the company could now insist on the firm presenting it with a final bill, which the company could then ask for a remuneration certificate for, but for the replacement of the 1994 Order by an order which does not include anything about remuneration certificates. Indeed, the firm acknowledges that it has not sent the company its final bill. As Mr Vikram Sachdeva for the firm noted in para. 66 of his skeleton argument, the work which the firm had been instructed to carry out had not been completed by the time the last bill was submitted. The company had not requested a final bill. The last bill did not set out the work covered by the 11 previous bills. And on the date of the submission of the last bill, the firm’s retainer had not been terminated. However, since I was not addressed on the firm’s obligation to submit a final bill, or whether that would have entitled the company to ask the firm to obtain a remuneration certificate for it which incorporated all the work which the firm had done, it would not be appropriate for me to say anything more on the topic.

[29]Since all 12 bills submitted by the firm were interim statute bills, they were all bills of the kind for which a remuneration certificate could be sought. However, only the last bill was one for which the company could require the firm to obtain a remuneration certificate in the light of the requirement in Art. 9(b) for the request to the firm to obtain a remuneration certificate to have been made within one month of the submission of each bill.

The effect of payment of the last bill

[30]The firm contends that once the company had paid the last bill, albeit “under protest”, the firm was no longer obliged to obtain a remuneration certificate. That is said to have been the effect of both Art. 9(a) and Art. 12(1). If the adjudicator was called upon to consider this issue, he did not address it.

[31]The argument based on Art. 12(1) can be disposed of quickly. It is acknowledged that Art. 12(1) had no direct application to the present case because the firm never applied for a remuneration certificate – whether for the last bill or any of the bills. But its case is that what Art. 12(1) implied was that if, as Art. 12(1) expressly provided, the payment of a bill would not invalidate any previous application for a remuneration certificate for it, the payment of a bill would prevent any subsequent application for a remuneration certificate for it being made. I disagree. The latter proposition simply does not follow from the former. Art. 12(1) ensured that the process which the application for a remuneration certificate started was not curtailed prematurely simply because the client paid the bill to which the remuneration certificate related. It says nothing about the effect of payment of the bill if the process had not started because the solicitor had not complied with the requirement to obtain one.

[32]Similar considerations apply to Art. 9(a). The question is whether the firm was obliged to obtain a remuneration certificate for the last bill, bearing in mind that the bill was paid by the company otherwise than by deduction. The critical point here is that the company’s request for the firm to obtain a remuneration certificate pre-dated the payment of the bill by over six months. The fact that the bill was subsequently paid did not mean that the company’s previous request for a remuneration certificate was invalidated.

The communication of the requirement

[33]I turn to the second issue on which the adjudicator found against the firm, namely that the request for a remuneration certificate did not have to be actually received by the firm for it to have been obliged to obtain one. It was sufficient if the request had been posted to the firm. I do not believe that such a result could have been intended by those who drafted the 1994 Order. It would mean that the Order imposed an obligation on solicitors to obtain a remuneration certificate when they may not know that their client had required them to obtain one at all.

[34]That is not to say that the request for solicitors to obtain a remuneration certificate has to have been received by the solicitors for the client to be regarded as having “required” the solicitors to obtain one. I take the firm’s point that it would not be difficult for clients who have sent their request for a remuneration certificate to their solicitors by post to ensure that the solicitors received the request. They can send it by recorded delivery, so that if it is not signed for, they will know that it has not been received, and they can take such steps to ensure that it is. After all, they have a month to do that. Or if the request is not acknowledged, they can contact the solicitors by telephone, text or e-mail to find out whether it was received, so that again, if it was not, they can inform the solicitors of the requirement. After all, Art. 4(1) does not require the request to be in writing. But it would, I think, be a little harsh for the client to lose the right to obtain a remuneration certificate if, for example, the request for one was lost in the post, and the client did not notice that the solicitor had not acknowledged receipt of that request within a month. I do not believe that those who were responsible for drafting the 1994 Order could have intended that to happen.

[35]The correct position is that the clients will have “required” the solicitor to obtain a remuneration certificate if the requirement to obtain one was sent to the solicitor, whether the solicitor received the request or not. However, the solicitor’s obligation to obtain such a certificate only arose when the solicitor became aware of the request. That ensures that the solicitor was not obliged to do anything he knew nothing about, while at the same time ensuring that the client was not penalised as a result of vagaries in the post. Indeed, the distinction between the client “requiring” the solicitor to obtain a remuneration certificate, and the solicitor being obliged to obtain one, was recognised in the 1994 Order. Art. 14(1) entitled a solicitor to charge interest on the unpaid amount of his costs, but when Art. 14(2) came to identify the period for which interest could be charged it provided that “… the period for which interest may be charged may run from one month after the date of delivery of a bill, unless the solicitor fails to lodge an application within one month of receipt of a request for a remuneration certificate under article 4, in which case no interest is payable in respect of the period between one month after receiving the request and the actual date on which the application is lodged.” (Emphasis supplied)

[36]Accordingly, the company required the firm to obtain a remuneration certificate in respect of the last bill when it wrote to the firm on 19 October 2007 requesting a remuneration certificate, but the firm was not required to obtain one until it knew of the letter. It was not until 31 January 2008 that the firm knew that the company was claiming to have sent a letter dated 19 October 2007 requesting a remuneration certificate. That was when its obligation to obtain a remuneration certificate for the last bill arose. Having said that, though, I do not agree with the firm’s contention that the adjudicator gave no, or no adequate, reasons, for his decision on the issue. The adjudicator correctly regarded the fact that the letter of 19 October 2007 had been sent as satisfying the company’s obligation to require the firm to obtain a remuneration certificate. The adjudicator assumed that that meant that the firm was then obliged to obtain one. I disagree with that assumption, but the fact that the adjudicator did not spell out why he was making the assumption which he did did not mean that his decision on the topic was inadequately reasoned.

The direction which the adjudicator made

[37]The adjudicator “directed” the firm to “apply” for a remuneration certificate in respect of all 12 bills. In the circumstances, the adjudicator could only have directed the firm to obtain a remuneration certificate for the last bill. But the firm questions whether the adjudicator could have done even that. The adjudicator’s powers are those conferred on the Law Society’s Council by Schedule 1A to the 1974 Act. I have no doubt that the adjudicator had the power to direct the firm to obtain a remuneration certificate in respect of the last bill under both para. 2(1)(b) and para. 2(1)(d) of Schedule 1A, which entitled the adjudicator to direct Mr Halborg, at his expense or that of his firm, “to secure the rectification … of any … omission” or “to take such … action in the interests of the client” as he might specify. The omission in this case was the firm’s failure after 31 January 2008 to obtain a remuneration certificate for the last bill.

[38]I note that para. 1(1) of Schedule 1A permitted the adjudicator to make directions of the kind set out in para. 2(1) only “where it appears to [him] that the professional services provided by [the solicitor] in connection with any matter in which he or his firm has been instructed by a client have, in any respect, not been of the quality which it is reasonable to expect of him as a solicitor”. The firm argues that this prevented the adjudicator from making the direction he made because there was no finding of inadequate professional services. But no such finding has to have been made. It is sufficient if it appears to the adjudicator that the services have been inadequate. It would have been open to the adjudicator to conclude – and he must be taken to have concluded – that the firm’s failure to obtain a remuneration certificate for the last bill once it knew that such a certificate had been requested by the company appeared to amount to the provision of an inadequate professional service.

Conclusion

[39]For these reasons, I have concluded that the adjudicator was entitled to direct the firm to obtain a remuneration certificate, but for the last of the 12 bills only. I therefore quash that part of the directions he gave which relate to all of the bills submitted by the firm, and his direction will accordingly relate only to the bill dated 17 October 2007. I leave it to the company to decide whether it will now insist upon the firm obtaining a remuneration certificate for that one bill, when it was only for £264.38 inclusive of VAT. The firm’s time for complying with the adjudicator’s direction was extended until 28 days after the High Court’s judgment on this claim for judicial review. Accordingly, if the company still insists upon the firm obtaining a remuneration certificate for the only remaining bill, the firm must do so by 16 February 2010.

[40]I wish to spare the parties the trouble and expense of attending court when this judgment is handed down, and I leave it up to them to see if they can agree an appropriate order for the costs of the claim in the light of this judgment. If they cannot do so within 14 days of the handing down of this judgment, they should refer the issue to me, and I will decide the appropriate order to make without a hearing on the basis of any written representations which are made. If either party wishes to apply for permission to appeal, they should notify my clerk of that within seven days of the handing down of this judgment, and I will consider that application as well without a further hearing. However, the parties’ time for filing an appellant’s notice will still be 21 days from the handing down of this judgment.