R (TM Eye Ltd) v Dean Hall [2026] EWHC 70 (SCCO)

[2026] EWHC 70 (SCCO)

Case No S20230428

Case No T20210899

SCCO Reference: SC-2024-CRI-000112

SC-2024-CRI-000115

IN THE HIGH COURT OF JUSTICE

SENIOR COURTS COSTS OFFICE

Thomas More Building

Venue Royal Courts of Justice

Date 16 January 2026

London, WC2A 2LL

Amended on 19 January 2025 under CPR 40.12

Before

COSTS JUDGE LEONARD

R (TM EYE)

DEAN HALL

R (TM EYE)

(1) FLORENTINA RADU (2) CARMEN TEDORESCU

Judgment on Appeal under Regulation 10 of the Costs in Criminal Cases (General) Regulations 1986

Appellant: TM Eye Ltd

Edward Strickland for the Appellant

Richard Clarke for the Lord Chancellor

These appeals have been successful (in part) for the reasons set out below. The appropriate additional payment should accordingly be made to the Appellant. The costs of the appeal remain to be determined.

COSTS JUDGE LEONARD

Between

R (TM Eye Ltd)Claimant

Dean HallDefendant

[1]This appeal concerns the assessment of the costs payable to the Appellant, as a private prosecutor, from central funds. The costs are payable by virtue of two orders made in the Crown Court at Snaresbrook, under section 17 of the Prosecution of Offences Act 1985 (“the 1985 Act”). The Defendants were (in one case) Dean Hall and (in the other) Florentina Radu and Carmen Tedorescu.

[2]In the case of Dean Hall, the section 17 order was made on 24 January 2024. In the case of Florentina Radu and Carmen Tedorescu, the order was made on 5 October 2023. The pertinent wording of each order is identical, providing for:

“… the payment out of central funds of such amount as is reasonably sufficient to compensate the prosecutor for any expenses properly incurred by it in the proceedings… The amount to be paid out of central funds in pursuance of this order shall be determined in accordance with regulations made by the Lord Chancellor for these purposes, pursuant to s l7(2C)(b) POA 1985.”

[3]That wording reflects the statutory provisions governing payment to private prosecutors out of central funds, set out below.

[4]This appeal concerns the hourly rates payable to the Appellant for its work. The Appellant argues that in all private prosecutions, it should be paid for all work, and for travel time, at these rates: More Complex Case (Crown) CEO/Director Operations £250 £330 Team Leader/Undercover operative £160 £195 Senior Investigator £130 £170 Investigator £115

£130

[5]In the case of Hall, a claim has been made at the four hourly rates appropriate (on the Appellant’s case) to Magistrates’ Court cases. In the case of Florentina Radu and Carmen Tedorescu, the claim has been made at the four hourly rates contended for by the Appellant for Crown Court cases.

[6]In both cases, says the Appellant, the Legal Aid Agency (“LAA)’s Determining Officer has awarded hourly rates of £89 per hour for preparatory and investigative work and test purchases of counterfeit goods, and £32 per hour for surveillance and travel.

[7]In fact, according to what I have seen, the Determining Officer has allowed an hourly rate of £89 for all substantive work. Only travel time has been remunerated at the lower rate of £32 per hour.

Authorities

[8]In R (Allseas Group SA) v Paul Sultana

[2023] EWHC 2731 (SCCO)

it was necessary for me to summarise statutory provisions and judicial authorities pertinent to the assessment of costs awarded to private prosecutors from central funds. I shall revisit that summary, adapted as appropriate to the issues in this case.

[9]I should add that have had the benefit of extensive submissions from Mr Strickland for the Appellant and Mr Clarke for the Respondent. I am grateful to both of them. I have not in this judgment mentioned every judicial authority to which they have referred me, only those which seem to me to be most pertinent to the conclusions I have reached. I believe however that I have given due consideration to all of them.

Primary Legislation and Policy

[10]Section 17 of the 1985 Act reads, insofar as pertinent:

“17. — Prosecution costs. (1) Subject to subsections (2) and (2A) below, the court may… in any proceedings in respect of an indictable offence… order the payment out of central funds of such amount as the court considers reasonably sufficient to compensate the prosecutor for any expenses properly incurred by him in the proceedings. (2) No order under this section may be made in favour of— (a) a public authority; or (b) a person acting— (i) on behalf of a public authority; or (ii) in his capacity as an official appointed by such an authority. (2A) Where the court considers that there are circumstances that make it inappropriate for the prosecution to recover the full amount mentioned in subsection (1), an order under this section must be for the payment out of central funds of such lesser amount as the court considers just and reasonable. (2B) When making an order under this section, the court must fix the amount to be paid out of central funds in the order if it considers it appropriate to do so and— (a) the prosecutor agrees the amount, or (b) subsection (2A) applies. (2C) Where the court does not fix the amount to be paid out of central funds in the order— (a) it must describe in the order any reduction required under subsection (2A), and (b) the amount must be fixed by means of a determination made by or on behalf of the court in accordance with procedures specified in regulations made by the Lord Chancellor…” (6) In this section “public authority” means — (a) a police force within the meaning of section 3 of this Act; (b) the Crown Prosecution Service or any other government department; (c) a local authority or other authority or body constituted for purposes of— (i) the public service or of local government; or (ii) carrying on under national ownership any industry or undertaking or part of an industry or undertaking; or (d) any other authority or body whose members are appointed by Her Majesty or by any Minister of the Crown or government department or whose revenues consist wholly or mainly of money provided by Parliament…” (a) a public authority; or (b) a person acting— (i) on behalf of a public authority; or (ii) in his capacity as an official appointed by such an authority. (a) the prosecutor agrees the amount, or (b) subsection (2A) applies. (a) it must describe in the order any reduction required under subsection (2A), and (b) the amount must be fixed by means of a determination made by or on behalf of the court in accordance with procedures specified in regulations made by the Lord Chancellor…” (a) a police force within the meaning of section 3 of this Act; (b) the Crown Prosecution Service or any other government department; (c) a local authority or other authority or body constituted for purposes of— (i) the public service or of local government; or (ii) carrying on under national ownership any industry or undertaking or part of an industry or undertaking; or (d) any other authority or body whose members are appointed by Her Majesty or by any Minister of the Crown or government department or whose revenues consist wholly or mainly of money provided by Parliament…”

[11]Section 16 of the 1985 Act provides for the payment of defence costs out of central funds. Like section 17, it provides (at section 16(6)) for payment to be limited to such amount as the court considers reasonably sufficient to compensate the defendant for any expenses properly incurred by him in the proceedings, and (at section 16(6A), and before 1 October 2012 at section 16(7)) for the court, in appropriate circumstances, to order payment of such lesser amount as the court considers just and reasonable.

[12]Section 20 of the 1985 Act empowers the Lord Chancellor to limit the costs recoverable under section 16 orders. Before section 20 was amended with effect from 1 October 2012, that power also extended to section 17.

[13]In R (Law Society) v Lord Chancellor

[2010] EWHC 1406 (Admin)

Elias LJ and Keith J heard a challenge to regulations introduced by the Lord Chancellor in 2009 under section 20, restricting the amounts recoverable under section 16 orders to Legal Aid rates. The court found the regulations to be unlawful by reference to the provisions of section 16 for compensation to be “reasonably sufficient”.

[14]At paragraphs 48 and 52 of his judgment Elias LJ said:

“…The s 20 power has to be exercised “to carry into effect” the principles enunciated in Part II of the Act, and that includes the principles set out in s 16(6)… That provision requires that the compensation must be “reasonably sufficient”

. It should be such amount as is reasonably incurred for work properly undertaken. In my view, one can only sensibly ask whether the cost has been reasonably incurred by having regard to the prevailing market. The individual defendant seeking legal representation is a consumer in that market. The amount he or she will have to pay to secure the services of a lawyer will be determined by that market… … The obligation is to provide a sum of money which is reasonably sufficient to compensate the successful defendant. The word “sufficient” pre-supposes that there is some measure to determine whether the amount paid satisfies that criterion of sufficiency or not. It must be sufficient by reference to some particular criterion or criteria. In this case the relevant measure is the principle of compensation, albeit one which is constrained by considerations of what is reasonable and proper expenditure…”

[15]The amendments made to section 20 with effect from 1 October 2012 included provision to the effect that the Lord Chancellor may restrict by regulations the amount recoverable under section 16, whether or not that results in the fixing of an amount that the court considers reasonably sufficient or necessary to compensate the defendant.

[16]No such provision has been made in respect of orders made under section 17. That appears to embody a policy referred to by Elias LJ at paragraph 65 of his judgment in R (Law Society) v Lord Chancellor:

“… Ms Albon in her witness statement has identified a number of reasons why the Secretary of State has chosen not to cap private prosecutors' costs in the same way as defendants' costs. The Lord Chancellor took the view that it might deter private prosecutions if the claimants were to be so limited and that would be against the public interest. Some private prosecutors conduct prosecutions on a fairly regular basis. This will include a number of charities, such as the RSPCA. They will need to recover expenditure close to actual levels, otherwise they would be out of pocket, and that in turn would deter them from bringing such prosecutions.…”

[17]Lane J put those observations into a wider context at paragraph 79 of his judgment in Fuseon Ltd v Senior Courts Costs Office

[2020] EWHC 126 (Admin)

“… the compensatory nature of section 17 needs to be recognised in the context of the importance afforded to private prosecutions. That importance explains why, despite the similarities between sections 16 and 17 of the 1985 Act, the Lord Chancellor was held in R (Law Society of England and Wales) to be entitled to decide not to cap private prosecutors’ costs in the same way as defendants’ costs. Paragraph 65 of Elias LJ’s judgment, although describing private prosecutors (such as the RSPCA) who act in that capacity on a fairly regular basis, falls to be read as having a more general application; particularly where he highlighted the fact that, unless private prosecutors can “recover expenditure close to actual levels… they would be out of pocket, and that in turn would deter them from bringing such prosecutions…”

Secondary Legislation, Authorities and Guidance

[18]The determination under section 17(2C)(b) above of the amount of costs payable from central funds is governed by Part III of the Costs in Criminal Cases (General) Regulations 1986 (“the 1986 Regulations”).

[19]Regulation 5 sets out the mechanism for the assessment of the costs awarded:

“(1) Costs shall be determined by the appropriate authority in accordance with these Regulations. (2) Subject to paragraph (3), the appropriate authority shall be…an officer appointed by the Lord Chancellor in the case of proceedings in the Crown Court… (3) The appropriate authority may appoint or authorise the appointment of determining officers to act on its behalf under these Regulations in accordance with directions given by it or on its behalf.”

[20]The officers referred to at regulation 5(3) are the LAA’s Determining Officers. Until 2016, determinations (or assessments) were undertaken by the National Taxing Team (“NTT”). In 2016, the NTT was subsumed into the LAA. Since then determinations have been undertaken by the LAA’s Criminal Cases Unit (“CCU”). The Appellant tends to refer to the CCU as the NTT (or, on occasion, as the Ministry of Justice) but that is of no consequence. For present purposes, and for simplicity’s sake, I have treated the terms “NTT” and CCU” as interchangeable.

[21]Criteria for the assessment of costs awarded out of central funds are set out at Regulation 7, which insofar as pertinent reads: “(1) The appropriate authority shall consider the claim and any further particulars, information or documents submitted by the applicant… and shall allow costs in respect of—(a) such work as appears to it to have been actually and reasonably done; and

(b) such disbursements as appear to it to have been actually and reasonably incurred. (2) In calculating costs under paragraph (1) the appropriate authority shall take into account all the relevant circumstances of the case including the nature, importance, complexity and difficulty of the work and the time involved. (3) Any doubts which the appropriate authority may have as to whether the costs were reasonably incurred or were reasonable in amount shall be resolved against the applicant. (4) The costs awarded shall not exceed the costs actually incurred. (5) … the appropriate authority shall allow such legal costs as it considers reasonably sufficient to compensate the applicant for any expenses properly incurred by him in the proceedings…” (a) such work as appears to it to have been actually and reasonably done; and (b) such disbursements as appear to it to have been actually and reasonably incurred.

[22]Rule 45.2(7) of the Criminal Procedure Rules provides: “On an assessment of the amount of costs, relevant factors include—(a) the conduct of all the parties;

(b) the particular complexity of the matter or the difficulty or novelty of the questions raised;

(d) the time spent on the case;

(e) the place where and the circumstances in which work or any part of it was done; and

(f) any direction or observations by the court that made the costs order.…” (a) the conduct of all the parties; (b) the particular complexity of the matter or the difficulty or novelty of the questions raised; (c) the skill, effort, specialised knowledge and responsibility involved; (d) the time spent on the case; (e) the place where and the circumstances in which work or any part of it was done; and (f) any direction or observations by the court that made the costs order.…” 23. Factors to be taken into account on assessment are also listed at paragraphs 1.11 and 1.12 of the 1995 Taxing Officers’ Notes for Guidance (“TONG”): “(a) the importance of the case, including consequences to reputation and livelihood (b) the complexity of the matter (c) the skill, labour, specialised knowledge and responsibility involved, (d) the number of documents prepared or perused, with regard to difficulty and length (e) the time expended; and, (f) all other relevant circumstances… … (a) regional variations in the expense to solicitors of conducting litigation, and (b) the assessment of the weight of the case by the Judge who tried it or those who participated in it.” and length … (a) regional variations in the expense to solicitors of conducting litigation, and 24. Regulation 9 of the 1986 Regulations provides that a prosecutor who is dissatisfied with a Determining Officer’s decision may apply for redetermination. Sub-paragraphs (1), (5) and (6) provide: “(1) An applicant who is dissatisfied with the costs determined under these Regulations by an appropriate authority in respect of proceedings other than proceedings before a magistrates’ court may apply to the appropriate authority to redetermine them…. (5) The appropriate authority shall redetermine the costs, whether by way of increase, decrease or at the level previously determined, in the light of the objections made by the applicant or on his behalf and shall notify the applicant of its decision. (6) The applicant may request the appropriate authority to give reasons in writing for its decision and, if so requested, the appropriate authority shall comply with the request.” 25. Regulation 10 provides for an appeal from the appropriate authority to a costs judge. Sub-paragraphs (1) and (11)-(14) provide: (1) Where the appropriate authority has given its reasons for its decision on a redetermination under regulation 9, an applicant who is dissatisfied with that decision may appeal to a costs judge… (11) The costs judge may consult the presiding judge, and the appropriate authority or the determining officer who redetermined the costs on its behalf as the case may be, and may require the appellant to provide any further information which he requires for the purpose of the appeal and, unless the costs judge otherwise directs, no further evidence shall be received on the hearing of the appeal and no ground of objection shall be valid which was not raised on the redetermination under regulation 9. (12) The costs judge shall have the same powers as the appropriate authority under these Regulations and, in the exercise of such powers, may alter the redetermination of the appropriate authority in respect of any sum allowed, whether by increase or decrease, as he thinks fit. (13) The costs judge shall communicate his decision and the reasons for it in writing to the appellant, the Lord Chancellor, and the appropriate authority or the determining officer who redetermined the costs on its behalf as the case may be. (14) Save where he confirms or decreases the sums redetermined under regulation 9, the costs judge may allow the appellant a sum in respect of part or all of any reasonable costs (including any fee payable in respect of an appeal) incurred by him in connection with the appeal.” 26. It will be evident from these provisions that there are no “fixed rates” for private prosecution work. Whilst there may well be a recognised “going rate” for certain kinds of work, each case must be determined on its own merits, according to the criteria I have set out above. 27. It will be equally evident that the court’s jurisdiction in this appeal is set by the 1986 Regulations, and is limited to determining the issues the subject of the appeal under regulation 10. This particular appeal is, accordingly, concerned only with the hourly rates payable for certain kinds of work in two particular cases. 28. For those reasons, it is not open to me to make a finding to the effect that the hourly rates contended for by the Appellant should be awarded on every prosecution undertaken by the Appellant, or for that matter that they should never be awarded on any prosecution undertaken by the Appellant. The hourly rates payable to the Appellant will turn upon the application of the criteria I have set out to the facts of the particular case.

The Market

[29]I have been referred to authorities which explain the importance, on determining this appeal, of considering the hourly rates claimed by the Appellant by reference to the rates claimed by others for similar services.

[30]Relevant authorities include R (Law Society) v Lord Chancellor, to which I have already referred, R v Zinga

[2014] EWCA Crim 1823

and McEwan v National Taxing Team

[2014] EWHC 2308 (Admin)

[31]McEwan v National Taxing Team concerned an application for judicial review of the assessment of costs awarded under section 16. The court dismissed the application. At paragraph 19 of his judgment Cranston J distilled from the statutory provisionsand judicial authorities, the following principles:

“(1) The statutory test is one of compensation but subject to the amount being considered reasonably sufficient to cover expenses properly incurred… (2) Compensation in an amount considered reasonably sufficient to cover expenses for work properly incurred must have regard to prevailing market rates and is not limited by the size of the public purse... (3) The test is an objective one, necessity plays no part and there is no indemnity for costs actually incurred… (4) In determining compensation in an amount considered reasonably sufficient to cover expenses for work properly incurred, the taxing authority must have regard to all the relevant circumstances, including the nature, importance, complexity or difficulty of the work and time involved… (5) In the special circumstances of a particular case it may be considered inappropriate for there to be recovery according to the above principles and the taxing authority can then fix a lesser amount considered just and reasonable…”

[32]In Zinga the Court of Appeal considered the costs of a private prosecution arising out of intellectual property infringement. The court observed (at paragraph 25 of its judgment):

“… the reasonableness of the costs incurred must be judged by reference… to the proceedings in question… and… comparable market rates charged for similar work…”

[33]I would observe that the authorities to which I have been referred were concerned with the market for legal services, so that (for example) a Manchester-based private prosecutor who instructs solicitors in central London, when there is a healthy market for such services in Manchester, might not recover any additional costs associated with his choice of London solicitors.

[34]In issue here are the Appellant’s hourly rates, not the rates of solicitors instructed by the Appellant. It is not in issue however that, in identifying hourly rates reasonably sufficient to compensate the Appellant for its work, I should have regard to such market as exists for the services offered by the Appellant. To that end, both parties have referred to what they describe as comparable hourly rates (“comparables”), which I shall come to consider in more detail.

The Appellant’s Business

[35]Mr David McKelvey founded the Appellant company at about the end of 2007. He is the sole (managing) director and controlling shareholder of the Appellant. Prior to founding the Appellant, Mr McKelvey served in the policefor over 30 years, retiring at the rank of Detective Chief Inspector.

[36]Mr McKelvey has, for the purposes of this appeal, provided a witness statement dated 11 July 2025. He describes the Appellant as one of the United Kingdom’s most active private investigation and private prosecution companies, created by him to fill a growing void in enforcement caused by diminishing public resources. He states that the Appellant has successfully prosecuted over well over 1,000 defendants, achieving a conviction rate of approximately 98%.

[37]The Appellant, says Mr McKelvey, specialises in investigations into organised crime, intellectual property offences, counterfeit goods, human trafficking, modern slavery, and retail crime. It is structured into specialist operational units, including covert surveillance, major crime investigations, retail crime investigations, illicit drugs, tobacco and luxury goods teams, and disclosure and case preparation teams.

[38]The papers filed for this appeal include a copy (undated and without any citation, although it would appear to date from early 2021) of a ruling of Her Honour Judge Deborah Taylor in R (TM Eye Ltd) v Abdullah, in which, among other decisions, she refused applications to stay, as abuses of process, prosecutions brought by the Appellant. In her ruling, HHJ Taylor summarised evidence given in that case by Mr McKelvey and his colleague Mr Hobbs, a senior investigator.

[39]At the time of HHJ Taylor’s ruling, the prosecutions undertaken by the Appellant all concerned offences relating to alleged counterfeit luxury goods. According to the evidence of Mr McKelvey in this case the Appellant has, since 2022, also brought private criminal prosecutions for retail crime, burglary and pickpocketing offences where the police and the Crown Prosecution Service have refused to do so or have not done so.

[40]Notably, Mr Hobbs in Abdullah gave evidence to the effect that where the Appellant, as a private prosecutor, received costs from central funds, the Appellant would claim hourly rates of £118 and £89 an hour, depending on the tasks performed, against which the NTT would “invariably” allow £89 and £32 an hour, which combined with disallowances and reductions of claimed time resulted in an average recovery of 19.6% of claimed costs, between £750 and £3,200 plus VAT for each case. Mr McKelvey stated that the determinations of such applications over the years 2017-19 had rarely led to recovery of more than 20% of claimed costs.

[41]Mr Hobbs described the Appellant’s “luxury goods operation” as primarily non-profit making, generating other opportunities in the private and corporate sectors that are potentially profit-making. On the evidence presented to me on this appeal (addressed in more detail below), it seems that the Appellant’s retail crime, burglary and pickpocketing prosecutions are, similarly, unprofitable.

[42]I should mention that HHJ Taylor concluded, from the fact that 80% of the costs claimed by the Appellant were not awarded on assessment, that the Appellant was claiming excessive costs. That conclusion necessarily rested on the proposition that the Appellant’s costs were normally assessed at reasonably sufficient sums to compensate the Appellant for expenses properly incurred in the prosecutions. That proposition is very much in contention on this appeal.

The Prosecutions

[43]Dean Hall was charged with three offences of theft by shoplifting from Fortnum & Mason, Piccadilly, on three separate occasions. He had been apprehended by store security on the third occasion. TM Eye subsequently reviewed the CCTV and bodycam footage of the thefts and undertook the private prosecution.

[44]The total value of the goods stolen was £535.80. Hall pleaded guilty and was committed to the Crown Court at Snaresbrook for sentencing, where a sentence of 22 weeks imprisonment, suspended for 18 months, was imposed.

The Determining Officer’s Written Reasons

[45]Florentina Radu and Carmen Tedorescu were charged with selling counterfeit tobacco products. Investigating TM Eye employees made four test purchases between 19 January 2021 and 10 February 2021 via a private selling page on Facebook. A TM Eye operative met with the defendants on 19 and 26 January 2021 to complete two £50 purchases, and on 1 and 10 February 2021 to make two more purchases to the value of £40 and £50 respectively. The purchases were video recorded. Following a four-day trial at the Crown Court at Snaresbrook, both defendants were acquitted of all charges. The Determining Officer’s Written Reasons In accordance with regulation 9 of the 1986 Regulations, the Appellant requested from the Determining Officer a redetermination and then written reasons for the decisions made in both cases. The Determining Officer’s written reasons are, of necessity, similar in each case.

The Determining Officer’s Written Reasons: Similar Cases

[46]The Determining Officer’s written reasons refer to three prior costs judge decisions: TM Eye Ltd v Singh (SCCO 443/14, 20 October 2015, Master Simons); TM Eye Ltd v Smethurst & others (SCCO 137/17, 26 April 2018, Judge Whalan) and R (TM Eye Ltd) v(1) Pama & Co Ltd

(2) Original Edge accessories Ltd

(3) Enus (SCCO 239/19 and 240/19, 26 February 2021). All three cases concerned counterfeit goods.

[47]In TM Eye Ltd v Singh the defendant was selling counterfeit goods in a public market. The Appellant’s investigators made three test purchases before instituting proceedings in conjunction with Trading Standards. They also undertook surveillance to establish the defendant’s home address and where the counterfeit goods were stored.

[48]The Appellant claimed for investigative work at £89 per hour. The Determining Officer allowed that for some of the work, but not for test purchases or surveillance work, taking the view that such operations were not "complex technical investigations" but rather were activities routinely performed, or more reasonably carried cut, by enquiry agents. For that work, the Determining Officer awarded an hourly rate of £32.

[49]The Appellant argued that surveillance and test purchase work was routinely performed by highly trained professionals and that it was necessary for those undertaking such work to be trained so as to avoid risks for their own safety, to avoid detection and to ensure that the investigative work was carried out in accordance with the law, avoiding the risk of entrapment. Further, costs purchase activity and surveillance activity can often be dangerous, dealing with unpredictable and volatile criminals who are aware of enforcement tactics and techniques and are naturally suspicious of new customers.

[50]This argument (perhaps unsurprisingly, given that the defendant was selling from a market stall) did not find favour with Judge Simons, who upheld the Determining Officer’s decision. He also rejected the submission that TM Eye Ltd v Singh was a test case, pointing out (as I have done above) that every case has to be judged on its own merits. Whilst some work undertaken by private prosecutors might well be highly specialised, meriting a higher hourly charging rate, TM Eye Ltd v Singh was not such a case.

[51]In TM Eye Ltd v Smethurst & others goods were sold through online platforms linked to a closed Facebook group. The Appellant’s investigators created online pseudonymous profiles to develop online friendships with the defendants. Having built relationships with the defendants, the operatives were able to buy counterfeit goods online before collecting them from the defendants' home addresses. 13 test purchases were made before a successful prosecution was initiated.

[52]The Appellant sought hourly rates of £89 for undercover work and surveillance, £118 for risk assessments, RIPA (Regulation of Investigatory Powers Act) applications, witness statements and compilation of transcripts, and £161 for attendance at court by its managing director, Mr McKelvey.

[53]An hourly rate of £32 had been awarded for undercover work and surveillance. Judge Whalan, rejecting the contention that undercover and surveillance work should in every case qualify for a higher hourly rate, agreed with Judge Simons’ case-specific approach but took the view that there was a significant, qualitative difference between test-purchasing an anonymous sale in a public market, and the far more complex task of engaging with security-conscious defendants who traded via a closed Facebook group. The Appellant’s investigators had had to build up relationships of trust with the defendants before collecting counterfeit goods from their home addresses. That was not, in his view, work akin to that of an enquiry agent or investigator, because it involved work of greater complexity, technical sophistication and, potentially, risk.

[54]Judge Whalan, accordingly, awarded the rate of £89 per hour sought by the Appellant for all work (including Mr McKelvey’s attendance at court) except preparation of the prosecution file, for which he allowed the claimed rate of £118 per hour, noting that such work had been paid for at that rate by Determining Officers in seven other cases.

[55]In R (TM Eye Ltd) v Pama, one of many issues considered by Judge Whalan was the hourly rate awarded to the Appellant for investigative work in relation to one of the defendants (Original Edge Accessories Ltd). The Determining Officer had allowed an hourly rate of £32. The Appellant sought an hourly rate of £118 for a “senior investigator” and an “undercover operative”.

[56]The Appellant had been instructed by Apple Inc. to carry out undercover investigations into Original Edge. Apple was concerned that Original Edge, a wholesale and retail online company settling mobile telephone accessories was involved in the mass distribution of dangerous counterfeit Apple merchandise. The Appellant used online, pseudonymous covert accounts to build a rapport with Original Edge by e-mail and WhatsApp to purchase significant quantities of Apple stock, later found to be counterfeit. The work included building a rapport with the director of Original Edge.

[57]The Determining Officer, relying upon TM Eye Ltd v Singh, had allowed £32 per hour for the Appellant’s undercover investigative work. As in TM Eye Ltd v Smethurst & others, and for much the same reasons, Judge Whalan allowed an hourly rate of £89 per hour for such work, but not the full hourly rate of £118 claimed by the Appellant except in respect of work undertaken by Mr McKelvey in assessing the claim and determining whether there was a legal and public interest basis to pursue a private prosecution. He considered that to be the same sort of work that he allowed at £118 in Smethurst. As in Smethurst, he did not award a higher hourly rate of £161 claimed by Mr McKelvey as managing director.

The Determining Officer’s Written Reasons: These Cases

[58]The Determining Officer took into account a report dated 20 July 2023 which had been prepared by Mr Strickland, the advocate for the Appellant on this appeal, the purpose of which was to put forward hourly rates that would (on the Appellant’s case) allow the Appellant to undertake private prosecution work at a profit, rather than at a loss. I will consider the content of that report when I address the evidence filed in support of this appeal by the Appellant.

[59]The Determining Officer’s view was that as section 17 is compensatory in nature, it was not incumbent upon her to “allow hourly rates by reference to the level that is necessary to enable a company to make a profit from a business model that relies solely on cost recovery from central funds”.

[60]For that reason, and because the appendices containing the information upon which Mr Strickland’s conclusions were based were not included with his report, it is evident that the Determining Officer found it of little assistance (although she had, on redetermination, offered to reconsider it if a complete copy were to be supplied).

[61]The Determining Officer also observed that she had been supplied with no evidence of market rates that that might demonstrate that the hourly rates she had allowed were out of step with the prevailing market. In that context she referred to “rates charged by those conducting similar work to TM Eye such as security guards, environmental protection officers and private investigators…” and rejected comparisons with the hourly rates awarded to solicitors in private prosecutions.

[62]I should refer to the following extract from the Determining Officer’s written reasons in both cases, which underpinned her award of £89 per hour for investigations generally, and £32 for travel:

“The current legal aid rate for an enquiry agent is £29/hour outside London and £21/hour inside London. However, one must bear in mind that the work undertaken by the private prosecutor, whilst similar in some respects to that of an enquiry agent, is not directly comparable and, as in this case, includes the consideration and preparation of evidence and attending court in support of counsel.”

[63]The Determining Officer appears to have concluded that in TM Eye Ltd v Smethurst & others, Judge Whalan upheld a rate of £32 per hour for travel: I can find nothing to that effect in his judgment (although he did allow that rate for the preparation of transcripts). The Determining Officer explained however that she did not consider it reasonable for travel to attract the same hourly rate as preparation. She distinguished between the preparation of a case and travel (including travel to collect goods purchased online) and between attending court in support of counsel and merely travelling to court. Travel by itself does not, she observed, require any knowledge of the case or any expertise. Whilst recoverable, she concluded that travel time should not be treated as case preparation.

[64]One of the fundamental points made by the Determining Officer was that the cases of Dean Hall, Florentina Radu and Carmen Tedorescu did not feature the degree of complexity and other key characteristics that underpinned the conclusions of Judge Whalan in TM Eye Ltd v Smethurst and R (TM Eye Ltd) v Pama (a prosecution for offences that could have had serious consequences for public safety and involved an undercover investigation, the instruction of technical experts and meetings with Trading Standards). Nor did the nature of the work, in her view, justify any enhancement to the hourly rates awarded to work done by the Appellant’s CEO.

The Grounds of Appeal

[65]The Appellant submits that in all assessments of its cases seem to be awarded at hourly rates of £32 per hour for travel and test purchases and £89 per hour for all other work and occasionally (but rarely) at £118 per hour, apparently based on the costs judge decisions to which I have referred.

[66]Those rates, says the Appellant, are unreasonably low. They are unsustainable and should be materially increased. They are out of date and give no allowance for significant inflation pressures over the period, during which the published SCCO Guideline Hourly Rates for the summary assessment of solicitors’ fees (“the GHRs”) have been increased twice. They are not sufficient to remunerate the prosecutor for work done, in consequence of which the Appellant is making a loss.

[67]Insufficient regard is being given by the LAA to the lower cost overall to the public purse per prosecution conducted by the Appellant, compared to the cost of having the same investigation conducted by a public body such as the Metropolitan Police, and to the importance of the Appellant’s work to the wider public.

[68]The LAA fails to recognise that just because a crime might relate (for example) to counterfeit goods, it does not absolve the fee earners of the complexities of conducting a thorough investigation. Insufficient regard is given by the LAA to the level of skill, effort, specialised knowledge and responsibility of the fee earners involved, the high conviction rate of the Appellant compared to public authorities, and the resulting public benefit.

[69]Similarly, says the Appellant, insufficient regard is being given to the speed and efficiency with which investigations and prosecutions are being conducted by the Appellant, with cases taken from investigation to conviction in a matter of months, and the totality of time spent by the firm often being lower than a matter of weeks.

[70]The LAA also appears to draw an artificial distinction between the necessary and required work of the Appellant and the work of solicitors.

Evidence In Support of the Appeal

[71]The Appellant relies upon two witness statements: that of Mr McKelvey, and a statement dated 11 July 2025 from Mr Paul Conway, the Appellant’s accountant. The Appellant also refers to the contents of Mr Strickland’s report of 20 July 2023.

Mr McKelvey’s Evidence

[72]Much of Mr McKelvey’s evidence comprises argument, which has no place in a witness statement and which I will address, in so far as appropriate, when I come to the Appellant’s submissions. He also addresses the evidence produced by both parties on comparables. I will deal with that separately.

[73]Mr McKelvey offers a brief summary of his policing career, which appears to have been exemplary. In support of the proposition that the Appellant performs a vital role in prosecuting criminal wrongdoing in the absence of public authorities (such as the police) where certain crimes, such as theft and shoplifting, are at crisis levels, he refers to the exceptional conviction rate achieved by the Appellant.

[74]The Appellant is, says Mr McKelvey, unique in operating the only dedicated covert undercover unit in the United Kingdom, outside of law enforcement. The Appellant employs highly trained individuals, including former police investigators across the country and internationally. All investigations are, he says, conducted in accordance with the highest standards of evidence gathering, compliant with the Police and Criminal Evidence Act 1984 (PACE) and the principles set out in the 2014 Home Office Code of Practice: Covert Surveillance and Property Interference.

[75]This is, he says, vital in securing the Appellant’s high conviction rate and maintaining confidence in the service it provides. In conjunction with its sister company, “My Local Bobby”, the Appellant has, says Mr McKelvey, been highly successful in reducing crime and anti-social behaviour across all the areas that it operates. The use of private criminal prosecutions has been an essential and integral key to reducing crime in those areas. Even “everyday” crimes such as persistent shoplifting and the production and sale of counterfeit goods, which the police often cannot or will not take on due to resource constraints, remain deeply damaging to the communities affected, resulting in substantial losses to public and private individuals and businesses.

[76]Mr McKelvey has more to say about the social and financial cost of shoplifting offences and the huge human and financial cost and dangers to the public presented by systemic counterfeiting (including, for example, medicines and defective counterfeit electrical goods). I need not repeat that detailed evidence here, but all of it strikes me as perfectly cogent. He emphasises the importance of intelligence-led enforcement, inter-agency collaboration, and a legal framework that supports timely and effective prosecutions. The Appellant’s private prosecutions have he says proven uniquely successful in this context, securing convictions where public enforcement has often lacked the resources to act or has not prioritised effective action.

[77]The Appellant, says Mr McKelvey, employs professional investigating officers to build its cases. Many are former detectives, ex-police officers, or individuals with extensive law enforcement experience. To deliver evidence to the standard required for criminal prosecutions they must undergo continual specialist training covering disclosure, evidence handling, PACE compliance, court procedure, digital evidence, and safeguarding. This training is costly, rigorous, and essential to successful prosecutions.

[78]Mr McKelvey states that the individuals behind counterfeit goods operations are frequently linked to serious organised crime groups. They are international, structured, and violent networks that use counterfeiting to launder money, fund other criminal activity, and corrupt public institutions. The Appellant’s operatives have been threatened, followed, and in some cases assaulted. They are undertaking frontline criminal justice work.

[79]Mr McKelvey complains that the rates awarded by the NTT, and subsequently the CCU, have not increased since 2011, which is causing the Appellant to suffer substantial and unsustainable losses. Claims are consistently assessed at less than 25% of the amount sought.

Mr Conway’s Evidence

[80]Mr Conway is the Appellant’s accountant. His role, as he describes it, is that of a quasi-financial director, producing detailed monthly management accounts, assisting in day-to-day financial decisions and contributing to other major business decisions.

[81]Mr Conway confirms that the Appellant derives its income from conducting private investigations, together with prosecutions of criminal wrongdoing. He says that it became apparent in 2021 that the Appellant’s operations were being severely impacted by the approach taken by the NTT and CCU to the Appellant’s claims for costs in respect of its private prosecution work, in particular in not increasing recoverable hourly rates since 2011.

[82]Over this 14-year period, he says, according to the Bank of England’s website, a rate of £89 per hour, increased in line with inflation, would be £131.88. Applying the Royal London Consumer Prices Index (“CPI”) would take that rate to £134.91, and applying the Royal London RPI index would take it to £156.59. Appendices to his witness statement appear to support these calculations.

[83]Mr Conway states that the average paid to the Appellant per private prosecution between 1 April 2023 and 31 March 2025 was £2492.19 per case. In the accounting year 2019, and the two preceding years, the amount paid per case was, on average, £15,000 per case. Whilst not ideal, given the amount of the overheads borne by the Appellant, this was manageable and meant that the Appellant was profitable.

[84]Due to steadily worse recoveries since 2019, the Appellant sustained a loss of £77,822 in 2021 and made a small profit of £19,670 in 2022. Accounts exhibited to his witness statement show substantial losses for 2023 and 2024. He projects a loss for the Appellant’s criminal prosecutions division, for 2025, of £276,781. During the years to 2024, he says, no payments were made to Mr McKelvey, either as director’s fees or by way of dividend.

[85]From analysis of all costs recoveries over the recent years it is clear, says Mr Conway, that the CCU are “crucifying” the costs claims of TM Eye cases resulting in less than a 20% recovery of costs in the vast majority of submissions.

Mr Strickland’s Report of 20 July 2023

[86]I emphasise that Mr Strickland’s report is not presented to the court as an independent expert report, although Mr Strickland says he has approached the exercise as if it were, in particular in attempting to present an objective, unbiased opinion regardless of any obligation to his client.

[87]Mr Strickland’s key point is that the Appellant has, over the years, continued to claim costs at rates consistent with those which Determining Officers and costs judges, historically, have awarded. Those rates are based upon the Appellant’s running costs between 2008 and 2012. They have effectively become fixed, claimed because they are the rates awarded and awarded (if not reduced) because they are the rates claimed. They are he says demonstrably too low: the hourly rate of £32 per hour allowed for travel, for example, is akin to a legal aid rate.

[88]Mr Strickland offers three ways of calculating an appropriate hourly rate. The first is to prepare an “expense of time” calculation akin to that traditionally used to identify the hourly cost of running a solicitor’s practice, before allowing an appropriate element of profit for the work done, sufficient to allow the solicitor’s practice to be a going concern.

[89]That, along with consideration of the market for the services offered by the Appellant, is the stated basis upon which Mr Strickland has recommended that the Appellant claim the hourly rates set out in the table at paragraph 4 above. Those rates are, he says, within or less than the broad range of other specialist providers within the Appellant’s field.

[90]The detailed calculations behind Mr Strickland’s cost of time calculation are not appended to the report, being (in common with many of the other appendices to his report) withheld as commercially sensitive, but he produces comparative “notional hourly rates” for the Metropolitan Police which, he says, are readily comparable to those claimed by the Appellant (although this does not seem to me to be true of the highest rates proposed by the Appellant).

[91]Mr Strickland’s second approach is simply to allow for inflation since 2020, which by his calculation, by reference to the Retail Prices Index (“RPI”), would bring a rate of £89 per hour up to £149 and a rate of £118 up to £198.

[92]Mr Strickland’s third method is to consider the market, both for the particular services provided by the Appellant and for other service providers. The former market produces, he says, figures of between £115 and £375 per hour (and up to £1,200 per hour for investigations within a “multidisciplinary firm”) depending upon seniority. The organisations referred to are anonymised.

[93]By “other service providers” Mr Strickland refers to “legal service “providers” (lawyers, accountants and multi-disciplinary firms).

[94]One of the appendices to Mr Strickland’s report that is not withheld as confidential is an undated briefing note from Mr McKelvey, apparently submitted to the LAA following directions from District Judge Lucie in a case called R (TM Eye Ltd) v Sanlii, which appears to have been another counterfeiting prosecution. The purpose of the note appears to have been to address a request for a claim based only upon the costs to the Appellant of undertaking a private prosecution, without any element of profit.

[95]Mr McKelvey’s response, in short, was that the Appellant (employing a small permanent core staff and subcontracting to undercover operatives, surveillance experts and specialist investigators) did not make a profit in pursuing counterfeiting prosecutions, and where costs were not paid as claimed, would make a loss. Mr McKelvey, according to the note, did not take a salary or dividend and subsidised the Appellant from his own money.

The Respondent’s Evidence

[96]I have (in substance) two witness statements from the LAA on behalf of the Respondent. They are both from Kath Burdett, head of the CCU and National Taxing Director. Her first statement, dated 20 May 2025, was revised and updated on 5 June 2025. Her second is dated 8 July 2025.

[97]Notably, Ms Burdett confirms that since Judge Whalan gave his decision in R (TM Eye Ltd) v Pama, the CCU has paid the Appellant £118 per hour for “Director/complex” work, £89 per hour for investigative work and £32 per hour for travel and waiting. This confirms that the Appellant has received precisely the same hourly rates for the same categories of work since 2021, and at least by implication supports the Appellant’s evidence to the effect that, before R (TM Eye Ltd) v Pama, the Appellant was receiving lower, in effect “fixed” rates, of either £89 or £32 per hour.

[98]According to Ms Burdett’s evidence, in the year to 31 March 2024 the Appellant was the prosecutor in 62% of the claims submitted to the CCU, and that in that year the Appellant was paid a total of £806,911.09, being 8.4% of a total spend on private prosecutions of £9,836,000 (I make the figure 8.2%).

[99]The rest of Ms Burdett’s evidence focuses upon her attempts to obtain comparable rates by reference to which one might gauge the reasonableness of the hourly rates sought by the Appellant. She states that (having, as is evident from her statement, made or authorised a number of enquiries) she was unable to find evidence that the rates authorised by Judge Whalan in R (TM Eye Ltd) v Pama are not representative of the prevailing market rate now.

[100]Before I look at the evidence on comparables, I need to address the parties’ submissions in relation to the Appellant’s profitability.

Whether the Appellant is Entitled to Earn a Profit

[101]Mr Clarke argues that it was not the objective of the 1985 Act to introduce private prosecutions for profit, and that a private prosecutor may not claim a profit from central funds for bringing a prosecution. He refers me to authorities on statutory interpretation including R(O) v Secretary of State for the Home Department

[2023] AC 255

and Pepper v Hart

[1993] AC 593

[102]Mr Clarke submits, by reference to those authorities, that the primary source by which a meaning of a statute is to be ascertained is the actual words Parliament has chosen to use, read in context. He points to the plain wording of section 17 of the 1985 Act, which provides for the prosecutor to receive an amount reasonably sufficient to compensate the prosecutor for any expenses properly incurred in the proceedings. That wording, he says, is clear, unambiguous and does not produce absurdity. A notional profit margin upon prosecution costs is not an expense that has been occurred, and its recovery would violate the indemnity principle.

[103]That interpretation is supported by the drafting of regulation 7 in the 1986 Regulations, which provides at subparagraph 7(4) that the costs awarded to the prosecutor shall not exceed the costs actually incurred.

[104]Other costs provisions of the 1985 Act, being differently worded, are of limited assistance, but Mr Clarke refers to the judgment of Hickenbottom J in Evans v Serious Fraud Office

[2015] EWHC 1525 (QB)

on costs awards under section 19 of the 1985 Act (costs incurred as a result of an unnecessary or improper act or omission by another party) and the emphasis, at paragraph 20(iv) of that judgment, upon the need for the judge being satisfied that the amounts claimed do not offend the indemnity principle.

[105]None of this, Mr Clarke emphasises, prevents the recovery of a normal profit component within the cost of external legal services paid for by the prosecutor. Nor (other than where it would clearly breach the indemnity principle) does it prevent the recovery by a prosecutor of employee costs quantified by reference to Re Eastwood (Deceased)

[1975] Ch 112

, discussed in more detail below.

[106]The Appellant is however in much the same position as would, for example, a retailer undertaking the prosecution of a shoplifter, or a fashion house undertaking the prosecution of a counterfeiter: such prosecutors may only recover an indemnity for expenses properly incurred. The 1985 Act does not enable them to profit from a prosecution.

[107]Mr Strickland argues for a purposive interpretation of section 17, which would enable the Appellant to conduct its business, in the usual way, at a reasonable profit. He refers to the judgment of Davis LJ in Mirchandani v Lord Chancellor

[2020] EWCA Civ 1260

, in which the court rejected the interpretation of section 17 of the 1985 act which would exclude the court’s power to make a section 17 order in respect of High Court enforcement proceedings. Davis LJ, at paragraph 81 of his judgment, referred to:

“ …the policy reasons why provisions governing payment to a private prosecutor may be more favourable than those applying to a defendant: namely, a desire not to deter private prosecutions…”

[108]Similarly, in R v Dudley Magistrates Court Ex P Hollis

[1999] 1 WLR 642

, the court rejected an interpretation of section 82(12) of the Environmental Protection Act 1990 to the effect that the court’s power under that section to “pay compensation to the complainant for any “expenses properly incurred by him in the proceedings” was limited to the costs of preparation for and attendance at a hearing, and did not extend to the cost of proving the existence of a statutory nuisance, or of complying with the statutory requirements attendant on making a complaint.

[109]Mr Strickland also refers to R v Burt Ex P Presburg [1960 1 QB 625 in which the court rejected an interpretation of the word “costs” which would confine it only to disbursements and expenses, and which would exclude the recovery of costs of salaried employees. Even if only the cost of time is recoverable, then in line with Re Eastwood, the court should allow reasonable hourly rate by reference to the cost of obtaining the same services from external contractor.

[110]Otherwise, Mr Strickland submits, the approach advocated by the Respondent would be unworkable. It would create an artificial, illogical difference between the basis upon which a corporate prosecutor like the Appellant is remunerated, compared to solicitors (including public sector solicitors acting for, for example, HMRC, who tend to be remunerated at the GHRs); it would destroy the market in which the Appellant operates; and it would prevent the Appellant from rendering a valuable public service.

[111]In Re Eastwood a Taxing Master, on assessing the costs recoverable for work undertaken by the Treasury Solicitor on behalf of the Crown, had excluded from the Treasury Solicitor’s recoverable hourly rate what would, in an independent solicitor’s bill of costs, have represented the profit element (the “B factor”) on the cost of undertaking the work (the “A factor”). As Russell LJ put it (at 130 G et seq):

“It was the view of the taxing master that, since there was no element of solicitor's profit in cases such as the present, item B was not allowable: for otherwise the party would be making a profit, contrary to the well-established principle that taxed costs should not be more than an indemnity… In our view, the fallacy underlying the refusal of the taxing master to allow what is referred to as B lies in this: that if you embark on an A B exercise, in which A is really meaningless unless accompanied by B, you cannot stop short with A above. If it were, because it is not a case of an independent solicitor, inappropriate to use the A B exercise at all, some quite different exercise would be called for. Moreover, the method adopted assumes that it costs a party less to engage in litigation when he employs his own salaried solicitor and legal department than if he instructs an independent solicitor to act for him, simply because the independent solicitor makes a personal profit out of the litigation. On that last point an example was given in the course of debate. Suppose a solicitor in independent practice with an assistant solicitor, two legal executives, clerks and typists and other overheads, who in year 1 works in fact exclusively for corporation X. For year 2 it is arranged that his whole office and staff is taken over as a department of corporation X, the solicitor also becoming an employee of the corporation at a salary commensurate with the profit made by him in year 1 doing the corporation's legal work. Suppose that in year 1 the corporation was successful in a piece of litigation in which in fact one of the legal executives did all the work: in taxing the corporation's costs the taxing master would apply the A and B conventional method and the figure for the discretionary item would be £75. Suppose in year 2 the corporation is successful in exactly comparable litigation, again with the legal executive doing the work: if the method of taxation adopted in this case were followed, only A (£45) would be allowed for the item, though the change would not have effected any saving to the corporation, who, instead of paying the profit to the solicitor in respect of that litigation, would have paid to him the equivalent in the form of a proportion of his salary. This example seems to us to demonstrate that there must be something wrong in an approach which uses only the A of the A B conventional method in the case of an employed solicitor… It was contended before us that in any event there was an onus upon the party with its own legal department to produce figures to demonstrate that the operations and expenses of that department, analysed and broken down and apportioned, would throw up a figure properly attributable to the litigation in question which would be not less than the figure of reasonable costs to be allowed had it been a case of the use of an independent solicitor. In the first place, we should have thought it a perfectly sensible presumption as a starting point that it would not be less. Secondly, we view with horror the immensity of the complication which would be introduced into an already complicated system of taxation… In summary, therefore, in our opinion. (1) It is the proper method of taxation of a bill in a case of this sort to deal with it as though it were the bill of an independent solicitor, assessing accordingly the reasonable and fair amount of a discretionary item such as this, having regard to all the circumstances of the case. (2) There is no reason to suppose that the conventional A B method is other than appropriate to the case of both independent and employed solicitor. (3) It is a sensible and reasonable presumption that the figure arrived at on this basis will not infringe the principle that the taxed costs should not be more than an indemnity to the party against the expense to which he has been put in the litigation. (4) There may be special cases in which it appears reasonably plain that that principle will be infringed if the method of taxation appropriate to an independent solicitor's bill is entirely applied: but it would be impracticable and wrong in all cases of an employed solicitor to require a total exposition and breakdown of the activities and expenses of the department with a view to ensuring that the principle is not infringed, and it is doubtful, to say the least, whether by any method certainty on the point could be reached. To adapt a passage from the judgment of Stirling J. in In re Doody [1893] 1 Ch. 129 , 137, to make the taxation depend on such a requirement would, as it seems to us, simply be to introduce a rule unworkable in practice and to push abstract principle to a point at which it ceases to give results consistent with justice.”

[112]In my view, Mr Clarke’s interpretation of section 17 of the 1985 Act must be the correct one. The wording of the section is clear. Its stated purpose is purely compensatory.

[113]I do not however believe that this gives rise to the problems envisaged by Mr Strickland, for these reasons.

[114]To understand the true cost of undertaking investigations and private prosecutions one must include all overheads, not just the direct costs of employment (an approach accepted by Master Rogers in FACT v Broomhall and Others [2007] 4 Costs LR 640 and, I would suggest, self-evidently correct).

[115]Re Eastwood demonstrates that there is no reason to assume that there is any real difference between the costs recoverable by a party engaging external services for a fee, and the costs recoverable by a party who receives the same services from employees. What would in the first instance be recoverable as the profit element payable to an external supplier is in the second instance recoverable as part of the overhead in respect of which the employer is entitled to an indemnity.

[116]The Appellant is a corporate entity. In calculating such amount as is reasonably sufficient to compensate the Appellant for any expenses properly incurred by it in the proceedings the starting point would be that the amount payable should be sufficient to cover all of its normal operating costs of undertaking the prosecution. Those costs will include, of necessity, not only the sums it pays to independent agents but its day to day operating costs in the normal course of business. Otherwise, the Appellant will be undertaking the work at a loss, and the compensation received by the Appellant will not be reasonably sufficient.

[117]Those day to day costs will include remuneration to Mr McKelvey, the Appellant’s sole and managing director. There is no breach of the compensatory or indemnity principles in the Appellant receiving remuneration for the provision of services which is sufficient to allow it to offer appropriate remuneration to its managing director.

[118]What has been described in this case as “profit” seems to me to be no more than a reference to remuneration to Mr McKelvey, the Appellant’s sole director and controlling shareholder (who to date, on the evidence, has received none).

[119]As in Re Eastwood, it is not appropriate to undertake some sort of elaborate accounting exercise to ensure that the Appellant is undertaking its prosecution work at neither a profit nor a loss, nor to enquire into the manner or amount of Mr McKelvey’s remuneration. The award of costs in line with market rates should eliminate any danger of excessive remuneration.

[120]If nonetheless (again adopting the Re Eastwood approach) it appears reasonably plain that to award a claimed hourly rate to the Appellant would go beyond reasonable compensation for expenses incurred it might be necessary to make further enquiry into such matters, but not otherwise.

[121]My conclusion, in summary, is that having identified what appear to be reasonable hourly rates for the work undertaken by the Appellant in any given case, there is no occasion for the court to make further enquiry as to whether any part of that rate might represent a “profit” element.

Market Comparables: the Evidence

[122]The best means of providing the court with reliable market evidence, by reference to which one might be able to identify hourly rates reasonably sufficient to compensate the Appellant, would be an independent expert report illustrating the extent to which the hourly rates sought by and awarded to other private prosecutors are properly comparable to those sought by the Appellant.

[123]I do not have such evidence. I mean no criticism when I say that it seems to me that Mr Strickland’s report on the one hand, and Ms Burdett’s evidence on the other, are inevitably influenced by their understandable desire that the outcome of this appeal should be that preferred by the party they represent. Each produces figures which they say supports that party’s position.

[124]Some of Ms Burdett’s evidence has no bearing at all upon the hourly rates which are the subject of this appeal. I appreciate that the Appellant is presenting this court with hourly rates which, it says, should apply to all of its work, and that Ms Burdett may have felt it necessary to respond in kind. For reasons that I have given, however, the only issues before me are whether the Appellant, in two individual cases, should receive more than £89 per hour for its investigatory work and prosecution work, and £32 per hour for travel.

[125]Accordingly, whilst it may well be the case (as Ms Burdett’s evidence suggests) that hourly rates are being advertised for store security guards in London at less than the national minimum wage, that seems to me to have no real bearing upon the right hourly rates for the work which is the subject of this appeal. Nor, in my view, are the hourly rates or salaries paid by the Financial Conduct Authority to investigators and litigation support workers.

[126]Similarly I find the rates charged by a supplier of labour for making test purchases of no real evidential value, at least without some understanding of the context in which such purchases are made, nor the rather piecemeal information gleaned by Ms Burdett as to the hourly rates advertised by sundry private investigators for broadly defined investigatory work, all of which appear to be lower than the hourly rates already deemed appropriate by the Determining Officer for the Appellant’s investigatory and prosecution work in these two cases.

[127]Ms Burdett has also produced evidence of the hourly rates claimed by public authorities. They include the hourly rates which Ms Burdett says are claimed by Oxford City Council, under court orders, for its Trading Standards Officers.

[128]I approach this evidence with some caution, given that subsections 17(2) and 17(6) expressly exclude prosecution costs awards to public authorities. It may be that the rates referred to are claimed when costs were awarded against defendants under section 18, which provides that where a defendant is convicted in the magistrates’ Court, “ the court may make such order as to the costs to be paid by the accused to the prosecutor as it considers just and reasonable”. Those criteria differ from section 17: the means of the defendant, for example, may be pertinent to such a decision. It may also be that the rates referred to extend to costs claimed in connection with civil enforcement orders, which, again, a different context.

[129]In any event, the Oxford rates referred to generally appear to be lower than those awarded to the Appellant in this and other cases, but I have no idea of how they are formulated: for example whether they represent the actual cost to Oxford City Council of undertaking prosecutions, or only the sort of rates that Oxford City Council would expect to recover. Mr McKelvey makes the point that Oxford City Council appears to undertake a quite limited number of Trading Standards prosecutions and compares the City of Westminster’s hourly rates of up to £109 (for a Trading Standards manager who reviews criminal cases and investigations).

[130]Similarly, figures appended to Ms Burdett’s statement concerning the hourly cost of police officers seem to me to have very limited if any bearing upon the costs of the investigations and prosecutions undertaken by the Appellant in these two cases. The figures in any event exclude overheads (other than pension and national insurance costs) and so are incomplete.

[131]Ms Burdett appends to her witness statement information compiled by the Association of Chief Trading Standards Officers which indicates that, across England and Wales between 2021 and 2022, local authorities would charge for their services, on a full cost recovery basis, anything between £31 and £118 per year, presumably depending upon who was doing the work, what the work was and where it was done. This is perhaps more to the point, but it is still vague. The figures have no real context.

[132]Mr McKelvey has more to say about the information on hourly rates offered by Ms Burdett but I do not think it necessary to repeat them.

[133]I do need however to address Mr McKelvey’s argument (echoing Mr Strickland’s comparison of the Appellant with firms offering legal services) that the majority recipients of the private prosecutions budget, predominantly solicitors’ firms “acting as quasi investigators”, would in fact constitute a more appropriate benchmark for assessing investigation costs.

[134]Many legal practitioners, paralegals and administrative staff, Mr McKelvey says, undertake investigatory functions despite lacking any policing experience, operational surveillance training, or investigative accreditation. They are nonetheless routinely compensated by the LAA at the full GHRs, often he says for work of considerably lower complexity or evidential value than that undertaken by the Appellant’s detectives. In contrast the Appellant’s highly trained former detectives, many with decades of policing and covert surveillance experience, are Mr McKelvey says routinely restricted to cost recoveries at less than the £40 per hour they are paid by the Appellant.

[135]I note that Grade D legal work has been claimed and awarded in these two cases at the 2021 and 2024 GHRs for outer London (albeit underclaimed by £1 per hour in the case of Hall).

[136]There are obvious objections to using the rates claimed by or awarded to solicitors’ firms as a measure of “market rates” by reference to which to judge the rates to be paid to the Appellant. They are not comparable businesses. The Grade D fee earners to whom he refers are working within an organisation authorised to undertake reserved activities under section 12 of the Legal Services Act 2007, and the hourly rates awarded for work done at all levels of seniority reflect that. Mr McKelvey may well believe that his operatives are at least as skilled as junior fee earners in a solicitor’s firm, but the Appellant is not in the same market.

[137]Much the same objection applies however to using as comparables the hourly rates claimed by public bodies such as local authorities, not least given that the Appellant undertakes prosecutions which public bodies cannot or will not undertake. Such bodies represent a different a different kind of organisation with different overheads, which cannot in any meaningful way be said to offer services in a competitive market, much less to be in direct competition with the Appellant.

[138]For the reasons I have given, I do not believe that either solicitors’ firms or public authorities (whether referred to by the Appellant or the Respondent) can offer truly comparable hourly rates for the purposes of this judgment.

[139]A much more obvious and valuable comparator would, I would suggest, be the hourly rates charged by private firms or companies which offer specialist services similar to those of the Appellant. Mr Clarke argues that the Claimant is in an unusual position, in accepting payment only from central funds under section 17 orders, but that is no bar to comparison with similar organisations that do not. Ms Burdett does not offer any examples. Mr Strickland in his July 2023 report offers a limited number of examples, but as the organisations in question are not identified and his figures are unsupported by any kind of useful evidence, that information is of no help to me.

[140]For those reasons, I do not find either party’s attempts at identifying comparable “market rates” to be of any assistance on this appeal.

Conclusions on the Appeal

[141]As I have observed, it appears to be the aim of the Appellant on this appeal to establish a fixed set of hourly rates, set by reference to seniority rather than activity, which it should recover for all prosecution work. For the reasons I have already given, that is not achievable. Every case has to be judged on its own merits, applying the statutory criteria to which I have referred. Hourly rates will be set by reference to the nature of the work undertaken.

[142]Mr Conway complains that recoveries under section 17 orders have significantly reduced since 2019, from an average £15,000 per case to an average of less than £2,500 per case. He attributes that to recent assessments by Determining Officers coming to less than 20% of claimed costs. According however to the evidence given by Mr McKelvey and Mr Hobbs to HHJ Taylor in R (TM Eye Ltd) v Abdullah, between 2017 and 2019 recoveries were rarely more than 20% of claimed costs (Mr McKelvey’s evidence) and recovery per case at the time (which would have been 2020) was approximately 19.6% of the costs claimed, at between £750 and £3,200 plus VAT (Mr Hobbs’ evidence).

[143]I am unable to reconcile Mr Conway’s evidence in this case with that of Mr McKelvey and Mr Hobbs in R (TM Eye Ltd) v Abdullah. Whatever the cause of the Appellant’s move from profit to loss over recent years, I can find no sound evidential basis for attributing it to a reduction in recoveries under section 17 orders in prosecution cases that form only a part of its overall business. In any event, it is not the responsibility of the CCU to ensure that the Appellant operates at a profit.

[144]The most pertinent part of the Appellant’s case is, however, that the hourly rates claimed and paid for its work have never varied from £89, £32 or (to a limited extent, since R (TM Eye Ltd) v Pama) £118. In that respect the Appellant’s evidence has been largely consistent, as well as consistent with the evidence of Ms Burdett.

[145]Turning to the two cases the subject of this appeal, Mr Strickland for the Appellant argues that the Determining Officer has not properly applied the assessment criteria set out at regulation 7 of the 1986 Regulations and Rule 45.2(7) of the Criminal Procedure Rules, in particular in failing to recognise the importance of the work undertaken by the Appellant and the skills involved. He also places some emphasis on the fact that the relevant criteria do not include proportionality as a criterion.

[146]I cannot accept Mr Strickland’s argument. The Appellant may of necessity bring the same set of skills to every case, large or small, complex or relatively simple, but the renumeration received must still be appropriate to the particular case and the amount of money involved in criminal activity is plainly one of the circumstances to be considered under regulation 7(2). The Determining Officer considered the circumstances of each of the two cases the subject of this appeal and concluded, rightly in my view, that neither was really comparable to R (TM Eye Ltd) v Pama.

[147]I do disagree however with her application of an £89 hourly rate unchanged since Master Simons’ decision in TM Eye Ltd v Singh, 15 years ago; with her refusal to allow a higher rate for the Mr McKelvey’s supervisory work; and with her award of £32 per hour for travel (a rate also unchanged since TM Eye Ltd v Singh).

[148]Starting with the allowance for travel, it is not appropriate (as the Determining Officer appears to have done) to use publicly funded comparators when assessing privately funded costs: see paragraph 25(i) of the judgment of Hickenbottom J in Evans v Serious Fraud Office. The Legal Aid rate for private investigators has no bearing on these appeals.

[149]I cannot see how an hourly rate for travel which is lower than the hourly rate paid by the Appellant to the investigator doing the travelling, could ever be said to represent reasonable remuneration to the Appellant. Further, it seems to me that, properly judged in context, the investigator’s travel was an inseparable part of the investigatory work for which a higher hourly rate was found to be appropriate, and that as such it should be remunerated at the same rate.

[150]The question then is the extent to which that higher rate of £89 should be adjusted. I have already given my reasons for rejecting the proposed comparables produced by the Respondent in an attempt to justify the proposition that the cost of conducting the sort of investigations and prosecutions undertaken by the Appellant is no greater than it was in 2015. That proposition seems to me to be inherently unlikely: whilst changes to overheads over time will vary between different businesses, no business is inflation-proof.

[151]There must, in consequence, be some increase to the £89 rate to reflect the passage of time. This leaves two questions. The first is: what is the appropriate period by reference to which the increase should be calculated? The second is: on what basis should the adjustment be made?

[152]The Appellant’s case on that first question is not quite consistent. I have difficulty in understanding, for example, how a rate that is said not to have changed since 2011 could have been based upon the Appellant’s operating costs to 2012: in fact, according to Mr McKelvey’s evidence in R (TM Eye Ltd) v Abdullah, the Appellant’s decision to undertake private prosecutions in counterfeiting cases was taken in 2013, in which case the Appellant could not have been receiving any sort of costs orders for that work in 2011, and probably received few if any until 2014.

[153]For those reasons I take as my starting point 2015, the year when TM Eye Ltd v Singh was decided. The endpoint would be 2023, when the work in those two cases was completed.

[154]As to the measure by which any increase in the costs of providing the sort of services offered by the Appellant since 2015 can be identified, Mr Clarke reminds me of the observation of Lord Dyson MR, in 2014, to the effect that a revision of the 2010 GHRs based on inflation alone would have been arbitrary.

[155]That observation was however made in anticipation of some more satisfactory measure being forthcoming for increases in rates that had not been revised since 2010. The eventual answer came in the form of the revised 2021 GHRs, but that revision was based on criteria specific to solicitors’ practices, which I have found not to be truly comparable businesses.

[156]It seems to me, in consequence, that the fairest solution for the purposes of this appeal is to make a broad-brush, inflation-based adjustment to rates that have not changed over at least 10 years.

[157]£89, according to the Bank of England’s inflation calculator (based on the CPI), would between 2015 and 2023 have increased to £117.66.

[158]I cannot know the precise extent to which that figure offers an appropriate adjustment to reflect the increased cost to business like the Appellant’s, over that period, of undertaking investigations and prosecutions. Again, this is something that might best be addressed by independent expert evidence.

[159]Without such evidence, I am left with the likelihood that that such cost has increased substantially over 8 years, but with no precise measure. Because, in accordance with regulation 7(3) of the 1986 Regulations, I must resolve the element of doubt in favour of the paying party, I have adopted an increase of 20%.

[160]That is, as I have said, a broad-brush figure but as a cross-check I bear in mind that the GHRs are currently being adjusted annually by reference to the Service Producer Price Index (SPPI), which focuses on services and which, according to my own research, increased by 2.4% annually between 2015 and 2025. Between 2015 and 2023 that would come to just under 20%.

[161]My conclusion is, accordingly, that the hourly rate of £89 allowed by the Determining Officer in both these cases should be increased by 20%. That would give an hourly rate of £106.80 per hour, which I would round up to £107 per hour (for the reasons I have given, this would include travel time).

[162]For the supervisory work undertaken by Mr McKelvey, whose responsibility was to oversee both cases, it seems to me that even in relatively straightforward cases, a higher hourly rate would be justified: that seems to be consistent with the evidence of Ms Burdett.

[163]The R (TM Eye Ltd) v Pama rate hourly rate of £118 appears to be of the same vintage as the £89 rate. I appreciate that Judge Whalan did not award a higher hourly rate adjusted for inflation to 2020 or 2021, but he was not asked to do so. I would, accordingly, increase that rate by 20%, to £142.

[164]I must emphasise that the conclusions I have reached are limited to the two cases under appeal, and that my calculation of the increase on the rates payable is of necessity a broad-brush exercise based on the limited evidence available to me. Different evidence, on another occasion, might bring about a different result.