Counting the costs

Increasing numbers of students are looking to a career as a costs lawyer, Lawyer2B takes a closer look at what they can expect.

Background:

The number of people choosing to train as a costs lawyer has doubled since 2010 as the impact of several major forces – including the Jackson reforms and the Legal Services Act – are felt in the costs sector.

In 2012 the applications to join the profession matched 2011’s unprecedented rise as students recognised the importance of regulation and the need for specialist skills ahead of the introduction of the Jackson reforms.

Study leads to qualification as a costs lawyer, an authorised person under the Legal Services Act with independent rights of audience and to conduct litigation. Several costs lawyers are also now partners in legal disciplinary practices.

Iain Stark is Chairman of the Association of Costs Lawyers, he explains: “The introduction of the Jackson reforms in April 2013, introducing costs management and other measures to keep control of costs, are putting a far greater emphasis on dealing with costs pre-emptively rather than after the event. This means solicitors will need to bring in costs expertise from the start of a case to ensure that the budget they will have to submit to the court at an early stage is realistic and defensible. It is increasingly important for instructing solicitors to ensure that they are working with costs lawyers and not unqualified and unregulated costs draftsmen.”

“The unprecedented rise in student numbers demonstrates that people are starting to realise that there are other routes to a successful and rewarding legal career.”

The Role and Work of Costs Lawyers:

Costs lawyers are concerned with all aspects of legal costs that are controlled by both statute and common law. They are concerned with costs relating to all areas of the law and deal with every conceivable type of legal matter that touches upon the subject of costs.

The three main areas in which costs lawyers may become involved are:

1. Solicitor and client costs:these are costs payable by a client to his own solicitor. Different rules apply to the costs where court proceedings have been commenced, known as contentious business, to those applicable to non-contentious matters such as conveyancing, probate and general advice. A client who is unhappy with his solicitor’s bill has remedies available if he wishes to challenge it. If the bill relates to non-contentious business, the client may ask the solicitor to obtain a remuneration certificate from the Law Society. If either the client or the solicitor is dissatisfied with the outcome of that request, or if the bill relates to contentious business, either the client or the solicitor may apply to the court for the bill to be assessed. A costs lawyer may be instructed to prepare a detailed bill of costs for assessment, to advise on law and procedure and, subsequently, if instructed by a solicitor or a litigant, to argue in support or to oppose the bill.

2. Public Funded (legal aid) costs:where a solicitor is representing a publicly-funded client, a detailed bill is usually required to be assessed either by the court or the Legal Services Commission before payment can be made out of the Community Legal Service Fund to the solicitor. Whilst such bills are usually assessed without any formal hearing, if an amount has been disallowed in respect of which the solicitor wishes to object, an appointment can be obtained and the matter argued at a hearing. In criminal cases, the objections to an amount disallowed are usually made in writing and, often, a costs lawyer will be instructed to prepare the written submissions.

3. Costs payable between parties:the unsuccessful litigant is usually ordered to pay the successful litigant’s costs and, if those costs cannot be agreed, a detailed bill is prepared and served. The paying party then has to serve a schedule of points of those items in the bill he wishes to dispute before the bill is lodged at court and a detailed assessment hearing takes place at which the points are argued and a decision made by the court. A costs lawyer can be involved in all the necessary procedural steps for either party and can also be involved in preparing case budgets.

The requirement to attend court to oppose or support a bill of costs may arise in any of the above three categories. Costs lawyers have a right of audience and are entitled to appear as an advocate in relation to disputes as to costs. In addition under the Civil Procedure Rules 1999, a costs lawyer may be instructed as an expert by a litigant in person to advise on aspects of costs law and the litigant may recover any reasonable fees thereby incurred if he is awarded costs in his favour.

How do I become a Costs Lawyer?

The costs lawyer route to qualification supports the social mobility agenda in the legal profession, as students need only a minimum of four GCSEs to begin the training – those who have completed law degrees or postgraduate legal education can gain exemptions from parts of the programme.

The training is provided by the Association of Costs Lawyers (ACL). ACL is responsible for setting and maintaining standards for trainee costs lawyers. The Costs Lawyers Standards Board is responsible for setting and ensuring standards for all costs lawyers practising in England and Wales.

Study is broken into three modules: general and civil costs; solicitor and client costs, special courts and tribunals; and public funding/legal aid. Each module includes self-assessment assignments, examiner-marked assignments, and a compulsory practical seminar and workshop.

There is one intake per year in September, with exams completed the following summer. Each module takes one year to complete.

Before starting the modular training course, trainees are required to enrol as a trainee member of the Association of Costs Lawyers. That membership must be maintained throughout the course.

How much does it cost?

These fees and costs are those applicable in April 2012 and are subject to change

One-off administration fee £50.00

Module costs x 3 £2,820.00

Compulsory seminar x 3 £ 360.00

Membership subscription x 3 £300.00

The examination fees payable after the completion of all three modules are £600.

All of the above figures include VAT.

Total: £4,130

Where are Costs Lawyers employed?

Some costs lawyers are directly employed by firms of solicitors. However, many costs lawyers are self-employed and often work from home. Unfortunately these rarely employ untrained assistants, but it is strongly recommended that student members should work either in-house or at least in association with a costs lawyer or an authorised litigator rather than seeking to practice immediately on their own account.

Training overview:

The training course is separated into three separate and distinct modules, all of which include an introduction to the English Legal System. The modules are:

General and Civil Costs

This includes: Introduction to the English Legal System, the Law of Contact, the Law of Tort, Civil Procedure, General Costs Law and Practice, Litigation Funding and Costs Pleadings.

Solicitor and Client Costs, Special Courts and Tribunals

This includes: Introduction to the English Legal System, the Law of Property, Ethics and Professional Standards, Solicitor and Client Costs, Costs in Special Courts, Costs in Arbitration Proceedings and Tribunals and Legal Accounts.

Public Funding/Legal Aid

This includes: Introduction to the English Legal System, Family Law, Criminal Law, Costs in Family Law Proceedings, Costs in Criminal Law Proceedings (non Legal Aid), Civil Legal Aid, Family Legal Aid and Criminal Legal Aid.

Each module includes self-assessment assignments, examiner-marked assignments, and a compulsory practical seminar and workshop.

What is the difference between a costs lawyer and a costs draftsman?

A costs lawyer is a regulated member of the Association of Costs Lawyers. Under the Legal Services Act, costs lawyers undertake reserved legal activities and enjoy the same benefits and status of many other legal professionals – including partnership in legal disciplinary practices.

The term ‘costs draftsman’ denotes an unregulated and unqualified person operating in costs and those who instruct costs draftsmen have no recourse to either the Legal Ombudsman or the Costs Lawyer Standards Board (CLSB), the profession’s approved regulator.

What can a costs lawyer expect to earn?

Kevin Dawson at Adept Recruitment says: “Qualified Costs Lawyers in London can command basic salaries between £40k and £100k+ in other specialist costs firms or top City law firms. However, the top salaries are generally due to length of service as many costs lawyers that move in-house tend to stay in these positions until retirement.

“Outside London salaries vary enormously with Manchester being the second highest paying region due to the concentration of Costs firms.”

Ben Pitts of BPW Legal Recruitment says: “We conduct an annual salary guide for the costs’ profession and have found that salaries have increased quite dramatically over the last three years, despite the very difficult economic climate. The market is intensely candidate driven and firms are willing to pay for experience. In short there is too much work with not enough skilled labour! However, there is an element of caution from some costs firms around the potential Jackson reforms, but the big hitters are developing their businesses though alternate solutions and are continuing to expand, therefore increasing the demand for costs professionals.”

How do I apply?

Visit the ‘train to be a Costs Lawyer’ section of the ACL website at: http://www.associationofcostslawyers.co.uk

Applications for membership for entry to the modular training course must be received by the end of June 2013 for an applicant to be admitted as a trainee member that year and to commence the course in October 2013.

Applications for membership are made by submitting a completed membership application, course application, CV, a character reference and a business reference, evidence of qualifications and administration fee. The references must be from a person who has known the applicant for a minimum of two years.

Case studies:

The 60-strong Costs Department at Irwin Mitchell is led by costs lawyer, Steven Green.

He explains: “The team at Irwin Mitchell undertakes a range of work including commercial, court of protection and personal injury. Our work encompasses anything that needs a legal bill right through to a detailed costs assessment. It is therefore crucial that we have professionally trained costs lawyers on board. 

Forty-five of the 60 people in the firm’s Costs Department are either qualified costs lawyers or going through the ACL Costs Lawyer training. All new joiners to the Costs Department are sponsored by the firm to undertake the ACL training after their probationary period has been passed.

“We want to offer proper career progression for costs professionals, which the ACL training offers. It not only gives credibility to the role and provides an excellent legal grounding, it gives all costs lawyers rights of audience and is widely recognised by the judiciary.”

Chris Asbury, who leads a team of six costs specialists in Irwin Mitchell’s Birmingham office, explains why he took the training: “The market is changing rapidly and is hugely competitive, so I wanted to make sure I had a professional qualification that set me apart. It’s not easy balancing work, family and study but it is worth it to attain that added credibility.”

As you would expect, Irwin Mitchell is supportive of its costs lawyer trainees, offering up to five days study leave and, as Chris Asbury points out: “…the added benefit of a pool of knowledge within the firm to draw upon.”  

When asked about the best part of the job, with no hesitation Chris Asbury says: “…seeing your advice and work playing a significant role in winning a case.” For Steven Green its: “The satisfaction gained from working closely with other costs lawyers in resolving cases.”

Green also points to the variety and challenge of the work which includes arranging a bill of costs, negotiating with opposition, managing and running cases, lodging court documents and preparing for and attending court hearings.

For the firm it makes commercial sense to have an in-house Costs Department. “Not only are we a viable profit centre for the firm, clients really appreciate the integral working relationships we have with colleagues where matters can simply be sorted out by walking across the corridor,” says Steven Green.

Green is adamant that costs lawyers should undertake professional training: “Costs professionals should be properly qualified and I think the courts should demand it.”

Michael Kain, founded Kain-Knight Costs Lawyers in the 1970s, it has now grown and according to Kain has more costs lawyers than any other company. He says:

“We encourage our trainees to go through the ACL training. We will only succeed and grow by recruiting and retaining the best people. There are many law graduates and simply not enough roles to fill them which is why a career as a costs lawyer will make a brilliant alternative. It is a great match for law graduates to become heavily involved in the detailed analysis of cases and budgets. I can see a time when a law degree will be a pre-requisite for a costs lawyer.”

Lisa Surridge joined Kain-Knight six years ago as a trainee, she says:

“I’d always wanted a career in the law. Originally I was hoping on becoming a barrister but was put off by the length of time it would take to train and establish myself. However, I saw a role advertised at Kain Knight as a trainee costs lawyer and I have not looked back since.

“Four years ago I started the ACL training to become a costs lawyer and last year I passed my exam third top in the country which was a great achievement. For me, undertaking the training while working for Kain Knight has been invaluable as I was immediately able to put into practice what I had learnt and was also able to share my learning and solve any problems with my colleagues who helped me immensely.

“I can honestly say that no two days are the same. You really don’t know what you’re going to be faced with until you open up a new file. I love the variety this career choice has given me. Much of my work to date has been on the claimant PI/clinical negligence side but over the past year I have handled a lot more defendant work. Although there are no boundaries you can be engaged in any type of work ranging from employment disputes, civil work and commercial dispute resolution.  

“The upcoming Jackson reforms may change the workload but a good costs lawyer will adapt. I suspect that costs lawyers will start to work more closely than ever before with solicitors and become involved at a much earlier stage in cases which will be good for the profession.”

Jo Moorhouse is office manager at Beetenson and Gibbon Solicitors, the firm has offices in Grimsby, Louth and Scunthorpe. She explains how having an in-house costs lawyer has benefitted the firm:

“We’re very fortunate to have a costs lawyer in-house. It’s a legal discipline that should be taken seriously, it’s not about dabbling a little with bills but combining and then applying expert legal and financial knowledge.  

“Although the training was lengthy, we were happy to support Tracey and we’ve certainly had a return on our investment. Our fee-earners also appreciate having someone in close proximity able to turn matters around quickly, who understands the firm and can apply this to their work.”

Tracey Jackis a costs lawyer at Beetenson and Gibbon. Following a career working in variety of legal roles including as a paralegal and a legal secretary, she qualified as a costs lawyer last year and works on Legal Aid cases:

“The costs lawyer training was challenging but I was well supported by my family, my firm and my tutor. In particular, the seminars ran throughout the training where I got to meet up with fellow students were always really motivating. As was the ACL Annual Conference where I got to speak with qualified costs lawyers and hear inspirational speakers – it really made me want to succeed.  

“I work in a firm where having an in-house costs lawyer is really valued.  The best bit of the job is getting a big file, putting it into order by applying the rules and ensuring the i’s are dotted and the t’s are crossed, I get such satisfaction from this. I’ve already recommended the training and career path to one former colleague.”