The Court of Appeal has upheld High Court orders requiring former partners and a solicitor’s firm to continue a settlement process for determining fees owed to another law firm for transferred client files.
The appeal concerned a mediated settlement signed on 26 July 2018 after a dispute between partners of Augustus Cullen Law (ACL) and former partners who established Michael Boylan Litigation Law Firm (MBLLF). The agreement provided that the firms’ nominated legal costs accountants should try to agree the fees due to ACL. If they could not agree, a third accountant’s determination would bind the parties.
The accountants disagreed over the first files considered. An independent accountant, Brendan Cooke, was appointed and issued a determination on one file in May 2019. The appellants disputed the process and instructed their accountant to pause it. ACL applied to the High Court to enforce the settlement. The High Court ordered the process to resume and referred five cases to Mr Cooke for determination.
The appellants argued on appeal that conflicts in affidavit evidence required cross-examination, and that ACL should provide bills of costs, including under section 152 of the Legal Services Regulation Act 2015. The Court of Appeal said the material issue was whether the accountants had failed to agree, triggering the settlement’s third-party process. That disagreement was undisputed, and the appellants had acknowledged the pause. The court said the trial judge did not decide whether the appellants had deliberately frustrated the process; that question was not necessary to the orders. No cross-examination had been sought.
The court also rejected the bills-of-costs arguments. It held that MBLLF was not ACL’s client and could not enforce statutory rights belonging to ACL’s clients or former clients. The settlement did not require ACL to provide bills to MBLLF, and the court found no basis to imply such a term. The agreed process was effective without it.
The Court of Appeal dismissed the appeal and found no basis to interfere with the High Court orders. ACL was entitled to its appeal costs, to be assessed if the parties could not agree. Any request for a different costs order was to be made by written submissions within 21 days of receipt of the judgment, with a reply within a like period.