The High Court has found that a solicitor joined as a notice party in proceedings connected to proposed mediation of “plastic hips” claims was acting for clients, not for his firm, when costs were awarded.
The finding came in a review of a Taxing Master’s decision about whether VAT could be recovered on a bill of costs. Mr Justice Meenan delivered judgment on 8 May 2019. He said he was satisfied that the solicitor was acting for the various clients who had instructed him when he made submissions about a proposed alternative dispute resolution scheme.
The underlying proceedings were Christopher Gaffney v DePuy International Limited, one of many claims concerning plastic hips. The High Court had joined solicitors representing plaintiffs in other claims as notice parties so they could make submissions on the proposed scheme. An order made by Mr Justice Cross on 16 December 2015 awarded costs of the motion to DePuy and the notice parties, once taxed and ascertained.
The VAT issue arose during taxation of those costs. The Taxing Master disallowed VAT, reasoning that the costs had been awarded to a VAT-registered notice party and that it had not shown the VAT was “not otherwise recoverable”. The solicitor’s side argued that he had been acting for clients, who were not VAT-registered. DePuy’s side said the solicitor had not established that the VAT was not otherwise recoverable.
Mr Justice Meenan said the Taxing Master’s ruling on objections accepted that the solicitor was acting for clients, although the Taxing Master’s later report to the court appeared inconsistent with that view. The judge relied on the solicitor’s lack of standing to make submissions if he was not acting for clients, the transcript and order from the hearing before Mr Justice Cross, and correspondence showing clients were kept informed about developments concerning the proposed ADR.
The court concluded that the costs order had been made in the solicitor’s capacity as a representative of clients. It did not make a consequential order in this judgment; Mr Justice Meenan said he would hear counsel on what orders should follow.