The High Court declined to make a wasted-costs order against Gary Matthews solicitors after a dispute over the transfer of two clients’ legal files. It ordered the clients, Adrian Sullivan and Stefanie Abrams, to pay Sweeney solicitors’ costs of the motion.
Mr Justice Binchy’s judgment addressed applications brought by the plaintiffs, who are husband and wife, after they changed solicitors in personal-injury proceedings. Gary Matthews solicitors sought the files from Sweeney solicitors. Sweeney said it would not release them while it remained liable under undertakings given to Claim Finance on the clients’ behalf.
Gary Matthews solicitors questioned whether the Claim Finance agreements and related undertakings were lawful, arguing that they might involve maintenance and champerty. They also raised an undertaking connected to a medical-negligence claim for Ms Abrams’ minor son. Sweeney rejected the allegations and maintained a lien over the files pending release from its undertakings.
At a hearing on 4 April 2017, the judge said he would not order a solicitor to hand over files while remaining liable under client-authorised undertakings to a third party. He suggested the parties seek clarification from Claim Finance about an undertaking from the new solicitors. The dispute was later resolved: Claim Finance and Gary Matthews solicitors agreed the terms of an undertaking, and the files were transferred. The judgment therefore dealt with the costs of the motion, rather than the relief originally sought.
Sweeney sought its costs from the plaintiffs and a wasted-costs order against Gary Matthews solicitors, arguing the motion had no prospect of success. The judge described a letter from Gary Matthews solicitors as inflammatory and “bordering on the unprofessional”. However, he found that their concerns about the undertakings did not amount to misconduct or gross negligence in their duty to the court. He refused the wasted-costs application.
The judgment also noted the cost of the Claim Finance advances. The plaintiffs had received total funding of €43,000, and an acknowledgement dated 14 June 2017 stated that €92,240 was then owing. For one €20,000 advance, the stated repayment rose from €29,600 if repaid within 12 months to €37,600 if repaid within 18 to 24 months, with a further €8,000 per year thereafter. The judge described the funding as being provided at an “exorbitant cost”, while noting that its terms were clear and transparent.
He said the proceedings were not intended to require the plaintiffs to acknowledge the balance as a condition of transferring their files. He also made clear that the decision neither prevented them from pursuing any legitimate grievance about the finance nor suggested they had a legal remedy.