Appropriate Solicitors hourly rates – The ‘Wraith’ question

Appropriate Solicitors hourly rates – The ‘Wraith’ question.

The case of Kelly –v- Hays and Another [2015] EWHC 735 (QB) is very interesting for that age old question as to what are the appropriate recoverable hourly rates.

We are all aware of the various travails in recent times concerning the guideline hourly rates. They were last updated in 2010 and of course the last attempt to revise them met with disapproval by the Master of the Rolls.In our experience, notwithstanding a great deal of case law and informed comment, most Costs Judges are still inclined to apply guideline rates in routine matters.

The case of Kelly involved a Claimant who lived just outside London and worked in Outer London. He instructed a City firm who obviously applied City rates. The argument in the case centred around whether National Band 1 rates or Central London rates should form the basis of consideration of the appropriate houlrly rates. At the initial assessment, the Costs Judge felt that it was objectively reasonable to instruct Central London Solicitors and applied those rates with an uplift to take account of the complexity of the case.

In the appeal, Baker J, found that the Costs Judge had not only failed to provide reasons as to why central London hourly rates were preferable, but he had also failed to provide reasons for rejecting the defendants’ submissions that a National band one firm was appropriate. What is interesting is that despite taking National Band 1 as a starting point, the Appeal Court allowed rates which were significantly in excess of the guideline rates, £295 for grade A, £230 for grade B, £175 for grade C and £120 for grade D whereas the Guideline Rates would have been £217.00, £192, £161 and £118 per hour respectively. The case is therefore interesting for the affirmation in relation to ‘Wraith’ still being the predominant consideration and that the Appeal Court was still prepared to consider appropriate solicitors hourly rates which varied considerably from the Guideline Rates when reaching its decision.