KA-2023-000225 - [2025] EWHC 1605 (KB)

It was the Appellant's contention that the Costs Judge was bound by the decision in Edwards so that when there is a dispute over items in the cash account within Solicitors Act 1974 assessment proceedings, that dispute must be resolved, and Part 18 requests should be answered. The Appellant argued that a similar dispute to that in Edwards exists in the present case concerning the cash account.

Further to this, the Appellant maintained that it is settled law that a former client, as principal, is entitled to receive information from their solicitor, acting as agent. The Part 18 questions posed by the Appellant relate to potential undisclosed commissions or other financial benefits received by the Respondent or an associate but not accounted for to the Appellant. The Appellant asserted that, in accordance with the principle established in Yasuda the Respondent has an obligation to provide information regarding the handling of the appellant's funds.

The Appellant submitted that the questions in the Part 18 request were related to receipts by his solicitors of sums which, if undisclosed, may be repayable to him for breaching provisions of the Financial Services and Markets Act 2000 (FSMA 2000) and specific rules made under that statute. He argued that potentially undisclosed sums ought to appear as a credit in the cash account. The Appellant emphasised in argument that the answer to many of the questions was a binary, yes or no response under a statement of truth, which could potentially resolve his concerns.

It was submitted, in the Appellant’s written and oral argument, that whether the Part 18 questions should be answered turns on two key tests: first, whether the cash account is a matter in dispute in the proceedings, and secondly, whether the Court has jurisdiction within these proceedings to either approve or adjust the cash account based on the Respondent's answers and the subsequent resolution of any dispute. The Appellant contended that the second test has been conclusively answered in his favour by the Edwards decision, which recognised the necessity of resolving cash account disputes within SOCA proceedings before a final order could be issued.

The Appellant argued that Brown was inconsistent with Edwards and wrongly decided or in any event could be distinguished since in Brown the Court declined to compel answers to Part 18 requests due to a lack of evidence of anything untoward. The Appellant argued that the mere fact that the cash account is disputed should necessitate the provision of information, whether or not the client's concerns are initially based on a belief or suspicion. He contended that the Part 18 request was not a "fishing expedition" but a legitimate request by the client to verify the accuracy of the information provided about his own financial affairs in circumstances where the client cannot be expected to know whether a commission has been received. In the context of a relationship which is fiduciary in nature with client money held on trust the Costs Judge had imposed too high a hurdle to the provision of necessary information. In support of that contention the Appellant pointed to Lewis v Tamplin [2018] EWHC [2018] EWHC 7777 (applying the principles set out in Schmidt v Rosewood [2003] EWHS 26) arguing that Lewis makes clear that in a claim by beneficiaries for pre-action disclosure of documents held by trustees there is no threshold test for suspicion. The question is just whether it is appropriate for the Court to interfere.

The Appellant argued that the Part 18 requests in this case, relating to potential undisclosed commissions, are "all but identical" to the questions ordered to be answered in Edwards. He contended that answering these questions, supported by a statement of truth, is not onerous and the requested information is likely to be contained within records the Respondent is required to keep.

In summary, the Appellant maintained that the cash account served by the solicitors is a prescribed part of the process under the Civil Procedure Rules and is explicitly disputed in the Points of Dispute. He submitted that the Costs Judge failed to give proper weight to the fact that the cash account was served as a step within the proceedings. He argued that the need to "certify what is due" under section 70(7) of the Solicitors Act 1974 requires the Court to be satisfied that the information provided in the cash account is accurate and necessitates resolving disputes within the cash account; an approach which Ritchie J's Judgment in Edwards supports.

In relation to the request for the identifying company number for the Gibraltar-based company, to which a net payment of £750 was made by the solicitor, the Appellant argued that this information is also relevant to the scrutiny of the solicitor's bill. The Appellant contended that understanding the nature and ownership of this recipient company is necessary to assess the propriety of this payment within the detailed assessment process. The fact that there was such an unexplained payment also founded the suspicion that a commission may have been received.

The Appellant’s primary intention in seeking the number was to undertake independent investigations into AJG Ltd.’s constitution under Gibraltar law, its structure, and its accounting for his funds. Should these investigations reveal any unlawful or improper payment, he indicated that he would invite the Court to strike this debit from the cash account.

Whilst it was suggested that the requested information could be obtained from Gibraltar Companies House at the Appellant’s cost, he argued that the onus rests on the Respondent to make full disclosure. The Appellant suggests that the payment to AJG Ltd. appears to relate to a success fee but was made to this Gibraltar-based company, not directly to the Respondent. This further underscores the need for clarity and a proper justification for the disbursement.

The Appellant submitted that the Costs Judge’s reliance on a “principle” regarding publicly obtainable third-party information is misplaced. The direct link between AJG Ltd. and the success fee funded by the Appellant’s compensation renders information about AJG Ltd pertinent to the scrutiny of the cash account within a SOCA and brings the information request within the Court’s jurisdiction in such proceedings.