A firm has lost its appeal in the High Court after a Costs Judge ruled a solicitor cannot charge for work done in his role as executor due to a missing charging clause.
The solicitor, Robin Shepherd of Shepherd & Co Solicitors, is entitled to charge for work done in an estate administration capacity. However, Master Rowley, sitting as a Costs Judge, ruled in November 2021 that Shepherd “did not specify provision for payment to be made […] for acting in the capacity of executor” and therefore cannot charge for such work – which the court acknowledged was “long-drawn-out”:
“The process of administering Mrs Brealey’s estate was complicated and long-drawn-out, largely because it had been necessary to bring possession proceedings against the Claimant and because he challenged or disputed various decisions that were taken by the executors in relation to the estate. The administration of the estate is largely complete. In the most recent draft of the Estate Accounts, the gross value of the estate is £1,018,023.77. The fees of the Defendant were £153,507.38. This is approximately 15% of the value of the estate.”
The firm appealed Rowley’s decision, questioning “[whether] the judge [erred] in failing to take into account the fact that the charges sought for the time of Mr Shepherd are sought by the Defendant firm, not by Mr Shepherd himself?”
Dismissing the appeal, High Court judge Mr Justice Cavanagh ruled:
“In my judgment, and with respect to Mr Rupert Cohen [Shepherd & Co Solicitors’ counsel], there is nothing in this point. If the defendant was entitled to recover costs from the estate for the work that was done by Mr Shepherd in his capacity as executor, it was because he was a partner in the firm. In other words, any right for the defendant firm to recover the charges levied in respect of Mr Shepherd’s work as executor is contingent upon, and resulted from, Mr Shepherd’s right to be paid for that work.
A distinction between Mr Shepherd and the firm in these circumstances would be wholly artificial.”
Mr Justice Cavanagh also noted that “in the absence of a charging clause, or the express agreement of the beneficiaries, the entitlement could be derived only from one of the other two potential routes, section 29 of the Trustee Act 2000, or the Boardman jurisdiction”.
On any argument based upon s29 of the Trustee Act, Mr Justice Cavanagh said:
“Mr Smyth [the other partner at Shepherd & Co Solicitors at the time] was an executor of Mrs Brealey’s estate. As he did not give written approval to payment to Mr Shepherd for the work done as executor, this is fatal to the defendant’s argument based on section 29 of the Trustee Act 2000.”