Work from home and cost assessments

One of the significant changes from Covid is the steady rise of virtual law firms and contract lawyers who work primarily from home.

One point that is likely to become more of an issue in the future is the extent to which the attorney’s workplace affects the amount they can recover in assessment.

Lawyers claim their costs at an hourly rate based on their experience, which must be at the appropriate level for the case at hand, along with other things, including their location. London solicitors have higher fees due to the location of their office.

The Courts’ Guide to the Aggregate Assessment of Costs states in paragraph 31 that: “When all or part of the work in a case is carried out in a place other than the solicitor’s office in the court file, the appropriate hourly rate for that party should reflect the rates allowable for work at that location, whether that rate is lower or higher (provided that, if a higher rate is requested, the decision to instruct the lawyers in that location would have been reasonable).

However, with working from home and the rise of virtual law firms becoming more and more popular, there may be room in the future to argue over the costs of work-from-home commissioners seeking to claim London rates .

Although the subscriber in question may be linked to a London office, the paying parties may have a legitimate point of dispute if they are asked to pay London hourly rates when the subscriber in question rarely or never visits the London office.

A report on indicative hourly rates conducted by the Civil Justice Council and published in April 2021 noted that traditional zoning may need to be revised in the future in light of home work. However, section G, paragraph 7.3 of the report stated that “the working group does not accept that now is the right time to consider any effect of home working”.

The matter has been further discussed in the case of Otto & Ors v Inner Mongolia Happy Lamb Catering Management Company Ltd & Ors where the judge considered the issue of work at home. After consideration, the judge commented: “there are no law firms in this country of any size that have a ‘virtual practice’, with each of the many collectors working only from home (or a ‘desk hot leased nearby) and without a central base. As these companies are established, there will undoubtedly be evidence to show what the overhead costs are and how the attributable costs are made up.”

In view of the above, it seems likely that home work will be subject to further review in the future and the court has a wide discretion as to costs.

If the paying parties wish to dispute the hourly rate charged, they will need to try to establish where the work was carried out and whether the fee recipient uses the London premises. If they can show that a commissioner is not primarily linked to a London office, there may come a time when the court will find it unreasonable for London fees to be charged, even though there are a number of other factors that the court takes into account when evaluating. costs

In the assessment, questions are likely to be raised about where the work was carried out and changes may be made to the costing forms. For example, form N260 could be updated to ask where commissioners worked from, but this could make assessments and especially summary assessment much more complicated when commissioners work in a hybrid manner, i.e. half from home and half at the centre. office

For now, it appears that the court will focus primarily on the location of the solicitor’s office rather than the specific location of the individual, but the question for the legal industry to consider is whether the amount of their fees will still be can justify regardless of where the work was done.

Dipesh Dosani is a partner at Lincoln & Rowe, London