On 25th June the Court of Appeal allowed the 2nd appeal in Holcroft v Thorneycroft Solicitors by consent. The Order of District Judge Batchelor dismissing Mr.Holcroft's application for assessment, and the Order of Mr.Justice Eyre dismissing the first appeal were both set aside.
A crucial development for clients
The original decision dramatically narrowed the scope for clients to use section 70 of the Solicitors Act 1974 to retrospectively challenge legal fees.
It emphasised that section 70 assessments are not available when a final agreement has been reached and the client has waived their right to further assessment, even implicitly. It meant that clients could easily find that they had signed away the opportunity to challenge legal fees, even though they had not received a formal bill.
Detail of the Original Decision
The appeal decision in Holcroft v Thorneycroft Solicitors Ltd [2024] EWHC 1473 (KB) centered on whether a former client could challenge a 60% deduction from his personal injury damages under section 70 of the Solicitors Act 1974.
Background- Ashley Holcroft was represented by Thorneycroft Solicitors in a personal injury claim following a 2018 road traffic accident.
- The case settled in August 2020 for £24,200, with Holcroft receiving £9,865 after deductions for:
- Profit costs: £8,995.83 (reduced from £10,143)
- VAT: £1,799.17
- Disbursements: £2,910
- Holcroft signed an acceptance form agreeing to the settlement and the breakdown.
- Holcroft later initiated proceedings under section 70 to challenge the solicitor's bill.
- He argued that he had not been fully informed of the actual recorded costs and that he had not explicitly waived his right to a detailed assessment.
- District Judge Batchelor (Sheffield County Court) ruled that the August 2020 correspondence constituted a binding agreement on both the settlement amount and its division.
- On appeal, Mr Justice Eyre upheld the decision, stating:
- The client had clearly agreed to the settlement and its terms.
- The agreement was all-inclusive, and Holcroft had no grounds to later dispute the deductions.
- The judge cited precedents including Belsner v CAM Legal Services Ltd and Jones v Richard Slade & Co, reinforcing that a binding agreement precludes later assessment
The appeal was dismissed. The court confirmed that once a client agrees to a clear and informed settlement—including how damages are divided—they cannot later seek a detailed assessment of the solicitor's costs.
Conclusion following allowance of 2nd Appeal
The previous appeal decision is no longer binding either way.
Reopening Cost Agreements- The Court of Appeal's willingness to allow a second appeal—even by consent—signals a shift in how strictly courts may treat previously "binding" cost agreements.
- It suggests that procedural fairness and client protection may, in some cases, outweigh the finality of earlier agreements.