Statutory tests of taxation and payment from the Fund

The following regulations form the basis, set by Parliament, on which you are entitled to payment and is termed the standard of taxation. It is the test (or benchmark) against which we are required to assess an account, and it is important that you have an understanding as to the basis on which an account is properly payable.

In circumstances where we cannot allow a charge on the information provided, in whole or in part, we require to restrict the charge.

Section 4(2)(a) of the Legal Aid (Scotland) Act 1986, states that only such sums as are due in respect of fees and outlays properly incurred by a solicitor (or counsel), by virtue of the Act or regulations, can be paid out of the Fund.

Accounts submitted in relation to contempt of court Legal Aid are regulated by the Legal Aid in Contempt of Court Proceedings (Scotland) (Fees) Regulations 1992.

Regulation 4 of the Legal Aid in Contempt of Court Proceedings (Scotland)(Fees) Regulations 1992, provides that a solicitor shall be allowed such amount of fees, calculated in accordance with Schedule 1, as shall be determined to be reasonable remuneration for work actually and reasonably done, and travel and waiting time actually and reasonably undertaken or incurred, due regard being had to economy.

In determining the fees specified above there shall be taken into account:

1. time necessarily spent at the court on any day in waiting for the hearing or the appeal to be heard, where such time had not been occupied in waiting for or conducting another case
2. time necessarily spent in travelling to and from the court at which the person appears or the hearing or appeal takes place (not being a court in the town or place where the solicitor has a place of business) and to and from the prison and any place visited for the purpose of preparing or conducting the defence or appeal.

Regulation 5 of the Legal Aid in Contempt of Court Proceedings (Scotland)(Fees) Regulations 1992, provides that a solicitor shall be allowed the following outlays:

1. expenses actually and reasonably incurred by himself or his clerk in travelling to and from the court at which the person held to be in contempt of court appears or the hearing or appeal takes place (not being a court in the town or place where the solicitor has a place of business) and to and from the prison and any place visited for the purposes of preparing or conducting the defence or appeal:Provided that where public transport is not used a reasonable mileage allowance shall be treated as an outlay; and
2. any out of pocket expenses actually and reasonably incurred, provided that without prejudice to any other claims for outlays there shall not be allowed to a solicitor outlays representing posts and incidents.

Unlike civil, children’s and criminal proceedings there is no prescribed Table of Fees for contempt of court under advice and assistance and ABWOR.

Where a person is potentially liable to be dealt with for contempt of court during the course of or in connection with any proceedings and you elect to provide the client with advice and assistance you should refer to the respective accounts guidance relative to the proceedings under which the potential contempt has arisen.

For example, if the contempt arises during criminal proceedings you should refer to the criminal legal assistance accounts guidance for information on how to prepare and charge your account.

You must never ask your client to put you in funds to cover an outlay or fees at a time when advice and assistance or legal aid is being provided.

It is worth discussing the standard of taxation in some detail.

An understanding of the legal basis on which we are tasked with assessing an account is fundamental to our approach, see Parks v Colvilles Limited (1960) S.C. 143 per. Lord Patrick at page 153 where, in identifying and supporting a third party standard, his lordship states: “In these instances the parties controlling the fund…have had no voice in controlling the scale on which the expenses were incurred”.

This is important. The standard of taxation applicable to the assessment of an advice and assistance or legal aid account is solicitor and client, third party (Fund) paying.

This standard is quite different from the two standards, or modes of taxation as between solicitor and client:

• on a solicitor and client, client paying basis, where the test is the client is liable to his solicitor for all expenses reasonably incurred, even although they could not be recovered from the other side, and for any expenses which he has specially authorised (MacLaren: Expenses at 509);
• on a party and party basis, where the test is on the basis of such expenses as are reasonable for conducting the proceedings in a proper manner.

Clearly these definitions are more suited to where representation is allowed (legal aid), but they can equally be applied in principle to advice and assistance accounts.

There is a body of law defining the scope, structure and application of the third party standard.

According to Sheriff MacPhail, the taxation of an account as between solicitor and client, third party paying should be closer to the taxation standard of party and party (following an Interlocutor awarding expenses against an opponent without qualification) than between a solicitor and his own client. Macphail continues, at Sheriff Court Practice, 4^th  edition, (2002), chapter19.56, that the third party paying mode, while “not so generous” as in a taxation between solicitor and client, client paying, “is yet not quite so rigorous as the taxation between party and party”.

In short, some work undertaken by you may not be chargeable to the Fund on a third party basis of assessment, and your client’s authority or approval is not necessarily determinative in the context of publicly funded advice.

It should be noted that:

• the requirement that an item of work has to be “necessarily” done is stated and not implied; and
• the phrase “due regard to economy” or “conducting the proceedings in a proper manner” is a clear injunction to a solicitor to address the question of cost actively in the way in which fees and outlays are incurred in the course of the advice and representation that is being provided.

Sheriff MacPhail also quotes the dicta of Lord McLaren in the case Hood v Gordon 1896 23R 675, as follows:

“…when a statute authorises the taxation of expenses as between agent and client, what is given is the expenses which a prudent man of business, without special instructions from his client, would incur in the knowledge that his account would be taxed. “

The term “prudent man of business” can be read as a “prudent solicitor”.

The aim of this guidance is to provide you with an indication as to how your account may be taxed: what we as the paying party, applying the third party test, consider to be chargeable and shall allow in the assessment of an account, and in our determination as to whether the work undertaken was reasonable and calculated in terms of the Tables of Fees, see the observations of Lady Rae in the Note of Objections by Mark Stewart QC 3 July 2014.

According to James Hastings, formerly Principal Clerk of the Office of the Auditor of the Court of Session, in his work “Expenses in the Supreme and Sheriff Courts of Scotland” (1989) at page 112, he explains that the benefit of any doubt is to be given to the paying party where the legal aid Fund is paying in the event of uncertainty or lack of supportive detail in respect of a claim.

It is important to emphasise that the benefit of the doubt test is not engaged where we, or an auditor as the case may be, is not in any doubt about the basis of a claim on the legal aid fund.