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.

Basis of payment of fees and outlays

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.

Civil and Children’s Legal Aid

Accounts submitted in relation to civil or children’s legal aid are regulated by the Civil Fees Regulations.

Regulation 9 of the Civil Legal Aid (Scotland)(Fees) Regulations 1989, provides that   “Subject to the provisions of regulation 8 regarding the submission of accounts, and the provisions of regulation 10 regarding the calculation of fees, the fees allowable to counsel shall be fees for such work as shall be determined by the Board to have been actually and reasonably done, due regard being had to economy”.

10(1)   Counsel’s fees in relation to proceedings in the Court of Session, Upper Tribunal for Scotland, Sheriff Appeal Court, First-tier Tribunal for Scotland and sheriff court shall be calculated in accordance with Schedule 4.

Regulation 10(1) of the Civil Fees Regulations provides that counsel’s fees in relation to any work in relation to the proceedings below are payable under Schedule 4.

• Court of Session,
• Upper Tribunal for Scotland,
• Sheriff Appeal Court,
• First-tier Tribunal for Scotland, and
• Sheriff court

Schedule 4, Table of Fees A, Parts 1 and 2 prescribes separate Tables of Fees specifying the fees payable to counsel depending on the status of counsel for proceedings in the

• Court of Session

Schedule 4, Table of Fees B, Parts 1 and 2 prescribes separate Tables of Fees specifying the fees payable to counsel depending on the status of counsel for proceedings the

• Sheriff court,
• First-Tier Tribunal for Scotland,
• Sheriff Appeal Court, and
• Upper Tribunal for Scotland

Schedule 4 is accompanied by detailed notes on the operation which set out the circumstances when a fee is, and is not, payable for the majority of work that you will undertake.

These notes are an essential element of the assessment process and you must apply them, where appropriate.

Advice and Assistance and ABWOR

ABWOR is simply a type of advice and assistance where representation can be provided, but only for the proceedings listed in the ABWOR regulations.

Accounts submitted in relation to ABWOR are regulated by The Advice and Assistance (Scotland) Regulations 1996.

There are no prescribed fees for counsel under and advice and assistance and counsel’s fees must be claimed and assessed an outlay in the instructing solicitor’s account in terms of Regulation 17(1) of the Advice and Assistance (Scotland) Regulations 1996, which provides “that fees and outlays allowable upon assessment by us, or taxation by the Auditor, can only be for work actually, necessarily and reasonably done and outlays actually, necessarily and reasonably incurred in connection with the subject matter of the advice and assistance, due regard being had to economy”.

There are four elements to the test, all of which must be satisfied.

Private funding

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

The standard of taxation

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 a 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.

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 the client’s or instructing solicitor’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 “actually” done is stated and not implied; and
• the phrase “due regard to economy” 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 counsel”.

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.

Benefit of the doubt to SLAB in an agent and client, third party paying taxation

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.