COST BITES 226: ARE THE COSTS OF DELEGATION RECOVERABLE? POTENTIALLY – BUT THERE IS A CAVEAT – IT MUST NOT LEAD TO INCREASED COSTS
It is prudent for litigators of every type to take a look at decisions made on the assessment of costs. The fundamental questions “am I going to get paid for doing this?” or “Is my client going to recover the costs of me doing this?” should feature fairly highly on a litigator’s list of priorities. That is why we are looking at the judgment of Costs Judge Nagalingam in XX & Anor v Jordan Young & Anor [2025] EWHC 680 (SCCO). Here we look at the judge’s consideration of the issues in relation to delegation.
“… the points of dispute invite a general ruling that costs of delegation are not recoverable. I disagree. Delegation, whether it be by way of memo or internal discussion, cannot be achieved without some communication medium. Thus, as a matter of principle, spending time engaged in delegation is recoverable.”
KEY PRACTICE POINT
This case emphasises the importance of all litigators thinking proactively about the importance of delegation. Ensuring the work is done at the right level is they key to (financial) success in litigation. The time engaged in delegation is potentially recoverable. However delegation is a skill that is rarely taught or considered. Many of the issues relating to delegation were considered in detail in the webinar “Cost Effective Delegation in Civil Litigation”, which can be found – on demand – here (until the 9th June 2025).
THE CASE
The judge was assessing costs in a personal injury case. One of the issues raised by the defendant paying party was the costs claimed for communication within the internal team and the costs of delegation.
THE JUDGMENT ON ISSUES RELATING TO DELEGATION
“Point 3 – communications with internal legal team
15. As indicated during the first 3 days of the hearing, I am concerned by the internal time claimed and made it clear to Mr Scott this represents a section of the bill vulnerable to proportionality reductions if this assessment is not compromised, or the line by line assessment results in a disproportionate figure.
16. However, in the first instance I am bound to consider the procedural effectiveness of the point as raised.
17. With reference to the case law cited by the Defendant in their points of dispute, there is a distinction to be drawn between a case largely run by a lower grade/s which required recoverable supervisory input from a higher grade, versus a claim where the highest grade is running the case and deferring to lower grades from time to time.
18. Where the senior fee earner delegates certain tasks, it must not lead to increased costs in monetary terms as compared with the senior fee earner undertaking the task personally.
19.Notwithstanding Mr Scott’s arguments to the contrary, it is undoubtedly the case that this matter was run by Mr Preston, and that no single named fee earner has incurred more hours on this file than Mr Preston. It is thus a case of Mr Preston delegating certain tasks in a matter which he was leading, rather than checking the work of a junior fee earner running their own matters.
20. With regards to the 6 categories of work which the Defendant submits are not recoverable, I comment as follows.
21. Travel arrangements – I filtered for activity A8 and column E for “travel”. Rather than this being travel arrangements as a litigation cost, the work relates to travel arrangements relatable to the schedule of loss. Allow the 0.65 hours (which includes one moiety item as claimed).
22. Delegation of work – 34.45 hours of time has been isolated using activity A8 and “delega” in column E. 31.96 hours of this is Mr Preston. Notwithstanding my concerns expressed above regarding the sheer amount of time in this section of costs, the points of dispute invite a general ruling that costs of delegation are not recoverable. I disagree. Delegation, whether it be by way of memo or internal discussion, cannot be achieved without some communication medium. Thus, as a matter of principle, spending time engaged in delegation is recoverable.
23. Allocation of work – “allocate” nor “allocation” appear in the descriptions of work done in this section of items. I cannot therefore account for reductions in the allocation of work where the Defendant has not been clear where such time arises.
24.Collation of documentation – 1.6 hours of time identified using activity A8 and column E for “colla”. The identified time is reasonably incurred and reasonable in amount.
25.Administrative work with Sharefile – 3.2 hours of time identified using activity A8 and column E for “share”. The majority of the time is administrative in my view. Allow 0.6 hours at Grade D.
26.Password issues – 2.0 hours of time identified but this includes 1.5 hours of time in which Sharefile was also considered. Time properly attributable to passwords is administrative and should be disallowed.
27.The objection proceeds to set out that “Further, a number of items of work will have been duplicated with routine communications out with the various parties for example, this would relate to the following types of work”, and that “Additionally, a significant proportion of work has already been claimed in the plan, prepare, draft and review parts of the Bill”.
28.These are essentially arguments of duplication. However, the Defendant has neglected to identify precisely where in the bill duplication has arisen. The quoted passages above amount to speculation, leaving the court to identify actual examples of duplication. The court will not do this, and the Defendant’s opportunity to highlight where they say duplication has arisen (by reference to item numbers which demonstrate the same work being repeated / over-worked) has long passed.
29. As a matter of principle, I cannot apply reductions for duplication where it is not obvious to me where in the bill such duplication has occurred, or where it is not adequately identified.
30. The Defendant is thus left to pursue a fallback argument which is simply set out as “the Defendant submits the time sought of 93.25 hours is excessive” and thereafter pleads that if “the Court deems this time is recoverable on principle, the Court is asked to allow [a] reasonable and proportionate amount to take into account the issues previously raised in respect of the Claimant’s conduct.”
31. This is far too broad an invitation. In some cases, 93.25 hours may represent the entire main action time incurred. Paying parties cannot expect a single paragraph objection to so much time to yield reductions, especially where it is asking the court to arrive at a figure rather than expressing an amount offered which is wholly referable to the point raised.
32. It seems to me that the Defendant has assumed their primary arguments seeking all internal communication be disallowed would succeed, and has neglected to fully articulate their argument in the alternative.
33. Absent the paying party having discerned which items they challenge in the alternative, and how much they proposed be allowed, the receiving party has been denied the opportunity to consider such proposals and narrow the issues. It also leaves the court to conduct such a discernment exercise on behalf of the Defendant – which I decline to do.
34. The outcome is that I do not consider Point 3 protects the Defendant in achieving reductions greater than those outlined above.
35.However, as I expressed during the hearing, the Claimant would be wise not to consider this a victory. I stated that this was the highest claim for internal communication I had ever seen and if I am asked to reduce the assessed sum on the grounds of proportionality then this is very likely a tranche of costs upon which my focus will fall.”
LATER DISCUSSIONS ON DELEGATION AND DUPLICATION
“Delegation
62. Whilst the use of lower grades of fee earner is to be encouraged, that should not be to the detriment of expediency and efficiency. Delegation ought to be done with care. Having said that, I acknowledge that the Grade D rate allowed is 37% of the Grade A rate, such that where an experienced fee earner could have undertaken the same task in a third of the time, the net effect will be negligible.
Duplication
63. Duplication is a concern in this matter. Over the course of a long running case some changes in fee earner involvement are inevitable. However, this was not a case lacking complexity or challenge, and there are too many occasions in which I consider a Grade D fee earner has been needlessly involved – given Mr Preston was quite rightly running the case, and the sheer number of referrals to Mr Ford (counsel).
64. Similarly, save for a fairly light supervisory touch, there is little to no justification in Mr Preston becoming involved in the more basic aspects of running a case when he had capable Grade D assistants to defer to.”