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ACL instructs leading counsel over "malevolent" challenges to members' rights

23 June 2014

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The Association of Costs Lawyers (ACL) has gone to the length of obtained counsel's opinion in order to confirm that its members have rights to conduct costs litigation and to act as advocates in costs proceedings.

The opinion, provided by 4 New Square's specialist cost counsel Roger Mallalieu, is in response to several "malevolent" challenges to costs lawyers' right to appear in court. New ACL chairman Sue Nash says: "We decided to take advice after several malevolent challenges to costs lawyers' right to appear in court. These challenges go to the very route of our raison d'être."

The advice given by Mallalieu is described by the ACL as "unambiguous". Costs Lawyers have an absolute right as conferred upon them by statute to conduct all costs proceedings within the limits of their statutory powers - regardless of the circumstances in which they are retained or employed. This, therefore, includes circumstances when they are working in conjunction with unregulated costs specialists.

Recent challenges have arisen where costs lawyers are working in organisations that are not themselves regulated and so not authorised to conduct litigation or provide advocacy. The ACL suggest that this is mainly because the Costs Lawyer Standards Board does not yet have a scheme of entity regulation in place.

However, Mallalieu has advised the ACL that the Legal Services Act 2007 specifically exempts costs lawyers from having to work in authorised bodies until entity regulation is introduced. In order to ensure their position is as robust as possible, Mallalieu's advice states that costs lawyers should have systems in place to ensure that any non-authorised persons they work with are not engaged in "reserved activities".

In relation to the right to conduct litigation, Mallalieu's advice states that costs lawyers are entitled to use unregulated persons to assist them with tasks such as drafting, correspondence, secretarial services, general advice and assistance, without fearing that their litigation rights could be successfully challenged. What amounts to the conduct of litigation is likely to be narrowly construed, he counselled.

The Costs Lawyer Standards Board is currently consulting on introducing a scheme of entity regulation next year and Mallalieu acknowledged that until entity regulation is introduced, challenges could continue. He suggests that judges may have concerns until such time as the situation is properly explained to them.

"We are keen to hear from any costs lawyers who have, or are currently experiencing, any challenges to their audience rights," says Nash. "If appropriate, the Association would consider being joined as an interested party to the relevant proceedings. It is important that a clear legal precedent is established to prevent further unwanted satellite litigation of this kind."

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