A Beneficiary Of An Estate Has Challenged The Fees Charged By A Law Firm That Acted For The Executors Of The Estate

Leasehold And Freehold Reform Act

In the case of Kenig v Thomson Snell & Passmore LLP [2023] EWHC 181 (SCCO) a Beneficiary of an estate challenged the fees charged by the law firm that acted for the Executors of the estate.

Kenig v Thomson Snell & Passmore LLP

Case background

The Executor (and Solicitors’ Client) had previously agreed to the fees, between 2019 and 2021, which were raised as interim bills during the course of the administration and paid on delivery of those bills from funds held by the Solicitors.

Cost estimates had been given but significantly exceeded, the Solicitor revised the estimates but they were also exceeded, and the Solicitors had sought to explain this was due to the regular contact with the Beneficiaries and other third parties. The total cost was over £54,000 plus VAT and expenses, whereas the estimates were originally £10,000 and later rose to £20,000 plus VAT and expenses, with an open caveat for further costs on a “time spent basis”.

It was argued by the Solicitors that:

  • The Court could not now assess the bills as they had been paid over a year ago, and there had been further substantial delays since the Beneficiary had become aware of the amounts, and there were no “special circumstances”.
  • The documents relevant to any assessment were privileged and only the Executor could waive that (rather than being disclosed in a dispute between the Solicitor and Beneficiary); and
  • The principle in Tim Martin Interiors v Akin Gump LLP(2011 EWCA Chiv 1574) applies such that there was no real benefit to the Beneficiary in challenging the bill given the limitations on the assessment due to the approval by the Executor and that the better approach ought to be to seek an account from the Executor for not challenging the bill himself.

Cost Judge Brown disagreed with all three issues and order the bills would be assessed. He found that:

  1. The amount of the bills (and how much they were over the estimate) was a special circumstance, and that this he thought was “rather obvious”, and that the delay in bringing the claim did not mitigate against this, particularly as the Beneficiary’s cost draftsman had been ill;
  2. The issue of disclosure of the relevant documents was not a bar to an assessment. He referred to Schmidt v Rosewood Trust Ltd, [2003] 2 A.C. 709 (2003) and the Court’s inherent jurisdiction to supervise estates and the issue could be overcome (for example by the executor agreeing to disclosure or being made to by the Court); and
  3. The Tim Martin principle did not apply to this case, and even if it did there would still be a good reason to have an assessment and a potentially significant benefit.

As such beneficiaries in estates, and particular disputed estates where they may well have been the “opponent” in a dispute in the administration of that estate can still have a say in the solicitor’s costs generated by the executor/administrator.

How can we help?Kenig Thomson Passmore

Lewis Addison is a Partner in our expert Dispute Resolution team, specialising in Will, Trust, and Probate disputes.

For more information regarding the subjects discussed in this article, please contact Lewis or another member of the team in Derby, Leicester, or Nottingham on 0800 024 1976 or via our online form.

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