Solicitor wins appeal on 'wasted costs' order

The president of the High Court has overturned a unique direction by the master of the High Court which required a solicitor to reimburse her client the costs of bringing what the master described as a "'pointless" application.

The master, Edmund Honohan, had described his "wasted costs" order, made last February, as a "wake-up call" to solicitors about high legal costs.

Such costs orders were in the long-term interests of the legal profession, although, he added, lawyers probably would not "see it that way . . . the old problem of not being able to see the wood for the trees".

Upholding the solicitor's appeal against the order, Mr Justice Joseph Finnegan yesterday said the conduct of the solicitor fell far short of what was necessary for such a "wasted costs" order to be made against her.

He also found Mr Honohan had no jurisdiction to make such an order under the rules of the superior courts, as only the courts could make such orders.

The judge noted that the courts had directed solicitors personally to pay costs in a wide variety of circumstances involving, in essence, improper conduct during proceedings.

After reviewing the relevant legal authorities, he was satisfied the power of the courts to make such a wasted costs order depended on a solicitor being guilty of misconduct in the sense of a breach of their duty to the court or being guilty of gross negligence in relation to their duty to the court.

In this case, he was satisfied the conduct of the solicitor in question "fell far short" of this requirement. He stressed no imputation whatever had been made against the solicitor's honesty although it was not necessary to establish bad faith for the purpose of making unnecessary costs orders.

Mr Justice Joseph Finnegan said he had particular regard to the fact that the solicitor was acting on the advice of senior counsel when she had made the application (for answers to interrogatories or questions), which had been criticised by Mr Honohan. While acting on such advice would not justify a breach of duty to the court, it would generally be an answer to a charge of negligence, the judge said.

In this case, "put at its highest", the solicitor was guilty of negligence but not of negligence which could be characterised as gross, the judge said. In those circumstances, the jurisdiction of the courts to make the costs order, whether that jurisdiction was punitive or compensatory or both, did not arise and the order should not have been made.

The Master had limited powers relating to costs and the provisions of Order 99 Rule 7 of the Supreme Courts applied to the superior courts but not to proceedings before the Master, he held. Therefore, the Master had no power to make the order.