Costs in Private Prosecutions – what does it mean?

2020 has very much been a year of firsts. On 28th January 2020, the High Court ruled in the case of Fuseon Limited v Senior Courts Costs Office [2019] EWHC 126 regarding guidance on the extent of costs recoverable from central funds. The claimant in this case was a letting agent and in 2015, it appeared that one of the directors had been defrauding the company for some years. The total accrued loses were over £100,000. When the company informed the police of the matter, they were told that they did not have sufficient resources to investigate the matter. The company chose to instead work on a private prosecution of the fraudulent director. He was subsequently convicted and sentenced to 3 years in Prison.

An order was made under section 17 of the Prosecution of Offences Act 1985 for the reasonable costs of the prosecutor to be paid out of central funds. The sum claimed by the claimant was £427,909.66. however, the sum allowed on the initial determination was only £150,000. On appeal, this was increased to £200,000 but the claimant was still significantly out of pocket. Arguably, justice is not being done at this point as the claimant is not fairly compensated for the wrongs committed by another. On appeal at the High Court, this claim was dealt with further.

Lane J faced two issues. The first was the finding of the determining officer that as local solicitors would have been able to take the case on, there was no requirement for the claimant to instruct a more expensive London solicitor firm instead. The second issue was the determining officer’s concurrent finding that in assessing the so-called “Singh Discount”, he was entitled to take into account the much lower costs which would have been incurred if the case had been pursued by the Crown Prosecution Service, rather than privately. A “Singh discount” is arrived at by assessing whether the hours claimed for each piece of work to a reasonable claim globally. The Master supported the determining officer in relation to both points.

Mr Justice Lane did not agree. In regard to the first matter, he ruled that the issue was not whether other local solicitors could take on the case at a cheaper cost, but rather whether it was reasonable in all the circumstances for the London firm, which specialises in private prosecutions, to be instructed instead. He ruled that it was reasonable, in the circumstances of this case, for the firm to have been used.

Regarding the “Singh Discount”, Lane J. found that there was no legal justification for comparing the prosecutor’s recoverable costs to the level which would have incurred by the CPS. Lane J. said that private prosecutions play an important role in the constitutional framework and the right to bring such a case should not be limited to those with deep pockets. However, Lane J. did note that the only time it would be acceptable to compare recoverable costs to CPS rates would be if the private prosecutor does not make any attempts to involve the police or the CPS. In order for clients to be protected on costs in private prosecutions, they must take this step.

The change in precedent indicates changing times. Lane J’s desire to emphasise that private prosecutions are not only available to those who have high sums of money indicates the changing in society that allows all people to have access to justice. In times when police resources are scarce, private prosecutions may be the answer.

By Molly Barnes

Paralegal

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