MasterCigars has ushered in a new costs regime. Virginia Rylatt explains why
In MasterCigars Direct Ltd v Withers LLP [2007] EWHC 2733 (Ch), [2007] All ER (D) 385 (Nov) Mr Justice Morgan found for Withers in a landmark case that reassesses the effect of estimates, caps, margins and the Solicitors’ Costs Information and Client Care Code 1999. Given its importance, a full explanation of the facts of the case is given below.
On 6 May 2005, Withers wrote to MasterCigars Direct Ltd (MCD) giving an estimate of costs from 6 May 2005 to the end of the anticipated four-day trial which was due to start on 7 July 2005. The letter explained that:
“Although the figures are becoming relatively fearsome, it has to be said that the potential fees that might be added by bringing in Geoffrey Hobbs [barrister and QC at
One Essex Court] are a heavy burden. However, they are guesstimates only in that we cannot ask his clerk for an estimate since they do not yet have all the papers and cannot assess what will
