By Bipin Regmi, Senior Underwriter
(Estimated reading time: 5 minutes 33 seconds)
Over the years changes have been made by way of fixed recoverable costs. This is mainly the case in low value personal injury claims with the introduction of Pre-Action Protocols for Low Value RTA and EL/PL claims since 31 July 2013. Further extension has been made to most litigation claims up to a value of £100,000 due to the implementation of the new regime under CPR 45 and PD 45 which came into effect on 1 October 2023.
One has to consider that law firms are businesses. Due to the changes and recovery of costs being more and more difficult in litigation, it is of upmost important for law firms to recover as much profit costs as possible in all cases.
Often law firms are instructed under a Conditional Fee Agreement which means they are not paid unless there is a successful resolution of the claim, which can often be years of work; and it is also not unusual for firms to fund the medical report fee with assistance from a third party such as a medical agency.
Why do law firms use medical agencies?
The simple answer is for fee deferral. It is crucial for law firms to have a profitable business and to have a good cash flow. In personal injury and clinical negligence claims, it is not unusual for law firms to front the cost of medical report fees; in high value and complex cases these fees can be six figures, due to involvement of various experts. The fee deferral by a few years or until the conclusion of a claim help firms to fund the report fees and assist with the cashflow in the business. This also assists the claimant, who is not able to pay the cost of such disbursements.
Use of medical agencies also assists firms by vetting the experts, suggesting suitable experts, contacting the experts, arranging medical appointments, vetting the medical report for compliance under the CPR, organising the file of papers for experts and co-ordination of instructions with the experts.
Medical expert reports are essential in any personal injury and clinical negligence litigation. Depending on the discipline of the expert and complexity of a claim, expert’s fees can be eye watering. It is therefore important to also consider what is reasonable and proportionate in cases as it is likely that the defendant will no doubt argue the cost of such reports.
The medical report fee can itself be expensive.
The service from medical agencies comes with a cost and often they charge an uplift which is added to the expert’s fee, and a fee note is provided to the solicitors, without a breakdown of the expert’s fees, and their charges, but with one total invoice for the medical expert fees.
Medical agencies fees have also increased over the years. Such agencies have been reluctant to provide a breakdown and there has been little guidance from the court to enforce such a requirement. This has been a matter of dispute between the parties, and the defendant requesting the breakdown, arguing that the cost of the report fees are unreasonable and disproportionate.
HHJ Cook in Stringer v Copley (2002) (unreported) described the activities of medical agencies as follows:
“In routine personal injury cases, where a medical report is required, it has become a common practice to instruct a medical agency to arrange a medical examination of the Claimant, to undertake the collation and obtaining of relevant medical reports, to arrange the appointment with the medical expert and the Claimant, deal with any cancellations or rearrangements, and to deliver the resultant medical report to the solicitors. Because of the specialisation, experience and expertise of the medical agency they are able to do this administrative work, at least as efficiently, expeditiously and economically as most firms of solicitors using their own fee earners.”
In Copley the court ruled that the medical agency fees were recoverable, provided the charges did not exceed the reasonable costs of the work if it had been done by the solicitors.
In Northampton General Hospital NHS Trust v Hoskin [2023], HHJ Bird in the High Court decided that a breakdown of a medical agency note should be provided, and in default, the disbursement would be assessed at nil.
JXX v Archibald [2025] EWHC 69 (SCCO) provides the first binding guidance in respect of breakdown of medical agency fees.
In brief, the claimant in JXX v Archibald was involved in an RTA, sustained serious injuries and was a protected party. The claim was settled in a joint settlement meeting and was subsequently approved by the court. Detailed assessment proceedings were commenced, and the bill of costs were served. The fees that were disputed in the application amounted to £120,946.00 including VAT from a total figure for experts’ fees of £253,859.96 including VAT. The disputed fees concerned expert evidence obtained from a medical agency.
The defendant requested breakdown of fees rendered by the medical expert and the medical agency. The medical agency refused to provide a breakdown and adopted the position that it is not their practice to provide breakdown of its fees, nor they are obliged to do so.
The sums in issue were significant and the issue was one which potentially affects many cases. Costs Judge Rowley concluded that the better course of action is for the claimant to choose one the following two options as to how the fees are to be assessed –
1.On the basis of the expert’s evidence and the medical agency work in obtaining that evidence if the information sought by the defendant (breakdown of fees rendered by the medical expert and the medical agency) is provided.
or
2.On the hypothetical basis that there had been no medical agency involvement, and the fees claimed are solely for the expert’s evidence, if no such breakdown of fees is provided.
It is likely that an uplift charged by medical agencies will be recoverable, but it is yet to be seen to what extent it will be recoverable and what would be reasonable. It is also unknown whether adverse inference will be drawn if the breakdown is not provided.
The Temple Perspective
This will be concerning for claimant solicitors, especially if they are using a medical agency unwilling to provide a breakdown of fees rendered by the medical expert and the medical agency. Depending on the agreement between the solicitors and the medical agency, the solicitors may ultimately be responsible for any unrecoverable expert fees which may ultimately result in deduction from their profit costs. Any judgment in the future in respect of recovery of medical agency fees and breakdown of fees may have an impact on a lot of cases.
It may be sensible for law firms to consider alternative disbursement funding solutions to negate any such difficulties in the future.
Bipin Regmi
Senior Underwriter
Bipin Regmi
Bipin qualified as a Solicitor in 2019. He has extensive experience dealing with personal injury, clinical negligence and professional negligence claims.
Bipin joined Temple as a Senior Underwriter in 2024.
With his knowledge of legal practice and understanding of risk assessment, Bipin brings a unique perspective to the underwriting process, ensuring that all decisions are informed by thorough analysis and sound judgement. His legal experience is invaluable to the business and our clients.
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