Solicitors entitled to enforce costs incurred under a CFA against client who rejected their advice

the end

Managing a client’s expectations in litigation can be difficult. Where there is no CFA in place the client has the privilege of being able to ignore his/her solicitors’ advice altogether, hold out for whatever result they desire, however unrealistic, or simply have their day in court.

When acting under a CFA things are slightly different.

Under the terms of most CFAs solicitors are entitled to end the agreement if a client refuses to accept an offer against their advice.

However, what can you do about a client who refuses to accept your advice about making a settlement offer when acting under a CFA?

In this case, the solicitors terminated their retainer and sued the client for their costs. Upholding Master Yoxall’s decision at first instance in favour of the solicitors, The Hon. Mr Justice Turner found there to be no distinction between “making a settlement” [the language used at Clause 7(b)(iii) of The Law Society publication: “Conditional Fee Agreements: what you need to know”] and advising on making an offer.

“On a true construction of clause 7(b)(iii), a solicitor’s opinion about making an offer, on the facts any given case, is perfectly capable of being one which is about “making a settlement”. A settlement is an end point but the making of one is a process.”

*This decision has been upheld by the Court of Appeal at Butler v Bankside Commercial Ltd [2020] EWCA Civ 203*