Success fees and ATE insurance premiums recoverable, SCCO judge rules

A claimant’s decision to switch from funding their case via legal aid to a conditional fee arrangement (CFA) just days before the Jackson reforms were implemented was reasonable, a senior costs judge has ruled.

In AMH v The Scout Association, the claimant was pursuing a claim for damages against the Scout Association in relation to childhood sex abuse. The claimant’s decision to switch from funding his case via legal aid to one based on a CFA, supported by an ATE insurance policy, followed a brief telephone conversation with his solicitor in the weeks leading up to the 1 April 2013 Jackson reforms implementation date. During that conservation, the solicitor explained to the claimant that he may lose his legal aid funding if he got a new job. In addition, the solicitor also explained to the claimant that, if he switched to funding his case via a CFA after the Jackson reforms came into effect, he might be financially disadvantaged by the new recoverable costs regime.

Delivering his judgment in the Senior Courts Cost Office, Master Leonard criticised the “incomplete” advice given to the claimant by their solicitor, stating that some of the advantages of the new post-Jackson regime had not been explained. However, Master Leonard ultimately concluded that the claimant’s decision to switch from funding his dispute via legal aid to a CFA-based arrangement was reasonable. In explaining his reasoning, Master Leonard stated that any decision regarding the reasonableness of such actions must – to some extent – be facts specific.

In light of his decision that the claimant’s funding switch was reasonable, Master Leonard decided that it would not be appropriate to disallow the success fees and ATE insurance premium.

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