Do I need to enter into a new CFA when my client loses capacity or when new Litigation Friend is appointed?
The Court of Appeal has upheld the decision of both Master Rowley (costs judge) and Jay J on appeal to disallow additional liabilities in the form of success fees (for both solicitors and counsel) and ATE premium claimed in the sum of £1,078,972.72.
This case highlightds the importance of familiarising yourself fully with the retainer documentation under which you are acting.
In the course of a detailed assessment in the SCCO Deputy Master Friston (costs judge) found that the conditional fee agreements (there were three, of which one “The Third Agreement” was relevant to the instant proceedings) were so confusing as to be almost incomprehensible.
The Law Society’s Model Form CFA contains a specific clause providing that “The parties acknowledge and agree that this agreement is not a Contentious Business Agreement within the terms of the Solicitors Act 1974.”. It was argued by the solicitors in this case that even absent this specific clause (as was the case here) any CFA which provides that no fees are recoverable in the event of failure, cannot be a Contentious Business Agreement within the meaning of s59 Solicitors Act 1974
In a short judgment on costs following conclusion of the Iraqi Civilian Litigation The Hon. Mr Justice Turner was tasked with determining the proper interpretation of the individual Claimants’ CFAs insofar as they allowed for recovery of staged success fees.
Applying the principles laid down in Surrey v Barnet And Chase Farm Hospitals NHS Trust  EWCA Civ 451 Mr Justice Jay dismissed this appeal against a Costs Judge’s disallowance of additional liabilities including a success fee of over £300,000 following a switch from legal aid funding to CFA in 2012.
The Court of Appeal has upheld the decisions of District Judge Bellamy (first instance) and Soole J (on appeal) that a 100% success fee in a low value personal injury claim which was fixed without any reference to the actual risk involved amounted to a cost of “an unusual nature or amount” under CPR 46.9(3)(c).
Managing a client’s expectations in litigation can be difficult. Where there is no CFA, the client has the privilege of being able to ignore his/her solicitors’ advice, holding out for whatever result they desire, however unrealistic, or simply having their day in court. However, what can you do about a client who refuses to accept your advice about making a settlement offer when acting under a CFA?