Hyde v Milton Keynes NHS Foundation Trust [2017] EWCA Civ 399

[2017] EWCA Civ 399Case No A2/2016/0542
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN’S BENCH DIVISION
MR JUSTICE SOOLE
2016/0542
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 23/05/2017
Before
LORD JUSTICE DAVISLORD JUSTICE LEWISONLORD JUSTICE McCOMBE
Between
HYDERespondent/ClaimantMILTON KEYNES NHS FOUNDATION TRUSTAppellant/
Vikram Sachdeva QC (instructed by Acumension Limited) for ClaimantRoger Mallalieu (instructed by Ashton KCJ Solicitors) for DefendantHearing Hearing date: 4 April 2017
Judgment Approved

Introduction

[1]The claimant pursued a personal injury claim, commenced in 2012, against the defendant with the benefit of public funding. There came a time, in circumstances which I will come on to recount, when her solicitors and counsel then proceeded to act under a Conditional Fee Agreement (“CFA”). For whatever reason, no application to discharge the public funding certificate was at any stage made. The proceedings were ultimately settled, with the claimant being awarded costs. The issue arising comes to this. Can the claimant recover, in such circumstances, the full amount of her costs, and in particular the success fee under the CFA and the amount of the After the Event insurance premium, from the unsuccessful defendant?[2]The defendant argued that the claimant could not so recover. She could not recover, it was said, by reason of the provisions of s. 10(1) and s. 22(2) of the Access to Justice Act 1999: which, put shortly, have the effect that lawyers are precluded from “topping up” fees by payments under a private retainer at a time when the client is also publicly funded. The claimant, on the other hand, whilst not disputing the overall general prohibition of “topping up”, argued that on the facts here there was no such consequence.[3]Master Rowley, the costs judge in the detailed assessment proceedings, ruled in favour of the claimant on this point by a reserved judgment handed down on 1 July 2015. The defendant’s appeal was dismissed by Soole J (sitting with Master O’Hare as assessor) by a reserved judgment handed down on 20 January 2016: [2016] EWHC 72 (QB), [2016] 4 All ER 374. The defendant now appeals to this court by leave granted by Burnett LJ on 5 May 2016.[4]The appellant defendant was, as below, represented by Mr Vikram Sachdeva QC. The respondent claimant was, as below, represented by Mr Roger Mallalieu. The case was very well argued on both sides.

Background facts

[5]The facts are fully set out in the judgment of Soole J, to which reference can be made. They can, for present purposes, be summarised as follows.[6]The claimant was admitted, as an emergency patient, to the defendant’s hospital on 18 February 2008. Complications arose in the form of extravasation injury to her left arm. It was said that the defendant negligently failed to respond to such injury or to treat it adequately, thereby giving rise to extensive and serious complications.[7]A legal aid certificate was issued on 10 July 2008. A letter of claim was not sent until 22 August 2011. It was subsequently amended. Liability was admitted on 9 July 2012. It was further accepted, as a matter of causation, that had the claimant been referred to a High Dependency Unit, as she should have been, the injury would have been avoided.[8]On 13 July 2012 the claim form was issued. Notice of public funding was sent to the defendant. An application for a consent order, providing for judgment on liability, was issued on 30 July 2012. Quantum, however, remained in dispute. Judgment against the defendant was formally entered on 11 September 2012, with damages to be assessed.[9]The defendant made a Part 36 offer in the sum of £150,000 in August 2012. The claimant made a Part 36 offer in the sum of £275,000 (excluding CRU) on 24 August 2012. That Part 36 offer by the claimant was withdrawn on 13 March 2013. On 29 April 2013 the defendant then made a further Part 36 offer of £275,000 (including CRU). On 16 May 2013 the claimant responded with a Part 36 offer of £500,000 (excluding CRU). On 8 November 2013, following a joint settlement meeting, an offer of £300,000 (net of a previous interim payment of £25,000 and of CRU) was accepted. A consent order was made to that effect by the court on 6 January 2014.[10]During this time the claimant was represented by various firms of solicitors. Initially she was represented by Scrivenger Seabrook, in whose favour a Community Legal Services funding certificate for Investigative Help was issued with effect from 10 July 2008. There was then a change of solicitors to Osborne, Morris & Morgan, with the certificate being transferred on 15 October 2009. There was a further transfer of the certificate to Kester Cunningham John on 2 June 2011, full representation being granted on 12 September 2011. The certificate was ultimately transferred to Ashton KCJ on 17 May 2012. In the meantime an Individual High Cost Case Contract had been entered into by the Legal Services Commission (“LSC”) and Kester Cunningham John in June 2011.[11]The Current Certificate Status of the funding contract schedule expressly stated that the certificate imposed both scope and financial limitations on the work to be done under it. It was stipulated, among other things, that payment would not be made for work undertaken outside the scope specified or in excess of the costs limit. It was also stipulated that there was a need to apply for amendment of the certificate “where the total costs for the work to be done under the whole of the certificate are likely to exceed the highest limitation”. A Note to the certificate indicated that the costs limitations were a final costs figure and the limitation imposed on the final version of the certificate would be the relevant limitation on assessment.[12]From time to time there had been various increases, by amendment, in the financial limitations set by the certificate. As at 15 September 2011 the limit was set at £25,000 excluding VAT. On 23 July 2012 and 5 November 2012 the total limits were increased in order to complete stage 5 (Quantum Investigation Funding) of the check list: to £39,400 and then £43,000 respectively. This latter increase extended to the instruction of five experts, £18,000 being allocated to the quantum investigations.[13]Ashton KCJ corresponded with the LSC at this time. They complained that the increase to £43,000, excluding VAT, was wholly insufficient to fund the required experts and meetings with experts, let alone thereafter to bring the case to a conclusion. They requested a further increase. The LSC rejected the request on 20 November 2012. It also subsequently rejected a request by Ashton KCJ to “credit” £14,000 previously incurred by former solicitors (as it was asserted, unproductively incurred).[14]As found by the costs judge, Ashton KCJ then undertook an internal costs review. That concluded that the total work done to date was approaching the £43,000 limit and that the permitted public funding was insufficient to complete the quantum investigations or case. The claimant was so advised. She was informed that Ashton KCJ were nevertheless willing to continue to act on the basis of a CFA; and she assented to that.[15]A CFA was entered into between the solicitors and counsel (not Mr Mallalieu) on 20 March 2013. It included a success fee. A CFA was entered into between the solicitors and the claimant on 25 March 2013. It included a success fee. It related to the “work that has been done since our initial instructions 20 March 2013 (sic)”. It among other things stated:
“If you win your claim, you pay our basic charges, our disbursements and a success fee. You are entitled to seek recovery from your opponent of part or all our basic charges and disbursements, a success fee and insurance premium…”
Further provisions indicated that the claimant, if successful, was liable to pay to the solicitors any difference between basic charges and disbursements and what the court allowed on assessment.[16]Notice of funding of case or claim, in standard form N251, dated 26 March 2013 was sent to the defendant. Among other things, it gave notice that “all claims…. is [sic] now being funded by a conditional fee agreement dated 25 March 2013 which provides for a success fee” and by an identified insurance policy. That notice was received the following day.[17]At no stage did the solicitors seek a discharge of the funding certificate. Whether that was through oversight, or in the belief that such a discharge was not needed, was not explained in the evidence.[18]It should be noted that these changes in the arrangements were made not only after liability had been admitted but also shortly before the changes to the funding of litigation (in particular with regard to CFAs) introduced, with effect from 1 April 2013, by the Legal Aid, Sentencing and Punishment of Offenders Act 2012. For the avoidance of doubt it should be recorded that it was expressly found by the costs judge, and affirmed by Soole J, that the entry into the CFA of 25 March 2013 was in good faith and reasonable.

Statutory Scheme

[19]For present purposes, the starting point is the Access to Justice Act 1999. By s. 8 and s. 9 provision is made for the preparation of a Code relating to the provision of funded services, to be laid before each House of Parliament. Section 10 (1) is in these terms:
“An individual for whom services are funded by the Commission as part of the Community Legal Service shall not be required to make any payment in respect of the services except where regulations otherwise provide.”
By s. 22 (1) and (2) it is provided as follows:
“(1) Except as expressly provided by regulations, the fact that services provided for an individual are or could be funded by the Commission as part of the Community Legal Service or Criminal Defence Service shall not affect— ” (a) the relationship between that individual and the person by whom they are provided or any privilege arising out of that relationship, or (b) any right which that individual may have to be indemnified in respect of expenses incurred by him by any other person. (2) A person who provides services funded by the Commission as part of the Community Legal Service or Criminal Defence Service shall not take any payment in respect of the services apart from— (a) that made by way of that funding, and (b) any authorised by the Commission to be taken.”
[20]Regulations as sanctioned by s. 10 and s. 22 are contained in the Community Legal Services (Costs) Regulations 2000. With regard to termination Regulation 4 provides as follows:
“(1) The following paragraphs of the regulation apply where funding is withdrawn by revoking or discharging the client’s certificate. (2) Subject to paragraphs (3) and (4), on the revocation or discharge of the client’s certificate, the retainer of any supplier acting under that certificate shall terminate immediately. (3) Termination of retainers under paragraph (2) shall not take effect unless and until any procedures under the Funding Code for review of the decision to withdraw the client’s funding are concluded, and confirm the decision to withdraw funding. (4) The solicitor’s retainer shall not terminate until he has complied with any procedures under the Funding Code that require him to send or serve notices.”
A funding Code was prepared in accordance with s. 8 of the 1999 Act. At Part C 51 this was, among other things, provided:
“51.1 The Director may withdraw funding by either revoking or discharging a certificate from such date as he or she considers appropriate in accordance with section 15 of the Criteria and these Procedures. 51.2 Where a certificate is revoked or discharged no further services may be provided under it from the date of the notice of discharge or revocation and the retainer of the solicitor shall cease in accordance with Regulations.”

Outline of Submissions

[21]The core of Mr Sachdeva’s submissions comes to this. Section 10(1) and s. 22(2) make it clear that where a person is publicly funded that person cannot be required to make, and a person providing services funded by the LSC cannot (unless authorised by the LSC) take, any payment for services provided apart from that made by way of the public funding. The ultimate rationale is to avoid abuse of the client and of the legal aid system. Consequently "topping up" is prohibited. He drew attention in this regard to the strongly framed admonitions of Gross J, sitting with Thomas LJ in the Divisional Court in the case of Merrick v Law Society [2007] EWHC 2997 (Admin), whereby it was emphasised that solicitors acting for legally aided clients are not entitled to look to the clients for payment: and that was a matter of “the first importance."[22]Mr Sachdeva readily accepted that in the present case there was no intention whatsoever on the part of the solicitors (or claimant) that there would or might be such topping up. He did not dispute that, as found by the costs judge, there in fact had been no topping up. But that, he said, does not matter. The critical point, he said, was that what was done here, in the absence of discharge of the funding certificate, created a risk of such topping up on the part of Ashton KCJ: because the funding certificate continued to be in place in that period after the CFA was made. He submitted that that was contrary to s. 10(1) and s. 22(2) of the 1999 Act: and the CFA was accordingly required to be treated as unlawful and unenforceable. On this argument, therefore, the prior discharge of the funding certificate was an essential pre-requisite to the enforceability of the CFA.[23]Mr Mallalieu disputed that it was necessary in all such cases to procure a formal discharge of the funding certificate before acting for the same client on a CFA under a private retainer. He submitted that s. 22 itself connotes that a client always retained the freedom to instruct a solicitor on a privately funded basis. He further submitted that it is essential in this respect to have regard to the substance, not the form. Here, whilst no formal discharge of the certificate was obtained, the actuality was that the public funding, and hence certificate, was regarded as superceded and thus double recovery would never arise. At all events from 25 March 2013, when the CFA was made, the claimant was not, on any sensible view, in receipt of publicly funded services: on the contrary she was in receipt of services privately funded by solicitors and counsel. He submitted that there was nothing in s. 10(1) and s. 22(2) of the 1999 Act or in the Regulations or Code to preclude such a result or to preclude entitlement to payment under the CFA.[24]Both the costs judge and Soole J agreed with the submissions advanced on behalf of the claimant. Master Rowley proceeded on the footing that where a party had "exhausted" the costs that could be claimed under a funding certificate then in principle a “discharge by conduct”, as he put it, could be established. He saw no difference where a solicitor (reasonably) assessed that the outstanding work could not possibly be done within the financial limitations set by the LSC and had declined to act further on such a basis. Soole J took, in essence, the same approach, holding that, even though there had been no formal discharge, as a matter of substance services provided under the public funding had come to an end before the solicitors acted on a private retainer.

Discussion

[25]In the courts below the appellant appear to have argued that the claimant could recover no costs at all for work done in the period covered by the CFA. Such an outcome can scarcely appeal to any sense of the merits. Before us, however, that position was modified. It was now accepted that the claimant could recover reasonable base costs and expenses for that period: the logic for that concession being that, in the absence of formal discharge, the claimant (on the appellant’s own argument) proceeded on the presumed continuation of the funding certificate. But even so she could not, it was said, recover the success fee and insurance premium. Thus it is that the position of the appellant remains that the claimant and the solicitors are to be deemed to have continued to operate under the legal aid certificate; even though they had in fact intended and agreed to operate under a private retainer and had proceeded accordingly, giving notice to that effect to the appellants. So that outcome still does not particularly appeal to a sense of the merits. But Mr Sachdeva said that was the consequence of the statutory scheme; and hard cases should not be permitted to make bad law.[26]One potential advantage of Mr Sachdeva’s argument is clarity and certainty. The Code and Regulations permit the LSC to discharge, or revoke, a funding certificate: no one else. To obtain such a discharge is not (normally) likely to be complex and, when it is obtained and notice of discharge served, the position is clear for all concerned: client, solicitors, opposing party, court. On the other hand, as he submitted, to sanction such an outcome as Soole J arrived at in this case operates to undermine the entire system of discharge by the LSC and, as this case illustrates, can lead to uncertainty and dispute. In particular, where a discharge from the LSC has been obtained there can then be, as he emphasised, no possibility of topping up at the expense either of the legal aid fund or of the client.[27]However, as I see it there are problems in the way of this bright line approach advocated by Mr Sachdeva, arising both from the terms of the statute and from the stance taken in a number of reported decisions in this area.[28]The first problem is that this approach means that, in the absence of discharge of the funding certificate, the CFA is to be regarded as unenforceable. But in my view such a consequence cannot readily be spelled out from the wording of s. 10 and s. 22 of the 1999 Act or the Regulations. To the contrary, the language of the statute does not state that to be the consequence. Rather, the prohibition is on the obligation to make, and entitlement to receive, payments for services on a concurrent basis. Mr Sachdeva’s argument put an enormous premium on the mere risk or possibility of such overlapping recovery: but the statute, as I see it, is directed towards actuality, not possibility, in this regard. The point is highlighted by Mr Sachdeva accepting in argument that the position on his own case would have been different had only the claimant retained fresh solicitors (that is, other than Ashton KCJ) under a CFA. The whole difficulty, on his case, arises from the same solicitors acting under the public funding certificate and then, without obtaining a discharge, entering into the CFA. Such an outcome of unenforceability, however, in my view, is neither compelled by nor consistent with the statutory wording or statutory scheme.[29]As Mr Mallalieu submitted, and I agree, s. 22 (1)(a) is so worded as to retain the right of the publicly funded litigant to enter into a private retainer with his or her solicitors. Nothing in the Regulations precludes that, as between solicitor and client. It follows that, as between solicitor and client, there is no proper basis for concluding that the new contractual relationship so arising becomes unlawful. As I see it in the present case, the solicitors were not, after entering into the private retainer, providing their services “under” the legal aid certificate (as was Mr Sachdeva’s position). Rather, they were providing those services under the private retainer: the CFA in this case. I can see nothing in the statutory scheme to bind parties in law to the provision of services – and it is to be noted that s. 10 and s. 22 are geared to the provision of services – under a funding certificate unless and until the funding certificate in question is formally discharged.[30]Mr Sachdeva also accepted in argument that, on his case, the position would have been different here had only the CFA expressly by its terms excluded the entitlement to charge for publicly funded services provided under the certificate. That concession was of itself revealing. At all events, in my view (as was in effect the view of the judges below) it was inherent in the making of the CFA that it indeed from its commencement entirely superseded the public funding for the services being provided and precluded the solicitors from claiming on the LSC for such services so provided. By reference to the statutory scheme I also can see nothing to suggest that a conclusion, in the circumstances of this case, that the CFA was valid and enforceable would be harmful to the integrity of the legal aid scheme or to the integrity of the legal system (to adapt the words of Lord Toulson in Patel v Mirza [2016] 3 WLR 399], [2016] UKSC 42): to the contrary.[31]The second problem is that such attractions as there are in the bright line approach advocated by Mr Sachdeva also are undermined by authority. For there are, as Mr Sachdeva accepts, instances where it is established that a private retainer is still enforceable even where the funding certificate has not been formally discharged: such cases being decided on the footing that a client may cease to be a publicly funded litigant even in the absence of formal discharge of the funding certificate.[32]Thus in Littaur v Steggles Palmer [1986] 1 WLR 287 legal aid had been granted, on the application of a firm of solicitors, to enable the plaintiff to purge his contempt of court for failure to comply with a court order in legal proceedings. Thereafter he instructed the firm of solicitors to perform additional work (some of which related to the earlier proceedings) on the understanding that it was not covered by legal aid. The actual work covered by the legal aid certificate itself was completed. No application to discharge the certificate, however, was made. Subsequently the plaintiff declined to pay their outstanding fees on the footing that, under s. 8 of the Legal Aid Act 1974 and Regulation 65 of the Legal Aid (General) Regulations 1980, the solicitors were precluded from receiving any payment. (It may be noted that, in broad terms, s. 8(1) (b) of the 1974 Act corresponds to s. 22(2) of the 1999 Act.) Ackner LJ held (at p. 291 F-G) that there was nothing in that section which of itself would, at the conclusion of the contempt proceedings, have disentitled the solicitors, stating that they could no longer act under legal aid, from acting on the basis of a private retainer. He went on to hold that Regulation 65 had no contrary effect.[33]The Court of Appeal thus would have none of the argument being advanced by the plaintiff. It was accepted by counsel for the plaintiff that, after the dismissal of the application to purge the contempt, the certificate ceased to have any force, in that it had served its function. Nevertheless, as it was argued, despite it having no force it nevertheless remained in force: in that it was current because it had never been discharged. As to that, Ackner LJ among other things said this (at p. 292 H):
“To my mind, this suggests the fallacious proposition that someone cannot be pronounced dead until it is established that he or she has been buried. The short answer, in my judgment, to this application is that no work for which the plaintiff was charged was ever done during the currency of the certificate... ”
Ackner LJ went on (at p. 29B) to say that there was no obligation on a solicitor at the conclusion of work covered by a legal aid certificate “when the legal aid is, so to speak, spent” to have the certificate discharged. It was also made explicit that the conclusion in that case was much influenced, as stated at p. 294C, by the desire to avoid “a wholly unfair” result: p. 294C. Parker LJ and Sir David Cairns agreed with Ackner LJ.[34]This case is thus authority for the general proposition that, on appropriate facts, fees may be recovered under a private retainer notwithstanding that a funding certificate has not been formally discharged, where the scope of the work sanctioned by the public funding certificate has been completed. It was not suggested to us that the position is any different under the subsequent statutory scheme.[35]In Turner v Plasplugs Limited [1996] 2 All ER 939, legal aid was granted limited to obtaining further evidence and counsel’s opinion, including settling proceedings. Thereafter, however, without any extension of the certificate being sought or obtained proceedings were actually issued and the action pursued until then being later discontinued. It was held by the Court of Appeal that, although the certificate had at no stage been discharged, where the steps for which a limited legal aid certificate had been granted had been completed the certificate was to be regarded as “spent”. Accordingly, the litigant was not thereafter to be regarded as an assisted person entitled to costs protection under s. 17 of the Legal Aid Act 1988, notwithstanding that there had not been obtained any formal discharge of the certificate. “There was strictly no need to discharge the certificate. It was spent. Everything it authorised had been done” (at p. 943 c, per Sir Thomas Bingham MR).[36]It may be noted that, in agreeing with the result, Schiemann LJ indicated that he found it difficult to define the precise point in time when a certificate was to be regarded as spent. But, having so stated and after giving examples of the problems that might arise in identifying just when a certificate was to be regarded as spent, he went on to say that he was not persuaded that “all of these problems” would be avoided if it were to be held that a person continued to be an assisted person until the certificate was formally revoked or discharged: p. 946 e-j.[37]A further example is where a publicly funded litigant terminates the instructions of the solicitor and then acts in person. In the case of Burridge v Stafford [2000] 1 WLR 927 it was held by the Court of Appeal that in such circumstances the fact that the litigant’s funding certificate had not been formally discharged was not determinative of whether the litigant remained a legally assisted person. After referring to the previous authorities, including Littaur and Turner, Lord Woolf MR, with whom the other two members of the court agreed, said (at p. 934 G-H):
“… a legal aid certificate does not have to be discharged if it is spent so that a litigant is no longer receiving assistance under the certificate. By analogy it seems to me that the existence of a legal aid certificate which has not been discharged is merely for present purposes evidential.”
He went on to acknowledge that there might be difficulties in ascertaining the operative date when a person ceased to be an assisted party. He did not find that it would always be the date of notification to the opposing party (one of the candidates put forward). He also said that he would be “unhappy” about taking the date as being when the solicitor ceased to act, stating that that might be difficult to identify. He thought it unnecessary to adjudicate finally on the date, however, because he was satisfied in that case that it was “at least from the date that a previously legally assisted party starts to act in person”: p. 935 B-D. It is thus clear from the conclusion in that case that the arguments of counsel, based on certainty, by reference to the date of actual discharge of the certificate were to be rejected.[38]A broadly similar approach was taken by Briggs J in the case of Mohammadi v Shellpoint TrusteesLimited [2010] 1 All ER 433, [2009] EWHC 1098 (Ch). He held in that case, at paragraph 24, that during the period when the claimant was in fact acting in person she was, notwithstanding the lack of discharge of the certificate, not a legally assisted person. He also, however, went further in holding that when a legally assisted person’s solicitors ceased to act, without another firm being retained under a legal aid certificate, the litigant ceased to be a legally assisted person once that had been communicated to the opposing party: paragraph 30.[39]These authorities are at all events flatly against an inflexible conclusion that a party in all cases is necessarily to be regarded as a legally assisted person until, or in the absence of, a formal discharge of the certificate. Mr Sachdeva accepted that. But he said that the authorities permitted just the two exceptions to the requirement of a formal discharge: where the scope of the legal aid certificate has been exhausted, and thus the certificate was spent, and where the legally aided party starts to act in person. Mr Sachdeva said that - in order to maintain the efficacy of the scheme and to remove the risk of topping up - no further exceptions should be acknowledged.

Disposal

[40]As foreshadowed by my previous remarks, I do not agree with the arguments advanced on behalf of the appellant. I think that the costs judge and Soole J both reached a proper conclusion.[41]The argument as to clarity and certainty – although in itself it has attractions – is, as I have indicated, undermined by the approach taken in cases such as Littaur, Turner, Burridge and Mohammadi. It is clear that the authorities ultimately are focused on the justice and fairness of the individual outcome in each case, on substance rather than form. In all those cases it was said (as here) that none of the difficulties would have arisen had only a formal discharge been obtained. But that feature did not in any way prove determinative.[42]The widest expression of the applicable approach is perhaps that enunciated by Lord Woolf in Burridge. It can be said that his remarks were made in the context of that particular case: his statement that the presence of a legal aid certificate which had not been discharged was “merely evidential” was, it is to be noted, accompanied by the words “for present purposes”. But it seems to me that, looking at the judgment as a whole (and reflecting also the remarks of Ackner LJ in Littaur) the applicable approach as there indicated is of a broader kind: and it is justified, in an appropriate case, to make an evidential inquiry to see whether, as a matter of substance, a funding certificate is to be regarded as in truth spent.[43]The present case nevertheless is, I agree, capable of distinction on the facts from the previous authorities. Those cases essentially related to the scope of the funding certificate. Thus in Littaur the funding extended only to the contempt application. In Turner it extended only to obtaining evidence and counsel settling draft proceedings (which steps were completed). In Burridge and Mohammadi it related only to the work done by solicitors while still acting. Thus there was an available objective criterion for assessing whether or not the subsequent steps were within or without the ambit of the public funding. The present case is, I accept, potentially different in that regard. The relevant limitation in the present case was to the financial amount of the available funding. There was, in one sense, no objective criterion at the time available to establish whether, or when, that limit – latterly increased to £43,000 – had been reached. The LSC had not itself made any assessed determination on the point. Rather, it was the solicitors’ own appraisal that the limit, if not reached, was at all events being “approached” and would be exceeded if the expert reports and other steps adjudged necessary were obtained or undertaken (albeit this was an appraisal accepted by the costs judge as reasonable). Thus it is, submitted by Mr Sachdeva, that the funding certificate could not be regarded as spent. The solicitors could, for instance, have elected to continue. The certificate thus continued in force in the absence of discharge and the risk of topping up remained.[44]The logic of this argument would appear to connote, as he accepted, that had there been a trial on quantum and had the defendant had succeeded then, for the purposes of costs recovery, the claimant would have had to be regarded as a protected person by reason of the certificate not having been discharged. He asserted that the defendant would have accepted that (Mr Mallalieu was more sceptical). The logic of this argument would also mean that on such a scenario the solicitors would not have been able to look to recovery from their client, the claimant, of any part of their unpaid basic charges or disbursements.[45]In my view, all this is much too narrow. It is not reflective of the way the previous cases have developed and the conclusion argued for also is not compelled, as I have indicated, by the provisions of s. 10 and s. 22 of the 1999 Act. As a matter of reality and substance, the CFA had for all purposes replaced the previous public funding. The crucial fact was not, in my view, the solicitors’ own assessment that the work thus far done had reached, or was approaching, the limit set by the LSC. That would not of itself, I accept, cause the certificate to be spent. That however, was simply the motivation for, and reason for, what here was, as I see it, the crucial fact: namely the entering into the CFA. The absence of a certificate of discharge, in such circumstances, was evidential: not conclusive. It is quite plain, as the costs judge found on the facts of this case, that the CFA was designed and understood entirely to supersede for all purposes the public funding of the claim. As Mr Mallalieu put it, there had been a “definitive switch.” There was no prospect of topping up in such circumstances.[46]I do in general terms accept (as did Schiemann LJ in Turner and Lord Woolf in Burridge) that there may be a potential difficulty in some cases in assessing the date on which a party ceases to be legally assisted. Since the thrust of s. 10 and s. 22 is aimed at payment for the provision of services one can indeed see attractions in the argument that a person ceases to be a publicly funded party when his nominated solicitor ceases to provide those services to him as a funded party. However, in Burridge, at paragraph 30 of his judgment, Lord Woolf had professed to be “unhappy” about that date as a candidate, both on grounds of the date being difficult to identify and on grounds of it being unknown to the other party: albeit that it might be said that such uncertainties were scarcely resolved, with respect, by his selecting as the date in that case “at least from the date that a previously legally assisted party starts to act in person”. Schiemann LJ in Turner had expressed similar doubts as to precisely when a certificate was to be regarded as spent; albeit he made clear, as I have said, that he was not persuaded that “all these problems….. would be avoided if we were to hold that a person continued to be an assisted person until the certificate was formally revoked or discharged.”[47]I agree that difficulties potentially can arise here. No doubt ordinarily an appropriate date may well be the notification to the opposing party, given the potential importance of the matter, in terms of costs protection and general tactical considerations, to the opposing party. I would be disposed to agree in broad terms with Briggs J in Mohammadi on this; and I observe that the Court of Appeal, albeit (as it stressed) on a provisional basis, appears to have taken the same approach in Rayner v Lord Chancellor [2015] EWCA Civ 1124, [2015] 6 Costs LR 957 at paragraphs 61 and 64 (per Underhill LJ) and paragraph 75 (per McCombe LJ). Nevertheless, inflexibility is to be avoided in order to cover instances where an inflexible approach could bring about injustice: and I remind myself that Lord Woolf in Burridge had himself not been prescriptive on this point. Thus a different conclusion may be drawn if the facts, and requirements of justice and fairness, so require in a particular case.[48]That said, it will be gathered that in a case such as the present I see no real difficulty. It is true that the defendant received on 27 March 2013 the Notice of Change of Funding dated 26 March 2013, itself giving notification of the CFA dated 25 March 2013. (As Mr Mallalieu observed, speaking generally, notices often refer to an event which has occurred, not just to one that will thereafter occur). Soole J indicated that he would, if necessary, have been prepared to look at any potential overlap as de minimis. Given that justice and fairness are the key here, I am far from saying that I would have disagreed with that. But the more fundamental point, as Mr Mallalieu submitted and as Soole J also held and as I agree, is that so far as the claimant and the solicitors were concerned there was in truth, given the facts and circumstances, no concurrency. There was no period of time when, with regard to the services being provided to the client, the solicitors could, let alone did, take payment both under the private retainer constituted by the CFA and under the (undischarged) funding certificate. In such circumstances , as Soole J said (at paragraph 44 of his judgment):
“It would require the express language of unenforceability, eg as in s. 58 of the Courts and Services Act 1990, to have the drastic effect for which the [defendant] contends.”
I agree.

Conclusion

[49]In my opinion the costs judge and Soole J reached the right conclusion, given the circumstances of this particular case. Mr Sachdeva complained (as had counsel before him unsuccessfully complained in cases such as Littaur and Burridge) that such a conclusion would in effect neuter the statutory scheme with regard to discharge. But the general desirability of obtaining such a discharge of course remains: as the very fact that this case has ended up in the Court of Appeal illustrates.[50]I would dismiss this appeal.[51]I agree.[52]I also agree.

Cited in 1 later judgment