“2. What is covered by this agreement (a) proceedings brought by you against your Landlord or former landlord, Birmingham City Council arising from your tenancy and/or occupation of a dwelling house owned by your landlord and based upon breach of contract and/or a tortuous act and/or based on proceedings under theLandlord and Tenant Act 1985 and/or theDefective Premises Act 1972 and/or such other defendant against whom you have a cause of action but not including any claim based upon personal injury … (a) proceedings brought by you against your Landlord or former landlord, Birmingham City Council arising from your tenancy and/or occupation of a dwelling house owned by your landlord and based upon breach of contract and/or a tortuous act and/or based on proceedings under theLandlord and Tenant Act 1985 and/or theDefective Premises Act 1972 and/or such other defendant against whom you have a cause of action but not including any claim based upon personal injury … 3. What is not covered by this agreement Any appeal by your opponent against an order made in the County court, except an interim appeal where we advise you in our absolute discretion in writing that it should be opposed because you have a reasonable chance of success. Any appeal you make against an Order made in the County court, except an interim appeal which we in our absolute discretion advise should be pursued because you have a reasonable chance of success … 4. Paying us If you win your claim you pay our charges and expenses as set out in paragraph 5 below save where ‘reduced charges’ are due in the circumstances set out below … We may end this agreement before you win or lose. Please see paragraph 9 for details. Charges and Expenses Our charges are based on the time we spend dealing with your case. We are obliged by Law Society Rules to give you the best estimate that we can for our overall charges and expenses. Our current estimate is that our fees are likely to be between£1,200 and£1,500 if your case does not proceed to trial, and between£1,800 to£2,200 if a trial proves necessary … 8. Reduced Charges … [if] you are successful in recovering money from your opponent, but it is not possible to either agree that your opponent will pay your legal costs and expenses or alternatively the court does not make an order that your opponent pays your legal costs and expenses, you will only be liable to pay either the amount we would normally charge you under clause 5 above or the amount calculated in accordance with the formula below, whichever is the lower [original emphasis] figure: If the amount of compensation recovered is£3000 or less, we will limit our charges to£1,000 plus VAT plus the full amount of any expenses incurred. If the amount of compensation recovered is more than£3000 then we will limit our charges to no more than one third of the total compensation recovered (to which VAT will be added). Therefore this formula operates as a cap on our charges in these circumstances. Again the full amount of any expenses incurred will also be payable. 9. Ending the Agreement before your claim for compensation ends (b) paying us if we end this agreement (i) we can end this agreement if you do not keep to your responsibilities as outlined in clause 11 below … (iii) we can end this agreement if you reject our opinion in relation to the conduct of the case … 11. Your responsibilities YOU MUST co-operate with us … not ask us to work in an improper or unreasonable way. 13 What happens if you win You are then liable to pay all our charges and disbursements in accordance with the other clauses of this agreement….. 18 Other points Immediately before you signed this agreement we verbally explain to you the effect of this agreement and in particular the following … (e) other methods of financing these costs including Private funding, Community Legal Service Funding, legal expenses insurance, Trade Union funding (f) whether we consider that any particular method or methods of financing any or all of these costs is appropriate. We have advised you that in relation to these proceedings, if they are referred to the Small Claims Track of the County Court, a court would not normally order you to pay your opponent’s costs, unless, for example it believed the proceedings were brought, or carried on, unreasonably, frivolously or vexatiously. We believe that the risk of the court making such an order is minimal and that therefore we do not believe that a contract of insurance to cover those risks would be appropriate in these circumstances. We have also advised you that we do not consider that it would be appropriate to insure against your costs and disbursements as the premium is likely to be expensive and would not likely be recoverable if the case is referred to the Small Claims Track. We have further advised that if the case is allocated to the Fast Track or the Multi-track it will be appropriate at that stage to consider either an application for a Legal Services Commission Public Funding Certificate, or, alternatively, After the Expenses insurance, depending upon your financial circumstances at that time.”
“Dear Ms Forde….. We are pleased to tell you that the City Council have now made an offer to settle your case and we enclose a copy of the letter they have sent. You will see that they are offering to pay you a total of£4,500 in compensation and in addition, are offering to pay your reasonable legal costs….. We need to see you to discuss with you whether you are going to accept the offer in view of the fact that it is below amounts previously indicated to you, and therefore arrangements have been made for Mr Khan to come to visit you at 3.30pm on Wednesday5th April 2006 ….[original emphasis] In order to prevent any argument about the Council being liable to pay your legal costs, we intend to take advantage of a change in the Regulations governing “no win no fee” agreements which we explain below. By way of background we should explain that the regulations under which you signed the Conditional Fee (“No win no Fee”) Agreement with us some time ago have changed. The reason for the change was to make it more difficult for opponents such as your landlord to challenge in court the validity of the old style agreements. That is particularly important since this firm has been the subject of a serious challenge by your landlord to the validity of the agreement of the sort that you signed with us. In particular, the landlord has been alleging that we are not allowed to agree with you that we will charge you a reduced amount if we do not succeed in recovering a costs order in your favour. In order, therefore, to take advantage of the new regulations and to prevent an argument such as this (which has had the effect of causing problems and delay in paying compensation to a number of our other clients) we have prepared an alternative agreement which we would invite you to sign. A copy of the agreement is enclosed herewith. The key features are that you are agreeing that all of the legal costs to date will be dealt with under this agreement rather than the original one (unless by some chance the court ruled that this one was not valid – in which case we will rely on the original agreement). The most important apparent effect of that is that this agreement contains a success fee and the old one did not, so on the face of it, you could be worse off. Because of that theoretical possibility, we have to tell you that you should not sign it unless you are entirely happy with it and you are entitled to take independent legal advice if you wish. In reality, however, you will not be any worse off because the ‘cap’ that we put on your costs in the original agreement still applies and the only reason we are inviting you to create a potential further liability is to ensure, as we indicate above, that the City Council pays your legal costs on a proper basis, rather than you. Javaid Khan will explain all this to you and deal with any questions or concerns you may have. Yours sincerely…”
“The requirements which the Lord Chancellor may prescribe under Section 58(3)(a) – (c) – (a) include requirements for the person providing advocacy or litigation services to have provided prescribed information before the agreement is made; and (b) may be different for different descriptions of conditional fee agreements (and, in particular, may be different for those which provide for a success fee and those which do not).”
“… must state the percentage by which the amount of fees which would be payable if it were not a conditional fee agreement is to be increased.”
“Public funding is extremely unlikely to have been available to any claimant until the case was allocated to the fast track. Save in very exceptional circumstances, as I understand it on the evidence before Master Campbell, public funding would not be granted otherwise. The direct advice was that, if and when the case was allocated to the fast track, the claimants should apply for public funding … 34. If in practical terms it is not possible to achieve a public funding certificate before allocation, then advice that it should be sought before that point may be theoretically correct but is liable to divert and delay the conduct of the claimants’ case. It is also potentially confusing and even misleading for the client. In any event, the letter did make two key points: firstly, the public funding certificate provides a measure of protection against adverse costs and secondly, that once the case has been allocated to the fast track, the claimants should seek public funding. In my view the Master was right to conclude that on this matter the letter complied with Regulation 4 … 35. I should record that, had I taken the contrary view and concluded that the letter gave inadequate advice as to the risk of adverse costs orders and what might be done to avoid that risk, then unless the advice was only minimally deficient, I would have regarded it as a material departure for the purposes of the Hollins v Russell materiality test. The impact of an adverse costs order might in a few cases be considerable.”
“Public funding is extremely unlikely to have been available to any claimant until the case was allocated to the fast track. Save in very exceptional circumstances, as I understand it and on the evidence before Master Campbell, public funding would not be granted otherwise. The direct advice in the letter [McGraths retainer letter] was that, if and when a case was allocated to the fast track, the claimant should try for public funding.”
“In my view the Master was right to conclude that on this matter the letter complied with Regulation 4. It would probably have been better had the letter said something like: “A public funding certificate provides effective protection, if not complete protection, against an adverse costs order once it has been granted. However, in practical terms you will not be granted a public funding certificate and not achieve costs protection unless and until your case has been allocated to the fast track. That is one of the reasons why we recommend you make such an application if that situation arises.”” “A public funding certificate provides effective protection, if not complete protection, against an adverse costs order once it has been granted. However, in practical terms you will not be granted a public funding certificate and not achieve costs protection unless and until your case has been allocated to the fast track. That is one of the reasons why we recommend you make such an application if that situation arises.””
“Criteria to be applied for full representation 1(a) Cost benefit – for all cases under Section 10 of the Code (whether possession or other claims within Section 10) the cost benefit criterion is a general test requiring simply that likely benefits of the proceedings must justify likely costs, having regard to the prospects of success and all the circumstances (criteria 10.3.3 and 10.4.4). Therefore the strict cost benefit ratio in the General Funding Code do not directly apply to housing claims within Section 10, even if the primary claim is for money. (d) Conditional fees – funding will not be refused in any housing case under Section 10 of the Code on the grounds that a CFA is suitable (criterion 10.3.1 10.4.1 disapplying criteria 5.7.1 [this provides that if the nature of the case is suitable for a CFA, Full Representation will be refused]).”
“Cost benefit – quantifiable claims If the claim is primarily a claim for damages by the client and does not have a significant wide public interest, Full Representation will be refused unless the following cost benefit criteria are satisfied: (1) the prospects of success are very good (80% or more) likely damages must exceed likely costs; (2) the prospects of success are good (62% to 80%), likely damages must exceed likely costs by a ratio of 2:1; (3) the prospects of success are moderate (50% to 60%), likely damages must exceed likely costs by a ratio of 4:1.”
“We have done so as explained in previous correspondence because, although we regard the clients prospects of recovery of compensation in this matter as being good, with a minimum of 60%, given the uncertainties in this type of litigation, in particular in relation to issues such as notice to the landlord and the possibility that any existing disrepair may have been remedied before allocation to track, it is impossible at this stage for us to certify that this case will be allocated to the fast track … As for as the costs/damages ratio is concerned the figure that we have given for the likely value of the claim is based upon the clients specific and uncorroborated instructions as to the date of notice and assumes for the recovery on that basis. Given the normal dispute that arises in these cases, however as to the date of the notice, such an approach also pre-supposes that such a case is more likely to go to trial. The estimated costs of trial is therefore calculated on that basis …”
“considered on the information available the likely benefits of the proceedings to the client and others do not justify the likely costs, having regard to the prospects of success and all other circumstances.”
“Has the particular departure from a Regulation pursuant to Section 58(3)(c) of the 1990 Act or a requirement in Section 58, either on its own or in conjunction with any other departure in this case, had a materially adverse effect either upon the protection afforded to the client or upon the proper administration of justice? If the answer is “yes” the conditions have not been satisfied. If the answer is “no” then the departure is immaterial and (assuming that there is no other reason to conclude otherwise) the conditions have been satisfied.”
“It is clear from Note 1 of the Code [Solicitors Costs Information and Client Care Code] will result in a breach of Rule 15 [Solicitors’ Practice Rules]. It has to be a serious breach of the Code, alternatively there have to be persistent and material breaches. In my judgment, this Note is an indication that a breach of the Code does not of itself render the contract of retainer unenforceable.”
“(2) Variation which can prejudice or benefit either party … the parties may agree to vary the contract in a way that can prejudice or benefit either party. Here the possible detriment or benefit suffices to provide consideration for the promise of each party … This possibility of benefit and detriment is sufficient … if a variation is, taken as a whole, capable of benefiting either party, the requirement of consideration will be satisfied even though a particular term of the variation is for the sole benefit of one.”
“Given that these defendants [the Council] argue that the CBA is unenforceable in any event, I do not see how an allegedly unenforceable after-coming agreement could be held to vitiate an otherwise enforceable CFA.”
“Whilst it remained relatively easy to persuade the legal aid authorities to grant a certificate to pursue a claim, it became increasingly common for there to be a limitation placed at the outset that prevented proceedings being issued … 117. We then found, that once the stage was reached where proceedings needed to be issued if we were to galvanise the opponent into action and ensure that the clients got justice, applications to legal aid authorities to amend the certificate to allow full proceedings to be issued were routinely refused on the basis that the costs benefit ratio did not make it worthwhile allowing the client to issue proceedings under public funding. By that stage, because of the amount of work that had already been done and because of the effect of the statutory charge, it became frequently very difficult to justify putting any alternative funding in place, given the risks involved in this sort of litigation. 118. In short, our clients were being caught between an opponent who frequently sat back and did nothing and made no attempt to negotiate in accordance with the spirit of CPR and a funding body who were not prepared to fund vigorous litigation that would have forced the opponent to comply and meant cases settled far more quickly and ultimately economically. 119. Against this background we were increasingly coming to the view that best advice to clients may not be to follow the public funding route but go for some private funding arrangement that would remove the limitations imposed by the Legal Services Commission and allow clients to deal with claims quickly and effectively. 120. The tipping point, however, in that process came with the introduction of the Legal Help scheme at the beginning of the year 2000. 121. Whilst the equivalent to the statutory charge continued to apply for some types of cases, in housing cases the statutory charge did not apply if the case was dealt with entirely under Legal Help funding. Legal help did not, however, permit the issue of proceedings, only some preparation of the case and negotiations. 122. If, however, the client was subsequently granted a public funding certificate to pursue litigation then the statutory charge was retrospectively applied to the other work done under Legal Help. 123. Whilst this was not a problem if public funding was granted to allow proceedings to be issued and those proceedings were subsequently successful with costs paid by the opponent, it became a major problem if either the costs were not paid (or ordered to be paid) by the opponents or if the public funding certificate was issued with a limitation which prevented the issue of proceedings and which might well be discharged once proceedings became necessary. 124. In the former, the fact that a public funding certificate had been obtained meant that the statutory charge applied and not only to the work done under the certificate, but also to the work done under Legal Help and accordingly this had the potential to have a serious impact on any damages the client might recover. In the latter the client had the worst of all worlds, since they had no prospect of successfully litigating with public funding, but they were saddled with a very substantial statutory charge which would bite if they were not successful in obtaining a costs order in highly risky litigation. 125. It is against that background that we took the view that the best advice for clients who were eligible to initially advise under Legal Help and then, if attempts to negotiate a settlement failed, to put in place private funding rather than a public funding certificate. In practical terms this meant a CFA.”
“Master Campbell: Have you got the references there? Mr Mallalieu: Master I do, in Maiden the legal application I believe is at 1355 and the refusal from the Legal Services Commission is at 1428. Of course the relevance we draw from that again, it just shows in these cases that public funding is by no means a certainty but of course our case isn’t predicated on the basis that we couldn’t get public funding. All of these people might not be eligible for it, our case is predicated entirely that it was reasonable advice, that there was an alternative available to them which in the light of the risks to their particular case was better suited to them … So we’re not saying that there was a bar to public funding which meant that we had to, or it was reasonable in the absence of public funding to sign them up to a CFA. What we say is it was reasonable advice that this was an alternative method of funding.”
“The issues raised by these appeals make it necessary to go back to first principles. Undue influence is one of the grounds of relief developed by the courts of equity as a court of conscience. The objective is to ensure that the influence of one person over another is not abused. In every day life people constantly seek to influence the decisions of others. They seek to persuade those with whom they are dealing to enter into transactions, whether great or small. The law has set limits to the means properly employable for this purpose.”
“Whether a transaction was brought about by the exercise of undue influence is a question of fact. Here, as elsewhere, the general principle is that he who asserts a wrong has been committed must prove it. The burden of proving an allegation of undue influence rests upon the person who claims to have been wronged. This is the general rule. The evidence required to discharge the burden of proof depends on the nature of the alleged undue influence, the personality of the parties, their relationship, the extent to which the transaction cannot readily be account for by the ordinary motives of ordinary persons in that relationship, and all the circumstance of the case.”
“… After perusal of the file, when I attend [sic] the client I first went through with her the new CFA agreement and in particular I advised the client about the success fee. Once the client I [sic] understood I then asked the client to sign the same which she kindly did. I also signed the agreement in her presence.”
“It is not in my view appropriate to seek to evaluate the adequacy of that consideration given by Islington, on the basis that “it did not give up very much”
“If it is agreed that a written agreement should apply to work done before it is entered into, it should be correctly dated with the date on which it is signed and expressed to have retrospective effect, i.e. to apply to work done before its date…”
“Where the funding arrangement had (sic) changed and the information a party has previously provided in accordance with paragraph (1) is no longer accurate, that party must file notice of change and serve it on all other parties within seven days.”
“(1) Before a conditional fee agreement is made the legal representative must – (a) inform the client about the following matters … (d) whether other methods of financing [the] costs are available, and, if so, how they apply to the client in the proceedings in question; (e) whether the legal representative considers that any particular method or methods of financing any or all of those costs is appropriate.”
“Q. At the end of the day it is going to be a matter for the judgment of the caseworker, is it not, applying the criteria? Mr Cox: Exactly.”