Findlay v Cantor Index Ltd & Ors [2008] EWHC 90116 (Costs)

Case No HQ06X0041[2008] EWHC 90116 (Costs)IN THE HIGH COURT OF JUSTICESUPREME COURT COSTS OFFICEVenue Clifford’s Inn, Fetter LaneLondon, EC4A 1DQDate 2 September 2008
Before
MASTER CAMPBELL
Between
LEWIS CHARLES FINDLAYClaimant(1) CANTOR INDEX LIMITEDDefendants(2) CANTOR INDEX HOLDINGS LPDefendant(3) BGC INTERNATIONAL (FORMERLY CANTOR FITZGERALD INTERNATIONALDefendant
Mr Gordon Wignall (instructed by Russell Jones and Walker) for ClaimantMr Philip Bowden (instructed by Linklaters LLP) for DefendantHearing date 18 August 2008:
Judgment

Master Campbell:

[1]This judgment addresses the following issue which arises at the outset of the detailed assessment of the costs of the Claimant (“Mr Findlay”) which are payable by the Defendants (“Cantor Index”) following Mr Findlay’s acceptance of an offer under CPR part 36 on 18 May 2007 : is Cantor Index entitled to disclosure of a Conditional Fee Agreement (“CFA”) made between Mr Findlay and his solicitors, Russell Jones & Walker on 12 June 2006, and to an opinion of counsel referred to in a risk assessment prepared by those solicitors, on the grounds that privilege in both has been waived?[2]The issue was argued before me by Mr Bowden, instructed by Linklaters, LLP for Cantor Index, and by Mr Wignall of counsel instructed by Russell Jones & Walker for Mr Findlay. The application for disclosure had been issued on 5 August 2008 and was supported by a witness statement made by James Russell of Linklaters dated 30 July 2008 to which Mr Paul Daniels of Russell Jones & Walker had responded on 15 August 2008. In addition, Mr Bowden lodged a skeleton argument. Having heard argument I reserved judgment.

THE BACKGROUND

[3]This can be stated shortly. Mr Findlay is a former managing director of Cantor Index. Following a dispute with the company, he ceased his employment on 30 January 2006 and commenced proceedings on 13 March that year claiming damages for breach of his employment contract. Subsequently, on 28 July 2006, Mr Findlay brought a claim in the Employment Tribunal for unfair dismissal. The claim in respect of his employment contract was resolved following his acceptance of the Part 36 offer; the Employment Tribunal claim has also been settled on terms confidential to the parties. Greater detail about the background (if it is required) is set out in a judgment of Holland J dated 23 March 2007 [2007] EWHC 643 (QB).[4]Mr Findlay served Notice of Commencement of detailed assessment proceedings on 23 October 2007, his bill claiming a grand total of £1,038,316.30 inclusive of disbursements, VAT and the fee payable to the court on lodgement. On 18 October 2007, Linklaters served points of dispute running to 81 pages (their length being indicative of scant regard having been paid to s.35.2 of the Costs Practice Direction (CPD) to CPR 47.9). Point 4 says this:
“Costs claimed pursuant to a Conditional Fee Agreement The bill of costs claims a success fee of 100 per cent under a purported Conditional Fee Agreement. The claimant has failed to provide a statement of reasons for setting the level of success fee in accordance with s.32.5 of the Costs Practice Direction to CPR 47. In accordance with CPR 44.3B the claimant is not entitled to recovery under the funding arrangement for any percentage increase for failure to comply with the Costs Practice Direction. Furthermore the defendants requested disclosure of the Conditional Fee Agreement in accordance with the principles of openness set out in the authorities referred to above. The claimant has rejected this request and it is not understood why the claimant’s solicitors should refuse such a request for disclosure. The defendants have a genuine concern over the level of the success fee claimed. The claimant has failed to provide any information to justify a success fee, let alone a claim for the maximum that can be recovered under a Conditional Fee Agreement … …the defendants reserve their position to make further submissions with regard to the claimant’s entitlement to claim costs under the Conditional Fee Agreement following receipt of information and disclosure of the agreement.”
[5]On 15 May 2008, Russell Jones & Walker served replies to the points of dispute. The reply to point 4 says this:
“Whilst the defendants request disclosure of the Conditional Fee Agreement, the paying party are reminded that this is of course a CFA governed by the new Regulations and accordingly the receiving party see no other explanation for the request for disclosure than a speculative fishing expedition, the nature of which the courts of course discourage. The bill of costs was signed by a partner at Russell Jones & Walker to confirm that there has been no breach of the indemnity principle …it is for the paying party to particularise a genuine issue with the CFA and no such issue has been raised to be answered. Whilst the bill claims for a 100 per cent success fee, it should be noted that the success fee was (as is common practice in such matters) set on a sliding scale basis, of 50 per cent prior to the receipt of Directions issued by the court, 75 per cent between the issue of Directions and notification of the Trial window by the Court and only at 100 per cent from thereafter. The Defendants had the opportunity to settle the matter earlier and avail themselves of a lower success fee but did not do so.”
[6]Concurrent correspondence between Linklaters and Russell Jones & Walker also addressed the CFA (see exhibit JR 1). On 13 November 2007, Linklaters had written to Russell Jones & Walker in these terms:
“We also note that a substantial proportion of the costs claimed by your client relate to a success fee of 100 per cent charged in accordance with the Conditional Fee Agreement between your firm and your client. Our costs draftsman has requested a copy of this agreement to assist him in this process.”
[7]On 23 November 2007, the request was repeated:
“We note that you have still not responded to our request that our costs draftsman be provided with a copy of the Conditional Fee Agreement to assist him in the process of advising our client in this regard. Without sight of this agreement our costs draftsman is unable to advise as to the recoverability of the uplift you are claiming, which will necessarily need to be excluded from the calculation of any interim payments which our clients are minded to make …”
[8]On 30 November 2007 Russell Jones & Walker replied:
“With regard to disclosure of the CFA we cannot see your reasoning behind such a request and see it entirely as a fishing expedition, which of course the courts strongly discourage. The bill of costs has been signed by a partner at Russell Jones & Walker to confirm that there has been no breach of the indemnity principle and we would respectfully refer you to Cole v MGN before Master Haworth at the Supreme Court Costs Office (whose comment is regularly upheld by the court) that it is for the defendants to particularise the genuine issue within a CFA and that it is for the Costs Judge to adjudicate on this under the Pamplin procedure prior to a claimant being put to his election whether or not to disclose the CFA. Section 58 compliance has been confirmed and in accordance with standard practice and court guidance we shall not be disclosing our client’s CFA. In any event, our client’s CFA and risk assessment in respect of the CFA are privileged documents which contain information relevant to all our client’s claims and we are therefore not prepared to disclose them in advance of the conclusion of the Tribunal proceedings. This is an entirely reasonable position for us to take in the circumstances.”
[9]On 7 March 2008 Linklaters had repeated their request for disclosure:
“Our client’s points of dispute set out in detail the numerous and serious deficiencies in your Bill of Costs … we note in this regard that you have still failed to provide your Conditional Fee Agreement (as encouraged by Hollins v Russell) even though both sets of proceedings have now concluded and your original reason for failing to provide this agreement is no longer valid. Please now provide a copy of your CFA by return …”
[10]Russell Jones & Walker responded on 1 April 2008:
“You are aware of our position in respect of the issues raised in that letter as has been set out in previous correspondence and we maintain that position. These are now matters for the judge at the detailed assessment hearing to consider. We shall be serving a reply in respect of your clients’ points of dispute in due course.”
[11]Linklaters wrote again on 2 May 2008:
“…We further note from your letter of 1 April your continued refusal to provide a copy of your Conditional Fee Agreement to us, notwithstanding that your success fee pursuant to this agreement, for which you are claiming reimbursement, amounts to approximately a third of the total of your client’s bill. This is despite the fact that there is no longer any litigation between the parties – the principal reason which you have previously advanced in defence of your position. In the circumstances, we can only conclude that you have little confidence that the terms of this agreement stand up to scrutiny. Please note that your continued unreasonable refusal to provide a copy of this agreement to our clients at an appropriate stage of this dispute (contrary to the overriding objective and case law) will be brought to the attention of the court in due course.”
[12]Russell Jones & Walker responded on 15 May 2008:
“We take this opportunity to again respond to your repeated requests for a copy of our client’s Conditional Fee Agreement. This is plainly just a speculative fishing expedition, which is without basis. You have completely failed to provide any valid reason as to why this should be disclosed. It is a strict matter of policy (like most other large firms, (and insurers) conducting thousands of CFA cases per annum) that we do not provide such a document without a proper basis for doing so. This approach is expressly endorsed by the courts and your costs clerk appears to be under a misconception in respect of the courts’ approach to this issue. For the avoidance of doubt this is simply a matter of policy and our following the CPR. With respect, we would be grateful if you will please now focus on the core issues in this matter and kindly do so in a proportionate and reasonable way.”
[13]Linklaters wrote again on 23 May 2008:
“Our costs draftsman is also concerned that, in breach of s.32.5 of the Costs Practice Direction (and as requested on page 15 of our points of dispute) you have refused to provide a statement of reasons for the setting of the success fee pursuant to the CFA. Without prejudice to our position that a copy of the CFA itself should be provided (which disclosure will be pursued once proceedings have commenced) we therefore require you to set out your statement of reasons by return which, for the avoidance of doubt, should include: (i) a detailed explanation of how the success fee is calculated and why such calculation is appropriate; (ii) what the definition of ‘success’ is under the CFA; (iii) the scope of the CFA including proceedings covered by the CFA; and (iv) the hourly rates set out in the CFA. As regard your time estimates for a detailed assessment hearing in your letter of 1 May 2008, we consider that the three days proposed will be required simply to deal with the preliminary issues we have raised and that at least a further five days will be required for the substantive hearing.”
[14]Russell Jones & Walker replied on 26 June 2008:
“With regard to the CFA, firstly please find attached herewith our client’s risk assessment [emphasis added]. Whilst we must maintain that your have failed to raise any valid reasoning as to why the CFA ought to be disclosed other than the attempt to embark upon a fishing expedition, we can confirm that the CFA provides as follows: (i) a success fee set at 50 per cent prior to receipt of directions issued by the court, 75 per cent between the issue of directions and notification of the trial window by the court and 100 per cent thereafter. (ii) success under the CFA arises where the Claimant recovers compensation from the Defendants. (iii) the CFA provides for the client’s legal representative to pursue a claim against the Defendants regarding the claim set out in the Particulars of Claim. (iv) hourly rates set out in the CFA – Grade A £250-£325 per hour, Grade B £200-£260 per hour, Grade C £150-200 per hour, Grade D £100-£150 per hour …”
[15]The risk assessment was dated 1 June 2006 and (where relevant) said this: MERITS LIKELIHOOD OF DEFENDANT ADMITTING LIABILITY, COMPROMISING CLAIM OR LOSING AT TRIAL IN PERCENTAGE TERMS Csl says CD 75% (see opinion) Breach of contract re declaration – complicated PIDA – better than 50% WHAT FACTORS FOR SUCCESS HAVE YOU TAKEN INTO ACCOUNT? IS THIS CASE SUITABLE FOR A CFA Yes EXPLAIN WHY Likely to settle. V good merits[16]The reference to “Csl” is to counsel and “CD” under “Merits” is to constructive dismissal. The reference to “PIDA” is to the Public Interest Disclosure Act 1998.[17]Following a request for a detailed assessment hearing, Mr Findlay’s bill was balloted to me and I listed the detailed assessment to take place over four days commencing Tuesday, 2 September 2008.[18]On 5 August 2008, Linklaters issued their application returnable before me on 18 August 2008 for orders and directions set out in an attached draft order. Paragraph 3 of the draft order says this:
“The claimant to produce to the court at the hearing listed for this application and disclose to the defendants a copy of the CFA dated 12 June 2006 pursuant to which a success fee has been claimed within the bill of costs (item 250) and any other funding agreement in relation to these proceedings and the Employment Tribunal proceedings together with a copy of counsel’s opinion referred to in the preliminary assessment form disclosed on 26 June 2008.”
[19]At the hearing on 18 August 2008, I reserved judgment in respect of paragraph 3 of the draft order. The balance of the application and other issues arising under the draft order will be dealt with on Tuesday, 2 September, 2008.

THE LAW REFERRED TO IN THE CORRESPONDENCE AND POINTS OF DISPUTE AND THE SKELETON ARGUMENT

[20]“Section 58”; this reference is to the Courts and Legal Services Act 1990 as amended by s.27(1) Access to Justice Act 1999 and deals with the basic requirements of a CFA eg that it should be in writing.[21]“Section 32.4 – Costs Practice Direction”: this (et seq.) provides:- “If the detailed assessment is in respect of an additional liability [success fee] only , the receiving party must serve on the paying party and all relevant persons the following documents…. (c) The relevant details of the additional liability … S.32.5 The relevant details of an additional liability are as follows: (1) in the case of a conditional fee agreement with a success fee... (b) a statement of the reasons for the percentage increase given in accordance with Regulation 3(1)(a) of the Conditional Fee Agreements Regulations or Regulation 5(1)(c) of the Collective Conditional Fee Agreements Regulations 2000. [Both sets of Regulations were revoked by the Conditional Fee Agreement (Rectification) Regulations 2005 but continue to have effect in relation to the Conditional Fee Agreements and Collective Conditional Fee Agreements entered into before 1 November 2005.]”[22]“CPR 44.3B”; this provides:- “Limits on recovery under funding arrangements (1) A party may recover as an additional liability- (c) any additional liability for any period in the proceedings during which he failed to provide information about a funding arrangement in accordance with a rule, practice direction or order; ” (1) A party may recover as an additional liability- (c) any additional liability for any period in the proceedings during which he failed to provide information about a funding arrangement in accordance with a rule, practice direction or order; ”[23]“CPR 44.5(3) PD 11.7”; this provides:- “… when the court is considering the factors to be taken into account in assessing an additional liability, it will have regard to the facts and circumstances as they reasonably appeared to the solicitor or counsel when the funding arrangement was entered into …”[24]“CPR 43 PD 4.5(3)”; this provides:- “The background information including a Bill of Costs should set out: (3) a brief explanation of any agreement or arrangement between the receiving party and the solicitors which affects the costs claimed in the bill.”[25]“Hollins v Russell”; this is a reference to Hollins v Russell [2003] 3 Costs LR[26]The “Pamplin procedure”; this is a reference to Pamplin v ExpressNewspapers Ltd. (1985) 1 WLR 689 ( Hobhouse J ). The “procedure” is set out on page 695 at G; “...the principle that each party must have the right to see any relevant material which his opponent is placing before the tribunal, and which that tribunal is taking into account in arriving at its decision , must prevail. In the final resort, the claimant must be put to his election whether he wishes to waive privilege and use the material, or to assert his privilege and retain the confidentially of the document which the respondent is asking to see....”[27]This procedure is now embodied in the CPD at s 40.14 which provides:- “The court may direct the receiving party to produce any document which in the opinion of the court is necessary to enable it to reach its decision. These documents will in the first instance be produced to the court, but the court may ask the receiving party to elect whether to disclose the relevant document to the paying party in order to rely on the contents of the document and instead rely on other evidence”

THE SUBMISSIONS FOR CANTOR INDEX

[28]Mr Bowden submitted that his clients’ request for disclosure of the CFA was not a “fishing expedition” given that over £300,000 turned on the level of success fee. His clients had set out the minimum amount of information which was needed from Mr Findlay in order to argue what success fee should be allowed. That information (as set out in Linklater’s letter of 23 May 2008) encompassed:(1) a detailed explanation of how the success fee had been calculated;(2) a definition of “success”;(3) the scope of the proceedings covered by the CFA; and(4) the hourly rates set out in the CFA.[29]Mr Bowden did not advance his case at this stage on the grounds that he wished the Pamplin procedure to be implemented. On the contrary, it was the position of Cantor Index that in disclosing the risk assessment, Mr Findlay had waived privilege in the CFA and the counsel’s opinion upon which the success fee had been premised and that his client was thereby entitled as of right to immediate disclosure of both.[30]Mr Bowden relied on the following to justify his submission (see especially his skeleton paragraph 27). First, disclosure of the risk assessment had been voluntary. Accordingly privilege had been waived in a document in respect of which Mr Findlay had previously claimed privilege in his solicitor’s letter of 30 November 2007. Second, the opinion of counsel referred to in the risk assessment was an annexure to that document which the paying party was entitled to see. Third, the CFA fell within the same series of privileged documents as the risk assessment and counsel’s opinion. Fourth, references to the contents of the CFA had been made in open correspondence upon which his clients had intended to rely in the context of the present application. In summary, Mr Bowden argued that: “The claimant should be ordered to disclose the CFA on the basis that the claimant’s waiver of privilege in the risk assessment form gives rise to a collateral waiver of privilege in the CFA and/or that the claimant has expressly waived privilege in the CFA by referring to and relying on its contents, which references relate to substance, rather than merely the existence, of the CFA.” (paragraph 27 op.cit.)[31]Mr Bowden relied on three authorities – Bennett v Chief Executive Officer v Australia Customs Service [2004] FCAFC 237, Great Atlantic InsuranceCompany v Home Insurance Company [1981] 1 WLR 529 and R v Secretaryof State for Transport ex parte Factortame (The Times May 16 1997). In Bennett, the Court had held that it was an error of law to draw a distinction between the conclusion expressed in legal advice on the one hand, and the reasons for that conclusion on the other and to take the view that disclosure of the conclusion did not involve disclosure of the reasons (paragraph 62 per Gyles J); further, the voluntary disclosure of the gist or conclusion of legal advice amounts to waiver in respect of the whole advice to which reference is made including the reasons for the conclusion (paragraph 65). It is not possible to sever material from a document over which privilege has been asserted unless the additional matter deals with entirely different incidents and; “… could in effect be divided into two separate memoranda, each dealing with a separate subject matter … It would not be satisfactory for the court to decide that part of a privileged document can be introduced without waiving privilege with regard to the other part in the absence of informed argument to the contrary and there can be no informed argument without the disclosure which would make argument unnecessary …” (See judgment of Templeman LJ in Great Atlantic at 536 A-C et seq). .[32]A party is not entitled to “cherry pick” parts of a privileged document from a sequence of privileged documents relevant to the same issue (Factortame). It followed in Mr Bowden’s submission, that fairness demanded that Cantor Index should be told of the reasons that had enabled counsel to estimate prospects of success at 75 per cent. Using the “ready reckoner”, this would have given a success fee of 33 per cent rather than the 100 per cent claimed. Since Russell Jones & Walker had voluntarily introduced material with a view to relying on it at the detailed assessment, fairness demanded that his clients should see the entirety of that material in order to reach a considered view whether 100 per cent or some lower success fee was reasonable in all the circumstances.

THE SUBMISSIONS FOR MR FINDLAY

[33]Mr Wignall took issue with the proposition that if privilege is waived in detailed assessment proceedings, the court must order disclosure of the relevant document. On the contrary, in detailed assessment proceedings, the Rules of Court do not permit the court to order disclosure but only to direct a receiving party to produce documents to the Costs Judge (see CPD s. 40.14). Accordingly, paragraph 3 of the draft Order was wrong and in so far as it sought an order for the CFA and counsel’s instructions to be handed over to Cantor Index, the application was misconceived.[34]Mr Wignall further submitted that there had been no waiver of privilege. The risk assessment was a document generated by Russell Jones & Walker for the firm’s internal purposes, namely for presentation to an internal committee to decide whether the case could be conducted on a CFA. In Pamplin, Hobhouse J had addressed the issue of waiver in the context of detailed assessment (then called taxation). At B on page 698 he had said this:
“In any given instance, it will be a matter for the Master to consider how far the waiver of privilege has gone. In taxation, it will normally be a matter of express waiver only. It should always be possible to avoid having to get involved with implied waiver, but when, exceptionally, questions of implied waiver do arise, the Master should decide them by applying the principle of fairness as between the parties in the conduct of the taxation. The claimant should not have imposed on him an unintended waiver unless fairness to both parties really does necessitate that result.”
[35]In the present case, there had been neither express nor implied waiver. Information had been disclosed, for example that counsel’s view of prospects was 75 per cent, but it did not need, in addition, the contents of his opinion to be revealed for there to be a fair hearing. Nor had there been waiver by conduct such as would make a fair adjudication impossible without such waiver. It followed that the application should be refused.

DECISION

[36]The starting point, in my judgment, is to address the nature and contents of the risk assessment disclosed by Russell Jones & Walker on 26 June 2008. The first observation to be made is that the document is not the same risk assessment which would have been carried out when the CFA was completed on 12 June 2006. On the contrary, it is plain that the document was prepared by Russell Jones & Walker for use by the firm’s CFA Committee in order to decide whether the case could be conducted on a CFA; it is headed “EMPLOYMENT DEPARTMENT CONDITIONAL FEE AGREEMENT ASSESSMENT FORM” and is dated 1 June 2006. It follows that any privilege in the risk assessment belongs not to Mr Findlay but to Russell Jones & Walker and that any reference to “CFA”, was to a putative document that had yet to come into existence.[37]Mr Bowden advanced his case on the footing that having waived privilege in the risk assessment, privilege had also been waived in the documents referred to therein which formed part of the risk assessment (counsel’s opinion, his instructions etc – see skeleton argument paragraphs 17 and 27). I disagree. In my judgment, in serving the risk assessment, Russell Jones & Walker could not on any view have been waiving privilege in a document that did not come into existence until twelve days after the risk assessment. The reference to “CFA” was to an agreement which might, or might not be completed in the future depending upon the outcome of the committee’s deliberations and not to the actual document which the parties signed on 12 June 2006. Since I am satisfied that the reference to “CFA” in the risk assessment was not to the document that Mr Findlay and Russell Jones & Walker later completed, Mr Bowden’s submission that privilege in it was waived, must fail.[38]I find likewise with regard to the suggestion that the mere mention of “CFA” in open correspondence such as in the letter at page 57 of JRS1, is some sort of waiver of privilege, entitling Cantor Index to see the document (see skeleton paragraph 27). It is often the case that inter-solicitor correspondence will say “we have written a letter to our client for instructions” or “we have taken counsel’s opinion on the point and will revert to you when we have considered his advice”. In my judgment it would be fanciful to suggest that any such reference involves a waiver of privilege in the documents in question, still less does the mere mention of the existence of such documents in open correspondence, confer any right on the opponent to see them. If it be otherwise, the requirement in the CPD at section 19 to CPR 44.15 that a party must provide information about the existence of a CFA (via Form N 251) which contains a success fee, would also mean that the document itself would need to be disclosed, but it was not advanced as part of Cantor Index’s submission that this is the case. It follows that I consider there is nothing persuasive in Mr Bowden’s argument and the point fails.[39]That deals with the CFA. What of counsel’s opinion and his instructions? In my view it is more likely than not that counsel’s opinion formed part of the risk assessment , since the CFA Committee had been urged to read it and it is reasonable to suppose that at some stage it would either have been attached to the risk assessment or at least put before the Committee.[40]Mr Bowden’s case is that there can be no “cherry picking” and a party who waives privilege in part of a document, waives privilege in the whole (see Great Atlantic ante). If that be correct as a proposition of law, it is also subject to exceptions. As Mr Wignall observed, this is not a trial in which each party is bound to give disclosure under CPR 31. On the contrary, on detailed assessment it is only the receiving party who is required to disclose documents, but only in so far as CPR 43-48 oblige him to do so and the choice is broadly his in deciding what material he wishes to deploy in support of his bill. This is plain from Pamplin page 695 at F:
“Taxation, although adversarial, is not subject to all the incidents of ordinary litigation. RSC Order 62 [predecessor to CPR 43-48] is, for present purposes, a self-contained code. The provisions of other orders for discovery and inspection of documents, etc, do not apply. However it cannot be disputed that the rules of natural justice apply to taxation proceedings and the question of principle which I have to decide on the present appeal is how the requirements of justice are best served in taxation proceedings, having regard to the fact that many of the relevant documents will be privileged and the claimant may have a legitimate interest in protecting that privilege.”
[41]Mr Bowden drew attention to the fact that Pamplin is an old authority long pre-dating the introduction of success fees. That is correct, but it is an also an authority which has been repeatedly approved post the implementation of the CPR, (see for example Hollins v Russell paragraph 80). It follows that whilst Mr Bowden is right that the rules of natural justice apply, it is plain from Pamplin that the Costs Judge must achieve a fair balance between the parties, in particular with reference to material over which the receiving party has asserted privilege. Therefore the issue for decision is whether Mr Findlay withdrew his assertion in relation to the opinion and instructions to counsel and if so does it follow that Cantor Index is automatically entitled to see the documents?[42]In my judgment, it is plain that Mr Findlay did not waive privilege either expressly or by implication. As to the former, there is no letter written by Russell Jones & Walker to the effect “we claimed privilege in our letter of 30 November; we are now instructed to waive that privilege”. The only document handed over was the risk assessment, which, as I have said, is an internal document prepared for the use of Russell Jones & Walker CFA Committee) and then only after relentless requests by Linklaters LLP for information about how the success fee was calculated (see letters quoted at paragraphs 6-14 above). Nowhere in that correspondence is it stated in terms that privilege is waived.[43]As to the latter, in my opinion, no waiver can be implied. Hobhouse J in Pamplin gives guidance about implied waiver ( page 698 at B):
“However, as was stressed in the General Accident case at page 114, “The underlying principle is one of fairness in the context of the trial and does not go further than that”
. Applying that principle to the conduct of a taxation, it will be seen that the requirement of fairness means that a claimant must often be allowed to be more selective. In any given instance, it will be a matter for the Master to consider how far the waiver of privilege has gone. In taxation it will normally be a matter of express waiver only. It should always be possible to avoid having to get involved with implied waiver, but when, exceptionally, questions of implied waiver do arise, the Master should decide them by applying the principle of fairness as between the parties and the conduct of the taxation. The claimant should not have imposed on him an unintended waiver unless fairness to both parties really does necessitate that result.”[44]The reference to “General Accident” is to General Accident Fire and lifeAssurance Corporation Ltd. v Tanter (1984) 1 WLR 100.[45]In my judgment, an unintended waiver of counsel’s opinion and his instructions should not be imposed on Mr Findlay where, as here, the risk assessment was handed over in response to repeated requests for information about the success fee and in circumstances where the principles of natural justice can still be met via the election procedure provided for in CPR 40.14 . I say this also in the context that it is by no means clear to me that Cantor Index have any entitlement to information about why the success fee was calculated at 100%; it is agreed that as the CFA post- dated 31 October 2005, the compliance obligations imposed under the CFA Regulations 2000 do not apply. It follows that in my judgment, CPD S. 32.5 (1) (b) did not oblige Russell Jones and Walker to disclose any statement of reasons for the success fee (such as a risk assessment attached to the CFA), as would have been the case had the CFA been signed before the 2000 Regulations were revoked. For these reasons the application on waiver fails.[46]In Pamplin, Hobhouse J also considered Great Insurance and concluded that the requirement of fairness meant that on detailed assessment, the receiving party must often (emphasis added) be allowed to be more selective, so the severance argument advanced by Mr Bowden is unpersuasive and also fails.[47]For all these reasons, the application for disclosure on the grounds of waiver is dismissed.

NEXT STEPS

[48]This outcome does not affect the application of Cantor Index for disclosure of the same documents by the election procedure in CPD 40.14 provided a genuine factual issue can be identified which is not sham or fanciful (see Pamplin page 696 at H). In this regard, I have drawn the parties attention to Hollins v Russell on this point. At paragraphs 74 and 80, Brooke LJ said this; “In our view the combination of the indemnity principle and a significant increase in the paying party’s liabilities results in there ordinarily being a sufficient ground in cases involving a CFA (whether or not a CFA contains a success fee) for the paying party to require the receiving party to be put to her election to produce the CFA or rely on other evidence (74)... We conclude, therefore, that if, in costs proceedings, a party seeks to rely on the CFA, as a matter of fairness she should ordinarily be put to her election under the Pamplin procedure...(80)”[49]That all said, I am in no doubt that Cantor Index’s case as advanced so far is no more than the type of satellite litigation about costs which has been condemned by the Court of Appeal (see Burstein v Times Newspapers (2002) EWHC Civ 1739 at paragraph 29 and Hollins v Russell at paragraph 226). In this respect, however, my wrath has been somewhat tempered by the fact that had Russell Jones & Walker been instructed to hand over the CFA in the first place (and the Court of Appeal in Hollins has said that this should become “normal practice” see paragraph 220), it would have been unnecessary for the parties to have engaged in this round of satellite litigation; a fortiori where, as here, the CFA in question was made after 31 October 2005 and is free from the cumbersome compliance requirements of the 2000 regulations which Cantor Index might otherwise have used to contend that the entire agreement was unenforceable and that, by operation of the indemnity principle, there were no costs to indemnify so their liability to Mr Findlay was nil. It is to be hoped that the CFA will now be handed over without further ado.