The claimant had instructed the defendant solicitors in a personal injury case. The agreement between the claimant and the defendant allowed a 100% mark up for the additional liability. The case settled for £3400.00. The defendant deducted £829.20 from the damages representing the success fee and a sum of £349.00 for the ATE insurance premium.
Mrs Herbert then instructed new solicitors to apply for a Solicitors Act assessment. Her central complaint was that the success fee had been set at 100% when the risk of her particular claim should have attracted a lower, more modest success fee.
First instance decision by District Judge Bellamy
At the initial hearing before DJ Bellamy he:-
First appeal before Mr Justice Soole
At the first appeal Mr Justice Soole upheld both decisions.
The Court of Appeal
The Master of the Rolls giving the Judgment in the Court of Appeal upheld the decision on the success fee but reversed the decision on the question of ATE.
Having considered the case law and the question of what constitutes a solicitor’s disbursement it was held that the ATE was a policy of insurance under which the client is insured pursuant to a contract between herself and her insurer. The premium is not a payment which a solicitor is obliged to make irrespective of whether the client has put him in funds.
Since LASPO many firms have used the same model as the solicitors in this case even on claims where the individual risk is low. Therefore, unless the client has been advised at the time of signing the CFA that the fee being charged was not based on the risks of the case, a court will be prepared to consider a reduction of the success fee on a Solicitors Act assessment. As to the ATE, the judgement means that a client cannot normally challenge the premiums on a Solicitors Act assessment.