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Hollins v Russell (2003)

Hollins v Russell (2003)

Court of Appeal
Date: 22/05/03

The Issues: Because of the large number of challenges to CFAs by Defendants, the Civil Appeals Office brought together a number of appeals raising important issues. Three issues were considered: (1) the circumstances in which, in detailed assessment proceedings, a court should force a successful Claimant “to its election”, (force the Claimant to elect either to disclose its CFA to the defendant or to try to prove its compliance with CFA Regulations by other means and/or ask the Court to take account of the fact that the Claimant may have a legitimate interest in not disclosing the CFA); (2) the proper construction of the words “satisfies all of the conditions applicable to it” in s58(1) of the Courts and Legal Services Act 1990, and whether costs and disbursements are recoverable in the event of non-compliance; and (3) whether on the facts of these particular cases, the requirements of CFA Regulations 2, 3 and 4 had been complied with.

Held: (1) Where there was a CFA a costs judge should normally exercise his discretion to require the successful Claimant (subject to their right of election) to produce a copy of the CFA. (Paras. 61 & 82) If necessary the CFA could be edited to remove any confidential information (Para. 72). Attendance notes showing compliance with regulation 4 should not ordinarily be disclosed; (2) In accordance with the indemnity principle, if a solicitor could not enforce a CFA against his client then any costs and disbursements provided for in the CFA could not be recovered from the other side. (3) The key question in considering whether the CFA was enforceable was whether any breach of the regulations had a material adverse effect either on the protection afforded to the client or upon the proper administration of Justice.

Comment: (1) This decision in relation to CFA disclosure was made prior to the Conditional Fee and Collective Conditional Fee Regulations 2000 being revoked in November 2005. For the position after November 2005 see Ashley Cole V News Group Newspapers – 2007.

NB. The fact that the CFA should be disclosed did NOT override the strong presumption that the normal certificate given on a bill of costs meant the bill was correct - Bailey v IBC Vehicles [1983] 2 All ER 570. The Defendant must still therefore raise a genuine dispute before the Court will enter into a lengthy examination of whether a CFA is valid BUT the Defendant may of course be able to do so once it has seen the CFA.

N.B. Where there is a suspicion that a CFA is unenforceable because of a failure to comply with the pre November 2005 regime, attention is drawn to the recent case of Forde v Birmingham CC (2009. Here the High Court allowed recovery of costs under a second, retrospective, CFA, which was entered into because of doubts over the validity of the first CFA.

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